August 16, 2005

THE UNENDING MARKET FOR OUR SECURITIES:

Stocks or real estate for China's middle class? (Min Xu, 8/17/05, Asia Times)

China is one of the most savings-oriented nations in the world: total personal savings deposits amount to over 12 trillion yuan (US$1.48 trillion), or around 50% of income. For thousands of years people have been accustomed to putting money under the mattress, and the intermediating role of a banking system has been well suited to the traditional, conservative mentality of saving at a risk-free rate for the future. This mentality, however, is rapidly changing.

The low savings deposit rates - the one-year deposit rate is now 2.25% and the five-year rate is 3.60% - give those who are profit-oriented an incentive to explore alternative investment channels.


Who would know better than the Chinese not to invest in their own economy?

Posted by Orrin Judd at August 16, 2005 1:06 PM
Comments

Ho, ho, ho, would I like to be sitting on the finance committee when Alan speaks and as him since even the Chicoms want higher returns and are looking towards the stock market, maybe we should redefine what we consider "national savings rate."

Posted by: Sandy P at August 16, 2005 1:14 PM

I'm sure the Europeans consider China a lucrative investment.

Posted by: jim hamlen at August 16, 2005 3:12 PM

"China is one of the most savings-oriented nations in the world..."

So is the USA one of the most savings-occidented?

Posted by: Axel Kassel at August 16, 2005 4:38 PM
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