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Chinese stimulus cash is inflating new stock market bubble, officials warn

Posted By admin On June 30, 2009 @ 10:53 am In Money Watch | Comments Disabled

Malcolm Moore
London Telegraph [1]
Tuesday, June 30, 2009

Half of the 5.8 trillion yuan (£522bn) of stimulus loans issued by Chinese banks have flowed into the country’s stock and property markets, inflating new bubbles, according to senior Communist officials.

Under orders from the government, China’s banks have flooded the economy with new credit this year, advancing more money in the first six months than the total for 2008.

It is the biggest wave of money since the People’s Republic of China was founded in 1949. The loans are part of a stimulus package to spur domestic investment and consumption and help the economy through the financial crisis.

However, a significant proportion has been diverted into shares and property, with the Shanghai Stock Exchange rising 60pc since January.

Full article here [1]

Chinese stimulus cash is inflating new stock market bubble, officials warn 290509banner [2]

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URLs in this post:

[1] London Telegraph: http://www.telegraph.co.uk/news/worldnews/asia/china/5695924/Chinese-stimulus-cash-is-inflating-new-stock-market-bubble-officials-warn.html

[2] Image: http://www.efoodsdirect.com/ammo-food.html?aid=14&adid=5

[3] TrimTabs: “No Amount Of QE Will Be Able To Keep The Current Stock Market Bubble From Bursting”: http://www.prisonplanet.com/trimtabs-no-amount-of-qe-will-be-able-to-keep-the-current-stock-market-bubble-from-bursting.html

[4] Farewell Bernanke – Thanks For Inflating The Biggest Bond Bubble The World Has Ever Seen: http://www.prisonplanet.com/farewell-bernanke-%e2%80%93-thanks-for-inflating-the-biggest-bond-bubble-the-world-has-ever-seen.html

[5] After Chinese Rate Hike, Faber Warns Of Severe Market Crash In 9-12 Months: http://www.prisonplanet.com/after-chinese-rate-hike-faber-warns-of-severe-market-crash-in-9-12-months.html

[6] China May Face ‘Massive’ Bank Bailouts After Stimulus Program: http://www.prisonplanet.com/china-may-face-%e2%80%98massive%e2%80%99-bank-bailouts-after-stimulus-program.html

[7] China’s Latest Stock Market Scare Was Its Worst Yet: http://www.prisonplanet.com/chinas-latest-stock-market-scare-was-its-worst-yet.html

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