6:59am:
After many months and billions borrowed, the Chinese authorities have finally cracked down on the practice of importing copper as collateral for loans to get around the government's attempt to tighten lending.
Via the FT, Michael Liang gives more details about the Chinese copper scam from
my earlier post:
He [the trader] said that on March, clothes makers, food manufacturers, and others who have never bought copper before were massively buying copper from the tariff-protected warehouses, in Guangdong for example.
These enterprises purchased copper just to get L/C [me: letter of credit] financing, in which banks finance the purchase of the imports for 90 days.
The reason that banks love to do this business – and markets have become so competitive and rates so low – is that 1) the transaction is off the balance sheet, and 2) bank clerks get paid a direct commission on the L/C.
The FT adds: "Either way though, you’ve got an impressive example of banks and corporates teaming together
to bypass the
government’s clampdown on leverage. Indeed, we’re getting a very distinct ‘
whac-a-mole‘ feeling here; as soon as Chinese regulators clamp down on one form off informal lending, another one springs up."
7:09am: Analysis: Man in the News: Alexei Navalny
The FT has done a profile on the blogger and activist
news reports have linked to the DDoS attack on LJ.
Some excerpts (do a search for the exact Subject: line "Analysis: Man in the News: Alexei Navalny" to read the full article):
He may have been dubbed Russia’s Julian Assange but outwardly there is little Alexei Navalny seems to have in common with the enigmatic founder of WikiLeaks. He dresses in polo shirts and jeans rather than Mr Assange’s trademark cream-coloured designer suits. He lives not in monastic seclusion but loves the hurly-burly of public life and debates. His hardline stance on gun-control and immigration grates with Moscow’s smug liberal elite.
Mr Navalny has made a political and media career as an activist shareholder, buying shares in the large, untransparent state-controlled companies that run Russia’s economy, such as Gazprom and Rosneft, and then trying to exercise his legal rights as a minority shareholder. His accounts of his efforts have led to his becoming the hottest political blog in Russia, a nation of 40m internet users, even though Mr Navalny admits that reading ìt is a “bit boring”.
His wife goes around with a sheet of paper with phone numbers to call if he is arrested, but he insists he is not afraid. When a mob of football hooligans – presumed to have been sent by the Kremlin – invaded a debate he was hosting at a Moscow nightclub in 2007, he shot one of them with an air pistol. He wasn’t aiming for the head so it was OK, he says.
Mr Navalny is not a typical Russian dissident, of the type the west is used to – like Garry Kasparov – who have made much of their liberal, western-leaning credentials. He is a nationalist, having helped found a movement known as Narod or “People” dedicated to saving “Russian civilisation”. He wants to limit immigration and favours cordoning off the troublesome north Caucasus region.
The blend of nationalism and anti-corruption fervour is hugely popular. “Today, you are a politician if you engage in politics, which is what I am doing every day with my website and my debates.” For the moment, the internet is the only platform in the country free of censorship. “I am having my 15 minutes of fame, as Andy Warhol put it,” he says. “But I know that those 15 minutes will not last.”
