FCC club lunch with Paul SCHULTE
Speaker: Paul SCHULTE
Global head of Financial Strategy and Asia Banks, CCBIS, China Construction Bank Corporation Group
Topic: The economic cycle is the credit cycle: let’s not kid ourselves
Everything depends on the banks whether we like it or not.
Euro banks are broken. US banks are recovering but half of the US credit system is broken with GSEs. The UK banking system is the most leveraged in the world.
That leaves the GEMS banks. Brazil is tapped out. So that leaves India and China and Indonesia and Russia.
In the West, only Canada has a clean banking system. So, we need a lot of new savings — or we need fewer loans or, we can solve the problem through inflation. This drives up the value of assets AND inflates away the debt. SO, make a bet on inflation.
Paul SCHULTE joined CCBIS in September 2010 as Global Head of Financial Strategy and Asia Banks Mr. Schulte’s career in equity research spans over 20 years on both the buy and sell sides covering the Aisa and emerging markets. He was most recently Managing Director and Head of Multi-Strategy and Asia-Pacific Banks Research for Nomura International. Prior to that, he was Chief Equity Strategist, Asia ex-Japan for Lehman Brothers.