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Chinese Corruption Probe Pivots To Bankers As Manufacturing Contracts At Fastest Pace Since August 2012
With all eyes on China as the great Eastern hope for putting a floor under crude oil prices, last night's dismally disappointing Manufacturing PMI print looks set to remove that last pillar of 'demand' - artificial or not. Having fallen 6 months in a row and printing 49.8, missing expectations of 50.2 (3rd of last 4 months) and down from the prior 50.1, this is the first official contractionary signal for Chinese manufacturing since September 2012. With Industrial Enterprises in China seeing profits collapse at 8% YoY along with the slowest GDP growth (7.3% of magic unicorns and credit expansion) since Q1 2009, the PMI components' broad-based weakness show significant signs of a cyclical slowdown. What is perhaps most worrisome though is that with cries for more RRR cuts or government-sponsored largesse, the banking system has, it appears, become the new focus of the nation's corruption probes as the President of China Minsheng Bank was taken away by the Communist Party’s Central Commission for Discipline Inspection.
Triple Whammy of Chinese ugliness...
- Industrial Profits -8% YoY - worst on record
- GDP growth weakest since Q1 2009
And now, Chinese Manufacturing PMI prints contractionary 49.8...
As Goldman Sachs notes,
January official PMI data was weak. Most sub-components showed signs of cyclical slowdown. The most important sub-indexes (production and new orders) both clearly softened (production decreased to 51.7 from 52.2 in December, and new orders moderated to 50.2 from 50.4). The only exception was backlog of orders which inched up to 44.0 from 43.8. These signals are inconsistent with the flash reading of the HSBC manufacturing PMI which rebounded in January (its final reading is to be released tomorrow 9:45 AM).
The fall in the official PMI is consistent with our expectations that 1Q growth will likely be weak. As the official PMI is viewed as more important by the government, the likelihood of further loosening measures has increased further.
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And while the calls for rate cuts and broad-based government bailoyts will grow stronger from this - despite the governnment's insistence that they will not embark on a broad-based credit expansion program - it appears the transmission mechanism for any such release of money is coming under signficant scrutiny... (as Bloomberg reports)
China Minsheng Banking Corp. said its President Mao Xiaofeng resigned for personal reasons after Caixin magazine reported that authorities had taken him to assist with an investigation.
Mao, who was appointed president last August, didn’t have any disagreement with the board, the Beijing-based bank said in a statement to the Shanghai Stock Exchange Saturday. The board accepted Mao’s resignation and appointed Chairman Hong Qi as acting president, it said in the statement.
Minsheng has taken note of reports on Mao, whose situation has nothing to do with Minsheng’s operations, the lender said in a statement earlier today. Mao’s mobile was turned off when called by Bloomberg News today. He was taken away by the Communist Party’s Central Commission for Discipline Inspection and removed as party secretary by the banking regulator, according to Caixin.
Minsheng’s comment and the Caixin report come amid President Xi Jinping’s crackdown on graft, described by state media as the harshest since the republic’s founding in October 1949. The campaign has spanned businesses, the military, and officials such as Zhou Yongkang, a former member of the Politburo Standing Committee, and Ling Jihua, who was a top aide of retired president Hu Jintao.
Turning 43 this year, Mao is the youngest president of a listed Chinese bank, according to Caixin. The president of a Chinese lender is the equivalent of a chief executive officer at a U.S. bank.
Mao is a graduate of Harvard University, where he completed a masters degree in public administration in 2000, according to a company profile.
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<<What is perhaps most worrisome though is that with cries for more RRR cuts or government-sponsored largesse, the banking system has, it appears, become the new focus of the nation's corruption probes as the President of China Minsheng Bank was taken away by the Communist Party’s Central Commission for Discipline Inspection.>>
Tyler, how is this worrisome?
If the Chinese are successful at cracking down on corruption, the luxury housing market is dead.
It was corrupt Chinese and Russian oligarch buying all the $10,000,000+ apartments and homes
for cash that was keeping housing bubble inflated.
Y'know? I don't find that too worrisome either!
Harvard graduate, it says all we need to know.
President of China Minsheng Bank was taken away by the Communist Party’s Central Commission for Discipline Inspection.>>
Tyler, how is this worrisome?
You have no disciprine!
President of China Minsheng Bank was taken away by the Communist Party’s Central Commission for Discipline Inspection.
"Discipline Inspection," Is that doublespeak for waterboarding?
If I were a Chinese communist I'd open my nation to foreign investment and sell trinkets to the natives in other nations in order to amass vast wealth, to buy up large swaths of the world's natural resources, to build within my borders most of the world's modern factories and to construct nearly unfathomable infrastructure for myself. Then when, as inevitibly occurs, the world found itself teetering on the edge of a precipice I'd burn the whole fucking global economic order down. In a plausibly deniable way of course; perhaps via a nice internal matter that I simply failed to contain. After all, he who controls the means of production wins ... well, if one happens to be a communist anyway. And who knows, perhaps some of the capitalist dogs will see the light and willingly submit to the yoke of their new Chinese overlords. I'm sure I could deal with the rest in their extraordinarily weakened states.
Industrial Profits -8% YoY - worst on record
low oil prices are good?
Any of you bitchez fancy going with the 'Central Commission of the Communist Party' for a touch of 'Discipline Inspection'?
Bet you could only imagine what that cunt is going through now??
I like the fucking sound of it though, find him guilty more than likely and hang for the dog he is no-doubt, being a banker and all that he blood all over his hands.
;-)
Loom 101.
Good episode from Orwell 1984
Mao is the youngest president of a listed Chinese bank
Still young enough to be seduced by hookers and bro...
Gee, if you can’t trust your banker, who can you trust ?
//sarc
Another Ivy league educated banker. Says a lot.
Oh Roe!!!
As long as China's GDP per capita is less than Iraq's and Turkmenistan's it remains a backward 4th world country. Though 1+ billion slaves is an asset in some way.
their gdp per capita is less mainly because of huge population . Imagine if US had population of 1.3 billion how much gdp per capita yanks would have ?
You do the global bankster jumpty jump.
Honor thyself. Jump bankster jump.
What???thought the BRICS were awesome??!!??
China is the world's business buddy
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But has China learned from America's incarceration rates?
Oh please enough with your clickbaiting links .
Discipline Inspection.I like that terminology.That should happen in the United States.March all the crooked banksters into Rikers Island.Next stop...a little facility on the tip of Cuba.The reasons are simple,they are the latest high degree of national security danger to the Government of The United States.It's not a military danger it's economic and it's from within.
Mao, who was appointed president last August...
damn, that's harsh. the dude barely had time to sharpen his pencil. round up the usual suspects. [/captain renault]
First contractionary number since September 2012. Why is that date familiar? Oh yeah, later in September 2012 the Fed started QE3!
Regime in fighting, the show must go on!
China acting more 'capitalist' than USSA.
now showing more 'discipline' than USSA. so what if that Banker was an ally of the 'competition'. any banker in jail is a good thing unlike
the Moziloo-Corzination of our banking regulator/enforcement agencies.
So, what's wrong with investigating the doings of a banker again?
China is the world's business buddy
http://www.theglobeandmail.com/technology/science/honey-laundering-the-s...
hang em all
I thought it was clear the Chinese simply matched spending to get a GDP number of 7.5%. No rocket science needed for that, since GDP = spending, right? So why did they stop doing that? If only one could read their complex minds.