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A Desperate China Cuts Key Policy Rates After Stock Market Crash; "It's Just Like 1987"
On May 10, China cut its benchmark lending rate for the third time since November. The move came just a few days after several brokerages tightened margin requirements, which triggered a 4% decline in Chinese stocks.
At the time, we noted that the PBoC had done something similar not even a month prior, when in April, the central bank slashed the RRR rate for the second time in 2015 after a decision by the CSRC to crackdown on brokerages’ use of umbrella trusts to skirt margin limits caused futures to crash.
Here’s what we said after each of those policy rate cuts: “We wonder then, if Beijing is taking its cues from stocks or from the economy.”
If there were still any doubts about what really matters to Beijing when it comes to setting policy rates, they were answered on Saturday when the PBoC cut both the benchmark rate (for the fourth time in eight months) and the RRR rate (for the third time this year) on the heels of the steep declines suffered by Chinese stocks last week.
Effective tomorrow, the one-year lending rate drops 25bps to 4.85% and some lenders will see RRR fall 50bps. As WSJ notes, this is the first time the PBoC has cute both the benchmark lending rate and the RRR rate on the same day since October of 2008, which should certainly tell you something about how dangerous Beijing thinks the current situation truly is. Here’s WSJ with more:
Analysts saw the PBOC’s moves as a reaction to the massive stock market decline. The near-20% decline in equity values in a matter of days—despite efforts to clamp down on margin lending—threatens to undermine recent progress on restoring growth momentum, said ING economist Tim Condon. “It’s difficult when you have a tiger by the tail. The stock market is clearly fueled by speculative excess,” he said.
It isn’t surprising that China cut interest rates, said HSBC economist Ma Xiaoping, but what was unexpected was that Beijing would put through both a cut in benchmark interest rates and a reduction in certain bank reserves at the same time. This reflects the central bank’s desire to stimulate the economy, fight deflationary pressure and respond to last week’s sharp market decline, she said.
Some analysts went so far as to liken the action by PBOC to that taken by the U.S. Federal Reserve following the infamous “Black Monday”—or Oct. 19, 1987, when stock markets around the world crashed. The Fed at the time encouraged banks to continue to lend to one another on their usual terms, which boosted investor confidence in the central bank’s ability to calm severe market downturns.
“It’s just like what the Fed did in 1987,” said Larry Hu, China economist at Macquarie Group Ltd., a Sydney-based investment bank. “The PBOC is trying to stabilize the market with the unprecedented easing moves.”
“The fact that this is announced now may have something to do with the plunge of the stock market on Friday. This may give the impression that monetary policy easing is somehow aimed at supporting the stock market, which is a pity,” Wang Tao, chief China economist at UBS Group AG told Bloomberg on Saturday.
So although Morgan Stanley — whose "don't buy this dip" call didn't do Chinese investors any favors on Friday — thinks Beijing can't "exert direct control over the stock market", it won't be for lack of trying because given that the Street is calling for several more policy rate cuts before the end of the year, this is likely only the beggining of what may end up being the most transparent attempt to use monetary policy to sustain an unsustainable equity bubble since... well, since the Fed-managed five-year S&P rally.
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One of many rate cuts that are coming as the world finally realizes that all the Central Bank fake statistics cannot cover declining employment everywhere. The 20% fall in the stock market has wiped off $2 trillion in Chinese wealth.
Every statistic about the US economy is now a lie as David Stockman looks at 5.5% unemployment:
At the present time, there are 210 million adult Americans between the ages of 16 and 68—to take a plausible measure of the potential work force. That amounts to 420 billion potential labor hours, if we accept the convention that all adults are at least theoretically capable of holding a full-time job (2,000 hours/year) and pulling their share of society’s need for production and work effort.
By contrast, during 2014 only 240 billion hours were actually supplied to the US economy, according to the BLS estimates. Technically, therefore, there were 180 billion unemployed labor hours, meaning that the real unemployment rate was 42.9%, not 5.5%!
Yes, we have to allow for non-working wives, students, the disabled, early retirees and coupon clippers. We also have drifters, grifters, welfare cheats, bums and people between jobs, enrolled in training programs, on sabbaticals and much else.
http://davidstockmanscontracorner.com/the-warren-buffett-economy-why-its...
"A Desperate China Cuts Key Policy Rates After Stock Market Crash"
rate-cutting is only one of the tools in the toolbox.
another tool is issuing 20 trillion dollars or yuan or whatever in order to purchase equities.
get busy, mister bankofchina.
hugs,
misteryellen
The candy man comes through with just-in-time delivery of financial dope. Once hooked one is too many and a thousand is not enough.
They'll be at ZIRP before they know it. Welcome to the unsustainable debt party, China.
The Greenspan Game
You can not stop panic selling with a rate cut, it has been tried over and over and never works. I think the private debt problem in China is even worse than the public debt problem in the US and despite the popular belief that they will prevail during the upcoming monetary shift, they may fare worse than the US.
Mrs. Cog and I are engaged in an ongoing discussion regarding this topic. There are several different levels from which to approach this subject, including who controls whom and why. But.....ultimately when (in my opinion) China also 'fails' they will have one ace in the hole. Their Gold, which will be used to rebuild CONfidence in their failed fiat.
What exactly will the West have to do likewise?
Salesmanship?
"Mrs. Cog and I are engaged in an ongoing discussion .."
coincidentally, missus cog and *I* have been engaged in an ongoing discussion as well
=:o
just yanking your chain, cog.
your posts are always appreciated.
I appreciate the humor and the support.
Doubleplusgood, comrad!
If China uses gold to back its currency, it will need to actually be convertible. A showcase full of shiny isn't going to impress anyone if it's locked. If it isn't locked, that shiny can dwindle fast when your debts are $28 trillion.
10000 tonnes is $0.6 trillion dollars at $2000 the troy ounce. China would need 200, 000 tonnes of gold to get close to covering its debts.
(Debtcrash is right about panics, btw, since no one getting murdered right now is going to jump back into the fray over a little small tinkering like 25 bps. It would have done wonders one week ago, but now there's blood in the water and people scared.)
"Would need 200,000 tonnes to get close to covering its debts"-----at current prices.
At $2000 actually.
Not current prices. Higher prices than here-to-fore. Raise it to $4000 and nothing really changes.
Why would China have to value its gold at $2000? As long as they wait until the entire global financial system melting down and blowing up what would stop them at saying that gold is worth $220K/oz, rather, that an ounce is worth $220K devalued USDs?
As long as they are building an alternate global system that does not rely on the dollar then this could work out fine for them and their partners. That is assuming we don't go ballistic (literally) over it. Yes, that is a very simplistic view of a complex and complicated scenario but the dollar is going to die one way or the other, that is not debatable.
I'd answer, but I'd rather just laugh at your suggestion that the dollar and the renminbi are somehow on different trajectories. In a thread like this.
The difference between whatever the China gold vaults hold and the American vaults hold is a speck in the oceans of liabilities.
Governments just don't set prices without lots and lots of takers willing to buy there. You aren't going to get 220K value in USD or CNY when people don't want it that much. Gold at $900. See you there.
Nukes? War? The US is exporting misery, who needs gold? The west will export weapons and everything else you need to suppress a revolution, while inciting revolutions where they see fit.
If they fail, they can still take you with them, they don't need any gold for that. Be careful what you wish for.
From what I gather China won't miraculously fix their fucked economy. They are as corrupt as everyone else and will continue stealing their own peoples money by inflating everything until it pops. The gold is just there to stay in power after the crash, not to help the citizens in any way.
People of this world need to get their pitchforks and start hanging the ruling elite, or stay forever enslaved. But they won't, the TVs are still working.
Your comment for this piece should be posted as the 'official reply', because you hit nearly everything dead-on.
+++++++
"What exactly will the West have to do likewise?"
Nuclear Bombs...1000's of them...
If you want to be the worlds "Super Power" and/or reserve currency, you don't need fiat backed by anything but military power...the USA has proven that for 30+ years now...
Aircraft carriers and rapid deployment forces experienced in urban combat.
Harkens back to the days of the Peacekeeper in the Old Wild West.
Dou you spell peace with an "I".
"What exactly will the West have to do likewise? "
Canned Sunshine tipped ICBMs. -So We have been told...
what a crappy article of yours. aNOTHER WISHFUL THINKER .
More data to show that China is not here to upset the Fiat Money Bankster Pig Trough.
They just want the same foodstuffs as American Banksters are taking.
I don't get it. What happened to the superior wisdom of the Chinese central planners? The air is being let out of the speculation bubble just like they wanted, but now they're panicking like running dog capitalists.
Same thing as all the others..."planned economies" failed in 1989 with the collapse of the Soviet Union.
The idea remains in full force of course...that our economic destiny can be "created" or "managed" for us.
This in a time when not even our own Government has a clue how to do that.
Talk about getting a lesson in "how to stretch a dollar" Governor Cockfag.
Much hidden wisdom in your statement, medes...
Indeed, one would have thought a 5000 year-old civilization would have become either wise enough (or clever enough) by now to foresee these events and do the right thing beforehand. But therein lies the paradox... With 5000 years of civilization - much like another 5000+ year-old civilization that seems to have a lock on the handles of transactionary and fiduciary cleverness, not to mention key positions of areas in & around governmental agencies that allow for this sort of trickery to metastasize beyond control, comes - in blunt terms, supreme cock-sureness of one's position and abilities. One need only look at the blog comments of Mr. B. Shalom since his departure, to observe the trait.
I do not understand the constant referring to 5,000 year old civilization as if there is some genetic transference of wisdom from centuries long past. If they chose an anarchist, a king, or a pope to be their leader would people still say the same thing? Instead they chose to copy the Soviet Union and the vast bottomless pit of political and economic wisdom the communists brought forth - not much history behind that experiment except failure.
This indicates to me that the Chinese have more likely passed down generations of stupidity and serfdom rather than anything of use to the common man.
The ancient Chinese Emperor's Court elites set the path for a millenium when they became an isolationistist theocracy, and deemed Confucuianism the state religion, delcared Budhism and Taoism foreign contaminants, and expunged idealistic Confucian theory and concentrated on materialitsic Confucian theory. The path led them to be conquered in 19th centuary like the quad amputeed drug addicted obese sluts that they had became. The Chinese Marxists rebranded themselves as Neo-Confucianists after the collpase of global communism and will suffer the same fate.
Amazingly the science denying, money and monopoly worshipping, non-pluralust supporting neo conservatives in the USA share the same traits.
From the ashes of teh latest business cylce low we must arise and modify the Constitution to include banks along with the church to be excluded from finacially support from the governement. It might not stop the next generational business cycle low but it beats the hell out thr status quo.
For crying out loud a bank that needs money from the goverment is not a %&! bank and should be put down not rescued.
"I do not understand the constant referring to 5,000 year old civilization"
Neither do I. People talk as if Chinese civilization descended in an unbroken line. Not true. The entire nation and most of central Asia was taken over by Mongols in the 13th century. For the affected nations it was a disaster on the scale of Hitler's Third Reich, with the difference that it lasted 200 years.
Following that you had a Manchurian invasion, invasion by Western Imperial powers, Invasion by Japan and finally the disaster of Communism.
China's modern history doesn't begin until 1911, and their influence on the world stage only emerged after the 1949 revolution and was heavily dependent on the USSR well into the 60's.
A more accurate description is of an assortment of dynasties that fought incessantly amongst themselves, were unable to resist foreign invasion, and only gained ascendancy after adopting Western political ideals in 1911 and Western political ideology (Marxism) in 1949.
I was in China in 1988, 10 years after Deng Xiaoping initiated the Four Modernizations, and I can tell you there wasn't much about the place that looked very modern. Pressed coal bricks for heating and cooking, old Russian trucks and taxis plus a few modern Japanese cars, all government owned. Even their bicycles were 30 years behind ours, mostly single gear with a step-back brake. Hell, some of their trains were still pulled by steam locomotives. It was like going back in time 50 years.
China owes it's modern development to one thing: The sell-out of Western nations by their political, banking and corporate elites. Without US, European and Japanese investment and technology transfer, they'd still be dragging their sorry asses through the 1930's and would probably have had another revolution that may well have split the nation in half.
FWIW, I wish China every success, and with their new alliance with Russia, perhaps they can pull it off. Still, the number of educated Chinese seeking to emigrate speaks to a different outcome, at least for the immediate future.
Levitating your own stock market is the fastest way to revive a flagging economy as the Fed has demonstrated since 2008.
Chinese stock market capitalization had gone up from $4 trillion to $10 trillion in the last 12 months. Now $2 trillion of that $6 trillion gain has evaporated and hence the desperation. China needs a few hundred Kevin Henrys.
More news on jobs today in UK even as official fake unemployment hits 5.5%:
Thousands of jobs lost in UK By Margot Miller27 June 2015
Thousands of workers are losing their jobs across all sectors of the UK economy.
The losses belie the latest figures, hailed a miracle achievement by Prime Minister David Cameron, registering unemployment as dropping to a seven-year low of 5.5 percent. The figures only register the growth in low-paid, part-time, temporary and zero-hours contract jobs as the government drives people into cheap-labour employment in welfare to work programmes.
https://www.wsws.org/en/articles/2015/06/27/jobs-j27.html
Sum ting wong
https://www.youtube.com/channel/UC24i0-R52E-Y4PHhsjLUbYg
"Sum ting wong"
Yeah, that never gets old.
Average hours worked per year by country . . .
http://www.forbes.com/sites/niallmccarthy/2015/04/21/these-countries-hav...
Of course, the flaw in Stockman's argument is that not every adult American is looking for a job. And there are a myriad of reasons why. In any event, the percentage working as a total of US population is in the middle of where its been for the last 25 years or so.
https://research.stlouisfed.org/fred2/graph/?g=1lur
what percentage of the population needs to work in orer to sustain;
a; themselves?
b; government tax revenues that are depended upon to support the nonworking?
Things are much more complex than can be illustrated in a single chart.
Most certainly they are. But the one chart is sufficient to dispense with Stockman's assertion. And here's a way of looking at the point you raised . . .
https://research.stlouisfed.org/fred2/graph/?g=1lvq
Federal transfer payments per worker. The amounts are expressed in constant 1947 dollars.
Same data expressed as a Y-o-Y percent change since 1980 . . .
https://research.stlouisfed.org/fred2/graph/?g=1lvs
Does this also include the considerable debt accumulated in the names of those who will hopefully still be working? I would suggest that if the real costs to sustain this ponzi were paid for through direct transfer payments from the actual earners, not placed in our national debt, not borrowed from supposed trust funds, not concealed with corporate and business taxes that add to the cost of everything we buy, there would have been a revolt years ago. Government, like business, spends a significant percentage of their budget, not on "product development and enhancement" but on marketing. Convincing us they have the answer, the better deal, the something for nothing. The only reason they are not selling us dog shit in glossy plastic wrappers is that they have calculated that the marketing costs could not be offset by the sales price. 50 years ago, who would have paid for bottled water?
All the graphs generated are paid for. This means that they must deliver a cost effective return.
So, everything is fine. Lets all go back to our regularly scheduled programming, place another order to buy APPL and relax. Everything will be as right as rain.
I'm certainly all for not adding it to the national debt and transitioning to more of a "pay as you go" system. The problem with that is 1) America could not support her thirst for empire nor her bloated FIRE economy, and 2) absent Federal expenditures on today's scale, unployment would skyrocket and with it social unrest.
https://research.stlouisfed.org/fred2/graph/?g=1lwc
Which means that the powers that be want the debt incurred and added to the pile.
"I'm certainly all for not adding it to the national debt and transitioning to more of a "pay as you go" system. The problem with that is 1) America could not support her thirst for empire nor her bloated FIRE economy, and 2) absent Federal expenditures on today's scale, unployment would skyrocket and with it social unrest. "
It would indeed work under a different, more 'traditional' administrative regime: Old Style Imperialism where conquered lands are unreservedly absorbed/colonized and plundered, and subject peoples forced to pay tributes to their conquerers perpetually. It is coproratism, soft hedgemony, nation building and multi-culturalism that have transformed imperilaism into a loss leader instead of a fountain of perpetual profit.
NO. -I am not endorsing imperialism of either administrative style; just pointing out that if the outcome of corporate/socialist imperialist escapades are sum losses for the conquering economic as opposed to the other form.
Remember when the US Citizenry were told that the oil wealth of Iraq would be plundered to pay for the subjugation of the country?
The US Government not only did not seize the old fields and tax the shit out of them to pay back the trillions that the war cost and use further extracted wealth to pay for services for the general US Citizenry, and grant the prime land/property in Iraq to the military men and contrators who subjugated the nation; hundreds of billions more were squandered on bogus elections and in recapitalizing Iraq's institions and enriching Iraqi oligarchs...
IF the US were indeed run in a more 'Roman' format Iraq would be paying tribute of hundreds of billions a year directly into the US Treasury and the only standing armed force in Iraq would be a very heavy handed US military administration...
The US Citizenry paid for the subjugation of Iraq and paid for those oil fields with treasure and blood. The oil fields should be a US Natonal Asset like the National Parks. Americans should be paying nickels a gallon for gasoline at the pump since they already paid for all of the goddamned fileds in Iraq up front...
Iraq should be a much safer place for everyone in it. In the US if 9 people are killed in a religious institution it is considered a crime of national signifigance and the Chief Administrator goes and sings at the funeral -and under a properly administered Pax Americana it would be the same in Iraq... THAT was the hearts and minds part that playing the failed soft-dick imperialism of putting corporate and 'multi-culturalist' interests first tragically lost instead of triumphantly won...
Is good thing they do not change how calculations of things like CPI and unemployment are made.
Combined, the wife and I work just under 40hrs a week..two part time jobs...BY CHOICE...donating 50hrs a week, to a job, so you can buy stuff you really don't need, that, in reality, just causes stress and unhappiness, is the "American Mental Disease".
Life is not all about "Work and Things"; despite what 'they' say...or try to make you believe..sadly most people don't realize this until they're old...and it hits them that they spent thier life, and health, "working" for not...
I understand how working at a job you hate can be demoralizing, but I wouldn't condemn work per-se. I spent 10 years in the trucking industry and loved every minute of it. 10-12 hour days were not a burden - I enjoyed being out on the road, in charge of the whole operation with no one breathing down my neck. I got to travel, meet lots of interesting people, see beautiful countryside and interesting industries. When it started getting old I just did something else. No regrets.
Friend of mine worked for the railroad all his life, as a brakeman, engineer, then running a heavy crane. It was his life and he loved it. Even after a motorcycle accident took one of his legs he still ran the crane, even though he was entitled to full disability benefits. After the crane became too much to handle he got the engineering dept. to modify a front loader for one-legged operation and spent his last years clearing snow in the Roger's Pass.
Even though we were paid well, neither of us cared much about the money as long as there was enough to keep on partying and enjoying life. The only real burden was showing up on Monday after a weekend of full-on fun, but that was a small price to pay for living life on your own terms and doing something you really enjoy.
If your only object in working is to make enough money to buy fancy stuff, then yeah... you're on the wrong path and it will eventually bite hard. OTOH, if you enjoy challenges and put your efforts into finding something you really like doing, the rest will fall into place (including, I should add, the right woman who'll appreciate you for who you are and won't try to change you).
Well I bought a some physical 2.5ozs gold and 100oz silver two days ago, just so I would have a little physical in my hands and not at the Perth Mint with those Certificates.
Also just got into to set some dry powder aside, the games a foot Watson.
So is it deflation before hyperinflation? Buy assets on cheap.
Buy assets on the cheap.
That is the game.
Deflate so assets are cheap. Inflate so you can sell for more. Money is the tool used to allow speculation of assets.
The ShadowStats Alternate Unemployment Rate for Aprile 2015 is 23.0%.
Yes but Shadowstats does not change the way these things are calculated to provide better propaganda so their numbers are invalid.
Well in China u already have a shitload of people trying to meet month end because of inflation. No deflation if u want to buy a flat or a decent meal. Those 2 trillions have never existed except for the already rich who levered the housing bubble in 2003-2010
Yeah, well, shit everywhere .... Then ?
Well, on the flip side . . .
"With $21 Trillion, China’s Savers Are Set to Change the World"http://www.bloomberg.com/news/articles/2015-06-25/with-21-trillion-china...
I need to call Dr. Sum Ting Wong.
Wi Tu Loh, may have an opinion also.
Yeah, but Ho Li Fuk always has the last word.
Yeah he called and left a message, "Rook out berow!"
Well after a 40% haircut with margin calls on 20% losses, they are down to 13 Trillion. LOL Their banks thank them for playing though.
and China's savers are comfortably nestled in the stawk market
China were too freaking stupid in allowing stock and housing markets to ramp up so quickly (like everyone else). they should have been exerting much pressure on them, otherwise you get this situation...too much money tied up, then lost in a bear market.
Let me be clear, there is no Fed equity market put.
William C. Dudley, NY Fed CEO
If the Fed ever speaks the truth, it is only by mistake.
OK, so China has cut rates in response to their stock market crash.... But what's the FED going to do when it happens here? They're fucked because they can't lower anymore.
BTW it doesn't seems like the China bubble has not been taken as seriously as a black swan contagion event like a possible Grexit, burst bond bubble, burst pension bubble, student loan bubble, or muni-bubbles.
The Fed will do what they do best.
Massage the numbers, following the Gov't statistical lead.
Gotta have more of the outliers on board though.
Can't have contrary thought breaking through the media fog.
dupe
Some interesting reading on a horrendously rainy Saturday morning,
along the economics for dummies line.
https://en.wikipedia.org/wiki/Ancient_economic_thought
https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=3&cad=rja&...
https://books.google.com/books?id=EdBEHD4XQ-0C&pg=PA59&lpg=PA59&dq=roman...
Sure they can! Negative numbers go to infinity too! MOAR, MOAR, MOAR!
The world and everything in it is constantly competing, some subtly and some violently, but all competing. I don't claim to understand the dynamics of all of these machinations but when push comes to shove and likely war, we are faced with determining who are our friends and who are our enemies and ultimately who should we fear the most.
When considering this at a national or cultural level we will try to judge our risks based upon politics or economics but I believe ideologies are far more important. Every military contest is a battle of resources, technological, financial, physical, population, but most importantly the willingness to both kill and die for their beliefs. Cultures with no strong beliefs will likely not represent much threat of resistance.
So, in that light, who should be the most feared?
A nation who puts image and public perception and the interests of a relative few ahead of victory. A nation who has wrought widespread destruction while demonstrating no specific agenda other than simple domination.
Or
A nation or culture who has very strong individual ideologies and motivations, one that has demonstrated that they will defy all odds to pursue their agenda, one that has demonstrated the will to slaughter millions, not of foreigners, but their own people, even those who share their ideology.
Would China deliberately collapse their own financial markets to destabilize the world? Would they do this in conjunction with other like minded interests? Fiercely nationalistic and a massive population dominated by young males. The huge buildup of all military forces. The alliance with Russia who has focused on developing missile technology to defeat western weaponry, while also pulling away from the west's financial domination.
Economics is the front line of war. Will Pearl Harbor come in a financial shit storm this time? And better still, is all of it being perpetrated by our own elite for their entertainment or devious greater agenda? Too many moving parts to know. Maybe too much coffee.
Interesting thoughts. But since all of the Chinese elites have moved assets to the U.S. and Canada, it is hard for me to imagine that they will cut off their nose to spite their face.
Plus once you start a brush fire in 80 MPH winds, you can't always control what gets burned.
The same goes for Russia. All of their wealth sits in Europe.
I would think that a financial collapse would first benefit those who hold property without debt, and a strong military to enforce those titles. I do not think any of these powers want to see the destruction of real assets beyond what is needed for effect. All of this seems to be about transfer of wealth and I'm not talking about bits of paper or even bitcoin. Real stuff. Land and buildings but also intellectual property like the INTERNET. China has already demonstrated their hold over it within China. They can control financial markets but basic information....the real asset. Power is control and power will decide who "owns" what.
I think we are seeing a financial armageddon coming. With any battle it is those willing to sacrifice the most who will likely win. Leadership will always sacrifice the lives of their people before their wealth and power, if their people are willing. I would not want to test that will with the Chinese or the Russians. the west is far too self absorbed to sacrifice anything for the good of any ideology. The virus of self absorption that progressives have implanted into us with the intention of weakening us has also made it near impossible to unify us into any meaningful collective, which leads me to believe that if this collective ideology is truly behind this destruction, then likely this about our defeat, not conversion. much as we see with the Muslim agenda, where conversion is only a bonus consideration of the terror of mass murder of the infidel...just as we saw in soviet and red China days of revolution.The rules stay the same. We just have to understand our position on the board.
Wealth accumulation by investing in listed equities is a a complete pipe dream for small investors. Nothing good ever comes of it.
There is nothing new about this.
All one needs to do is review Wall Street Speculation: It's Trick and It's Tragedies, written by Franklyn Keyes over 100 years ago.
There was never a casino built for the enrichment of its patrons. NEVER. Yet they are always full of those thinking they will get rich there.
It was explained to my why slots still payout in metal coins or tokens into a metal tray....to create the noise of WINNING!
Casinos have always recognized the need for apparent winners to keep the patrons coming in with hope in their eyes.
We don't all share the same religion but I do think we all believe in the power of "something for nothing". We fall for it every time.
You're exactly right. I notice the Mafia and corporate interests don't build casinos so they can play the games. Just as the money in Finance isn't made using one's own money to buy the stocks.
To come to a trading site and hear comments like this that the Market has been a Casino since over 100 years that is run by the Bugsy Siegels or Meyer Lanskys, makes you wonder WHY the American people believe in Capitalism and WS like they were the original Colt 44 and Winchester, straight shooting instruments of TRUTH and FREEDOM, that won the west.
If Americans are practical people who can tell Shite from Shine Holia, how come they bought into the Casino's irrational exuberance since the turn of the Last century and clamied the American Dream is like no other dream 'cos we have "capitalism".
If it wasn't capitalism then it was something else that created that dream.
Could it be the free land of the Amerindians and the free labour of the slave cotton pickers ? A huge continent that now has nothing more to offer 300 million over fat people?
The great American rise since 1865, when the US became a powerhouse united under one flag, had something to do with that. That is the impression we have from the other side of the pond.
Now you guys here at ZH have all gone anarchical and anti Market; 'cos this market belongs to Big Business who can't give a phuk about the people. This about-turn became even more radical when Reaganomics created the neo-liberal mantra that the Casino had only ONE GOD : the shareholder! And all decision making had to be in the framework of optimsing Market Capitalisation on a QUARTERLY REPORT BASIS. Bye Bye long term thinking. Hello speculation and asset ripping bigtime.
And then the market went bust under debt and fat cat shenanigans pumped on steroids.
So why not take back your country and kick these politicians out?
Either you are a bunch of marginal whackos who have lost faith in the model that now betrays you or you are delusional and totally out of touch with your country.
Take your pick. But your talk here has no head and no tail ! I am confused and also amused.
... makes you wonder WHY the American people believe in Capitalism ...
Propaganda, Television, stupid citizens. Need moar ? Lying politicians, Government bureaucrats, CNBC.
Your turn.
And yet, the pushers of the collective keep pushing the notion that what is killing us is capitalism, all while they have done everything in their power to make it not so, all to the effect we now see and all to be blamed on capitalism, when any fool can see it is anything but. It is some bastardized version that still carries the heading of "Capitalism" while operating with government puppet masters hand stuffed so far up its ass we can't even see the shoulder. As progressives continue to alter the fabric of (what we used to call) the market, the situation gets worse by the day. I would challenge any person to show me a true market economy that does not have some significant (or many) government interventions. It is laughable to keep seeing you lament our foolish faith in markets, like we are unaware of your progressive manipulations and corruption, while somehow believing we should have some epiphany to the glories of collectivism and a god like centrally commanded economy and society.
Who will you elect as YOUR God?
The Chinese Central Bank just announced they've "...ramped up production of fortune cookies."
The vast majority of fortune cookies are made in America.
http://www.fortunecookiemessage.com/
Fortune cookies .... Red Vines .... somehow, strangely satisfying ?
For China... 2015 is the year of the goat..how appropriate...
Capitalism = Economy .... Socialism = Aconomy !
Obama = Acornomy ! Tsirpas .... Esodomy !
Someone should do an interview with the Chinese women in the picture ZH ran last week, knitting while watching stock quotes on ancient CRT monitors. Their perspective would be interesting.
"“The tone from the state media is particularly helpful to retail investors like me, as I have a job to do and am pretty busy,” said Yao, 35. “China’s stock market is really different from other countries. The government surely has some measures to control the movement.”" - Yao Lina
"Different"...ROTFLMFAO!
WTF?
"Yao Lina, an accountant in Shanghai, is looking for clues in the state media before deciding whether to get back into stocks. She sold everything last week."
http://www.bloomberg.com/news/articles/2015-06-26/the-loudest-voice-in-c...
BTFD Banksters got hold of the printing press.China must not have a bootleg copy of the FEDs software.
Stockman's calculation of the percentage of potential hours worked (42.9%) actually reflects fairly closely the percentage of Americans who pay tax (50%).
So it would appear that Stockman is pretty much correct in his conclusions.
When your banana guy is giving you "hot" stock tips....it's time to sell.
China better get 'diggin' for more gold if they want the world to believe they're anywhere near labelling thier currency a 'non-fiat'. With all the labor supply, they merely need to direct them to the gold fields and put a shovel in their hand. If the Great Wall can be built with only manual labor, I have no doubt they can produce the gold they need in order to say "we're different, so THERE!"
It's WAY MORE THAN Gold....it's all about trust!
Do you TRUST that the Chinese will exchange that paper for gold upon YOUR demand?
Do you TRUST that they will protect your wealth...even in times of trouble...and not "re-appropriate" it for the "good of the state"?
Forget about gold or whatever is backing that currency...DO YOU TRUST THE CHINESE GOVERNMENT?
That is the question....and until the answer is "YES!", no amount of "gold backing" will make it the reserve currency.
PS> If you don't trust the Government, then how can you trust the numbers they put out about how much gold is backing that paper you're holding?
Good point. Needs to be said more around here.
A Desperate China Cuts Key Policy Rates After Stock Market Crash; "It's Just Like 1987"
Is it like 1987, or is it like 1929?
“It’s just like what the Fed did in 1987,” said Larry Hu, China economist at Macquarie Group Ltd., a Sydney-based investment bank. “The PBOC is trying to stabilize the market with the unprecedented easing moves.”
It's just like 1929, leading into a Great Depression.
Aircraft carriers and rapid deployment forces experienced in urban combat.
Harkens back to the days of the Peacekeeper in the Old Wild West.
Dou you spell peace with an "I".
Thing about China cutting rates, is that it INTENTIONALLY
supports the US$ by easing pressure on the FED to raise rates.
With Greece about to default, and the implications of a
massive unwinding in the derivatives market, China may
simply be doing its part... so to speak... to stabilize things.
Problem here, is that the bank(s) exposure was all transferred
to gov't. So how does the derivatives market unwind when
the "bag holders" are sovereign entities.
Good point.
Besides we can guess that CB engage in currency Degradation to offset Japan while keeping an eye on overall devaluation with all major central banks.
It is not a currency war so much as collaboration, collusion, and devaluation.
This is from wantchinatimes and they aren't exactly pro china (Taiwan publication)
http://www.wantchinatimes.com/news-subclass-cnt.aspx?cid=1102&MainCatID=...
Its states quite specifically the targeted areas. So whilst I was a bit puzzled by ZH's article initially (now why the F don't they just tell the brokers to loosen the margin accounts and lower their rates??? That will be targeted saving of the SO CALLED STOCK MARKET!), now its clear they also fell for the propaganda BS publications.
This is a new push people, not to save the stock market. China has bigger fish to fry than a poxy stock market correction.