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China Launches CNY500 Billion In "Stealth QE"

Tyler Durden's picture




 

It has been a while since the PBOC engaged in some "targeted" QE. So clearly following the biggest drop in the Shanghai Composite in 6 months after some abysmal Chinese economic and flow data in the past several days, it's time for some more. From Bloomberg:

  • CHINA’S PBOC STARTS 500B YUAN SLF TODAY, SINA.COM SAYS
  • PBOC PROVIDES 500B YUAN LIQUIDITY TO CHINA’S TOP 5 BANKS: SINA
  • PBOC PROVIDES 100B YUAN TO EACH BANK TODAY, TOMORROW WITH DURATION OF 3 MONTHS: SINA

Just as expected, the Chinese "derivative" currency, the AUD, goes vertical on the news, and the S&P 500 goes vertical alongside:

 

For those confused what the SLF is, here is a reminder, from our February coverage of this "stealth QE" instrument.

* * *

The topic of China's inevitable financial crisis, and the open question of how it will subsequently bail out its banks is quite pertinent in a world in which Moral Hazard is the only play left. Conveniently, in his latest letter to clients, 13D's Kiril Sokoloff has this to say:

Will the PBOC’s Short-term Lending Facility (SLF) evolve into China’s version of QE? While investor attention has been fixated on China’s deteriorating PMI reports and fears of a widening credit crisis, China’s central bank is operating behind the scenes to prevent a wide-scale financial panic. On Monday, January 20th, 2014, when the Shanghai Composite Index (SHCOMP, CNY 2,033) fell below 2,000 on its way to a six-month low and interest rates jumped, the central bank intervened by adding over 255 billion yuan ($42 billion) to the financial system. In addition to a regular 75 billion yuan of 7-day reverse repos, the central bank  provided supplemental liquidity amounting to 180 billion yuan of 21-day reverse repos, which was seen as an obvious attempt to alleviate liquidity shortages during the Chinese New Year. However, it is worth noting that this was the PBOC’s first use of 21-day contracts since 2005, according to Bloomberg. Small and medium-sized banks were major beneficiaries of this SLF, as the PBOC allowed such institutions in ten provinces to tap its SLF for the first time on a trial basis. A 120 billion yuan quota has been set aside for the trial SLF, according to two local traders.

 

The central bank also said it will inject further cash into the banking system at regularly-scheduled open market operations. This is a very rare occurrence, as it is almost unprecedented for the central bank to openly declare its intention to inject or withdraw funds at regularly-scheduled open market operations. Usually, these operations only come to light after the fact.

 

The SLF was created as a brand new monetary tool for the central bank in early 2013 and was designed to enable commercial banks to borrow from the central bank for one to three months. Since its creation, however, the SLF program has been used with increasing frequency by the central bank.

 

The latest SLF is remarkable for two reasons: First, as mentioned earlier, this SLF was expanded to allow provincial-level small- and medium-sized banks, for the first time, to tap liquidity from the central bank.  As local financial institutions are usually both the major issuers and holders of local government debt, the expansion of the SLF to include local financial institutions opens a new channel for liquidity to flow from the central bank to local governments. This may suggest that the central bank, which is now on high alert for systemic risk, is willing to share some of the burden of local government, though on a very selective and non-regular basis.

 

The second key reason is embodied in the following central bank announcement: “[we will] explore the function of the SLF in setting the upper band of the market interest rates.” In other words, in the event that interest rates spike higher due to a systemic crisis, the central bank can intervene, via the SLF, to bring rates back down if it so desires. In addition, the PBOC did not disclose any set cap on the SLF, implying that unlimited liquidity could be provided as long as the market’s rate spike exceeds the bands set by the PBOC.

 

...

 

Most important, the SLF appears to represent the PBOC’s strategy to avert China’s widely-publicized local government debt and banking-system problems. It is  worth noting that even though local government debt amounts to 30% of GDP and is growing at an alarming rate, China’s central government is relatively underleveraged, with a debt-to-GDP ratio of only 23%, which is significantly lower than the emerging-market average. Therefore, Beijing has considerable unused borrowing capacity to share some of the debt burden taken on by local governments, which would have the additional positive impact of lowering borrowing costs for those governments.

 

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Tue, 09/16/2014 - 11:38 | 5222913 Devotional
Devotional's picture

this can carry on for a loooooong time.

Tue, 09/16/2014 - 11:43 | 5222937 El Oregonian
El Oregonian's picture

SLF? Is that like a Chinese "Selfie"???

Tue, 09/16/2014 - 11:45 | 5222944 Ruffmuff
Ruffmuff's picture

It stands for "jump you fuckers"

Tue, 09/16/2014 - 11:47 | 5222959 knukles
knukles's picture

Oh see, China is in such great shape!  Green bamboo shoots!  Pass the MSG.

Tue, 09/16/2014 - 11:51 | 5222966 SAT 800
SAT 800's picture

No doubt these new paper monies will increase the electrical usage and factory activity. Isn't that always the way it works?

Tue, 09/16/2014 - 11:59 | 5223001 Divided States ...
Divided States of America's picture

Well obviously SUMTING WONG in the Chinese financial system for them to do this right now.

Tue, 09/16/2014 - 12:08 | 5223058 TruthInSunshine
TruthInSunshine's picture

This is being done to float Alibaba long enough for the insiders to cash out.

Tue, 09/16/2014 - 12:14 | 5223086 eclectic syncretist
eclectic syncretist's picture

They're probably just printing up enough to buy what little is left of the West's remaining gold and silver.

Tue, 09/16/2014 - 12:23 | 5223127 TheRideNeverEnds
TheRideNeverEnds's picture

and the S&P goes limit up.

Tue, 09/16/2014 - 12:35 | 5223191 fx
fx's picture

gee, 500bn yuan? that#s in $$ terms what the Fed has been doing per month. A rounding error, so to speak.

Tue, 09/16/2014 - 12:42 | 5223211 BurningFuld
BurningFuld's picture

The USSA will not be outprinted! Man your stations boys. Turn on those presses.

Tue, 09/16/2014 - 12:26 | 5223149 Mesquite
Mesquite's picture

Yaay...

Tue, 09/16/2014 - 11:53 | 5222971 Bangalore Equit...
Bangalore Equity Trader's picture

Listen, American. Do you have cancer? Are you sure you don't have cancer. "CANCER". Shouldn't you check to see if you "HAVE CANCER". Cancer is bad and is running rampant in USSA. Everyone in USSA has cancer. Are you sure you don't have cancer?

Tue, 09/16/2014 - 11:56 | 5222990 Grande Tetons
Grande Tetons's picture

Waiter, I will have two of what he is drinking.

Tue, 09/16/2014 - 12:02 | 5223014 Bangalore Equit...
Bangalore Equity Trader's picture

Listen. It's serious and "DEADLY". Cancer. It will kill you. Don't you know? The cancer is here and is "INSIDE" of you in America. Cancer will kill "YOU". Cancer cannot be avoided in America.

Tue, 09/16/2014 - 12:26 | 5223142 gmrpeabody
gmrpeabody's picture

...seems to attack the brain first.

Just saying...

Tue, 09/16/2014 - 12:55 | 5223251 eclectic syncretist
eclectic syncretist's picture

Remember, everything gives you cancer. There's no cure. There's no answer.

https://www.youtube.com/watch?v=1oDAkmfoAgA

 

Tue, 09/16/2014 - 14:12 | 5223522 Deathrips
Deathrips's picture

Tetons,

 

Ill join ya! That guys FUCK'd Up.

 

LOL

 

RIPS

Tue, 09/16/2014 - 11:58 | 5223005 whatsinaname
whatsinaname's picture

are you an idiot Bangalore ? Say nothing if you have nothing sensible to say. Been watching your drivel for a while now.

Tue, 09/16/2014 - 12:02 | 5223022 Bangalore Equit...
Bangalore Equity Trader's picture

Listen. You defiantly have "CANCER"! Get checked by the doctor. Cancer will "KILL".

Tue, 09/16/2014 - 12:23 | 5223118 nscholten
nscholten's picture

Its so popular we now have a TV series.  " The Redband Society" 

Its what the cool kids are doing.  Great for business because we know there is no money in cures only treatment.

 

Tue, 09/16/2014 - 12:34 | 5223185 Bangalore Equit...
Bangalore Equity Trader's picture

Listen. Many already know they are highly "PRONE" or infected with a genetic sleeper cell. That's why they will get pissed at me for saying this.

Your "GOVERNMENT" wants you to get cancer! And you will! It's incubating in your food, air, water, and "THOUGHTS".

Tue, 09/16/2014 - 13:42 | 5223404 Herd Redirectio...
Herd Redirection Committee's picture

You are severely overusing the word: Listen.

Try to gain some credibility before demanding people "listen" to you.

Tue, 09/16/2014 - 12:57 | 5223259 eclectic syncretist
eclectic syncretist's picture

He might have cancer, but you sound like you've had a lobotomy.

https://www.youtube.com/watch?v=rwdc8u93r_w

Tue, 09/16/2014 - 12:05 | 5223037 Latitude25
Latitude25's picture

I have cancer of the brain caused by customer service reps in India.

Tue, 09/16/2014 - 12:21 | 5223109 Bangalore Equit...
Bangalore Equity Trader's picture

Listen. This isn't some cavalier comment used to provoke thoughts of fear in the reader. This is a warning sent by someone who knows. Cancer in the USSA is unavoidable.

Don't have it yet? You will...

Tue, 09/16/2014 - 12:29 | 5223164 Bangalore Equit...
Bangalore Equity Trader's picture

And Listen! It's a known fact that dogs can "SMELL" cancer in the human. But you Americans ignore the medical advice.

"CANCER" is embedded. In your body, a sleeper cell. Waiting for the opportunity to thrive. "CANCER" is not afraid of you big bad Americans.

Tue, 09/16/2014 - 12:36 | 5223196 TruthInSunshine
TruthInSunshine's picture

You're a classic sock puppet.dotgov who tries to interrupt and slide the comments, disrupting the conversation.

You are the cancer.

Tue, 09/16/2014 - 12:45 | 5223216 Bangalore Equit...
Bangalore Equity Trader's picture

Listen. Your fear of "CANCER" is palpable. I understand. Everyone thinks it's "NOT GOING TO HAPPEN TO ME" but one day you stop to think "WHY AM I FEELING SO RUN DOWN?".

"CANCER"? Has it taken hold, "YET"?

Tue, 09/16/2014 - 13:46 | 5223424 wanderintheland
wanderintheland's picture

Shouldn't you be busy worshiping a cow or something?

Tue, 09/16/2014 - 12:06 | 5223046 post turtle saver
post turtle saver's picture

so long fu

Tue, 09/16/2014 - 11:46 | 5222948 hedgeless_horseman
hedgeless_horseman's picture

 

 

Takes some of the load off Kevin, now that the Brits have their own little problem.

Tue, 09/16/2014 - 11:53 | 5222974 Dr Strangemember
Dr Strangemember's picture

YEAH BABY!!!!!!!!!!!!!!!!

Tue, 09/16/2014 - 11:53 | 5222952 LawsofPhysics
LawsofPhysics's picture

Yep, in addition, as many have demonstrated, the chinese want absolutely nothing to do with the world's reserve currency.  Especially since they have the majority of the world's customers and are quite willing to let the West destroy itself.

Tue, 09/16/2014 - 11:58 | 5223004 Ruffmuff
Ruffmuff's picture

Let's all shit all over the currencies. More bogus bucks the elites can buy all the assets up with. We on the other hand will have only a few shreads to wipe our ass with.

 

Tue, 09/16/2014 - 12:29 | 5223166 gmrpeabody
gmrpeabody's picture

Shouldn't wipe your ass with something that dirty...

you'll get cancer!  ;-)

Tue, 09/16/2014 - 12:43 | 5223212 LawsofPhysics
LawsofPhysics's picture

Speak for yourself, real wealth/capital comes from ownership and control over productive assets and equity.  You really think that the truly wealthy hold the majority of their wealth in currency?

 

FAIL.

Tue, 09/16/2014 - 13:32 | 5223380 Winston Churchill
Winston Churchill's picture

1/3 productive land.1/3 PM's,1/3 fine arts, has worked for a thousand years.

Paper currency is for serfs.

Tue, 09/16/2014 - 11:39 | 5222918 jubber
jubber's picture

someone sure fucking knew this was coming !

Tue, 09/16/2014 - 11:41 | 5222926 Dr. Engali
Dr. Engali's picture

The worst thing that could ever happen is to have "investors" take a loss. Can you imagine the horror?

Tue, 09/16/2014 - 11:42 | 5222932 dracos_ghost
dracos_ghost's picture

Wait a minute. QE is OUR WORD. This is racist.

Tue, 09/16/2014 - 11:45 | 5222936 ekm1
ekm1's picture

Peanuts.

This is politburo bailing out their own closely run pyramid schemes

 

Move on. This is nothing

 

Fed has so far monetized $4 trillion of derivative losses from primary dealers, Warren Buffett etc and still going on through Brussels.

Tue, 09/16/2014 - 11:45 | 5222945 Infinite QE
Infinite QE's picture

Their bank is run by the same madmen that run ours.

Tue, 09/16/2014 - 11:59 | 5222999 KnuckleDragger-X
KnuckleDragger-X's picture

No, they have their own lunatic asylum to screw things up.

Tue, 09/16/2014 - 11:49 | 5222947 Yen Cross
Yen Cross's picture

    About (1) month of QE before it was scaled back.

81,298,860,000.00 US Dollars   There goes the aud/usd chewing through those stops @ .9055/60.
Tue, 09/16/2014 - 11:47 | 5222956 luckylongshot
luckylongshot's picture

There seem to be a steady stream of self proclaimed financial experts on ZH who look at China with the underlying assumption that the Chinese banking system is Rothschild controlled and then predict gloom and doom for China. The problem is this assumption is wrong. China owns its central banks and can cancel loans, do QE and issue money interest free without creating any meltdown pressure. This article is as wrong as all the other ones predicting China's pending demise.

Tue, 09/16/2014 - 11:53 | 5222976 SAT 800
SAT 800's picture

Don't confuse the muppets with facts; they'll hate you for it.

Tue, 09/16/2014 - 11:56 | 5222991 LawsofPhysics
LawsofPhysics's picture

Precisely why they don't want the scrutiny of holding the world's reserve currency.  this isn't to say they don't know how to allocate capital as this is another thing altogether. far too many people confuse the two as well as money and capital.

 

It is what it is.  In any case, world trade is the only thing that really matters.  once that stops, then and only then would any sort "demise" for anyone begin in earnest.

Tue, 09/16/2014 - 12:00 | 5223010 ekm1
ekm1's picture

Unlike some of us, most people have not experienced central command in their lives

Tue, 09/16/2014 - 12:33 | 5223188 gmrpeabody
gmrpeabody's picture

They, apparently, have not had the pleasure of meeting Mrs. peabody...

Tue, 09/16/2014 - 12:02 | 5223017 BandGap
BandGap's picture

I don't think any country printing money out of their asses helps with trade. I sure as hell wouldn't give up anything of value for a piece of paper printed by a government.

Who the fuck can place any value on any of these currencies when they pull this shit? Nothing is pegged to nothing.

Trust? Hahahaha.

Tue, 09/16/2014 - 12:36 | 5223199 gmrpeabody
gmrpeabody's picture

It's a race to the bottom, and China has no intention of coming in last. The difference is, when they all do hit bottom, the race to the top will be won by the one holding the gold.

Tue, 09/16/2014 - 12:01 | 5223012 ekm1
ekm1's picture

Correct.

China financial system is a wholly owned subsidiary of politburo and communist elite

Tue, 09/16/2014 - 13:27 | 5223358 gatorengineer
gatorengineer's picture

and of course you believe it acts completely independently of Brussels, or DC right?  No coordinated pump here trim there on the printing, right, its all magic.......

Tue, 09/16/2014 - 13:31 | 5223366 ekm1
ekm1's picture

That is not a matter of belief. That is reality.

They want yuan to be partial world reserve currency without shooting a bullet.

 

Chinese and russian oligarchs are at war with western oligarchs

Tue, 09/16/2014 - 12:08 | 5223051 post turtle saver
post turtle saver's picture

what's the chinese word for 'audit'

Tue, 09/16/2014 - 12:48 | 5223225 gmrpeabody
gmrpeabody's picture

I believe it's called 'bribe'.

Tue, 09/16/2014 - 13:04 | 5223279 LawsofPhysics
LawsofPhysics's picture

There is none, they invented paper money and such words have long since been eliminated.  Control the language...

Tue, 09/16/2014 - 13:08 | 5223293 Quaderratic Probing
Quaderratic Probing's picture

" Up against the wall mother.... "

Tue, 09/16/2014 - 13:04 | 5223278 Quaderratic Probing
Quaderratic Probing's picture

I have an empty city for sale, was called Ordos but I renamed it Forestville. Stupid is as stupid does.

Tue, 09/16/2014 - 11:49 | 5222960 q99x2
q99x2's picture

Prospects of war are likely speeding up the counterfeiting by central banks. It is end game. The banks don't ever expect to be paid back.

Tue, 09/16/2014 - 11:52 | 5222969 IronShield
IronShield's picture

It's all a farce, no matter where one might be.  The reset will be painful but hopefully avoids WWIII.  I would be surprised if this system makes it to the end of the year before, kaboom.

Tue, 09/16/2014 - 11:57 | 5222993 LawsofPhysics
LawsofPhysics's picture

 ... said my father in 1971...

Tue, 09/16/2014 - 12:10 | 5223064 IronShield
IronShield's picture

This time is different?  :-)

Tue, 09/16/2014 - 11:55 | 5222986 SheepDog-One
SheepDog-One's picture

Fuckin hell.

Tue, 09/16/2014 - 11:55 | 5222987 RattNRoll
RattNRoll's picture

QE for eva bitchez...

Tue, 09/16/2014 - 11:55 | 5222988 RattNRoll
RattNRoll's picture

QE for eva bitchez...

Tue, 09/16/2014 - 12:35 | 5223193 Mesquite
Mesquite's picture

They take turns... (CBs)...

It's not rocket science...

Tue, 09/16/2014 - 11:59 | 5223002 Latitude25
Latitude25's picture

And through currency swaps markets world wide ramp up.  Does it really matter anymore which central banks do QE?

Tue, 09/16/2014 - 11:58 | 5223003 mayhem_korner
mayhem_korner's picture

 

 

This is like that midway horse race game.  Looks like horse number 4 (China) just moved up 5 spots in the race to the end.

Tue, 09/16/2014 - 12:07 | 5223029 JenkinsLane
JenkinsLane's picture

"Just when I thought I was out, they drag... me... back... in."

Tue, 09/16/2014 - 12:05 | 5223032 jubber
jubber's picture

So I would guess EVERY short across the world just got stopped out in everything....

Tue, 09/16/2014 - 12:06 | 5223039 oak
oak's picture

china needs large quantity of cny to ciculate around the world simply as usd.

Tue, 09/16/2014 - 12:05 | 5223041 Seasmoke
Seasmoke's picture

You fucked up, you trusted us. 

Tue, 09/16/2014 - 12:09 | 5223045 buzzsaw99
buzzsaw99's picture

To qe, or not to qe, that is the question—
Whether 'tis nobler in the mind to suffer
The slings and arrows of outrageous Fortune 500 companies,
Or to take adjustable rate mortgages (ARMs, get it?) against them?

Tue, 09/16/2014 - 12:07 | 5223048 falak pema
falak pema's picture

more invisible hands... just when Macao Casinos tank !

Tue, 09/16/2014 - 12:08 | 5223049 madbraz
madbraz's picture

A rumor spread at midnight China time, when their markets and their central bank have been closed for hours, right as our markets falter 2 days before quadruple witching and close to quarter end.  

 

It's becoming surreal - these guys aren't afraid of anything, they do as they please.

 

 

Tue, 09/16/2014 - 12:11 | 5223071 Chuck Knoblauch
Chuck Knoblauch's picture

China doesn't owe any money outside China.

All Chinese debt is Chinese debt.

They can cancel it all.

Someone forget to look.

China is still COMMUNIST!

You dumb mothers.

Tue, 09/16/2014 - 12:54 | 5223252 walküre
walküre's picture

But until they cancel it, they create more and more and buy the entire world with the funny money. Everyone wants a piece of that Chinah action and is willing to look the other way. Chinese millionaires seeking residence in North America, mainly the Westcoast. They will give the Mexicans a run for their money. Once Chinese slave masters "hire" the Messicans, they will need a border to keep the illegals here.

 

Tue, 09/16/2014 - 13:31 | 5223368 gatorengineer
gatorengineer's picture

boy for a minute I thought that they had energy bills......  good thing they are energy self sufficient.....

Tue, 09/16/2014 - 13:50 | 5223435 Chuck Knoblauch
Chuck Knoblauch's picture

China sells production.

Russia sells energy.

Nice fit.

Tue, 09/16/2014 - 14:21 | 5223549 Quaderratic Probing
Quaderratic Probing's picture

So Russian oil profits go directly to the common man so he can go down to the local Mao-Mart and complete the circle?

How will they get the oil money back from the beach front in the south of France and into the commoners hands?

Tue, 09/16/2014 - 14:04 | 5223493 Quaderratic Probing
Quaderratic Probing's picture

Wow 12 up votes

Use ZH search for "risky bonds china "

Not that long ago to forget

Tue, 09/16/2014 - 12:11 | 5223075 Al Huxley
Al Huxley's picture

Well, the important thing is that the correction is over and we can all get back to buying stocks.

Tue, 09/16/2014 - 12:19 | 5223106 orangegeek
orangegeek's picture

build a few empty cities, jack the printers, who gives a shit?

 

 

Tue, 09/16/2014 - 12:20 | 5223112 vegas
vegas's picture

Translation: Well, if you can hit Cntrl-P so can we.

 

www.traderzoo.mobi

Tue, 09/16/2014 - 12:24 | 5223125 TabakLover
TabakLover's picture

Yellen blow the PBOC?

Tue, 09/16/2014 - 12:49 | 5223237 walküre
walküre's picture

As a diehard gold and silver bug, all I read is this:

the central bank intervened by adding over 255 billion yuan ($42 billion) to the financial system. In addition to a regular 75 billion yuan of 7-day reverse repos, the central bank  provided supplemental liquidity amounting to 180 billion yuan of 21-day reverse repos, which was seen as an obvious attempt to alleviate liquidity shortages during the Chinese New Year.

Central banks hokus pokus adding liquidty with this or that "facility" bla bla bla needing more liquidity and there could be shortages so ratatatata make more liquidity bla bla bla... once upon a time there was a...

Maybe this fairy tale will really end in happily Ever Afters for every royalty and its court but I seriously, seriously doubt it.

Stay liquid my friends. They're all cooking with water, creating illusions of wealth from thin air.

Tue, 09/16/2014 - 12:49 | 5223238 Absalon
Absalon's picture

WTF 500 billion yuan is chump change compared to the Fed's QE.  Why is the market moving so violently?

Tue, 09/16/2014 - 13:13 | 5223306 Quaderratic Probing
Quaderratic Probing's picture

Because they have millions more bad loans and all of them have to be covered.

You just saw how they intend to fix their mess, this is just starting

Tue, 09/16/2014 - 14:01 | 5223482 Pullmyfinger
Pullmyfinger's picture

They're just doing the same thing as every other country now. All debts will be covered by printing, but with the additional advantage of serving to keep the value of the yuan from rising. In today's "new normal"' it's a win/win strategy. Same as it ever was...

Tue, 09/16/2014 - 12:58 | 5223260 Bangalore Equit...
Bangalore Equity Trader's picture

Listen. So many kids in the USSA are getting "CANCER" that "THEY" are creating a TeeVee show to convince the Kids of USSA that's it's "OK TO GET CANCER" no matter your age.

Tue, 09/16/2014 - 14:13 | 5223516 wanderintheland
wanderintheland's picture

Fine. Now time for you to go wash up and brush your teeth in your sacred Ganges. Watch out for those rotting corpses floating over there upstream...

Tue, 09/16/2014 - 12:59 | 5223264 Quaderratic Probing
Quaderratic Probing's picture

What the patron saint of gold backed currency would just print Yuan to save its bankrupt banking system.

Tell me its not so....

Notice they covered bad copper loans. Silver is the poor mans gold but copper is the China mans gold. ( at least in business )

 

On other reserve currency fronts the Rouble is down to .02613 to USD half what it was a few years ago.

What a combo they are. Russia will default on bonds again because of sanctions and Yuan still pegged to USD while it QEs ( the math does not look good on that one )

Tue, 09/16/2014 - 13:05 | 5223280 p00k1e
p00k1e's picture

Beastie Boys - Rhymin' & Stealin' (Official Video) http://www.youtube.com/watch?v=U7M7d8u40I4
Tue, 09/16/2014 - 13:06 | 5223287 SmittyinLA
SmittyinLA's picture

(on top of their $500B a year US trade surplus)

Tue, 09/16/2014 - 13:08 | 5223296 ilw4e
ilw4e's picture

The amount doesn't matter, market are high just listen to the word "QE", like a drug addicted hears the word "heroin".

Tue, 09/16/2014 - 13:26 | 5223356 Bangalore Equit...
Bangalore Equity Trader's picture

Listen. The word "CANCER" is more provocative. Much "MORE".

Subliminal. Suggestive. Sexy.

Tue, 09/16/2014 - 13:54 | 5223416 22winmag
22winmag's picture

Next fiat reserve currency my ass.

 

The Chinese should stick with stuff they know, like Kung Fu and shitting on the side of the road.

Tue, 09/16/2014 - 13:46 | 5223420 GoBadgers
GoBadgers's picture

Why does a country with supposed yearly GDP growth of 7-10% need QE?

Tue, 09/16/2014 - 13:53 | 5223443 Quaderratic Probing
Quaderratic Probing's picture

Because bad bank loans grew at 20% per year for 10 years.
That is loans with no real collateral...fake. copper ect

And investment in empty houses that they will not rent out for fear of damage
eg best pigs get the guest room so no one steals them

Tue, 09/16/2014 - 14:10 | 5223514 Pullmyfinger
Pullmyfinger's picture

As I insinuated above, the apparent reasons are just excuses to keep up with the actual decline in Western currencies. In the meantime, the Chinese are pulling out all the stops to stockpile as much gold as possible before the collapse of the dollar really picks up speed.

Tue, 09/16/2014 - 14:17 | 5223539 Canucklehead
Canucklehead's picture

...RRRrrright...

Tue, 09/16/2014 - 13:52 | 5223442 Pullmyfinger
Pullmyfinger's picture

Why is this supposedly news? The total distributed is less than 81.4 billion $US. Big deal. This strikes me as merely surreptitious China-bashing. Compare this, for instance, to the 29 Trillion $US in funny-money that have been reported as having been pumped into equities by Western banks since 2009.

Tue, 09/16/2014 - 13:55 | 5223458 Quaderratic Probing
Quaderratic Probing's picture

ICEBERG BABY

Tue, 09/16/2014 - 14:05 | 5223494 Pullmyfinger
Pullmyfinger's picture

Did I mention that the other ninety-percent you don't see is comprised of solid gold?

Tue, 09/16/2014 - 14:03 | 5223450 Chuck Knoblauch
Chuck Knoblauch's picture

China reminds me of the Kanimits in the Twilight Zone episode "To Serve Man".

Instead, it's "To Serve Stupid Americans".

Mr. Chambers, don't sell any more Treasuries to China, it's a cook book!

Mr. Chambers smiles back and says, "Yes, I know".

Is Mr. Chambers a Kanimit infiltrator?

Tue, 09/16/2014 - 14:21 | 5223548 Canucklehead
Canucklehead's picture

So 500 Billion CNY equates to 81 Billion USD, or 6 years worth of Russian NG.

http://www.cbc.ca/news/business/russia-china-sign-natural-gas-deal-worth-400b-1.2649241

Tue, 09/16/2014 - 16:28 | 5224000 compound interest
compound interest's picture

".. It is worth noting that even though local government debt amounts to 30% of GDP and is growing at an alarming rate, China’s central government is relatively underleveraged, with a debt-to-GDP ratio of only 23%, which is significantly lower than the emerging-market average. Therefore, Beijing has considerable unused borrowing capacity to share some of the debt burden taken on by local governments, which would have the additional positive impact of lowering borrowing costs for those governments. .."

Local government (municipal) debt is a problem, but I think the corporate debt in China should also be mentioned here. Small businesses very indebted and big companies (for example construction, etc.) also.

Tue, 09/16/2014 - 16:31 | 5224009 compound interest
compound interest's picture

The risk on effect today was really the result of this "chinese QE"? Why BBG did not even mention it?

Tue, 09/16/2014 - 21:02 | 5224878 assistedliving
assistedliving's picture

i notice the rates for a date with those ChnloveAsia just went up

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