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China Carnage Continues; Investors "Lost & Concerned" Despite PBOC Reassurance
“China’s market is so distorted, you can’t sell short very confidently and you can’t buy up very confidently either," warns one Hong Kong-based asset manager as despite massive "measures" and manipulation, Chinese stocks extend yesterday's stunning losses (CSI-300 -5% at the open, Shanghai -4.1%). As Bloomberg reports, investors “are concerned and lost," although government officials tried to claim the situation by explaining they will "continue efforts to stabilize market and investor sentiment, and prevent systemic risk." As stocks continued to fall, the market is summed up by the opposing views of one broker noting "China won't tolerate a worsening stock market, so those state-backed financial institutions may start buying," and another who warned "it's hard to start a new up move after a bubble bursts... I don't think they are able to prevent it falling."
The PBOC is desperate to reasure on the fundamentals backing the bubble:
- *PBOC SAYS POSITIVE CHANGES SHOWN IN ECONOMY
- *CHINA PBOC REITERATES TO PURSUE PRUDENT MONETARY POLICY IN 2H
- *PBOC TO KEEP SUPPORTING REAL ECONOMY DEVELOPMENT
- *PBOC TO CUT FINANCING COSTS
But even after that, the market keeps crashing...
- *CHINA'S CSI 300 STOCK-INDEX FUTURES FALL 4% TO 3,611..
- *CHINA SHANGHAI COMPOSITE SET TO OPEN DOWN 4.1% TO 3,573.14 and more...
BREAKING: Shanghai benchmark index down over 4% at opening; tech-focused ChiNext down 5%; over 200 stocks already down 10% limit at opening
— George Chen (@george_chen) July 28, 2015
Bloomberg quotes another analyst who perfectly sums up the world...
“The markets in China now are not really markets,” Donald Straszheim, head of China research at New York-based Evercore ISI, said on Bloomberg Television last week.
“They are government operations.”
But as one manager concluded, if state-run funds withdrew support to test whether shares could stabilize at current levels on their own, the resulting retreat may prompt the government to step back in immediately to prop up prices, said Hann, who oversees about $350 million. On the other hand, if policy makers are starting to unwind support measures to let the market play a bigger role, shares may have further to fall, he said.
And here is CNBC from June 10th proclaiming how awesome the Chinese Stocvk Bubble was...
Farmers are eschewing crops to plough their cash into the booming stock market, a journey by CNBC into the heart of rural China discovered
Six months ago, apple farmer Liu Jianguo invested $8,000 into the Shanghai Composite, a big chunk of his life savings.
"It's a lot easier to make money from stocks than farm work," he told CNBC's Eunice Yoon.
...
The investment craze in Chinese rural areas comes as more retail investors play a bigger role in the market, encouraged by the Shanghai Composite rally which has risen 110 percent since last November.
Moreover, the country's high degree of financial literacy is a key factor; China ranked first in the investment component of the MasterCard Financial Literary Index Report this April.
"China is just beginning to catch up. In the United States 50 percent of families are investing in stock markets [whereas] in China, it's less than 9 percent," said Uwe Parpart, MD and head of research at Reorient Financial Markets.
Maybe farmwork is better after all?
As we noted earlier, clearly, this is has the potential to exacerabte capital outflows given the pressure it could put on the yuan. Nevertheless, "stabilizing" the market is likely to take precedence in the short-term which is why you should expect the plunge protection headlines to come fast and furious. And sure enough, just moments ago:
- CHINA TO CONTINUE STABILIZING MARKET, SENTIMENT, PREVENT RISKS
- CHINA SEC. FIN. CORP. HASN’T EXITED STOCK MARKET: CHINA’S CSRC
"[The turmoil] has come to an end."
Umm no, not so much!
* * *
There is only one thing left...
China preparing internment camps for malicious sellers.
— zerohedge (@zerohedge) July 28, 2015
Charts: Bloomberg
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Just don't buy gold.........its a barbarous relic. BTW that is what really has the ponzi scared. Its the only currency threat they have.
actually, probably shouldn't be buying gold or commodities until this China thing has worked itself out
so far they have done everything wrong, this looks far from over
Ladies and gents, it's time to get the fuck outta the "market" until further notice. FYI: "further notice" is the announcement of full-on QE4 which damned well better be at least twice the size of QE3.
I have little faith in Yellen or the limping Obama administration to come to the rescue with helicopter drops of money like the last year of the GWB crew. They just don't have the chops.
The markets have been betting way too heavy on China driving everything and pulling the world up with it. When that illusion is shattered (roughly now), there's nowhere else left to turn that's big enough to matter.
When there's blood dripping down the walls, flies buzzing around and the house is screaming "get out!" at you, it's time to just leave the Amityville Horror and put it up for sale to the next starry-eyed 'investor'.
NoDebt no doubt long term you are right, just remember where that hot money is going to go. To the US market. I hope I am wrong but we may have a while of this before the pop.
Maybe, but you have little upside while you wait unless you're a super-wicked-smart day trader. If you're joe-blow index investor, forget it.
Yup, I can see QE4 happening now, NoDebt. The currency war is just starting to get good.
The trouble with Chinese Sheeple is an hour after they have been fleeced they want to be screwed again....
" it's a lot easier to make money in the stock market, than doing farm work"
Well, yes. Yes it is.
Priceless
GAWDDAMN MARICIOUS SHORT SHELLERS
Fuck all these mother fucking, fucking, fucks. China, the USSA, etc is all about government intervention now. In true capitalism, it is about RISK. If these cunts would get out of the way so RISK could be properly assigned and capital flow to the correct areas, we could get out of this mess (after some short term pain).
But no, these fucks want to rule the world and maintain their power. Time for the whole thing to go KaBoom and darn time for it to. Please, speed this up asswipes with more of your interventions.
They arrogantly believe in their own infallibility and their ability to run an infinitely complex system.
Just don't buy gold but,,,,, if you don't hurry up and buy gold at what ever the price at this time IMHO you may not get delivery EVER!. Its about having it, not just ordering andwaiting for it. Those open orders are not being filled for weeks now. What does that tell you?
It is going to be fun when all these US real state, bought by Chinese, is dumped into the market to cover leveraged positions... on the bright side, you may be able to buy a 2 bedroom house in San Francisco for 'only' half a million in a couple years.
there is no market there is only the pboc
Where's Beeks? Where in hell is Beeks?
"China is just beginning to catch up. In the United States 50 percent of families are investing in stock markets [whereas] in China, it's less than 9 percent,"
If true, the total number is roughly the same.
I just got downvoted for math.
There are melodious down voters out there! Beware!!!
Absolutely. There is nothing like a mellifluous, sweet sounding down vote!!
A downvote for Base, a downvote for 'Base, a downvote for 'Balth, etc...
SEE !
Now we're all red like China.
Somebody got a downvote for me, too?
C'mon you Fightclubbas! -PLEEEEEESE...
Down voting is now illegal. If you know someone who has down voted please report them to the authorities.
I logged in to down vote you, but I gotta go, someone is knocking at the door...
In the US the people 'invested' have used funds from bankrupt pensions as their $. Think about that. Young people think it's all a ponzi and are not investing. 93 million people are not working and obviously don't have means to invest. Those who have jobs are battling just to stay afloat. There is no investor - hence the CB interventions.
I think Tiger just ran through the Brady Bunch household and the house of cards is about to fall.
Fuck the TeeVee, they should have used the stamps to buy Gold ;)
Mom always said, don't play ball in the house.
“The markets in China now are not really markets,” Donald Straszheim, head of China research at New York-based Evercore ISI, said on Bloomberg Television last week. “They are government operations.”... "China won't tolerate a worsening stock market"...
And neither will the good ol' U.S. of A.'s Federal Reserve and EU/ECB either!
"Pot Calling Kettle" something other then "Blanc"!!!
How can the worlds central bankers and governments allow a free market to go down!!!!!
Oh the humanity!!
… humanity hasn’t held up any
better than Der Hindenburg.
Its like any other government ponzi...YOU'RE ONLY ALLOWED TO GO LONG ON IT!!!
Its the law! Kill all the short sellers!...ROTFLMAOFFFFFFF!!!
Short sellers bring rationality into the market BUT they also pump it when short covering. Who was complaining then??
Shiiit who are we gonna sell the million bucks crap shacks!?
Iranians?
you just think you're kidding. i remember the flood of iranians coming here back in the seventies.
We got, like, zero Iranian resaurants?
At least the Vietnamese brought good cuisine!
Iranians to good to cook for me us?
There's 3 Iranian restaurants within 40 minutes of where I live- great food.
I live in pastoral, rural Pennsylvania.
You must be somewhere in remote Utah, or somewhere else in the remote West.
Positive changes in economy?
Pretty lame...and Mr Chan knows it...
Prime HK retail rents in the high end Mainlander shopping districts are droppinglike stones. What does this tell you?
Hint, it has zero to do with Occupy Central.
Yoo Flung Dung!
I think this is leading to a fundamental breakdown in the Chinese supply chain, and it's not as if literal, actual Communism has the power to put the broken pieces back together again. 1 month, 2 months, 3 months, one way or another the consequences of that will pound the American economy fore to stern. I think this might really be it this time...
Maybe the US could lease the Chinese some FEMA camps to hold their illegal short sellers!
Who needs FEMA camps when you can just bill the condemned prisoner's family for the cost of the bullet?
farmwork is better
Farmwork is honest and rewarding. Honest and rewarding are better.
But QE infinity and BTFD is soooo much easier than farmwork.
There looks like there is no way this doesn't cross the Pacific this time. ASIAN PANIC 2.
Shame they don't have any good corn wiskey in China
Duty Free bitchz!
You don't like biaju?
50 percent of families are investing in stock markets [whereas] in China, it's less than 9 percent," said Uwe Parpart, MD and head of research at Reorient Financial Markets.
What kind of shit is this dude blowing?
Mass executions are certainly in order
China ranked first in the MasterCard financial literacy component.
Yup, they're going to get fucked, but good. MasterCard ranking you first cant be good for anyone but MasterCard.
And oh, "Priceless! "
Hand over the Algos for People's justice!
Despite trying to prop up the markets, they still fall. Echos of 1929...
It's your civil duty to short China and reshore your lost jobs :P
Time for the PBOC to set the printing presses to hyperdrive.
Thats a great idea!...down-voter internment camps bitchez!
Shock and awe, bitches!