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What are the Consequences of the China Markets decline on Global Financial Markets?

London, UK - 1st September 2009, 19:25 GMT

Dear ATCA Open & Philanthropia Friends

[Please note that the views presented by individual contributors are not necessarily representative of the views of ATCA, which is neutral. ATCA conducts collective Socratic dialogue on global opportunities and threats.]

According to our computing systems, China's Shanghai Composite Index has closed down more than 20% on August 31 from August 4 (year’s high), the common definition of a bear market.

It has been the mi2g Intelligence Unit and ATCA Research and Analysis Wing’s joint view that the unprecedented $1.2 Trillion lending by China’s banks in the first half of this year is unsustainable and it has been lengthening the colossal asset bubble in property and stocks in China like in the case of Japan in the late 1980s. Its ramifications are felt in the global commodity markets – from oil to copper to gold. Further, it has acted as a false prop for the global financial markets by giving the impression of a global recovery, based on high commodities demand, which in reality is a speculation bubble based on leverage caused by China’s easy money policies that are now coming to an end. No wonder the state owned China enterprises are preparing the ground for default on commodity derivatives.

What are the consequences of the China markets decline on global financial markets?

[ENDS]

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Best wishes


ATCA: The Asymmetric Threats Contingency Alliance is a philanthropic expert initiative founded in 2001 to resolve complex global challenges through collective Socratic dialogue and joint executive action to build a wisdom based global economy. Adhering to the doctrine of non-violence, ATCA addresses asymmetric threats and social opportunities arising from climate chaos and the environment; radical poverty and microfinance; geo-politics and energy; organised crime & extremism; advanced technologies -- bio, info, nano, robo & AI; demographic skews and resource shortages; pandemics; financial systems and systemic risk; as well as transhumanism and ethics. Present membership of ATCA is by invitation only and has over 5,000 distinguished members from over 120 countries: including 1,000 Parliamentarians; 1,500 Chairmen and CEOs of corporations; 1,000 Heads of NGOs; 750 Directors at Academic Centres of Excellence; 500 Inventors and Original thinkers; as well as 250 Editors-in-Chief of major media.

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