Are the Chinese Nervous too? President Delays Retirement of Prominent Banker

Perhaps a testament to the uncertain global economic headwinds that are currently prevailing, Chinese President Hu Jintao has delayed the retirement of China Development Bank's (CDB) chairman, sources said Friday. According to two people familiar with the situation, CDB chair Chen Yuan, who is currently 66 years old, will stay on as the bank's chairman until his five-year term ends in 2013. This goes against China's typical system, which requires a retirement age of 65 for cabinet ministers. A Reuters report notes that the news "Suggest[s] that Beijing wants to keep a steady hand at the helm of the country's most powerful policy bank at a time of rising economic risks and global market volatility." Further adding fuel to the fire is the Chinese population's increasing distrust of their government's foreign reserve holdings. Especially with S&P's recent downgrade of U.S. government debt, it's likely that Chinese leaders want to keep the current chair to ensure stability and credibility. The China Development Bank provides loans to the country's enormous infrastructure projects in addition to offering financial aid for China's largest companies to expand. Ensuring calm waters at the CDB could make it easier for the government to manage local government debts. The report also notes that politics played a role in the decision, with one source telling Reuters that "Hu Jintao kept on Chen Yuan to show goodwill to 'princelings'.