• GoldCore
    09/04/2015 - 07:43
    Large pools of gold in indebted nations will be vulnerable. Pool accounts, digital gold bullion vaulting providers and depositories in the UK and the US might have their companies and assets...

People's Bank Of China

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"Central Bankers Look Naked... & Investors Have Nothing Else To Believe In"





"Policymakers responded to the financial crisis with easy monetary policy and low interest rates. The critics — including us — argued against 'solving a debt crisis with more debt.' Put differently, we said that QE was necessary, but not sufficient for a recovery. We are now coming to the moment of reckoning: central bankers look naked, and markets have nothing else to believe in."

 
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China Cuts Benchmark Interest Rate By 25bps, Cuts RRR By 50bps





  • CHINA PBOC CUTS INTEREST RATES
  • CHINA PBOC CUTS REQUIRED DEPOSIT RESERVE RATIO
  • CHINA PBOC CUTS 1Y DEPOSIT RATE BY 25 BPS
  • CHINA PBOC CUTS 1Y LENDING RATE BY 25 BPS
  • CHINA PBOC CUTS BANKS DEPOSIT RESERVE RATIO BY 50 BPS
 
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No Greatly Anticipated RRR Cut From China, Just More Jawboning: Will It Be Enough





In the aftermath of China's worst manufacturing PMI since the financial crisis, which in turn sent the Shanghai Composite crashing to the "hard floor" level of 3500, below which the PBOC and Beijing officially are seen as having lost control, virtually every China expert and strategist rushed to defend China's policymakers (and its stock market) with predictions that an RRR cut as large as 100 bps is imminent, and would take place as soon as this weekend, a much-needed move to calm nerves that China is in control. it did not.

 
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Gold Jumps After China Reveals It Bought Another 19 Tons In July





Putting what China has just done in very simple context: China announces an increase in its gold holdings of over 58% (June and July)... and then it devalues its currency by nearly 5% in one week. Even the most brainwashed Keynesians should be able to see what is going on here by now.

 
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Frontrunning: August 13





  • China central bank tries to soothe global markets, says no reason for yuan to fall further (Reuters)
  • Huge blasts at Chinese port kill 44, with hundreds injured (Reuters)
  • China efforts to slow yuan fall hoist Europe shares, bond yields (Reuters)
  • Greek Economy Unexpectedly Surged Before Capital Controls (BBG)
  • Joe Biden Is Sounding Out Allies About a 2016 Bid (WSJ)
  • U.K. Tries to Kick-Start Shale Gas With Planning Speedup (BBG)
 
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Demand For Credit Plunges 55% In China As Slump Deepens





Although the headline number suggests that credit demand in China was robust in July, the "expansion" was entirely attributable to Beijing's mammoth equity plunge protection effort. As for the real economy, well, the picture isn't pretty.

 
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A Stunned Wall Street Reacts To China's Currency Devaluation





There is much stunned confusion among Wall Street's "best and brightest" following China's historic Yuan devaluation overnight which was predicted by exactly zero of said best and brightest, just like nobody expected the SNB to give up its own peg to the EUR in January.

 
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Frontrunning: August 11





  • China Rattles Markets With Yuan Devaluation (BBG)
  • China Move Sparks Wave of Yuan Selling (WSJ)
  • China's devaluation raises currency war fear as Greece strikes deal (Reuters)
  • Protests return to Ferguson streets, state of emergency declared (Reuters)
  • Heavily armed 'Oath Keepers' inject new unease to riot-hit Ferguson (Reuters)
  • Greece Secures Bailout Deal After All-Night Talks in Athens (BBG)
  • U.S. Identifies Insider Trading Ring With Ukraine Hackers (BBG)
 
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China "Loses Battle Over Yuan", And Now The Global Currency War Begins





Almost exactly seven months ago, on January 15, the Swiss National Bank shocked the world when it admitted defeat in a long-standing war to keep the Swiss Franc artificially weak, and after a desperate 3 year-long gamble, which included loading up the SNB's balance sheet with enough EUR-denominated garbage to almost equal the Swiss GDP, it finally gave up and on one cold, shocking January morning the EURCHF imploded, crushing countless carry-trade surfers. Fast forward to the morning of August 11 when in a virtually identical stunner, the PBOC itself admitted defeat in the currency battle, only unlike the SNB, the Chinese central bank had struggled to keep the Yuan propped up, at the cost of nearly $1 billion in daily foreign reserve outflows, which as this website noted first months ago, also included the dumping of a record amount of US government treasurys. 

 
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As China Admits It Lied About Its Local Debt Levels, Local Billionaires Are Quietly Liquidating Their Assets





Overnight something unexpected happened: Sheng Songcheng, the director of the statistics division of the People's Bank of China (PBOC), was quoted by the National Business Daily on Saturday whereby he essentially admitted China had been lying about not only its local debt exposure but the level of NPLs across the economy.  The punchline: Sheng warned about the risks of local government debt, saying that 2 trillion yuan in bond swaps may not be able to fully cover maturing debt, according to the report. What he really said, as paraphrased by Bloomberg, is that "local govt's tended to not report all their debts when audited in June 2013, thus the 2 trillion yuan debt swap plan arranged this year may not cover all debts due, Sheng cited as saying."

Oops.

 
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Frontrunning: July 21





  • Gold claws back ground, European assets lose Greek tarnish (Reuters)
  • Greece's Euro Exit Back on the Agenda Next Year, Economists Say (BBG)
  • Greece submits bill needed to start rescue talks (Reuters)
  • Wall Street Lenders Growing Impatient With U.S. Shale Revolution (BBG)
  • Overtime Rules Send Bosses Scrambling (WSJ)
  • As Markets Swing, Beijing Steadies Yuan (WSJ)
  • Tennessee rampage suspect went to Qatar in 2014 (Reuters)
  • Kathryn Dominguez to Be Nominated for Fed Governor (WSJ)
 
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China's Annotated Collapse Into Centrally-Planned Market Hell





For those curious what it looks like when a centrally-planned market devolves into complete chaotic hell despite the relentless intervention of the local authorities and central planners, look no further than the chart below...

 
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China Challenges Gold Price-Setting Regime; Confirms Launch Of Yuan-Denominated Fix





Less than two weeks after Bank of China became the first Chinese bank to join the list of participants in the London gold auction, The Shanghai Gold Exchange confirms that a yuan-denominated gold fix will be in place by the end of 2015.

 
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