China is so "fine" that it has resorted to the full central-planning manipulation trifecta: first making up data, then deleting data, and now outright censoring anyone who reports the data, especially data which reveals the suddenly illiquid state of the local banking system caught in the middle of the grand Likonomics experiment.
FT reports that with (the extensively reported here) cash crunch roiling the Chinese economy, "propaganda authorities have told local media to tone down their reporting to help stabilise financial markets. In a directive written last week and transmitted over the past few days to newspapers and television stations, local propaganda departments of the Communist party instructed reporters to stop “hyping the so-called cash crunch” and to spread the message that the country’s markets are well stocked with money."
This is vaguely reminiscent of the US, only there those who describe the ugly truth behind the propaganda wholesale numbers are merely mocked and ridiculed as the tinfoil hat-wearing conspiracy theory gallery (until such time that one after another "theory" becomes "fact") not censored. At least not yet.
Last week’s directive is an indication of the concerns in Beijing about the dislocation and growing panic in the country’s markets following the onset of the cash crunch.
“First, we must avoid malicious hype. Media should report and explain that our markets are guaranteed to have sufficient liquidity, and that our monetary policy is steady, not tight,” the directive said, according to a text obtained by the FT.
“Second, media must strengthen their positive reporting. They should fully report the positive aspect of our current economic situation, bolstering the market’s confidence,” it continued. “Third, media must positively guide public opinion. They should promptly and accurately explain in a positive manner the measures taken by and information from the central bank.”
The directive was written early last week when the Chinese stock market lost more than 10 per cent in a day and a half of trading. But it has just begun to spread more widely to the nation’s media outlets. An economics editor with a leading newspaper received it three days ago and a television producer in a large northern city said the message was conveyed to staff at a Monday meeting.
The term “cash crunch” is still being used widely in newspaper headlines and television reports, but the tone of the coverage does appear to have been softened.
And with this directive in play, one must wonder just how ugly the reality behid the scenes must be, if stories like this are considered innocuous:
Over the past weekend, several banks again temporarily suspended operations for what they said was routine system maintenance, but there were no similar reports about cash shortages.
In one of the most alarming reports during the panic, 21st Century Business Herald, a financial newspaper, reported on June 20 that Bank of China had defaulted on an interbank payment, prompting a denial from the bank. The 21st Century Business Herald website later issued an apology. The Wall Street Journal reported on Tuesday that Ma Kai, a vice-premier, had ordered an investigation into that rumour.
The simple solution to all of this, of course, would be for the NSA to finally launch its own blog in which it discloses all global sovereign secrets on the objects of its espionage: everything from the 2012 net income line of the Belgian Caterers, to what the real 2022 Greek debt/GDP is, to just how broke China really is and, most importantly, whether the PBOC's official gold holdings are now 3000, 4000, 5000 or more tons. That last one is of particular interest.