China Says It Will Bail Out Insolvent European Countries

Tyler Durden's picture

As expected, China is the new IMF. No surprise there.


All this means is that China will do everything in its power to prevent the ECB from launching an outright unsterilized monetization episode, which will double the amount of importable inflation (plunging EUR) to hit the Chinese domestic economy, and destabilize the already shaky stability, so critical for the Chinese communist party. And since the USD and the CNY are pegged, this has the added benefit of devaluaing the CNY instead even more if not against the USD, then against the CNY, which is now importing European sovereign risk and will continue to do so, until China finds itself in the same lock out as half of Europe currently.

As for the IMF popularity contest, better known as "who is thst most feminine", it has just been relegated into complete historic obscurity and irrelevance. Which is sad because Lagarde may have actually had something worthwhile to contribute. Too bad her organization was just been rendered obsolete.

More empty rhetoric from Wen, courtesy of Reuters:

Chinese Premier Wen Jiabao said on Sunday he had no intention of pursuing a trade surplus and that he wanted balanced, sustainable trade growth for his country.

He was speaking during a tour of MG Motor's Longbridge factory in Birmingham, central England, during a three-day trade and political mission to Britain.

"China has no intention to pursue a trade surplus. What we want is to have balanced and sustainable growth of trade," he told the BBC through an interpreter.

He also said China would lend European countries experiencing trouble borrowing, just as it announced it would do for Hungary earlier this week.

We get it: China will not pursue a trade surplus... It will just happen purely accidentally for the next decade.

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slow_roast's picture

How about some coverage of the upcoming strike in Greece; there is no way that that doesn't turn violent. 

Tyler Durden's picture

Pretty sure striking on a Sunday is moot.


slow_roast's picture

I know you guys will cover it when the strikes start on Tuesday, but I'm curious just how large(read violent) these strikes may become as the austerity package is anything but positive and still does nothing to solve the solvency issues within the country.


Surely the populace will get all Egyptian at some point.

markmotive's picture

This is EU bailout Part II for China.

They did this about 6 months ago, didn't they?

slow_roast's picture

Economic circle jerking is 21st century math.

66Sexy's picture

Borrow from a toothess global banking organization like the IMF... or borrow from a communist country with military backing and a history of... well... dealing with opposition 'efficiently'.

Tough call (s/off). I wonder if China is 'in' on the global banking conspiracy; by making the act of borrowing created fiat credits from the IMF a much more attractive offer than, say, borrowing from a sovereign global military power.

wanklord's picture

China is the indisputable superpower of the 21st Century. The Asian dragon needs to relocate one third of its entire population elsewhere (about 400 million people) , and seems that the North American landmass is a suitable place to do that. They will accomplish this endeavour either by peaceful or coercive means. America will become a protectorate of PRC in the near future - so better start learning Mandarin and/or Cantonese.

Arius's picture

not so fast ... this country always makes it and it will come back stronger than ever before ...

Ag Star's picture

This country has had many depressions but none like the one coming and no amount of denial is going to change that.  Better take that bag of your head so you can see what's happening,  oh never mind--it's already to late for people like you!

Bindar Dundat's picture

China has NO Territorial ambitions -- full stop.   They think long term and want a world that is stable.  Some of the comments here verge on clinical paranoia.   The Chines are sharp and they want their Country to do well.  Our success is their success.  


It is OK to pick on the banksters but guys give your head a shake....China is part of our solution , not our problem.

magpie's picture

"The flag follows the trade"

ancient Chinese secret

Oh regional Indian's picture

Well, look at one major move (or is it three). north Dakota has allowed China to Start building a 50 square mile Exclusive economic zone. Google is your friend and a few other states are in the same talks.

Now imagine this:

A broke state (say California), fails to raise debt money/pass budget etc., broke DC can/will do nothing.

In comes China, save California, then Illinois........ 48X50 square miles = 2,500 ish square miles.

i'd research this if I was american or living there. The first state to be bailed out by China (nothing can stop China from buying state/muni debt) will start a chain reaction, which are near impossible to stop.

In one year, Chimerica.



magpie's picture

But that's ok, if or when free trade turns sour, you will always have something to take from the other guy and swap it back. Keeps everyone polite and stuff...

JLee2027's picture

China isn't "taking over" anything. Stop with the fear mongering.

Oh regional Indian's picture

Jlee, ND is already a done deal. A Chinese EEZ is considered Chinese territory, like an embassy, without the diplomatic immunity.

Given the shitty state of, well state finances in the US, directly or by proxy, China is in a position to own a lot of non-strategic assets in the US. A lot. Look what the Japs did in the 80's. Only, they were gypped into CRE and golf courses.

Different century. To not consider this possibility would be myopic. My sis is in the US, I have dear friends from coast to coast and everywhere in between, I have no desire for this coming crash to come to pass.

But coming it is. To deny that and all these crazy possibilities that are, well, possible in such to deny the fast crashing vectors of our environment, in every dimension.

I wish you the best.


trav7777's picture

Special Economic Zone, and it was Idaho

Oh regional Indian's picture

Thanks Trav, I got a little excited with my very probable thesis, Jlee's dismissal notwithstanding.


Ahmeexnal's picture

Chinese "Special Economic Zone" in Idaho? Why would that be news? There's been many of those in several major cities: NYC, San Francisco, etc.  They're called "Chinatown".

Soon coming to you, a "Chinatown"  right next to every "Main Street".

Cathartes Aura's picture

here's the link again, it's Idaho now, with "delegations" eyeing up Ohio, Pennsylvania & Michigan. . . a bit more in the "update" box:

Hoku Corp., a subsidiary of Tianwei New Energy Holdings Co, a Chinese company, has invested $270 million of the more than $400 million it expects to spend on its Pocatello plant to manufacture polysilicon for the solar market.

All of the polysilicon will be shipped back to China.

The Idaho Regional Center, a company developing the Gold Hill Mine near Placerville and Blackhawk on the River near McCall, has millions of dollars in escrow from Chinese investors awaiting approval of green cards from U.S. Citizenship and Immigration Services.

Once approved, the money will be released and the gold processing plant is expected to go into production, said Sima Muroff, head of the regional center.

Several other regional centers have started in the state. They allow investors a chance to get green cards in exchange for investments of $500,000 to $1 million.

brush up on that Mandarin. . .

snowball777's picture

This is my buddy Mr. Wang (no offense)...

JLee2027's picture

Jlee, ND is already a done deal. A Chinese EEZ is considered Chinese territory, like an embassy, without the diplomatic immunity.

Yeah sure buddy, whatever you say ding dong.

gmrpeabody's picture

There are a few neighborhoods that I wouldn't recommend you or your Chinese friends try to visit at any time. They may just be biting off more than they can chew by trying to own America. People aren't gonna be in a real good mood if it comes to that. 

smlbizman's picture

yeah, we handled that other immigration  problem so well...

Cathartes Aura's picture

maybe they don't want to "own" amrka, just "rent" it for a while then leave a hella toxic mess when they flit, rather like amrka's corporate fly-by-nights, maquiladoras, and various "special economic zones" in S. Asian countries.

imitation, sincerest flattery and all that.

DosZap's picture

China should be FORBIDDEN to OWN property in the USA.


If we are that dumb, I know I am checking out.

Manthong's picture

They can have all of Chicago.

Maybe the Red Army can subdue the mobs from the West Side.

But they will have to fight the Mexicans for the rest of the country.

Sunshine n Lollipops's picture

And I hear Detroit is lovely this time of year.

Ahmeexnal's picture

Chinatown in the middle of Philadelphia Badlands?

john39's picture

how many countries has china bombed or invaded recently? how about the U.S.? so who is the real bad actor again?

SMG's picture

If the current leaders in China do not want a large war.  The Oligarchy will make sure the next leaders who are put into power in China do.  Nothing will depopulate the world faster than an all out World War III killfest.

I love America, but if you fall into the China vs US idea, you are becoming a slave of the Oligarchy. The Oligarch will gladly use you as a slave. They don't care about you and want you dead, you useless eater you, so don't get on their side.

The real war is the Common Person (99% of us in the world) vs the Global Oligarchy (1% of us). The common people can win if enough realize this truth.

Urban Redneck's picture

For a country with no territorial ambitions, China has a few too many boundary disputes with its neighbors-

China-South Korea
and of course... the Spratly Island cluster-fuck China-Brunei-Malaysia-Philippines-Taiwan-Vietnam

In fact about the only neighbors China doesn't have territorial disputes with currently are Russia, who is supplying it with energy, and Thailand/Myanmar where all boundary issues have been resolved and trade highway is already under construction.

Oh regional Indian's picture

hmmmmmmmmmmmmmmmmmmmm...... good eye...


DeadFred's picture

The Amur valley border with the Soviet Union was a long-time war zone and we shouldn't forget Tibet. They're still digesting that "no territorial ambitions". I guess he's right though, we should SO trust them to fair and helpful.

i-dog's picture

Border disputes are a completely different issue than marching off on imperial expansionist wars against whole neighbouring countries -- or remote countries (like the US).

China has a perceived [by it] right to re-claim certain areas that were taken from it by other imperial or secessionist powers in the past.

Taiwan: Was part of Imperial China (as a prefecture of Fujian Province) for hundreds of years - after being taken from the freaking Dutch colonists by a Chinese emperor - then ceded to Japan in 1895 by the Ching (ie. occupying Mongol) Chinese emperor. When Japan lost it at the end of WWII, the American-backed Chiang Kai-Shek set up a nationalist Chinese government in exile (and martial law) there to attempt to militarily re-take the whole of Communist China. Chiang was not Taiwanese!

India: The only part of India that China wants back is a small section of Kashmir that was carved out by the British as part of Lord Louis Battenberg's random determination of the borders of India and Pakistan when the British scurried out of India in 1948. The borders of Kashmir have been in dispute ever since between India, Pakistan and China and are almost the sole cause of the ongoing hostilities, as well, between India and Pakistan.

Japan: China and Japan have disputes over a few small islands lying between them ... not over whole countries. I can't be bothered looking up the history of ownership over them now.

Vietnam: This one is a little more complicated -- because the North Vietnamese are historically ethnic Han Chinese while the South Vietnamese are from an older Indian ethnic background (as are the Thais, Burmese, Malays, Indonesians, etc). This always made a mockery of the contrived Vietnam War of "re-unification" -- since Vietnam had essentially been two separate countries for almost all of the previous thousand years.

Korea: I'm not aware of any Chinese attempt to take over South Korea -- other than supporting North Korea in its attempt to re-unite the country back into a single Korea. This is no different than America supporting South Korea in its attempt to re-unite Korea back into a single Korea. Hypocrisy abounds!

Bhutan: From Wiki: "Bhutan’s border with China is largely not demarcated and thus disputed in some places. Approximately 269 square kilometers remain under discussion between China and Bhutan.[23]". That's not imperialist aggression!

Tibet: Tibet was originally settled by Han Chinese about 3,000 years ago! China therefore considers it part of its "territority" (though, over the last 1,400 years, there have been many changes of hands between China and various independent "kingdoms" of Tibet).

Great Dane's picture

Reclaim?!  Umm Germany tried to reclaim their Sudatenland and areas poland had possession of, and we wonder why Germans were called invaders, when they were doing that 'reclaiming' thing.

Urban Redneck's picture

China's maritime boundary disputes are all about increasing China's territorial waters, which both the Chinese NOCs and western oil companies believe there is oil beneath.  Lawyers are less expensive than Tomahawk missiles and don't generate the bad press.  During the previous centuries imperialist-colonialist-mercantilist land grabs for access to resources there was no offshore oil drilling.  

So China's border disputes are the same as the marching off on imperial expansionist wars against remote countries (like the US), the only difference is the Chinese are using a 21st century model that leverages "globalization" while the US is still using the 19th century military model.


i-dog's picture

China has known of, and exercised dominion over, the Spratly Islands (which are off the coast of North Vietnam, see above) for well over 2,000 years. It's not only, but also, about oil.

DosZap's picture

China has no right to retake property lost in past wars.

If they start the colonialism routine, they can prepare to become Great Britain Deaux.

WE have learned, since we have not won a war since Vietnam,that it is impossible to carry on multiple fronts, and start civil wars and expect anything except Extended forever never ending wars...............

China is huge, China has power, but we did too.

For all the fiepower and manower we have used, we have damn little to show for it, except a lot of debt, and dead soldiers.

For what?.

If China wants to depopulate by starting wars have at it.

They will relearn the lessons we have already failed to learn.

Screwing w/nuclear states will bring on major problems for them.

I do not care how many troops their armies have.You cannot win in a nuclear exchange.

bakken's picture

@UR  Don't forget the massive water confiscation in Asia.  China will appropriate the Mekong (I fought there, the Delta was actually beautifull minus the gunfire! ) and the Brahmaputra river flows as well as water flow from a number of medium sized asian rivers.  Pakistan (and India), Bengal, BanglaDesh, Viet Nam, Thailand, Cambodia, Laos will all have reduced water flow and much lower resource levels  thanks to the Chinese. The Chinese love to build dams and  only a few have collapsed recently.  The Chinese haven't made any real joint-use agreements on this massive water diversion from other Asian countries.

Well, they control the headwaters, so they will probably take most of the water, wildlfe and minerals..  Little Asian pipsqueaks are supposed to be reassured by Chinese promises to be fair!  hahahahah.  Wars???  No way.  They can simply cause periodic floods and droughts to bring the reluctant countries to heel. 

Benevolent leadership of the Chinese Guiding Lights (older Mao Thought slogan)  will cause rice to grow in Viet Nam even without water(more Miraculous Mao thought. Hey it is coming back into style!)

DeadFred's picture

No <sarc> so I have to ask what you're smoking. You know this because of their wonderful peaceful history since 1949? Maybe you know because of your inside position in the politburo? Those guys have a LONG history of imperialism that was put on hold only when European imperialism had a temporary upper hand. Lol, I hope I just missed your sarcasm.

Kayman's picture

Bindar Dundat

China has NO Territorial ambitions -- full stop

I guess Tibet, Mongolia, Siberia, Taiwan, Vietnam and the South China sea are the "tiny" exceptions to your blunderbuss.

Loosen your cloth and let the blood flow to your brain.

China is a Frankenstein monster created by  Chinese Wallmart, Clinton (see contributors to the foundation), and GE. Of course, there are many other myopic culprit's, too numerous to name.

exiledbear's picture

China is out to screw the world. They're not too particular about who they're screwing, the U.S. happened to be stupid and easy to screw, that's all. But they'll happily bend the E.U. over and give them a jolly good rogering too.

Maybe the current political leadership in China doesn't have territorial ambitions, but politics tends to change when real crisis hits.


However. I think it's way too "expensive" to relocate Chinese citizens to N. America. The Pacific is a huge ocean, it requires ships or airplanes. However to relocate to Europe or Russia, why that just involves a train ride. All the tracks were built long ago.


All abooooooaaaaarrrrd! Or however you say it in Mandarin...

Cathartes Aura's picture

However. I think it's way too "expensive" to relocate Chinese citizens to N. America

tell that to Vancouver, BC - and the increasing periphery!

Léonard's picture

China has NO Territorial ambitions

How do you know ?

China would be stupid to not add new territories with that much power. They already took Tibet and the Piraeus in Greece.

Freddie's picture

Nah.  The place is filled with too many Hope & Change arse *****ers - many are on ZH.

The masses are easily controlled and brainwashed by Bilderberger/Rothschild TV.  If you watch - you are helping them. The masses have done nothing about the Atzalan - Reconquista Mexicali drug lord invasions.   The funny bit with that is they are doing ethnic cleansing of blacks in California in the drug trade and in Calif cities.  Even African Americans in So Cal have said as much.  Hope & Change.

Orly's picture

They have been saying as much since at least the early seventies.  Never heard stories of putting saltpeter in their Nehi soda?  Why would the CIA run drugs and guns into the inner cities?
And the great and benevolent Bill Gates has donated billions from his own pocket to fund African vaccination plans...

I do hope the world catches on to this before too much longer...

Speaking of drugs, why is it suddenly okay to smoke pot?  Anyone with any conspiracy theory ideas on that one would be most welcome.


snowball777's picture

Potassium nitrate can cause gastroenteritis, high blood pressure, anemia, kidney disease, and has a depressive effect on the heart. Not only would you not be able to "get it up", you wouldn't be able to get up.