This page has been archived and commenting is disabled.
China Interbank Market Freezes As Overnight Repo Explodes To 25%
It seems liquidity (or counterparty mistrust) is beginning to reach extreme levels in China as the nation's banking system is now quoting overnight repo transactions at 25%. The explosion in funding costs echoes the collapse in trust (and surge in TED spread) among US banks in the run-up to the Lehman bankruptcy. MSCI Asia-Pac stocks are down over 3% with China's Shanghai Composite -2.5% at seven-month lows.
- China’s 1-day Repo Rate Climbs to Highest Since at Least 2006
- MNI - CHINA OVERNIGHT REPO FIXING AT RECORD HIGH
China's bond market is also collapsing:
Yield on 3.1% govt bonds due January 2016 jumps 39 bps to 3.749%, biggest rise since notes were issued in January
China this week...
US in the run-up to Lehman...
Charts: Bloomberg
- 63974 reads
- Printer-friendly version
- Send to friend
- advertisements -




The pyramid scheme is running out of suckers. That's it.
A pyramid scheme can only collapse, it cannot unwind
This is the part left out in Keynesian Economics 101 and covered in Austrian Economics 801. A little chapter called "Disaster".
people. relax. trillion dollar coin. nuff said
Say what you will, but Jim Chanos has been raising red flags about China for a long time now.
http://www.planbeconomics.com/2013/05/chinas-actually-gotten-worse-jim-c...
Anyone else watching the freefall in gold/silver right now? Brutal!
players are selling paper, going for cash.
What paper cash ;)
Well check out US 10 yr and 30 yr jumping by 2+ percent overnight. Somethings broken...
nothing is broken spider. we are settling in around 2.5% which is about right based on the pick up in economic growth. EM and high yield may crash, but after a slight selloff in stawks everyone will come in and scoop em up.
thats the meme and get used to it because they are going to beat you over the head with it.
Its not the absolute level - its the volatility.
agreed, and treasury volatility will simmer down around here. other asset classes (pretty much anything else in credit) not so much.
But look at stocks. nice and calm.
I understand the junk. this is giving me an ulcer.
Would this be enough to finally bust the "China" hype?
Maybe he meant paper gold. Try and find physical under 1325.
silver just went sub 20 $
But whos going to make all my cheap crap?
Any straight thinker with an eye for history can see all the pieces falling in place for a general clampdown on borders, physical and now electronic that always precede a general break out of hostilities.
Everywhere, ME, Brazil, Japan, China, Fast asleep India, slowly being re-raped Africa.... things are coming to a head.... at some point, internal strife will be given a new bugbear, a furryner, the outsider, the jew, the despot across the border, US vs. Them....
War, it's what for dinner, like or hopefully NOT.
It is a jaggernaut, China too, but more so this slow unfoldment of rage... all manufactured....
Plenty of humans, very little humanity
ori
http://aadivaahan.wordpress.com/2012/03/23/un-holy-smoke-and-biblical-fi...
so.... good times?
Bullish.
Thanks for the simple expranation in Engrish boys.
Gonna need a bigger coin.
http://yapislandproject.blogspot.ca/p/stone-money.html
So then what are the chances of a bank collapse? Aside from this looking like LIBOR circa 2008-9, and regional stock markets & currencies dropping (along with all asset classes getting hammered), this makes liquidity issues look like only the start.
It might be too late for China to do a rate-cut or get anything together to loosen credit/liquidity.
coin(s) at least twenty...
Whose better at this than I am?
Been sayin' this stuffs gonna happen post haste.
Just you people wait.
Benji screwed the pooch.
World wide economies are sick, sick, sick...
Otherwise wouldn't have kept the Buy & Print open 24/7/365
So all's he's got's left is suppressing rates further, particularly LONG rates (viz Operation Tittytwister) and
Goosing stock prices
And Look what Ben Wrought
Just when you thought it was OK to get your pecker back in that babe again, you find she already gave you AIDS
Fucking Disaster
Mark my words
They're gonna be printing and monetizing everything inanimate till hell freezes over to compensate for this shit.
You ain't seen nothin' yet, folks!
Oh it's crisis time again,
I'm gonna see it,
I can see the look of panic
In your eyes
If the world starts unraveling around us
Benji and the boys
Will print
Until they die
La la la la
I can't wait for Maria Buttaroma tomorrow... gonna be a hoot!
But unfortunately, I'll be golfing.
Shucks
The answer my friend, is blowin' in Warren
The answer is blowin' Warren.
-Maria
I thought it was Becky, not Maria.
[Anybody done any decent fanfiction on this topic? Who knows it could be the next 50 Shades...]
knukles, you ignorant slut. Everyone knows it's the Print & Buy.
Simma Down Now Knukles, you be scarin the childrens...
Amen, brotha...
My first post in years! And it goes to Knuckles.
Panic and Print will be their mantra just like last time when Hank P got up there, trembling with quivering voice warning the mushrooom cloud over the financial world if we don't Bail'm out. Then followed four of the most Glorious Banker Bonus years in the history of Mankind....while the rest of the Nation has sunk deeper into recession.
Bankers cannot stand deflation....printing is their lifeblood so QE (or whatever they call it in whatever form) will certainly continue for the next several years...maybe for the rest of my life. Stock markets and the Housing Bubbles will still see a correction but maybe ben can limit it to a 30-40% drop, or less.
Actually it is called the "crackup boom" by Mises. And who says Austrians are boring?!
http://mises.org/humanaction/chap17sec18.asp
It’s about fucking time... Can we get this impending collapse shit underway already? My food stockpiles are nearing their expiration dates.
If the cans are flat, and heavy, and the seams are intact, they are okay.
Yes I read somewhere recently that on a revisit to Scott's Antarctica base camp they found tinned meat that was still edible, though it would have lost some taste and nutrients over time. It is how you store the cans that is important.
There were also bottles of whiskey there, too. I remember at the time reading that they would be put up for auction (with fantasmagorical estimates), but I never heard a word thereafter. Bet those .GOV fuckers drank it all.
Average antarctica temperatures are below 0 C. So I guess that might have helped them a bit with conservation.
FIFO, it's what's for dinner
Tell me about. Eating canned carrots with everything.
Y'r supposed to be eating it anyway, replacing it with new when eaten. Don't forget they'll get you with their leaching BPA canned products anyhow so is it really worth it?
Game of musical chairs between countries with each trying not to be the first one to fall.
Gandolfini was about to blow the lid off the whole scheme so they silenced him. Beat that for a new conspiracy!
"A pyramid scheme can only collapse, it cannot unwind"
But isn't a collapse just a very, very fast unwind? Besides, I'm a PhD doctor, Jim, not an economist. -- Ben "Bones" Bernanke
How do you spell relief?
R-O-L-A-I-D-S.
Pepto works great too.
Johnnie Walker Black Label.
Here's me at my trading terminal.
http://popsop.com/wp-content/uploads/johnnie_walker_double_black_02.jpg
no ZH on that screen?
My mother told me that she actually prefers JW red to black, which makes me wonder. (Doesn't black cost twice as much as red?)
'Course, she lives in Maine, which, because .GOV sells booze, price may be a significant factor. Probably affect my tastes, too.
Left hand for Johnnie Walker - Right hand for buy/sell button
Now thats a system I can understand. : - >
Gold
Or, what do you call a homo in a wheelchair?
R-O-L-A-I-D-S.
And there is NO connection between the sudden Chinese crisis and Snowden. None. So please please move along and go see that nice man with the body armor.
The PRC has been heading for a crash for quite some time. Not sure how you think the Snowden debacle could have precipitated a liquidity meltdown.
Because their dealer is pissed. Snowden is a potential game changer. You don't need a large percentage to change the paradigm.
New rule: All new conspiracy theories shall be assumed to be true, until proven false, since the average rate of conversion from theory to fact is greater than 50%.
The people are presumed innocent (so say the Founders) and only their peers (not the King in secret Court) may find him guilty. In the days of Kings and Queens this made sense and was urgently needed to be committed to writing. Today as well.
@Matt. You are smarter than a lot of us. Bon mot.
Yeah ... the words are still there. They mean what they mean. In the meantime, they don't mean shit to TPTB ... because they're only words - not sticks or stones. Sticks and stones - and guns and bombs - are what TPTB use to communicate with the serfs and keep them in line. It's always been such.
Kings and Queens have always been psychopathic bullies. The serfs have always outnumbered them and could topple them anytime they want - but they:
a) don't have the drive or kill instinct because they aren't psychopaths and mostly just want to be left alone
b) usually wind up attaching their fate and future to Kings and Queens (see: Welfare). Don't bite the hand that feeds - even if it beats from time-to-time.
c) have family members and neighbors who work as the Kings men and women - and it just isn't right to start killing family and neighbors in trying to get to the King.
d) don't perceive the psychopaths to be the cause of their problems because their problems are local and the King lives a ways off. The serfs become so mired in toil to pay taxes and keep the chicken coop and garden plot maintained that they can't focus on much of anything else.
And it's still that way today, just bigger and more refined. The serfs can still scrub their society and culture clean - start over if they wanted - but most can't think of a reason to do so or just don't have the means, energy or inclination to start. The toxins produced by TPTB and introduced into the environment via processed food and other methods only help to make matters worse for the serfs. Seems everyone I talk to these days has some type of memory problem among other weird health issues. Auto-immune diseases are running rampant and new viruses are cropping up seemingly daily.
Sure, the BOR is composed of important words - but by themselves they don't mean much of anything without action ... or when the K&Q's say that other words, like the Patriot Act and NDAA are the words that now matter and will be acted on.
The serfs will always be fucked because the minority of psychopaths keep it that way. The only time the psychopaths get a beat-down is when God shows up to do it.
Nothing new under the sun.
"The serfs have always outnumbered them and could topple them anytime they want"
Don't forget the calming effect of the middleman, religion, who was allowed to share power with kings for that very reason. "Don't revolt, serfs, you'll get your reward in heaven and 'they' will fry in hell." Same shit, different day...
after 9/11 the theory to trooth is almost batting 1000
Snowden isn't going to amount to a drop in the bucket. He threw away his life for nothing.
Anyone who was paying attention (sadly, not most Americans) already knew that the NSA was spying on phone calls and emails. Hell, BO himself was trying to score political points on the Bush NSA's misbehavior back in 2007. It's the epitome of old news. All that the latest revelations have done is produce some uncomfortable moments for members of the administration because they can't plausibly deny anymore. You'd have to be on crack to think this is going to mean the end of the spying program(s); other than that I'm not sure what the people here are hoping for as an effect.
This isn't a Hollywood movie; "getting the word out" about govt misdeeds is not enough, because most people don't give a crap as long as they can eat all the cheeseburgers they want and Dancing With The Stars isn't preempted by some boring news story.
Go get fucked. By yourself you fucking fuck. Jesus is this really the best you fuckers can do? "It was already known so who cares?"
Which is not what I said. I said that it's not going to have any lasting effect because the people who are finding out because of ES mostly don't care. What effect do you think it's going to have? So far all you've got is vague innuendo and obscenities, which isn't enough.
May I be repetitive? Go fuck youself you fucking fuck. NSA much?
Ooooo- cat fight.
Says the pussy.
You are what you eat.
Pussy! It's what's for supper!
No LT it gets better, it's NEEDED, so they con stop the trrrrists, just like they did in Boston, you know the trrrrrists that were folied in their plot because the USofNSA had been watching everything for everyones good
Damn straight. It works because we said so. Now go eat your Boston Marathon bombing meat. Because if you don't eat your meat, you can't have any pudding.
WAR IS PEACE
FREEDOM IS SLAVERY
IGNORANCE IS STRENGTH
And work. Shall set you free.
It seems to have worked in my case, being retired and all.
Imagine what it will be like when Medicare doesn't exist. Or do you have a pension with insurance?
No, no insurance, I'm goin' 'naked'.
Also, a personal decision and explicit instructions to my son not to hand what little I've accumulated go to the American Medical Mafia at the end. You know, "On a long enough timeline...."
+ 30 more years
And ARBEIT MACHT FREI
Uh, double post with LetThemEatRand
it has more impact when written in the original NAZI.
"WAR IS PEACE
FREEDOM IS SLAVERY
IGNORANCE IS STRENGTH"
Hmmm, where have I heard that before.
http://2.bp.blogspot.com/-UYlAczqixrY/TuniQLlzKMI/AAAAAAAAAdQ/-8pq9y2lt0Y/s1600/INGSOC_by_ghigo1972.jpg
Look for the interview with NSA whistleblower Russ Tice currently available at 'boilingfrogspost', but to be released to the web by this weekend. A mind blower of who's been wiretapped and by whom.
Yes there's one:
WINTER IS COMING.
Meh. It came back down, you changed the chart. The only question is how many Nikkei futures contracts should one buy?
You might as well buy them all, it's fun to pick up pennies in front of mushroom clouds!
http://finviz.com/futures.ashx completely red, except for Cotton & the Dolla.
Pretty apropos IMO - The Doors :: The End http://youtu.be/1b26BD5KjH0
Lehman? I'll believe it when I see it. U.S market still calls the shots.
and they will continue........until they don't....and if you think you're going to be given advanced warning
Im just being contrarian because ZH posts stuff like this every day and the criminals keep playing their bankster games without consequence.
Fair point. But this one looks interesting.
The US market action today looked interesting, too. The asset which seemed to do quite well today was... cash money.
If there is something the ZH "house view" has in common with the Keynesian orthodoxy, it is that omg don't hold cash. Because inflation. And because shut up.
The disagreement concerns simply which assets to buy.
We Were All Muppets Today.
And tomorrow and tomorrow and tomorrow...
US repo market is the same as the chinese one, but in a larger scale, it's a pyramid scheme which ran out of suckers in 2008 but managed to make the Federal Reserve as the SUCKER IN CHIEF
Ga Dam U Mongolian Bernake, you tear down my shitty Repo Wall!
Nope. US doesn't call the shots. Rehypothecated chains are global, and systemic. China is the epicenter of copper rehypothecation. What happens when you need to claim assets, and discover everyone has a claim. You trust no one, and demand more yield to offset risk.
There's not enough safe collateral in the world to back up the fungible money from Central Bank printing presses. It's likely a lot of rehypothecated chains were created on finite safe collateral. Classic pigeon hole problem.
However, the assymetry of trades (folks stagger wages, and exit all once) can turn rehyptothecated trades into leveraged doomsday plays, as everyone wants to exit their position concurently.
Polish Firing Squad. "Ready, fire, aim"
A Chinese bank run will prompt one of the greatest precious metals short squeezse of all time.
http://img12.imageshack.us/img12/8199/bf6.png
In the end it's always the fucking bankers that don't trust each other and the system dies.
kinda like crime syndicates when they don't trust each other
.........................and start sending out their "little people" sons' to meet with the heads of said families in hopes of ironing out the issues, only to find that when son returns from washroom, he's now got a 45 in his hands and he starts wiping out the other heads sitting at the table enjoying their eggplant parmigania.
a n d F U C K Y O U t o o M a o!
When does the shooting start?
In the "new normal," it started already. The bankers would MUCH prefer a shooting war to the war that has started. They don't get hurt in a shooting war.
a shooting war helps the bankers GDP, making Good Dead People and leaving the bad to continue ass fucking whats left of the world
Let the shoosting begin!
-Goldmember
Soon.
Wow a China crash, watch those USTs! Global bond dump is primed. This is actually really bad, China crashes, sends up the 30yr on mortgages. Will wipe out the so called housing recovery, tightening liquidity in the US - stocks crash, yields blowout and Detroit is the name of the game.
Detroit should go the IPO route ... what have they got to lose? ... they could make trillions in a market like this
The downside to seeing the moment most sheeple realize Bernanke is full of shit & has no effective means left to control bond yields (and the core interest rate structure in the real world, as deemed appropriate by Mr. Market) is that there will be shit hitting the fan and much collateral damage already taking place.
sure hope the PBC printers aren't made in China, they'll be running hot for awhile
How long until Bernanke starts wearing a cape and a spandex suit with a big 'B' on the chest?
Probably not long now. China meltdown will bleed to Japan, to Europe, then the US. How many electro dollars will be wiped out in this crash I wonder? Trillions, with a T.....
hmmm... did Bass factor a Chinese credit crunch into his Japanese timeframe?
I still like Singapore.
So do I, especially Ipanema! :-P
What if....chinese have accepted to be the next Lehman in order to clean the system?
Remember, Lehman was all preplanned
They would need a lot of gold and stolen technology.
Just a couple of major banks and few millions of people losing savings.
Now it's China's turn to take the hit and what is more important,,,the blame.
. If there is something really global, that's the financial system
It will affect the fin systen in the west also
As far as I remember, Lehman wiped out 100 trillion in notional derivatives.
This one may double or tripple that if my speculation comes out true
I wonder if the China repo rates rising to 25% will "puzzle" Bernanke
Bernanke "puzzled" = he is the one who caused it
How do you say "gremlin" in Chinese?!
Glemrin?
MogWai Bitchez !!!
Boo hoo, PLA corruption spoils gettin vaporized.
I need a tissue....thin veneer of civilization over the iron bootheel.
Boo hoo hoo.
Apple and the rest deserve whatever cornholing they get over there.
Oooh! I bet the hardliner communists have been itching to give Apple and the rest of the western corporations an epic cornholing! In fact this could have been the plan all along! China could save us all by stringing up some bankers, nationalizing western corporate assets and forcing jobs back to the US. Mao is dead, long live Mao!
Time to hook the equipment trailer to the diesel truck and make a costco run. Could be one of the last runs. God Bless America. Good luck ZH'ers.
'Murica! ;)
I think about buying shit but figure I'll get it fo free during the SHTF riots.
I just hate it when civilization collapses the day before my payday.
In China they'll take any bankster scammers out back to the firing squad. Big difference.
And send the bill for the ammo to the family!
guys don't you worry. you should go long stocks nao. a bird twittered that aapl could hit 1234 soon enough.
*cough cough*
NOT
I'll still take AAPL over stupid shit like priceline, netflix and amazon...
The Chinese know how to deal with banksters.
Get the cameras ready. Heads are going to roll.
" we are a bit puzzled by that" may go down in history as the words that finally blew up the system. The moment the Bernank uttered those words rates really started to blow out. Loss of confidence is a bitch.
That was my thought.
"Better to remain silent and be thought a fool, than to speak and remove all doubt."
I just about shit my pants when I heard that! (In a good way since I immediately realized my puts were going to pay off bigtime). Apparently, Bernake is not enough of a sociopath to pull it off.
Chairsatan is instead, a motherfucking idiot. We are completely fucked.
Not sure why we're not entering full panic mode right about now but I'm sure this will be spun (or not even mentioned) by BubbleHeads. Shit's gettin' serious, folks!
OT, on Hasting's death: https://mobile.twitter.com/wikileaks/status/347475869629022208
Working on a story on the NSA, contacts Wikileaks, a few hours later his car goes boom in a way seldom or never seen before.
I guess the race is on between the financial collapse and full disclosure...
http://www.businessinsider.com/michael-hastings-on-stanley-mcchrystal-2013-6
Taking down a General.
http://dailyentertainmentnews.com/tv/andi-parhamovich-michael-hastingss-former-fiancee-killed-in-iraq/
""As part of her job in the National Democratic Institute she had gone to meet a group of Sunni politicians from the Iraqi Islamic Party she was instructed to conducted a training seminar for the Sunni politicians who were located in Yarmouk, a west Baghdad neighborhood where shootings and executions are common.
and after she did she left in a convoy with her armed guards but just moments later the convoy was ambushed resulting in the death of 28-year-old Andi and three bodyguards. They tried to protect Andi but were outgunned never imagining they would be targets of such cruelty."
"Working on a story on the NSA, contacts Wikileaks, a few hours later his car goes boom"
Move along, nothing to see here, just a coincidence.
His car burned only after it hit a tree. He was probably drugged. Unless they supect foul play as they should, any toxicolgy tests will probably only include commonly abused recreational drugs.
BTW, here's another recent revelation of a lie:
FORMER INVESTIGATORS OF TWA FLIGHT 800 EXPLOSION WILL BREAK SILENCE—CALL OFFICIAL INVESTIGATION RESULTS FALSE
http://www.zerohedge.com/news/2013-06-19/drones-are-used-domestic-surveillance-fbi-director-admits#comment-3673735
Hastings last article, posted on 7 Jun 2013:
Why Democrats Love To Spy On Americans - Besides Senators Ron Wyden and Mark Udall, most Democrats abandoned their civil liberty positions during the age of Obama. With a new leak investigation looming, the Democrat leadership are now being forced to confront all the secrets they’ve tried to hide.
http://www.buzzfeed.com/mhastings/why-democrats-love-to-spy-on-americans
Once some military personnel, most likely those already socio- or psychopaths, are desensitized to killing other human beings in wars, what do you think would stop them from following through on threats like this?:
Michael Hastings conspiracy theories: Web goes wild after NSA, CIA reporter killed in crash
http://www.nydailynews.com/news/national/conspiracy-theories-abound-michael-hastings-death-article-1.1377392
"Hastings wrote in his book, "The Operators: The Wild and Terrifying Inside Story of America's War in Afghanistan," that he received a death threat from a former McChrystal staff member.
"We'll hunt you down and kill you if we don't like what you write," the staffer threatened, according to Hastings, who calmly responded: "Well, I get death threats like that about once a year, so no worries."
Hastings went on to say: "I wasn't disturbed by the claim. Whenever I'd been reporting around groups of dudes whose job it was to kill people, one of them would usually mention that they were going to kill me."
http://www.crystalbull.com/stock-market-timing/TED-Spread-chart/
I can Haz Gold???? Preaze?
In a few moments 'someone' will explain why this reminds them of the US........ waiting........waiting............
Yeah, thought so. There is no comparison. Markets ARE different! It is NOT about "WE", or "THEM". It is not about "First" or "Second"!!
IT IS ALL CRAP!!!!
But in the world of commentary you evaluate on a daily basis the most likely area of "discordance(?)".
Didn't know what a repo rate was. Here is definition I found:
"The discount rate at which a central bank repurchasesgovernment securities from the commercial banks, depending on the level of money supply it decides to maintain in the country's monetary system. To temporarily expand the money supply, the central bank decreases reporates (so that banks can swap their holdings of government securities for cash). To contract the money supply it increases the repo rates. Alternatively, the central bank decides on a desired level of money supply and lets themarket determine the appropriate repo rate. Repo is short for repossession."
http://www.businessdictionary.com/definition/repo-rate.html
Amusing. Finally Asia (HK/Shanghai) is down over 2%, we need Europe down over 2%. Futures are pointing towards a tiny fall. The market will have to figure out how the Fed can flood China, the problem is, Yuan swaps won't work (make it worst) and no one touches China's bonds. China's banking system starts to collapse, they will print, but loss of confidence will flow straight into US dollars. This is a perfect endgame situation.
Where's YC when you need him. FRNs are SURGING tonight. Dollar/Yen just hit 98. Gold getting absolutely hammered.
Let me try: "Scramble for liquidity."
this is fucking serious.... better double print
Hammer time...Gold & Silver paper price......
can you hear the echo in JPM's vault?
It can't be that serious, tanks and parachutes haven't been sent to Africa yet.
Papaer gold down to $1,310/oz and paper silver down to $20/oz.
What a farce these markets are.
Meanwhile panic buying of the physical around the world, especially in Asia.