China Is Proud To Announce It Is Reflating The Bubble - Will "Actively Push" Investors Into Stocks

Tyler Durden's picture

We did a double take when we read the following lead sentence from a just released Bloomberg report on what is about to take place in China: "China’s stocks regulator will “actively” push pension and housing funds to begin investing in capital markets, and encourage long-term investors such as insurers and corporate pension plans to buy more shares." To paraphrase Lewis Black - we will repeat this, because it bears repeating - "China’s stocks regulator will “actively” push pension and housing funds to begin investing in capital markets, and encourage long-term investors such as insurers and corporate pension plans to buy more shares." And that is the last ditch effort one does when one has no choice but to push "long-term investors" into the last giant ponzi. Of course, this being China, "long-term investors" means anyone at all, and "pushing" ultimately involves either 9MM or a 0.44 caliber. And what was said earlier about mocking mainstream media spin - well, the first opportunity presents itself a few short hours later - when Bloomberg, the same agency that wrote the above report, tells us that "Asian Shares Rise Amid Global Economic Optimism." Odd - no mention of the fact that China is now pushing habitual gamblers, which over there is another name for "investors" into what is openly an invitation (at gunpoint nonetheless) into the latest and greatest bubble. That said, we give this latest artificial attempt to boost stocks a half life of several days max before the SHCOMP plunges to new lows for the year.

More on this hilarious attempt at reponzification:

The China Securities Regulatory Commission will also allow the creation of sovereign debt futures and explore other new products such as high-yield corporate bonds and municipal debt, the regulator said in a statement on its website yesterday, citing Chairman Guo Shuqing’s comments during a national work conference in Beijing.

 

Guo, appointed Oct. 29, told securities officials China needs “systemic arrangements” to channel cash into under- funded areas and sustain growth. He echoed Premier Wen Jiabao’s message at last week’s financial work conference that the finance industry should serve the real economy.

 

The Shanghai Composite Index tumbled 22 percent last year, the most since 2008, on concern increases in borrowing costs and Europe’s debt crisis would derail economic growth. The 33 percent drop since 2009 makes the benchmark the worst performer among the world’s 15 biggest markets.

 

China should make investments using the 2 trillion yuan ($317 billion) in pension funds from its provinces and 2.1 trillion yuan in housing funds, Guo said at a conference in Beijing Dec. 15, without indicating where the money should go.

This explains the surge in US exports recently and the relative economic strength - it appears America has been exporting financial innovation (such as high yield corporate bonds and municipal debt) double time to Shanghai. Which in turn was tolled by domestic child labor sweatshops and resold to US investors via E*Trade and Schwab as quadruple levered ETFs.

And the kicker:

In a continuation of his predecessor’s policy, Guo pledged to “earnestly” tackle excessive initial public offering prices and to crack down on insider trading and market manipulation, according to the statement.

Chinese fraud? Unpossible.

Needless to say, this act has sown the seeds of the Great Chinese Stock Market Collapse: artificial and forced capital reallocation is always and without fail the coffin in the nail of any ascendent attempt at central planning. Of course, by then the global ponzi will have reach such dire proportions that somehow the ECB will lend money to Greece so that Greece can bail out China, because it is not in ECB's charter to bail out insolvent ponzi regimes (such as Europe of course). Or something just as ludicrous.

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ACP's picture

So they're finally learning from Bernanke, bitchez?

trav7777's picture

huh?  The chinks have a 30 year track record of this. 

why the fuck is everything everyone else does somehow OUR fault?

ACP's picture

It's not. It's Bernanke's fault.

That stupid god damn fucking cocksucker shit sucker bitch fuck is raping our bank accounts and then shitting in our cereal bowls. I can clarify further...

eureka's picture

Obviously it is the US bankster elite's fault. The Ivy Ilk Fi-Alpha Scum who run US Empire.

EVERYONE is learning from US EMIRE Keynes'ianism.

NO surprise at all.

Blowback, Bitchez.

Michael's picture

There is nothing in the known universe that can stop a super nova sized Chinese housing bubble from continuing to burst, as it has been bursting for many months so far.

In other news;

Why is everybody focused on the veterans unemployment rate?

Unemployment Rate Improved for Everyone in 2011, Except for Blacks

http://colorlines.com/archives/2012/01/unemployment_rate_improved_for_everyone_in_2011_except_for_blacks.html

Michael's picture

Dr Ron Paul's bodyguard Jesse Benton not only has brawn, he's got brains too and knowns how to use them. I wonder if he's married?

Jesse Benton ends interview with belligerent Dana Bash.mov

http://www.youtube.com/watch?v=hDlY5UKY9CM&feature=youtu.be

Michael's picture

If we have to run Ron Paul again when he's 84 in 2020, we'll glide him out in a hover chair. A very comfy hover chair. With WIFI and Internet, and a cup holder.

fockewulf190's picture

...and with Stephen Hawkings voice simulator when needed.

HD's picture

Maybe I'm getting old - but I watched the clip a couple times and couldn't hear/understand her question... what was it? Thanks.

economics1996's picture

The reporter gave a BS question about a voter who was not able to shake RPs hand so the voter became Democrat. Fucking BS question.

HD's picture

Seriously?  Sadly this is how many voters make important decisions...

Bicycle Repairman's picture

Big picture it is meaningless.

LouisDega's picture

Im confused. What does this have to do with the price of stocks.. I meant tea in china? Do Jesse Benton and Ron paul buy stocks or are they short?

TGR's picture

"There is nothing in the known universe that can stop a super nova sized Chinese housing bubble from continuing to burst, as it has been bursting for many months so far."

Kinda like how a balloon or soap bubble bursts over several days, right?

trav7777's picture

so the ponzi bubble being run by chinks in china for their own benefit is our fault too?

they have no complicity in it whatsoever?

a4ln143c2001's picture

even though what you said is true..chinks is an extremely offensive word to chinese people

SecondAdamWon's picture

Also, Dude, Chinamen is not the preferred nomenclature. Asian American, please.

jcaz's picture

excellent Lebowski reference, dude....

Shut the fuck up, Donny.

Urban Redneck's picture

Chink or Chinamen might be less offensive to the BILLION PLUS CHINESE WHO DON'T LIVE IN THE US than Asian-American, depending on how low their opinion of the US is.  Regardless, its better to be in the ballpark yet offensive than flat-out wrong.

ZeroPower's picture

Chinese fraud? Unpossible.

IMPOSSIBRU

Matevski's picture

Sam ting wong nao agen?

Colonial Intent's picture

Coz USA is in charge of the world, USA has to destroy any state that drops dollar otherwise......the sheep will start surrounding the wolf.

economics1996's picture

Oh fuck the odds of war go up by the day.

tmosley's picture

*Thinks using the "n-word" is racist.

*Claims not to be racist.

*Calls Chinese "chinks".

slaughterer's picture

Be careful.  This article is not necessarily about QE, but about market regulation.  It is the market regulator speaking not the head of the CB.  The exact words were in Chinese, and they were translated by an organization with an agenda.  The word "actively push" might not be an accurate rendition.    

Future Tense's picture

China is going to slow due to a collapse in exports to Europe due to their austerity this year.  No amount of pension buying is going to change that, especially in the face of a collapsing real estate market which makes up about 50 percent of their GDP.  Good discussion on the China bust here:

http://www.ftense.com/2012/01/2012-outlook-global-butterly-effect.html

Saxxon's picture

Not even slightly surprising.  My wife told me that when the PRC first started selling bonds to the People, they were suspicious.  So the Party simply made them buy bonds.  It was for their own good.  They paid well and often (8-12% depending on duration).

Unadulterated Fascism.  Did you ever think it was anything else?  The Party does not even bother to mask it or spray Lysol on it, as here.

fockewulf190's picture

Hmmm. Ponzi is so western. How about Pon-Zi-Yuan? ; )

CPL's picture

That's what I understand as well from ex-chinese nationals I've have the opportunity to have a pint with.  The paychecks get spread fairly thin with government initatives like this.

 

In a country that is having trouble meeting food demand, the little bites the Chinese government takes from the people's paychecks is only going to make more protests happen.  Between diesel shortages, gas capping, food shortages, brown outs (for now) and a metric shit tonne of empty property.  There isn't a nickle to be thrown into china.

 

My best guess is the earnings month They are going to over stoke it.  Of course there is the large possibility that the boiler explodes while doing it.  Of course, in terms of funny money, the Chinese and the Americans will just virtually increase the size of the boiler by dropping interest rates lower into  micro fractions if need be.

onthesquare's picture

When did China denounce its communist ideology?

These people are endentured slaves and the government has realized that they have given them too much money and freedom.  It is now time to call in some overpay.  After all the government believes they own all the people, property, legal tender, gold, etc. See what happens when they begin to nationalize western factories.  WWIII here we come

blu's picture

Benny B must weep with frustrration when he thinks about how centrally centralized is the ChiCom centralized economic planning.

All this messy congressional oversight and rule of law horseshit -- hardly what a central banker wants to deal with day in and day out, but the shitty West just can't get its act together seems like.

Such round-about stupidity. Better to just hold a gun to peoples' head with the admonition to sure go ahead and do whatever feels right with your own money.

Troll Magnet's picture

we have rule of law? we have oversight??? GET DA FUCK OUTTA HERE!!!

blu's picture

It doesn't seem like it but we do.

Okay actually they sorta mis-placed the Constitution, trampled on everyone's rights, emptied the Treasury for the benefit of the oligarch class, and maybe froze Eric Holder in carbonite. On accident.

But apart from that yeah it's all good. Benny has to toe the mofo line. Just like that.

fockewulf190's picture

Imagine a chinese version of Ron Paul grilling party officials about financial ineptitudes ala Bernank. He'd be taken away, neck shot, and the family charged for the bullit.

NoClueSneaker's picture

... delay time. Putting a lipstick on a pig takes time, that's all. Pig stays a pig, chinese or american, doesn't matter.

PBoC butchers can slaughter the pig faster than in the

FedBernank Facility, or at Goldman-am-Main, that's all.

 

ACP's picture

China Dictatorship = execution for dissent.

US Dictatorship = lose your job, family, identity and any and all sense of humanity for dissent.

The difference isn't that big.

Tompooz's picture

The difference is that when a Chinese family with some money decides to get out of dodge, they do not find banks in their country of destination unwilling to open an account for them.

hamurobby's picture

Scientist who argued against global warming would agree.

Fred C Dobbs's picture

Alex Jones said David Rockefeller loved what he saw there in his 1973 trip.  

KK Tipton's picture

Maurice Strong loved it so much he moved there:

http://www.canadafreepress.com/index.php/article/23141

Now, there was that little matter of the $1,000,000 payment by check from the UN.
Where else would you go till the heat is off?

"The 78-year-old Strong, who seemed to disappear from the international radar screen when his name became linked to the United Nations Oil for Food scandal in 2005, went to live quietly in China, a country he has long touted as the superpower poised to replace the United States of America."

Dude is an undercover eugenicist:
Maurice Strong Interview (BBC, 1972) - YouTube - http://bit.ly/wd4Ixo

Also owns Crestone, Colorado. His new age hideout:
https://en.wikipedia.org/wiki/Crestone,_Colorado
Maurice Strong, owner of a controlling interest and his fiancée Hanne Marstrand visited the development and "fell in love with it." The Strongs were inspired to create a world spiritual center and began granting parcels of land to traditional spiritual organizations.

But he might be on the way out, taking his carbon footprint with him:
http://www.canadafreepress.com/2007/cover051707a.htm

qussl3's picture

All in with a 2-9 off suit, whoop dee doo.

How long till they are called on it?

Gubbmint Cheese's picture

Hahaha... Good luck China

chump666's picture

China will get hyper inflation before the US.  Who would have thought.  And we know what the Chinese are like, they will flee the YUAN in droves, buy USD and throw everything else into stocks.  China is actually creating WEIMAR style...by design.  Amazing stuff. 

 

qussl3's picture

They wont be buying stocks, those with any wealth know its all BS, at the drop of the hat the state could reappropriate it all.

Wealth is going offshore or into PMs.

 

chump666's picture

The Chinese are the worst investors on the planet.  So I would not be surprised they sell off their currency on mass and throw it all into stocks get this massive rally and a HUGE spike inflation.  Amidst EZ going to hell, US falling to pieces in 2012.  Topped off with China completely imploding, then war.  Timeline?  Within 12mths

 

chump666's picture

...or maybe less.  Anyone got odds on global war? 

Harlequin001's picture

The way Iran's going I'd say around 20 mins...