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The Fate Of China's Monetary Policy Is In The Hoofs Of Pigs
It seems China's efforts to stabilize their economy stock market knows no bounds - nowhere better exemplified than the 5% spike in an hour last night after injecting $100bn into the sovereign (rescue) fund - and western observers applaud the efforts as if they are costlessly saving the world. However, there are costs to all this leveraged asset bubble creation (and maintenance) and, as China People's Daily reports, nowhere is that more evident than the surging price of pork (on if China's main CPI components). As Deutsche Bank warns, in the past 15 years, the PBoC has never cut interest rates when inflation was picking up (whether driven by food or more broad-based); so the fate of an 'easy money' inspired stock market bubble remains in the hands hoofs of pigs as the policy stance will be forced to turn from loosening to neutral in Q4 as inflation rises.
Just keep pumping money in right?
Well there are consequences... (via China People's Daily)
The price of pork in China has been rising for a couple of months now, with a new uplift record in 3 years. According to the National Bureau of Statistics (NBS), starting in March, the price of pork has been rising for 4 months with a total of a 5.7 yuan rise. In China, the price on pork is closely related to the CPI (Consumer Price Index). Experts interpret that the price of pork will keep on rising and drive the rise of CPI at the same time. Consequently, the CPI of the latter half of the year is expected to be a little higher than the first half of the year, but there is no strong sign of inflation.
Statistics of NBS show that from March 18 to July 20, the price of pork has risen almost 50 percent. The current price on pork ranks the highest since the year of 2012. Based on previous experience, the price on pork usually would have an "outburst" every 2 to 3 years. The last "pork cycle" happened during June 2010 to June 2011. It seems like a new round of the “pork cycle” is around the corner. Because of being under the oversupply for a long period of time, many small and medium-sized farmers' quit their jobs- a major driver of appreciation.
In China, the price of pork is one of the main components of the CPI. In 2010, the rise in the price of pork and vegetables was taken as the dominant factor that caused the rise of CPI in the fourth quarter.
And, as Deutsche's Jim Reid notes, there are actions after those consequences...
Yesterday our economics team in China highlighted the recent surge in pork prices for the country in recent weeks. They noted that having stayed negative for 14 consecutive months since the beginning of 2014 (averaging -4.2% in the time), the yoy growth of pork prices turned positive in March (+2%) and averaged nearly 7% in Q2 (8.3% in April, 5.3% in May and 7.0% in June). Pork prices have typically been the driving force for CPI in past cycles and they expect prices to remain on the rise for the next 6 to 12 months, reinforcing their view that CPI will be on an upward trend in H2.
Our colleagues also point that in the past 15 years, the PBoC has never cut interest rates when inflation was picking up (whether driven by food or more broad-based) and so believe that this could constrain the room for further easing beyond one cut (and one further RRR cut) in Q3 this year.
They then expect the policy stance to turn from loosening to neutral in Q4 as inflation rises and growth picks up slightly.
Furthermore, considering all factors, we believe recent development raises the probability for the government to cut growth target for 2016 to 6.5% from 7%.
* * *
So, simply put, the fate of China's economy, stock market, and monetary policy is in the hands of pigs (the porcine type, not the humane type)... just as it forced PBoC's hand in 2011... so be careful what you wish for.
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Literally...
OK....the the pigs just ran into the sea and drowsed themselves.
Is that bad?
I thought they always ended up in their rivers?
That must be some tide to flush 'em up river that far!
Its name is Legion, for they are many
A pig in every pot!!!
Pigs have been at the centre of Chinese culture, cuisine and family life for thousands of years. Pork is the country’s essential meat. In Mandarin the word for “meat” and “pork” are the same. The character for “family” is a pig under a roof. The pig is one of the 12 signs of the Chinese zodiac: those born in that year are said to be diligent, sympathetic and generous. Pigs signify prosperity, fertility and virility. Poems, stories and songs celebrate them. Miniature clay pigs have been found in graves from the Han Dynasty (206BC-220AD). Historians think people in southern China were the first in the world to domesticate wild boars, 10,000 years ago.
The Chinese eat so much pork that when its price goes up, the cost of other things rises, too. For the Communist Party, therefore, keeping affordable meat on the table is vital, not least for the stability of the economy. In 2007, for example, an estimated 45m pigs died in China from “blue ear pig disease”. Pork prices rocketed; the annual rate of increase of the consumer price index (sometimes known as the “consumer pig index” because of the creature’s prominent role in it) hit a ten-year high. Panic buying ensued. There were reports of customers being injured in a crush on a supermarket escalator when rushing to buy cheap chilled pork in Guangzhou, and a general pork-buying frenzy across China. Imports doubled.
http://www.economist.com/news/christmas-specials/21636507-chinas-insatia...
Pigs are actually very intelligent animals. They know when they're fucked and so they committed mass suicide by drowning themselves in rivers all over China a few years back.
The future craze will be "Long Pork"
China bougjt Smithfield last year so they were already frontrunning this development.
Well US monetary policy is certainly in the hands of pigs.
Pigs in Space: https://www.youtube.com/watch?v=8cq-PvPD8FQ
the sovereign wealth fund that got the $100bn funding and the stock market rescue fund are two different funds
they already created their stock rescue fund, this is not that.
two different issues here, you are mixing shit up Tylers
they'll just take a page from Americas reporting agencies, and take rise in food, housing, and transportation, out of the cpi column , and add it to gdp column, all fixed.
What's the old saying? I got my head in the freezer and my ass in the oven and the temperature is just fine.
Without my bacon sandwiches, I'm fucked. Just plain fucked. HELP!!
Try a BLT minus the B and the L. Just tomatoes, sliced thin, mayo, little salt and pepper and if you eat cheese, a slice of Swiss on top. That's pretty much all I eat from late July to late August when the tomatoes in the garden are coming in.
Don't try this with store bought tomatoes that are red on the outside and green on the inside. You need them ripe all the way though. Grow them yourself or get them at a local market.
+1 for home grown Mater Sammich!
Actually, usable benchmarks.
$100 b over night = 5%
$80 b over month = 5% (general QE)
Looks like a better, more effective use of 0 sand 1s to me.
(Until tomorrow's open)
I am sure the zionists are playing with the chinese markets, as well as the pork markets
When I was a child and old enough to figure some things out by myself[?],... I asked my mother why she always mentioned the"1929 Great Depression" to my father, when money became an issue!
"Remember the Great Depression?!?", was her battle-cry. Period!!!
Her parents had money, as did my fathers, but were at best middle-class, not as high-up the USSA caste?system as dear ole mom's.
Her parents lost everything dur[in]g the 'Great`Depression. Needless to say, the same fate had befallen my fathers' parents. Things were bad as my mother spoke of the devastation, and mental/ physical sacrifices. How could her parents become so foolish... so fucking` greedy? Her future was just flushed down the great 'Capitalist' rabbit-hole toilet! As far as my father was concerned, it was auto-pilot full-throttle survivalist`mode, taking no survivors on a slippery slope to success!?!
"Dog eat Dog"!
Both my parents and millions of americans were caught in the 'China Syndrome of fall?2015', way back in 1929. Surreal isn't it...[?]
What brought the USSA out of the 'Great Depression' was WWII. Period! The wealthy never felt its wrath, angst`ism, or cruelty! That's the way its supposed to worked since the beginning of capitalism. The wealthy will just start a war that the newly minted poor-man will fight. Simple as that... so, get on the ladder-runs of finding wealth?
FDR and Truman [1943-52] were afraid of a full-blown shift to 'communism',... a resurgence, starting with socialism as the straight-and-narrow-path to a fascist dictatorship. Always perdicated upon a subtle 'Marxist Doctrine'?!?
FDR, and especially Truman saw the dangers and nipped it in the bud. Still that really never was answered, until the soviets dissolved on 12/26/91[now it's our turn?]! Think!
Remember the 'Red Scare'? It was very real, and had many a grass-roots fomenting the impracticalities of capitalism. It was a serious cross-road in american ideology and culture, not to say future, with soliloguies on my mind?
China currently is experiencing my parents '1929' nightmare [moment]. My parents never ever invested in the stock market. Never again -- fool me once shame on you,... fool me twice, shame on me! Never-again in their life-tyme. Period!
But CD's did fit my parents risk criteria as did good ole-fashion compound-interest. [today CD's pay shit, and compound-interst has been banned from the investopia dictionary]
Summary: The Chinese people will blame American-Capitalism imported into the country by shady bureaucrats whom were of the Chiang Kai-shek proto-type`ilk,way back when China was but an infant on the NWO stage. This has probably/ perhaps be done by design, asecret agenda with plausible-deniability, giving the Chinese leaders a freehand watch-and-observe in determining their future poitical priorities. The outcome will turn [jmo] communist China inward and into a more conservative, pragmatic, and realpolitik cautious super-power approach regarding the blindfolded`following of quick-riches, western 'FreeMarkets' capitalism. Surely, the USSA is becomming toast as they've expanded 3600 far to far. Just as the USSR did during the period from 1950-1988.
jmo
Note: This wasn't the fault`line cracking by a long shot. It was simply, Greed! The same shit that warp'd my grandparents minds ~ 85 years hense! And all of america falling over each other on dirt pave'd roads glittering with gold?!?