PBOC Says Some Investment Products Should Be Allowed to Fail
China's central bank said Tuesday that certain high-risk financial products should be allowed to fail and fast-growing Internet banking products need tighter supervision as part of reforms to foster a more competitive, efficient financial system.
In an annual report on the nation's financial stability, the People's Bank of China said greater competition and innovation in the state-dominated banking sector would ultimately make the industry more responsive to consumer needs.
CASS forecasts 7.4 pct economic growth in 2014
The CASS also reported on real estate on Tuesday, indicating wider gaps in housing prices between different cities this year, through lack of a healthy expansion mechanism. Some megacities with large migrant populations will face pressure from housing price rises, while small cities with excess construction will see property bubbles.
The regulations on the property industry will further push forward property taxes in more pilot cities and continue restrictions in housing purchase and mortgages in megacities this year, the CASS said.
The Chinese article has the rebound story: 社科院：2014房价或小幅增长 楼市调控面临“两难” (CASS: slight increase in 2014 prices or market regulation facing a "dilemma")
Chinese Academy of Social Sciences Institute of Urban Development and Environment released April 29 Economic Blue Book "analysis of China's economic prospects," pointed out that in 2014 the real estate market transaction volume may still be essentially flat with last year, even a slight increase, prices are likely to remain modest growth, But between the city, the differentiation between regional markets will intensify.
Blue Book said that although the country earlier this year, the monthly real estate transactions is shrinking trend, the individual parts of the city appeared estate price phenomenon, but the market has experienced a period of deliberation and policy sidelines after the heat of the 2014 real estate market will continue trading. Blue Book said that although the country earlier this year, the monthly real estate transactions is shrinking trend, the individual parts of the city appeared estate price phenomenon, but the market has experienced a period of deliberation and policy, the 2014 real estate market transactions will stay hot.
Among them, there are five reasons: First, consumer demand driven by income growth and urbanization trends will remain strong; Second, buying restrictions changed investment and speculative demand, but have limited market impact, especially on the housing market; Third, demand for real estate devaluation of the RMB exchange rate factors are expected to result in a wait and see, will be re-released after the return of normal fluctuations in exchange rates.
Fourth, the end of 2013 to early 2014, there have been another round of land acquisition, the " land king " frequent, rapid land price growth in some cities will lead to cost-push; fifth, 2013 real estate transaction volume surge, the rapid growth of house prices, the majority of the leading development companies get huge sales and profits, making 2014 price change destocking pressure is not great.
Blue Book also suggested that in the prices run high and economic growth is relatively slow dual background, Chinese real estate regulation facing a "dilemma", while allowing continued high growth rates will further accumulate bubble risks, falling house prices and could harm the real estate and related fields investment, triggering financial risks.
Outlook 2014, the Blue Book emphasized that macroeconomic remain 7-8% of the steady and rapid growth, the country's economic policy will be further residential urbanization, improving people's livelihood tilt mechanism due to the lack of long-term stable and healthy development of the real estate market , the real estate market will be further differentiated in some cities because of soaring land prices face greater pressure on housing prices, real estate market trends in 2014 will depend on policy choices and implementation of regulatory policy differences and diversity will become the norm.
In addition, the Blue Book expects a higher proportion of the working population of the metropolis of foreign real estate, especially in the housing market and volume go up, while most ordinary urban real estate turnover and prices remain relatively stable trend. Some lack of industry support and build the city's pre-sided town house prices bubble risk of oversupply will be greatly enhanced.