How are these online payment system providers seen as "web-banks" and how they compete with traditional banks for deposit? When I’m talking with my Chinese friends about how low the interest rates are back home and even at Chinese banks, they tell me I should put some of my money in my Alipay or WeChat wallet. I am very surprised to find out that they are receiving over 4% interest. How can these firms afford to pay such a high interest rate? Is it the same as putting a deposit in the bank? Where do they invest the money? All of this will become clear in this article. Chinese Mobile bankingI’m waiting in the checkout line of a modern clothing store on HuaiHai Middle Road. When I’m ready to pay, I pull out enough cash to cover the expenses. The girl looks a little surprised and walks 10 meters to a table on the side that has the only cash counter on this floor, to check whether my cash is real. This is the first time I felt that paying in cash is a thing of the past. All other customers use Alipay, an online payment app that lets you pay by presenting a scannable barcode to the person behind the checkout. Welcome to the world of Mobile banking and mobile payment systems in China.
The Chinese Banking SystemGoing to a Chinese bank to open a bank account has always been an adventure. The first time you walk in assuming you have all the necessary documents and plan on being finished within 15 minutes, only to find out you actually need some more documents after waiting an hour on a small, uncomfortable bench. But what system is behind these banks and do they all operate in the same way? You will find out in this article.
Stocks eked out a slim victory on Friday following a range-bound day of trading on lighter-than-usual volume. The S&P 500 (+0.1%) hit some technical resistance at the 2800 level, which it hasn't been able to conquer since early February. The Dow Jones Industrial Average (+0.4%) did modestly better, and the Nasdaq Composite finished flat.
Wall Street rebounded on Thursday, resuming its recent upward trend following a trade induced sell off in the prior session. Stocks opened in the green and extended their gains throughout the day. The major averages each achieved a notable milestone: the Nasdaq (+1.4%) finished at a new record, the S&P 500 (+0.9%) hit its best level since the big drop in early February, and the Dow (+0.9%) returned to positive territory for the year. Small caps under-performed, but the Russell 2000 (+0.4%) still managed a modest gain.
An IPO (Initial Public Offering) is the process in which a company first gets listed on an exchange, and starts trading as a stock for the public to buy and sell. Companies IPO in an effort to raise investor money, by sharing ownership of their firm with the public. The popular electronics company, Xiaomi (SEHK: 1810), completed its long awaited IPO on July 9th, and the road has been bumpy. In an effort to raise capital and ensure a successful IPO, Xiaomi positioned itself as more than just a smartphone and hardware company, but instead as an “Internet servicing company”. Stocks snapped a four-session winning streak on Wednesday as U.S.-China trade tensions retook center stage and as crude oil prices tumbled, weighing on energy shares. The S&P 500 dropped 0.7% to 2774, the Dow Jones Industrial Average declined 0.9% to 24700, and the Nasdaq Composite slid 0.6% to 7717.
The market climbed for a fourth straight session on Tuesday, with the S&P 500 and the Dow adding 0.4% and 0.6%, respectively. The tech-heavy Nasdaq lagged, but still managed to eke out a narrow victory, and the small-cap Russell 2000 ended lower by 0.5% despite hitting a new intraday record in early trading.
Stocks rallied for a third consecutive session on Monday as investors shelved their trade war fears and set their sights on the Q2 earnings season, which will unofficially kick off on Friday. The S&P 500 and the Nasdaq advanced 0.9% apiece, and the Dow added 1.3%, climbing back into positive territory for the year (+0.2% YTD). The market started in the green and climbed steadily throughout the session.
Apparently, a trade war started on Friday -- or so it was said -- yet the stock market acted as if there was a daisy stuck in the barrel of every trade threat. For the second day in a row, the stock market ignored the trade conflict between the U.S. and China (and other countries for that matter) and rallied around a pleasing employment report for June. It was clear to see in the futures market this morning how the employment report was the inflection point for a shift in trading sentiment.
As the largest players in their respective markets, Alibaba (NYSE: BABA) and Amazon.com (NASDAQ: AMZN) have garnered investor attention, both growing more than 100% over the past several years. In the wake of this gold rush, China’s highest quality direct-to-consumer company, JD.com, has lagged. The nearly uninterrupted move since April saw the Yuan weaken 7.5%, from 6.25 to a low of 6.72. The currency has since retraced to 6.63 at the time of writing, however the past month remains the biggest one-month move in recent years. This devaluation comes during trade war talks and puts pressure on the US, as Chinese products become significantly more expensive. |
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