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Yuan Strengthens Most Since March, China Unveils New Bailout Source After Rescue Fund Runs Out Of Fire-Power
Update: China readies new bailout mechanism - pooling CNY2 Trillion of Pension funds for "investment"
Straight from Japan's playbook...
- *CHINA TO START PENSION FUNDS INVESTMENT AFTER FUNDS POOLED: MOF
- *CHINA DRAFTING RULES ON POOLING, TRANSFERRING PENSION FUNDS: YU
- *ABOUT 2T YUAN FROM CHINA PENSION FUNDS CAN BE INVESTED: YU
- *CHINA CAN ENSURE STABLE LONG TERM RETURN ON PENSION FUNDS: YU
- *CHINA TO CAP RISK EXPOSURE IN PENSION FUNDS INVESTMENT: YU
- *CHINA FINANCE MINISTRY OFFICIAL YU WEIPING COMMENTS AT BRIEFING
How can we be so positive that this is another bailout - simple!
- *CHINA PENSION FUNDS' ROLE IS NOT TO RESCUE STOCK MARKET: YU
They denied it was! Of course even more worrying - is this a Greece-esque pooling of pension funds in a desperate grab for cash across the nation?
We are sure that will work out great!!
* * *
As we detailed earlier...
A busy night in AsiaPac before China even opens. Vietnam had a failed bond auction, Japanese data was mixed (retail sales good, household spending bad, CPI just right), Moody's downgrades China growth (surprise!), China re-blames US for global market rout, and then the big one hits - China's bailout fund needs more money (applies for more loans from banks) - in other words - The PBOC just got a margin call. China margin debt balance fell for 8th straight day (although the short-selling balance picked up to 1-week highs). China unveiled some economic reforms - lifting tax exemption and foreign real estate investment rules. PBOC fixesds the Yuan 0.15% stronger - most since March, but even with last night's epic intervention, SHCOMP looks set for its worst week since Lehman.
Vietnam is in trouble...
- *VIETNAM FAILS TO SELL ANY OF 3T DONG BONDS OFFERED AUG. 27
The first of many failed auctions for EM we suspect.
- But Some good news:
- *VIETNAM TO RELEASE 18,500 PRISONERS ON 70TH NATIONAL DAY
* * *
Japanese data was mixed,..
- *JAPAN JULY OVERALL CONSUMER PRICES RISE 0.2% Y/Y (in line)
- *JAPAN JULY RETAIL SALES RISE 1.6% Y/Y (better than expedted)
- *JAPAN JULY HOUSEHOLD SPENDING FELL 0.2% Y/Y (much worse than expedted rise)
So Goldilocks - enough to keep BoJ in the game (as Reuters reports)
Japan's core consumer inflation was flat in the year to July and household spending unexpectedly fell, casting deeper doubt on the central bank's forecast that a solid economic recovery will help accelerate inflation to its 2 percent target.
While the Bank of Japan has said it will look through the effect of slumping oil costs on inflation, the weak figures will keep it under pressure to expand its massive stimulus programme.
Separate data showed household spending fell 0.2 percent in the year to July, confounding a median market forecast for a 1.3 percent rise and reinforcing concerns about the strength of Japan's recovery.
And then there's China...
Before we get started, we thought the following comparison of two stock indices today was in order... one is from a totally manipulated market that proclaims itself 'open' and 'free' with nothing to fear because "the underlying economy is doing great"... and the other is China...
Notice how the ramp was almost identical in style also - an initial burst, modst pull back, then big push, then rest, then final surge into close
But then again we already explained how past is prologue in this Nasdaq vs SHCOMP world.
And remember - it's not China's fault...
- *CHINA STOCK ROUT NOT THE REASON FOR GLOBAL MKT PLUNGE:SEC. NEWS
And then Moody's did the unpossible...
- *MOODY'S CUTS CHINA '16 GDP GROWTH FORECAST TO 6.3% FROM 6.5%
But the biggest news is...
- *CHINA'S RESCUE FUND APPLIES FOR MORE LOANS FROM BANKS: CAIXIN
- China Securities Finance may have applied for 1.4 trillion yuan ($219 billion) of borrowing in the interbank market, Caixin reported, citing unidentified bank officials. The government should adopt a proactive fiscal policy and further ease monetary policy, the Economic Daily wrote in a front-page commentary.
Which means the bailout fund needs a bailout after blowing its load last night.
Deleveraging continues:
- *SHANGHAI MARGIN DEBT BALANCE FALLS FOR EIGHTH STRAIGHT DAY
- *SHANGHAI MARGIN DEBT BALANCE FALLS TO LOWEST IN EIGHT MONTHS
Though we note that the short-selling balance rose to one-week highs.
Even with last night's epic intervention, Chinese stocks look set for the worst week since Lehman...
Although they are up at the open...extending gains from the US session...
- *FTSE CHINA A50 SEPT. FUTURES RISE 1.7%
But are fading off early highs.
And in what appears another reform aimed at improving the economy, China lifts some restrictions...
China's central tax authority has published a list of tax breaks for which qualifying businesses and other enterprises will no longer be required to seek prior approval to enjoy.
And...
The mainland has relaxed foreign investment restrictions in its once-sizzling real estate market as worries mount on capital flight in the wake of a weakening yuan and slowing economic growth.
Six governing ministries, including the central bank and the commerce ministry, issued a statement scrapping previous rules that required foreign property investors to pay the full amount of registered capital for their mainland entities to mainland authorities before borrowing any loans or applying for foreign exchange transactions.
"The move seems to be aimed at discouraging capital outflow after the devaluation of the yuan," said Alan Chiang, head of residential in the Greater China region for global property consultancy DTZ.
Which we are sure will not be taken advantage of.
Finally The Yuan - which remember is not being devalued - was fixed 0.15% stronger...
- *CHINA SETS YUAN REFERENCE RATE AT 6.3986 AGAINST U.S. DOLLAR
- *CHINA RAISES YUAN FIXING MOST SINCE MARCH
Problems continue to mount for the Chinese economy...
- *CHINA JULY INDUSTRIAL COMPANIES' PROFIT FALLS 2.9% Y/Y
After a 0.3% drop in June, it's getting worse.
* * *
Charts: Bloomberg
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I don't see the problem. The Fed can just buy them all back, no?
A leaking Dong?
I did not read the article.
Is this related to that gay dude that shot up the news crew?
Yes, let's all have a good laugh that Vietnam has a currecy named after your cock. Very funny.
Did anyone happen to notice that they failed so sell any of their offered bonds? The key word being 'any'. 'Any' means NONE that were on offer were sold. That is a really REALLY failed auction. If the US Treasury failed an auction in such a manner no stock market in the world would open the next day and there would instantaneous and complete collapse of the entire world financial system.
Not that that could ever happen here. Surely not.
Do crickets make the same sound in Vietnam?
at least they would fry the crickets up and head for lunch.
Yeah, noticed that, and it's getting ready to happen in a lot of countries. Living within your means is about to make a big comeback.....
I've come to the conclusion that it's more about living within OTHER'S means. Yes, you can debt-enslave entire countries, but you have to know the limits of the productivity you can get out of those slaves.
For example: the cost of Germany's debt enslavement of Greece was too high. They paid too much for those slaves and now it's all backing up on them because they can't get nearly enough out of them to cover what they put into enslaving them.
The EU I'm keeping a close eye on since there a lot of grumbling and Germany is in the process of pissing everybody off, all at once......
"you can debt-enslave entire countries, but you have to know the limits of the productivity you can get out of those slaves. "
You may have just defined one of the immutable laws of imperialism.
That one is going into the little book my publisher cringes at reading excerpts from.
+1 National Holiday
We're going to find out in due course just what the ~real~ value of those $UST's are. It's coming. And something tells me that the smarmy types who cackle incessantly of the 'value', 'safety', and 'deep liquidity' of U.S. Treasury instruments, are going to get it 'Long & Hard' in multiple orifices.
Dong leaks lower? Yeah, I can relate. I just attribute it to getting older.
In all likelihood, they will be FORCED to buy them back. Which is why I said last night that QE4 is a lock. I later amended that to say that I'd be surprised if the Fed wasn't already leaning into this Chinese Firesale of USTs through their intermediaries- Citadel and other 3rd parties (other central banks across the globe).
Long Dong.
It's a Big investment.
Somewhere, Clarence Thomas is stirring, firing up the Scottrade account.
'BLICS'...
China is providing the rate hike for them.
They only have to buy enough to guide the long end up to the targeted depth of our collective assholes.
Glad everything's fixed now. Dow +1000 tomorrow!
Was today’s Hillary news too much for CNN to handle?http://tinyurl.com/q3oyzct
C'mon Janet! 7 years at ZERO!
0.25%! I dare you! Are you YELLOW!?!?
Hahaha. That made me laugh.
Maybe it's the vodka? Surely it's the vodka. So tired of The Onion taking over my ZH.
Thanks for loaning me the donger....
https://m.youtube.com/watch?v=FTBL1BhSJCo
When there's no more go-go in the mo-jo, it's time to go, bro.
I'd be more concerned with Chinese trade than I would with Chinese money, Zeros.
China has better trade deals than the US, and no one says a word?
That's fucked up.
"Dong leaks lower". Damn, sorry. I know a doctor who has a fix for that.
A shot of tetracycline would knock that out.
You can get agricultural grade terranicklyne at Tractor Supply.
(This is not meant to be a substitute for medical advise. Only a shameless plug for Tractor Supply.)
I am no financial expert, but the dong leaking lower must be a Hindenburg Omen or something.
Or some kind of lethal "DEATH CROSS"
If long Dong has no buyers than at the very least we know that horny unsightly bitches are dead broke, that or something is wrong with long Dong.
A soft Dong does not leave me feeling Zloty.
I ran out of Dongs.
I have a strong feeling this will be a very interesting Friday in the financial "markets" across the globe. Let the fireworks begin.
We're gona need a bigger bazooka.
Ouch China Industrial profits for July -2.9% prev -0.3%. Brakes have been slammed on.
Interesting to see in that chart that the Shanghai market, about whose great historic bubble the western press is incessantly moaning, hasn't even reached its 2007 highs.
Yet the Nasdaq is a multiple of what it was then and our markets capitalize USA Inc. at a substantially higher multiple of GDP than the chinese equivalent.
So why do we keep talking about China's problems?
+100 because the sheeple must not find out the real truth. Sadly they are going to find out soon enough anyway. It's almost over.
@ZoroAustrian : very well observed.
China might well be in sharp focus right now but folk should really do look at the indicies like you have and ask who is trying to fool here.
Today, even after the correction of the past few days, Nasdaq and DOW are at mutliples today of what they were at in Spring 2007.
I'm having difficulty with this post. Are things fixesds?
No Dong jokes .... Monedas wasn´t fooled .... by such a corny set-up !
You misspelled your own name there, sparky.
28 August 2015, (Moody's)
https://www.moodys.com/research/Moodys-downgrades-AIG-Taiwans-rating-to-A3-from-A2-outlook--PR_333206
Googling "vietnamese dong bonds" can lead to some very interesting places.
The USSA and western fictitious "nations" are next. Liquidate your pensions and retirement accounts before they get their greedy paws on them. Take the modest loss before you let them take a huge or total loss for you (then prevent you from liquidating at all).
Start with a search for the term 'bank account sweeps'.
This is very often a feature of both private/individual and corporate/business accounts.
Read the fine print in your banking agreement carefully.
Most people that do have sweeps engaged already do not have the faintest idea that their funds are being 'aggregted and managed' 'after hours' in NON-FDIC INSURED 'trading products'....
Sure, the banks and brokerages are doing this as a service to YOU.
& they always dutifully put all the funds back right before the doors open in the morning every morning!
http://nypost.com/2011/12/18/parallels-between-mf-global-and-madoff/
http://www.nytimes.com/2008/12/23/business/23thrift.html?_r=0
Bingo! And one fine Monday morning...
It's gone!