No, There Is No Stoppage Of Cash Transfers In China

Tyler Durden's picture

Earlier today, Forbes managed to spook readers with a bombastic report that China's commercial banks had been instructed by the PBOC to halt cash transfers - something which would have dire implications on China's banking system ahead of its new year holiday, and send the banking system into a tailspin just as China is desperate to avoid all turbulence ahead of a potential shadow banking default.

Leaving aside the fact that one should typically rely on official PBOC advisories, posted quite clearly on its website (where one finds no mention of this notice), one could simply keep track of interbank liquidity indicators such as repo and SHIBOR, both of which dropped, indicating that liquidity actually improved.

Anyway, here is what really happened, as reported by China Compass. "Forbes columnist Gordon Chang claimed in a much-quoted item today that the Peoples Bank of China had instructed commercial banks to halt cash transfers. Chang's column, entitled “China Halts Bank Transfers,” specifically refers to Citibank's Chinese branches. The report is entirely misleading." Our advice - focus on the real "weakest links" in China's banking system, of which there are many and are backed by facts, not the least of which is the potential upcoming shadow banking default. Ignore groundless rumors and speculation.

More from China Compass:

According to Citibank China Customer Service, the bank is conducting a routine system upgrade over the first few days of the upcoming New Year bank holiday. System maintenance of this sort has occurred several times in the past. The PBOC has not—repeat not—asked Citibank to stop customers from wiring funds. Customers can still log on to their account to put in fund transfer requests at any time. The receiving bank (non-Citibank) will process the funds to be transferred on the next business day, as it always does. Because of the Lunar New Year break, the next business day is Friday Feb. 7. This is no different from the practice of banks throughout the world. Chang's understanding of Chinese culture evidently does not extend to the timing of bank holidays.

January 30, 2014 4PM is the afternoon of the Chinese New Year eve. Nobody will be around by 5PM as the Hong Kong stock exchange has a half-day trading day. 

Citibank's customer web site offered the following notice:

Important Notice:
 
1. Due to the system maintenance of People's Bank of China, Domestic RMB Fund Transfer through Citibank (China) Online and Citi Mobile will be delayed during January 30th 2014, 16:00pm to February 2nd 2014, 18:30pm. As to the fund availability at the receiving bank, it depends on the processing requirements and turnaround time of the receiving bank. We apologize for any inconvenience caused.
 
2. During Spring Festival, Foreign Currency Transfer Transaction through Citibank (China) Online and Citi Mobile will be temporally not available from January 30, 2014 18:00pm to February 7, 2014 09:00am. We apologize for any inconvenience caused.
 
If you have any enquiries, please reach us via our 24-hour banking hotline at 800-830-1880 or credit card hotline at 400-821-1880. If you are calling from other parts of the world, please reach us at 86-20-38801267 for banking services or 86-21-38969500 for credit card services.

* * *

All that said, China certainly has all too real liquidity (and solvency) problems - none of which have anything to do with a suicidal act by the PBOC - as explained here extensively in the prior weeks and months, captured best by the fact that both China's and HSBC's CDS are both at multi-month highs.

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ebworthen's picture

The World is one big giant Ponzi scheme.

WTF else do you need to know?

Own physical.

Renfield's picture

You know what's weird? There was another first comment on here before yours. I put a vote on it, then when I refreshed the page, it disappeared. Bizarre.

DarthVaderMentor's picture

Disappearing comments like Chinese fiat?

JLee2027's picture

Actually CB comments can rehypothenticate and vanish on their own.

SilverIsKing's picture

I think it comes down to who opens the reply window first, not who posts first. So if you are first to begin, someone else may finish and post before you and anyone checking will see that as the first post but when the person who first opened their post window saves it, it gets posted in the first position.

This is only my theory since I've seen things move around after-the-fact and it's the only logical conclusion I could come up with.

Ineverslice's picture

 

Wati, what...c''mon, what'ss goin on...? wtf?

OceanX's picture

Wecome to the world of database transactions, would you like to delv into to inter-process, programming threads?

OceanX's picture

Wecome to the world of database transactions, would you like to delv into to inter-process, programming threads?

LetThemEatRand's picture

Saw it too.  It said, "And now ZH is being spoofed?", or words to that effect.  Will this disappear too?

acetinker's picture

Thought i might reply that zh would quarantine a spoofer, as I would in the same instance.  Thought better of it after realizing who I was responding to... wait... what?

LetThemEatRand's picture

I don't get it.  Who was the spoofer and what was the spoof?  ZH did not post anything about the Chinese bank transfer freeze.  I saw a link to the Forbes story in comments only.

NoDebt's picture

That's what I saw, too.  I clicked through to the Forbes story based on comments from (numerous) posters inside existing ZH atricles, not from any ZH article directly.

LetThemEatRand's picture

Makes you wonder who bought this site.

acetinker's picture

Goddammit!  I am a liar!  I said I would ignore you.  I can't.  Take a deep breath and realize where you are.  This blog would not exist without considerable effort behind the scenes, and considerable "insider" knowledge of the darker arts of finance, politics and internetdom.

No way any gubmint entity would sanction this heresy.  Thank you, Tyler.

LetThemEatRand's picture

That was certainly true until recently.  Tone and content have changed markedly as of late.

acetinker's picture

You do realize what you're saying, of course?  The compendium of "truther" resources has been compromised?

Maybe I'm in denial, but I'm not willing to concede just yet.

LetThemEatRand's picture

I'm still here, hoping.  There are not a lot of decent alternatives (or not any, really), but lately this is like drinking watered down scotch.   Similar taste, but a lot less kick.

acetinker's picture

I'd know watered down scotch, trust me on this.  It may be scotch flavored Kool-Aid, though.  Some (a long time ago) suggested ZH may be a "honey pot", and I can't refute that.

What i want to know is this:  You know I am a liar.  I swore I would never talk to you again.

Do you trust me?

matrix2012's picture

@ LetThemEatRand

"That was certainly true until recently.  Tone and content have changed markedly as of late."

 

LTER, You phrased it at best the present situation here using the minimum numbers of words :-)

You just pinpointed the not-so-subtle transition of ZH contents... a long-time diligent reader will surely notice them!

Rentier88's picture

Was joke on how ZH posted the story and then it was found out to be fake story.

q99x2's picture

Tyler's building an army.

First commentors get drafted and we never hear from them again.

TruthInSunshine's picture

Operation Mayhem, bitchez.

StychoKiller's picture

I don't know what yer typing about!

Rentier88's picture

Was me, seems admins at ZH don't have sense of humor...they deleted the post and my original account.

LetThemEatRand's picture

Interesting how the first post about ZH being spoofed went poof. 

If the issue is the upcoming holiday, why is the official notice about system upgrades?

Honest question. 

Clever Name's picture

I am thoroughly confused.

The PBOC will be conducting maintenance on New Years Eve and New Years Day. Ok...

The banks are closed for the week (thats the implication, right?) so foreign currency transfers cannot take place.

Huh?

 

Why no link to the China Compass story? Trying to track anything down on this leads me in a freaking circle.

I did find this interesting little nugget:

Real Estate Employees Carry Year-End Bonuses in Burlap Sacks

Maybe thats the real reason behind all of this?

Johnny Cocknballs's picture

Gordon Chang didn't know it was Chinese New Year, eh?

Curious.

 

I think you can gauge his expertise via his prior predictions on China.  It's one thing to be a pessimist - it's another thing to simply not know what one is talking about.

 

The Wisp's picture

Aw man I already fueled up the generators in the  bunker and initiated Plan A Bulk Food Purchases, and now it turn out to be a false alarm...

    Practice, Practice practice...

Peter Pan's picture

You reminded me of the time I was in a hurry to get to Covent Gardens for a performance when I was holidaying In London. In the process I got lost and I stopped and asked a street busker with a guitar....

"How do I get to Covent Gardens?

He stopped playing, looked me in the eyes, nodded his head and said,

"Practice man.....practice." and then started playing again.

Fish Gone Bad's picture

You continue with the plan.  Making dry runs is part of being prepared.  The dry run allows you to see the shortcomings and improve the plans.

What if the generator didn't work?  Did you put Stabil in the fuel?  What if the fuel was old?  How about the food.  Have you sat down and rehydrated the beans and cooked a meal and stayed for a night yet?

Plan the practice and practice the plan.

DarthVaderMentor's picture

The Donglicker at the Dickerforum is calling it the end of the economic world as we knew it. He's dying to say "I told you so" like McHugh............ 

blindman's picture

if you like your deposit spoof cancellation
transaction you can keep your deposit spoof cancellation
transaction.

Little Boomer's picture

Damn, I just bought 12 gross of tuna cans.

Spanky's picture

Mild to moderate glow. Be careful about looking at others directly. Rads escape most easily thru the eyes. A hard glare is about equvilant to an x-ray with that dose...

matrix2012's picture

Thanks Al Gorerhythm :-)  

btw i like your handle for i'm a "big enthusiast" of that guy promulgating the Global Warming now known as the Climate Change :D

 

Some reader in that link posted as below not long ago:

"I think that all these puppets 'goober-mint' handled..will start (again) print more money like there's no tomorrow. Just take a look at the Granny we have in the FED...

On the other hand, thing are starting to change...it looks like China is going to teach a lesson on a true Austrian Economics approach to the USA...I think that China is not going to neither bail-out nor bail-in his 'Lehman'..."

 

NoDebt's picture

Wow.  The markets are jumpier than a long-tailed cat in a room full of rocking chairs right now.

The slightest ripple....

BandGap's picture

The slightest perterbation due to a financial anisotropy.

NoDebt's picture

Agreed.  When you split a piece of wood you do it paralell with it's grain for maximum effect.  The only thing that's spooked markets in any real way since 2008 is the credible fear of bank extinction.  When that pops up, even a whiff of it, the market reaction is orders of magnitude bigger than it is from other threads (like recession, scandals and other common real-world events).

 

Hulk's picture

sigh, financial collapse delayed yet again...

Skateboarder's picture

Don't worry, it'll come, Hulk, and people will be like "oh shit, didn't see that coming." And a hell of a lot of us will say "told you so!"

BrigstockBoy's picture

So possibility of PBOC being suicidal but HSBC wasn't?

NoDebt's picture

If we have now drilled down to bedrock truth of this whole incident (which I doubt), think about where that leaves us, logically. Who cried wolf?  CitiBank.  Their stated policy is in place, blaming PBOC decrees.  Yet PBOC says they have no idea what Citi is all excited about.

Something broke inside HSBC, whether it was their balance sheet or just their sanity, something broke.  Maybe something broke inside Citi as well?

Just remember- never one roach.

Clever Name's picture

Scrambling to rearrange the deck chairs, while the band plays on?

If we take all this 'official' explanation at face value, they are blaming Chang for misinterpreting the whole situation.

Until we get it all straightened out, lets all speculate our a**es off! Woo hoo!

Possible Impact's picture

Is this like SouthPark?

Spoof, and it's gone...

And it's gone (original)

http://www.youtube.com/watch?v=-DT7bX-B1Mg