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Global Markets Turmoil After China Extends Currency War To 2nd Day - Devalues Yuan To 4 Year Lows
Chinese stocks opened lower, extending yesterday's losses, after The PBOC weakened its Yuan FIX dramatically for the 2nd consecutive day (from 6.1162 Monday to 6.2298 last night to 6.3306). Offshore Yuan fell another 9 handles against the USD after China closed but was hovering at 6.40 as the market opens (now at 11 hnadles weaker at 6.51). Bear in mind the utter devastation in Chinese credit markets that data showed occurred in July, it remains ironic that for the 3rd days in a row, Chinese margin debt balances grew. Before the real fun and games started, Chinese officials once again exclaimed that their data is real (denying any mismatches between GDP Deflator and CPI) as China CDS spiked to 2 year highs. US equity futures are tumbling, bonds bid, and gold bouncing off the initial jerk lower.
PBOC makes some comments (like last night's)...
- *PBOC SAYS NO ECONOMIC BASIS FOR YUAN'S CONSTANT DEVALUATION
- *PBOC SAYS YUAN WON'T CONTINUOUSLY DEVALUE
- *PBOC SAYS MOVE OF YUAN REFERENCE PRICE IS NORMAL
- *CHINA YUAN MECHANISM CHANGE MAKES FIXING RATES MORE REASONABLE
And then there is this (from Xinhua):
China's state-owned news 4-year lowsagency Xinhua said: "China is not waging a currency war; merely fixing a discrepancy."
"The central parity rate revision was designed to make the yuan more market-driven and in line with market expectations," it said in a comment piece published on its web site.
"The lower exchange rate was just a byproduct, not the goal."
The "one-off" adjustment has now become two... some context for the size of this move...
- *MNI: CHINA PBOC WED YUAN FIXING LOWEST SINCE OCT 11, 2012
Onshore Yuan breaks above 6.41 - trades to 4 years lows against the USD...
US markets are reacting dramatically...
US Treasury yields are collapsing...
Offshore Yuan is collapsing...
- *CHINA SETS YUAN REFERENCE RATE AT 6.3306 AGAINST U.S. DOLLAR
- *OFFSHORE YUAN TUMBLES 1.6% AFTER PBOC SETS FIXING LOWER
War is begun... (via Ransquawk)
Offshore Yuan has been leaking lower since China closed...
Yesterday was mixed with the broadest indices all ending in the red...
- *CHINA'S CSI 300 STOCK-INDEX FUTURES FALL 0.8% TO 3,982.8
- *CHINA FTSE A50 STOCK-INDEX FUTURES EXTEND LOSSES TO 2.6%
But...
- *SHANGHAI EXCHANGE MARGIN DEBT RISES FOR THIRD DAY (will they never learn?)
- *CHINA STATS OFFICIAL DENIES MISMATCH OF GDP DEFLATOR AND CPI (if you just keep saying evcentually everyone will believe)
GDP deflator index reflects prices of all final goods and services produced in China, much broader than that of CPI which only reflects consumer prices, Xu Xianchun, a deputy head at National Bureau of Statistics, writes in an article in People’s Daily.
We think they do protest too much.
China Credit Risk surged to 2 year highs...
* * *
There’s been plenty of talk about what China’s "unexpected" (to everyone but us, apparently) move to devalue the yuan will mean for the country’s flagging economy and for Beijing’s efforts to promote the internationalization of the renminbi via a bid for SDR inclusion, but as Chinese stocks open for trading on the "day after" (so to speak) we thought it worth previewing what the move might mean for Chinese equities.
We present the following breakdown from Goldman with the obvious caveat that, as Tuesday’s farcical data from the PBoC on loan growth in July made abundantly clear, when it comes to China’s equity markets, one must always factor in the plunge protection "national team."
* * *
From Goldman
Our framework to think about FX depreciation on equities - Three main transmission mechanisms
We try to assess the potential impact of RMB depreciation on the equity markets through various micro and macro channels. In general, we think the macro-to-market transmission mechanisms (especially an unexpected one as in this case) could be summarized as follows:
Translation exposure—Universally, offshore-listed Chinese companies’ book values and earnings (if CNY-denominated) will be deflated when they are being converted into HKD or USD for financial reporting purposes. Lower book values and earnings would increase the P/B and P/E ratios, effectively making Chinese companies less attractively valued to USD-based investors.
Transaction and economic exposure— Assuming other non-USD currencies did not move along with the CNY, export-oriented companies would likely benefit due to a more competitive exchange rate and a mostly RMB cost base.
Impact on equity risk premium (ERP)—Using the exchange rate as a policy tool to manage the cycle should render a higher level of domestic monetary policy independence for policymakers and should partly ease investor concern about further domestic imbalances (e.g. over-investment, overcapacity, debt buildup, etc). Barring an abrupt depreciation case, the higher FX flexibility may shore up investor confidence on China's short-term growth outlook, thereby helping to suppress the currently-high equity risk premium, which seems to have priced in significant macro and micro growth risks, in our view.
That said, the consequential uncertainty regarding capital outflows could offset some of the positives.
Impact on equities: Not all depreciations are created equal
The abovementioned transmission mechanisms do not take into account the magnitude of and the speed at which the depreciation may take place. We aim to better quantify the market ramifications based on the following hypothetical scenario:
- One-off reset for now, and moderate depreciation leading up to and post the SDR decision: Assuming the RMB doesn't significantly further depreciate by the end of this year, we believe the macro growth impact will be modest, and the ramifications will likely manifest primarily in the stock markets through the translation and transaction/ economic channels.
At the stock level, we identify stocks which may be disproportionately impacted from a few different angles and approaches:
1) GS/GH covered stocks for which our analysts see highest positive and negative earnings sensitivity to 1% of RMB depreciation vs. the USD
2) Export-oriented companies (not only GS covered names) which have high US revenue exposure
3) Stocks (not only GS covered names) which have relatively high USD-denominated debt and financial leverage
(ZH: And here's a look at the bigger picture based on historical episodes of depreciation):
* * *
And by the look of it, FX carry traders are expecting more volatility to remain the norm... Last time we saw this - in 2011, it too a year for vol to normalize...
- *VOLATILITY OF YUAN FIXING COULD RISE TEMPORARILY: PBOC
As mentioned earlier this devaluation is likely not a one-time event but rather the beginning of an ongoing and persistent depreciation of the CNY versus the USD. The embedded USD short position within the carry trades will begin to result in losses and margin calls as the USD appreciates versus the CNY, thus forcing investors to liquidate some of their positions. These trades, which took years to amass, could unwind abruptly and exert an influence of historic magnitude on markets and economies.
Charts: Bloomberg and Goldman Sachs
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It's as if millions of carry traders screamed out in terror...and were suddenly silenced.
+1977 I feel something terrible has happened.
Wait, they devalued the official peg range a second time in two days? God I must be slow, but that sure sounds like trouble to me.
It's the temporary weather.
That's about 3.5% devaluation in 2 days. Just under 2% yesterday, another bean-and-a-half today.
My God, I've never been so excited to see what happens on a Wednesday in a long time.
Wednesday Chinese time zone or Wednesday American time zone? Remember the HFT bots never sleep.
I think the Fed has taken so long jawboning that first fucking 1/4 point rate increase they've basically left the welcome mat out for every other county in the world to front-run them and devalue while the devaluing is good.
Now the Fed can't do it. And they also can't NOT do it.
Sounds like the financial version of Catch 22. Good luck with that. When the conned lose faith in the con there is usually hell to pay.
Cog, my friend, you just need one giant bell-ringer hit off the QE4 monetary crack pipe and you'll be feeling right as rain in no time.
Yup, everything is awesome. Let's all become Lego characters.
08.11 All the Financial Charts You’ll need Tonight to KNOW Disaster is about to HappenRelax; it's simply another Global "Gore" Warmning Effect. Might call their devaluation, "An Inconvenient Truth."
When's the suitcase nuke go off in Manhattan or New York ??????????
Must be getting close.
The Federal reserve surely isn't going to take the rap when there are so many nasty ISIS terrorists about.
read these two...most have probably already read Alisdair's article earlier hopefully.
http://www.zerohedge.com/news/2015-08-11/will-china-play-gold-card
And this one later from Holter:
http://sgtreport.com/2015/08/guest-post-for-those-with-ears-to-listen/#m...
here's what I posted earlier in Alisdair's article:
This revaluation would also bump phyzz silver up to nearly 21 bucks an ounce. Don't forget about silver, folks. And this would just be the start of the revaluation.
Once the Crimex is drained and goes bust the laws of true supply vs. demand will take on a whole new fucking meaning. Nobody is going to sell their phyzz for any amount of shitty fiat paper in any currency.
Price will go parabolic in a hurry and there will be no way for the Monkeys to fly out and hammer prices down with their bullshit paper derivatives in order to stop the surge.
Price will overshoot dramatcially and then come back down some after a while once some sort of equilibrium occurs and things settle down a bit. But where those prices settle at could still be multiples higher for silver and gold than where it is today.
By the time all fiat has been destroyed from the currency war and the dust settles...what price would you take for your phyzz? Who would want 50,000 dollars an ounce for gold if 50k couldn't even buy a shitty used car???
Remember the Weimar Germany chart as the Mark hyperinflated in terms of gold. The Germans sold gold for paper thinking they were rich. One day they had 100,000 Marks but in quick order 100,000 was worthless and gold sold for 500,000 then 1 Million, etc. Everyone who sold thought they were rich until the next day they were dirt poor again.
And they no longer had any gold or silver in their possession.
Meh! 25 fucking thousand tons of silver produced annually. You must be one of those clowns who think ASE sales will drive the market wild. Talk to me about industrial demand or shut up.
remember devaluation = inflation by printing
Too many variables to look at only currency levels and say what is goin' on, so to speak. Currency is the proverbial tip of the iceberg.
For siesmic impact, look yen-wards....
The yuan is a baby on the bloc, most of it's negative impact links are with the USSA alone. With most other nations, China is a net investor (now even in India, another cheap chinese shit dumping ground)....
When the Yen starts to really strengthen....Watch Out World, that is the ticking time-bomb the FED has been setting up all these years (back from the late 1800 incidentally, in case you did nto know their long planning time-lines, jews have been running JApan loooong time)....
Here's why "we're gonna need a much bigger boat..." and why China's problems and most of their solutios look an awful lot like the rest of those in the West (except perhaps Treasury accumulation replaced by gold accumulation).
http://econimica.blogspot.com/2015/08/the-chinese-mirage-no-different-than.html
Don't know why so much surprise. *This is China people* - they play long term chess!. The war is in for long time but it is at the economic phase still, with this move China & Brics basically shots a heavy bullets load in USSA exports - don't you get it?!
China future is invested 100% in Brics not paper $ - look at the events from this perspective and all becomes so easy to see.
I wonder if it was pure coincidence that the Fed seemed to back off of a rate hike and the next day the Chinese declare economic war. Hmmm maybe it was also a coincidence that the Fed restarted QE way back when and a ballistic missile was fired from outside LA harbor. Oops I forgot, that was an airplane contrail that just looked like it was going straight up when filmed from different locations.
I know the Chinese are allegedly long-term players and selling off USTs after a run-up in the dollar seemed to make sense. Until you consider that waiting until CNY devaluation and the subsequent drop in UST yields would make even more sense. Makes this sound more of a recent decision if not an outright hint of desperation.
Ok...I'll try it. But I'm not gonna inhale. (Snicker)
Don't bogart that Opium pipe, ya Debt Junkie Cog Murfukkur!
( passes )
Ssssssffffmmmmooooooooshp! Gak, hoark, sputter, cuk, giggle, snork, zzzzzzzzzzzzz...
Marc Faber is right. It's a currency circle jerk. Not a war
Are you gonna finish that hooker?
She finished him.
The Fed was NEVER going to raise rates in the first place. The "second half recovery" they've been predicting isn't going to happen, and the "strong" dollar (as measured among a falling basket of currencies) further prevents them from raising rates a whole quarter of a percent!
Savers will continue to be evicerated, borrowers will be rewarded, and whoever gets the free money first (TBTF banks) will continue to make billions. It makes me absolutely nauseous that prudence is being punished while profligacy is being rewarded.
The Fed is trapped - remember, a 1/4% increase in rates is equal to $45 billion in extra interest payments for the Federal government - in fact if rates merely normalized to 6% we'd see payments on the natonal debt rise to $1 TRILLION, and we can't have THAT, can we?
Rates will never normalize again in our lifetimes, barring a complete reset. But expect some blowhards in congress to demand tarriffs on Chinese goods before the week is out!
AntiSanta you might like this. This will be a world class, world wide depression, acknowledged as such by all before it's over.
The fed was probably never seriously going to raise rates. It's like an addict, it's never the right time, christmas is coming, it's johnny's birthday, i have a big conference coming up, i can't quit now. The truth is always that you never really considered it.
Totally right. I don't know what I want to do with the rest of my cash. It's either buy more metal, or hold USDs. Yellen just got kicked in his nuts.
Roger- I'm going way off-screen with this comment (and probably nobody on ZH is going to like it), but that's been my problem with Yellen from the start. She DOESN'T have Ben Bernanke's balls. She's a scared little rabbit STILL running Ben's playbook he left on the desk two years ago. I haven't seen a damned original thought out of her. If anything, she's shown a hesitancy and indecision he never did.
With Ben at the helm you knew he wasn't reluctant to print money at the first sign of trouble. Currency war? No problem, Ben was down for that. Declining growth? Nothing that printing more money can't fix.
Janet? I got a bad BAD feeling she's going to keep plowing ahead without recognizing that the ground has shifted under her feet. I just don't think she has the chops.
Janet doesn't call the shots, Ben didn't call the shots either. I'm not sure who exactly does call the shots but Janet will do as she's told.
Not sure it matters exactly who calls the shots as long as you remember they are banksters. When is the last time one of them suggested doing something to benefit the country during a crisis?
Goldman's Sack calls the shots. They consider input from their 'club' but in the end they are the boss. Goldman's Sack just bought 3 tons of gold phyzzz........ when Goldman's Sack buys pysical gold, you know something's going down and you better have gold. Goldman's Sack is a do as I do, not as I say leader!
I don't think you are too far off on your assessment of Yellen, NoDebt.
Yellen definitely doesn't have Ben's attitude and smugness if that is all it really amounted to.
Whether or not the 'Chair(wo)man' is in control or is just fronting for Dimon/Rothschilds/Satan: who fucking knows.
Maybe not even Ben.
For all we know the Greenspan or the Queen of England or an underground .MIL A.I. Computer Farm from the 1970's is running this shit-show.
I predict the Fed will not raise interest rates and IMHO, never had any intention of doing so. China did Yellen a favor.
CD, presuming that it is you from the heyday of ZH and not some sock puppet with your name, how do you do it? This place has collapsed; the thinkers are gone; the lovers of liberty are gone. ZH has come to be dominated by luddites, right wing populists, weird ass neo-bolsheviks, Klansmen, and other detritus. I am about done with it. How can it be that you are not?
I can't answer for NoDebt; but, I can for myself.
The last ones standing will at least have the full experience.
...& who knows: we might inherit the Earth, whatever that means, whatever is left.
A torch will be passed.
Someone has to carry it for that to happen.
Defiance. Cussedness. Revenge.
Maybe even Love..
It's a 3.4% move to 6.33. In 2011 it was about 7.00. In 2009 it was about 8.00. "Carnage"??? Somebody needs to take their meds.
Yeah....BUT at what gearing of LEVERAGE ?!
Timing is everything.
Yeah, but Roddy, there's really nothing go on now. In 2011 we had the S&P downgrade of US debt and the threat of a government shut-down that would have delayed payments on ALL government debt obligations. Sure, it seems laughably silly now, but in 2011 there were serious people taking the default on USTs very seriously.
We're supposedly in mid-recovery mode now. This is supposed to be onward and upward across the globe with China tractoring world GDP higher. A "crisis" in the heart of the growth story is the absolute LAST thing that the smartest guys in the room were expecting.
Here's a chart of USD:RMB over 10 years. Isn't it silly to characterize today's move as anything but a small blip?
http://www.xe.com/currencycharts/?from=USD&to=CNY&view=10Y
Show me another move in that chart that's anywhere close to that large a 2-day change and you'll make a believer out of me.
Even at that, this isn't really about the absolute (or relative) change in exhange rate as much as it is about exposing China's true motives and priorities. How they act when the chips are down. They're in deep weeds, they know it, and they're showing that their priority is still subsidizing exports much more than "currency stability" or any other high-minded ideal they pretend to care about.
They are a giant third world country and that's exactly how they're going to act for the forseeable future. Their dollar peg was always to give them a semblance of stability, gravitas and world influence. Now it's in tatters. Their bid to be included in the SDR? Severely jeopardized. Their credibility in world capital markets? Taking another hit. They're trudging the well-worn path of centrally-planned economies throughout world history.
"They are a giant third world country and that's exactly how they're going to act for the forseeable future. Their dollar peg was always to give them a semblance of stability, gravitas and world influence. Now it's in tatters. Their bid to be included in the SDR? Severely jeopardized. Their credibility in world capital markets? Taking another hit. They're trudging the well-worn path of centrally-planned economies throughout world history. "
THAT. 100% ALL OF IT.
Fucking nuovo-dictator wannabees in this season's Men's Warehouse suits.
Apple and Co. had better get their sweat-shop ops. to India pronto. The Chi-party is over.
You'd think the anniversary of bombing the shit out of Japan would make them pause. Stupid.
ALL that overcapacity can be gone in an afternoon.
The whores of Corporate America sold out the nation and I don't give a fuck about smoking their scab labor paradise.
"That's about 3.5% devaluation in 2 days. Just under 2% yesterday, another bean-and-a-half today.
My God, I've never been so excited to see what happens on a Wednesday in a long time. "
I wonder if they will hit it again tomorrow.
Ya think Jack Lew is gonna say anything if they do?
...What about Thursday?
The CSI-300 futures look like a financial crime scene in the making.
I can just about make out the head and shoulders pattern but there doesn't appear to be a head... only a jagged neckline. Perhaps ISIS is behind this... I wonder if they managed to shut down their bank accounts and access to the SWIFT system/ BIS yet...
UNLEASH THE BULLSHITER, UH, BULLARD OR ANY OF HIS CRONIES!!
Btw, GO HAWKS!!
It's contained!
Is it safe to say that China is the black swan event?
"It's transitory"
said the Ass Holes at the FED
When the IMF renegged [Lucie'd the ball from Peanut's toe. Again.] on China's scheduled inclusion into the Spec Drawing Rights Basket, the Chinese were all ready with their response. They do know how to analyse rationally and comprehensively and thus predict and plan years ahead.
Also, Edgar Snow remarked to a Chinese official pleading for help with their peoples' misery and starvation about 1930, " "Your country has a written history over 2,000 years old. My country [America] less than 200 years. And you expect me to give advice on what you should do?"
Old countries that have maintained their sovereignty without being swallowed whole, owe their survival to competent thinking, analysis and planning. Well beyong mere luck and guessing. The newbies, not so much.
I up voted you for your take on the IMF but the rest is wrong. China has a history that is closed to the rest of the World for eon's. The middle kingdom stayed much the same for 13 Centuries but then came the British Empire and Trade on the British terms. From then on, gradually, bit by bit China has been "Infected" with the Fractional reserve banking system it had to adopt as well as the Printing press. China has opened it borders and become infected with the same fatal illness that is killing the rest on the World.. A Credit boom with unsound money. Think of them as the Mayan's or Inca's when the Spanish infected them with VD small pox and other fatal illnesses. The solution is obvious but cannot be spoken because of the collapse in faith that would occur if the international trade and the race to the bottom were stopped and sound money reinstated. Bernanke would be strung up, Yellen, Hung, drawn and Quartered and that old Fart Greenspan would be pegged out for the street dogs to eviscerate.
So I will correct your last sentence.... All countries who wish to maintain sovereignty without being swallowed whole by deflation will owe their survival to Tariffs, Capital controls, self sufficiency and prudence.
NO ONE WINS A DISCOUNT WAR
its crazy what is happening.
Anyone sick of the media talking about a crash on the market, and how this Yuan valuation and the FED raising rates will make the market go to ZERO. Ummmm. yeah right!!
One Market analyst I listen to ==> http://www.bit.ly/1fMcakI his calls are rediculously accurate. He basically has a great knowledge on what is coming next and has been 99% right in this bull market.
Janet yellen can kiss my arse, every time they say they are gunna raise rates, something bad mysteriously comes up and she says “nope, ok, not yet” LOL. yes….that old chest nut!!! Its getting old now, do you not think??????
For now their game is get everyone short, TRAP THEM and then take us up higher!! yes that old chest nut. Fool me once, shame on you. Then….fool me twice SHAME ON ME!
So much for the talking head(s) on the boob tube saying that "the Fed is the tail that wags the Chinese dog."*
No MSG for you
* But I didn't ask you, Buckwheat.
Of interest to those who are NOT friends of Hillary:
http://hosted.ap.org/dynamic/stories/U/US_CLINTON_EMAILS?SITE=AP&SECTION...
The FBI is closing in...
While they are at it if they have some spare time they may want to check into this...
http://www.bollyn.com/public/Biggart_WTC6.jpg
Since HIllary admits that she already deleted 30,000 emails that were "personal," just how are we supposed to take any promise she makes that none of those erased emails weren't classified? In fact, I'm surprised that ANY classified emails are left, let alone four of them!
You simply CANNOT elect as president someone who takes such a lasseiz faire approach to security. Emails sent to her personal server weren't even encrypted by PGP, let alone any government encryption methods. Can you say "Somebody doesn't have a CLUE?" "Or care about the law much," since having classified into in your basement is pretty much in violation of so many federal statutes that if her last name weren't "Clinton" she'd be headed for a Federal penitentary pretty soon for the rest of her miserable life! Instead she's going to run basically unopposed for the Democratic ticket for the presidency, thanks to the billions her family has somehow managed to raise through "speaking fees." Really? No quid pro quo expected fot that sort of investment? Nobody is that stupid.
Good luck pulling the "female card" now that you no longer look like one!
Short BRICS / Long King Dollar. They're (BRICS) all in bad shape, maybe with even worse news to come.
But, get out of US$ as soon as ITS downturn starts. That might be your last time to get gold at a good price.
hmmmmmm.. Begun the currency war has.
No, stepped up the currency war has.
Buy low.. sell lower.
“My father once told me that respect for truth comes close to being the basis for all morality. 'Something cannot emerge from nothing,' he said. This is profound thinking if you understand how unstable 'the truth' can be.”
-- Frank Herbert, Dune
#41
Actually 'truth' is the ultimate example of pure relativity. We are trained/conditioned to conflate truth with 'facts' when in practice the two rarely if ever intersect.
Are facts ever true?
Probably been said," he who can destroy a thing, controls a thing."
Donkey meet Kong.
What isn't silenced are the screams of passion as Yellen and Lagarde scissor furiously to this news. Feel free to puke now.
Does the orange rub off?
I had to look that up .....'Scissor'
My learning has begun after I clean up the floor and chlorinate my mind.
Damn will I ever be normal again
What has been shall never be unseen.
Currency risk!?! What???? Who could have seen that coming????!!!!!
Who has pockets deep enough to bail out the CDS issuers this time around?
"Who has pockets deep enough to bail out the CDS issuers this time around? "
The TV asks: "What's in your wallet?"
free chopstyx
with all Yuan trades...
LMAO
Oh, stop. I need to get back to watching my re-runs of Friends, no need for this negative talk!
And so it begins.
Oh yes.....rest assured its ONLY beginning.......the gloves are off....a fight for survival now
do you think anyone had the temerity to interupt Obozo's steam room session with Reggie to break this news?
Funny how things really started to unravel in August of 2008. Deja Vu all over again? Damn.....how I love a good historical rhyme.
No worries, it's "contained."
I want to believe, I really do...
~Collapse Fatigued
NOT ONE TIME. War is on.
China is collapsing.
This is probably the best chance of Japan JPY collapse we could see this year.
Oops. As a reminder from a day ago:
*PBOC SAYS TODAY'S YUAN FIXING IS ONE-OFF ADJUSTMENT
Until the next one.
#41
They meant a one time SERIES of adjustments. I'm sure they'll be done by Friday.
"Oops. As a reminder from a day ago:
*PBOC SAYS TODAY'S YUAN FIXING IS ONE-OFF ADJUSTMENT "
The Mantra Of the Junky: Just ONE. Ohm. Just ONE. Ohm. Just ONE. Ohm. Just ONE. Oh, Mannnn...zzzzzzzzJussszzzt...
Off topic: WTF was that? 17 point dump in less than 6 minutes on the ES.
dat called Bang Ding Ow!
Wait till they go no bid and start dropping 17 points per tick.
PM's and US index futures DOWN! I'd expect PM's to bounce back. U.S. futures - NOPE !!!
"PM's and US index futures DOWN! I'd expect PM's to bounce back. U.S. futures - NOPE !!! "
Everything goes over the side.
The dishes, the flatscreen, the dog and cat, the kids, everything. Yeah. That too.
Whew! Not the Spam and the beans!
OH! OH! Looks like another leg down starting. There goes the dog, cat, and the toaster!
Lovey dear where is my Dow 16K cap?
-Thurston Howell III
Do they play those reruns or do you just have to be an old fart like me to get your reference?
You're not the only one. I think you have to be gray haired to get that reference...and I do. I'd prefer MaryAnn to the cap though.
PPT - man your battle stations! and bring your Sung Tzu cliff notes, gonna be a long night
The fact that "gold prices are up" must send shivers down the backs of the fed and Wall Street Bankers and fear in their souls.
and the bombing of the phony Gold and Silver paper prices begins....
take a look how the charts perfectly overlap yesterdays chart when the China news broke...
now, tell me, what fucking markets trades the same way at the same time contrary to news that should be sending them to the moon...
http://www.kitco.com/charts/livesilver.html
http://www.kitco.com/charts/livegold.html
DEATH TO THE MONEYCHANGERS
I don't think you have 'grasped' this concept yet. The weakening yuan will cause a strengthening in USD terms. Means gold in USD will go down (stronger dollar). This is the last part of the firesale. This is th deflation we have been waiting on for many, many years. My powder is dry and as soon as it gets crushed some more, I'm backing up the dumptruck. Literally.
Tyler, why is the Euro not moving? Is it the end of the dollar as we know it?
Other than currency traders on the wrong side, and other than economists who thought currency adjustments would fix the US-China trade imbalance, is anybody really hurt by this? Er, that is, anybody outside of China?
It sounds to me like the latest Chinese five year plan is suffering a four year setback.
It's a big lever.
You ever wonder what a London Whale looks like after being flung over the Thames by catapault?
Get a load of this shit!
Look at it this way. The iPhone in China either goes up by 2% tonight (sales will take a hit) or Apple's Chinese profits dive by 2%. Either way, AAPL eats it. Same goes for any other US corp trying to sell in China.
I Write Code,
This hurts the Chinese people way more than anyone else. They are trying to prop up their exports, which will make their imports more expensive, therefore hurting their consumers.
The US is a net importer, mainly of Chinese goods, so it will be good for our consumers.
On a macro level it is part of the deflationary spiral, which won't be good for anyone, but other than that your comment is accurate.
I wonder about that too. The US trades more with Canada than China, not much more overall, but it exports almost three times as much to Canada as it does to China, and the Canadian dollar has dropped about 25% in the last few years. That shoudl be many times more serious than a few percentage point drop in the yuan.
Good comment.
Go out to your garage or into your closet or go to your kitchen. Made in China everywhere.
Another way to look at it is the Engine room is now flooded on the Titanic
or
"When America sneezes the World catches a cold, when China Sneezes the Crematorium's are overflowing.
Canada, Australia and Brazil will be pushed through the door first
from the "as mentioned earlier" link:
It is estimated that carry trades involving USD loans invested in China could represent a quarter to a third of the BIS estimated $9 trillion global carry trade...
the double whammy for foreign investors in chinese equities.
Going to 13
I would hate to be in Greece. I would feel lost and irrelevant...
My Scotch has aged well, my popcorn is tasty and my Dow 16,000, 15,000, and 14,000 hats may be old, moldy and smelly, but I will clean them up in anticipation of the bloodletting that may occur if the PPT finally loses contol of the situation.
Get to work Kevin. Get to work Ms.Debtfire and earn your pay for a change..like the rest of us plebes and serfs!
Markets took a hit at 21:16, Tyler Durden posts more than a dozen text-overlayed images AND a synopsis at 21:21?
Blankfein's got the Tyler's working hard tonight.
buy the "turmoil" headline, another ZH bottom tick
Overheard yesterday: "Tomorrow -is another day."
After initial panic out of gold now it's going in the right direction!
You have to wonder who are these people that panicked OUT of gold at a time like this??????
Forced sellers. People who didn't want to sell but were forced to by their other bets going pear-shaped.
Yup.
2 X 4 to the groin -and then one to the head.
Sell. Everything. Get. Me. OUT.
They panicked out of paper gold. Gotta wonder who the fools are that are bidding paper gold back up.
Those desperate for safe harbor/safe hedge.
Those who don't trust The FED to hold the line anymore than the Chicoms now.
Oil is the real dangerous shit to watch.
A pop in Oil might be a direct preclusion to mobilization. You gas up the fuel convoys before you roll columns.
Tanks have lousy mileage, burn a fuck-load of petrol...
IF the trucks are topped off, and the ships sit low in the water...
https://www.yahoo.com/tech/s/hong-kong-police-arrest-5-uber-drivers-sear...
Not funny, stoploss hit on AUDCAD. Commie deadshits.
I really think the Fat Lady is singing this time. Wow. She has a lovely voice.
There is no fat lady singing, or getting ready to sing....this isn't a war...it's a coordinated strategy between the US and China. Next stop for Wall Street....To Infinity...AND BEYOND! - Buzz Lightyear.
We ried.
There was no way they would keep stable versus an appreciating dollar when the rest of the world has gone printing crazy. Someone is going to make a boatload on currency trades here, just wish it were me.
They learned this by watching US corporations claim one time charges.
Looks like production will be kicking off in China again real soon. Perhaps all those resources will not stay in storage for as long as thought. Now better than 50-50 we have seen the bottom in oil and other commodities. If you get a shot at cheap oil in the am, jump on it. Upgraded from an even 50-50 shot at 2 pm.
Wha.... Did Kissinger tell ISIL to stop selling stolen oil at $20 / barrel?
That bastard is still alive? Ah, so what. He and Le Duc Tho are headed for the ashbin of history.
This:
Perhaps all those resources will not stay in storage for as long as thought.
AND now the next crisis up on deck in China is that someone goes to open those commodity warehouses and finds them...
Empty....
Please pay closer attention.
Port warehouses were already found empty and the remainder promptly closed to inspection.
Phantom rehypothecated Copper is so 2010...
Is this where EVERYTHING starts to come unglued?
No but it might be where everyone starts to see that everything has come unglued.
Only The Squid would advise that "not all depreciations are created equal..."
Only when it pertains as to which muppets are being slain on a given day...
Breakout the popcorn and enjoy the show as these psycopaths destroy the world.
The DOW will end up on Wednesday.
We've seen this show before. Nothing a little printed money can't fix!
When things get tough they lie. A whopper that lasted only one day. Things must be very tough indeed. Glad I am in cash (if you don't count my gold stock).
M2 growth has outstripped reserves since 2011, now there are 37 Yuan of M2 for Every Dollar of Reserves
Can chi a bankrupt the IMF by forcing a currency debacle?
Fear is the mind-killer. Fear is the little-death that brings total obliteration. I will face my fear. I will permit it to pass over me and through me. And when my fear is gone I will turn and face fear's path, and only I will remain.
He who controls the Spice, controls the universe!
Without change something sleeps inside us, and seldom awakens. The sleeper must awaken.
sir, are you daring to hint, nay, suggest, the fed's reputation may be at risk, or so they think, and YOU tell us "they can't." how in the name of all that is disgusting, can you suggest they have any brain cells that work in conjunction with an accurate perception of the everyday reality lived by the average and bulk of americans? no sir they are dishonest, pseudo-intellectual political dupes, who care not for us, nor for the vast majority of americans. and any care they have for themselves, or their pseudo theories - monumentally failed for all of us - makes any effort they make now just more shit in their names for all history of this country - if we have one worth remembering after what they have done to us the mant-tobenefit only the few - as they are the ultimate tools of the scum in washington and on wall strret.
Turn it up high Reggie, I wanna Burn!
exert an influence of historic magnitude on markets and economies.
I thought it sounded awesome and finally the last line. Bingo. But then again, is Greece going to default?
I might have missed something but aren't the traders still locked out of some 40-50% of the China market? If so, can someone a bit more affluent in economics tell me what this adds to that. Never in the markets so I honestly don't know.
How do they actually devalue, is their a big red easy button they push or sumptin ???
Command & Control.
The same way that the US Government sets the price of stamps at the Post Office. They say so.
Money goes into and out of the China via .GOV clearing mechanism. Same as a window at the Post Office.
...Exchange ratio is what they tell you it is. They say so.
Or,
Try telling E-Trade or whoever that you disagree with the price being offered for a security as it is different from that which you paid...
Oh. You had a borrow? Well... We'll be open tomorrow, too...
LULZ.
China and US have a very large exchange account for their trade. China changed the quote for exchange.
I wonder how many US firms that have left big profits sitting in China to avoid paying those horrible awful unsufferable taxes to Uncle Sam just took it up the ass...
How much of GM's profit was...? Oh, my...
For every move there is a counte-move.
Weather in Bejing: Partly sunny with a chance of a 5,000 degree day.
You must mean a 5000 point move up on the Dow after Lloyd Blankfein's proctologist's press release about Lloyd's successful bowel movement.
HAHA
This is so god damn funny.
I love it.