Nov. 2, 2009 (Erwan Mahe) In a modern economy, credit availability, both in terms of quantity and costs, is a major component in any analysis of future growth potential.

The death of securitisation had earlier choked off the credit flow to the real economy, since it deprived banks of their ability to easily refinance loans by packaging them as bonds, which ended up being sold to investors throughout the world. These packages involved loans to consumers (Credit Card, Mortgages, Student Loans), to businesses (CMBS) and to LBO funds (CLO).

With investors having deserted these products a long time ago, given a lack of confidence in what they viewed as overly complacent (to put it mildly) rating agencies, all these credits remain in bank balance sheets at a time when they are trying to improve their capital ratios, thus, pushing them to either launch a succession of capital increases or to reduce outstanding loan volumes.

(Oct. 21, 2009 - Erwan Mahe) This title even fits me, since I am looking for a Chinese teacher for my two young boys at home. That is what I call a free option (aside from the price of the classes), because at their age (7 and 8), either they find the classes fun and they learn or they don’t and, tough luck.

I was talking with a friend a few days ago who is creating a private equity fund in Hong Kong whose focus will be investments on the Chinese mainland. He said that he is hiring only those graduates of the most prestigious US and European universities who speak Chinese! If current trends continue, these lessons should give my kids a nice edge up in the next 10 to 15 years.

However, when I speak of the world’s love affair with China, I am referring to the incredible energy spent by observers throughout the planet to determine if the Middle Kingdom’s current growth is sustainable....