Posted on 10/12/2009 8:57:17 PM PDT by TigerLikesRooster
China state firms told to hold cash, hedge carefully
BEIJING, Oct 12 — China's biggest state firms must highlight that "cash is king" in their 2010 budgets and control trading in financial derivatives, China's state asset watchdog said.
The State-owned Asset Supervision and Administration Commission (SASAC) gave few details about its plans for derivative losses made by China's state firms.
But SASAC said in a notice issued over the weekend that it did not want state firms to speculate in derivatives in 2010.
"Any budget for financial derivatives should stick to the principal of risk hedging, and any trading scale must be in line with spot market budget and risk affordability," it said.
(Excerpt) Read more at themalaysianinsider.com ...
Ping!
They are a lot more sane financially than we are.
So do you think China is going to turn its back and not cover its derivatives losses? I think not. I think that the powers that be in the financial world made it clear to China that such an effort could create an even worse financial backlash.
However, if things go sufficiently bad for Chinese, it could get interesting.
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