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A Chinese Bank Run?

Tyler Durden's picture





 

The balance sheet recession that seems to have correctly diagnosed the problem facing Japan (and now Europe and the US)  - explicitly causing debt minimzation as opposed to profit maximization - seems to be taking hold. However, it appears this death-knell for credit-created growth is now being seen in China - as AlsoSprachAnalyst interprets "people are not borrowing, but selling assets to pay down debts, and/or holding cash". What is most worrisome is that while the focus of the world has been on European bank runs (for fear of bank failure and redenomination risk), 21st Century Business Herald now notes that these bank runs have spread to China's industrial and construction-heavy city of Wuyishan. Queues were seen on various branches of China Construction Bank, Agricultural Bank of China, and Industrial and Commercial Bank of China.

 

more from AlsoSprachAnalyst:

The reason which triggered the bank run was that there was a company that has just gone bust, with the founder and other executives ran away, brining probably RMB1 billion or more away with them.  The company in question looks like a Ponzi scheme.  It has set up an online shopping site which, on top of selling stuff, asks people to sign up and pay a certain among of money (e.g. RMB1,600), then the company will pay people back at a rate of RMB20 a day (a fee of 5% out of this RMB20 is deducted).  It sounds like a pretty good deal for the members, as far as it is working.  Based on the bank statement of the members obtained by 21st Century Business Herald, the company did pay back quite a fair amount, but, of course, the company has sucked up more than it has ever had a chance to pay back.

 

As the company went bust and the boss disappeared, the members of the website who have paid quite a lot of money in hope to be paid back even more became rather angry, and went to the office of this company in Fuzhou (which is actually not at all near Wuyishan) to protest and smash things.  However, as a lot of members of the website came from Wuyishan, people are worried.  On late 30 May, there was apparently some chatter that the government is dealing with the case, and will need to freeze personal bank accounts (presumably for investigations).  As a result of this, people started queuing up at virtually all banks the next day.  One local resident told the reporter that the city “has gone crazy”.

 

Now the boss is arrested, charged with taking deposits from the public illegally.  But victims of the scheme are still counting, and the exact count of the victims of the scheme is not known.  What is known is that because the website was so popular all over, the victims of this scheme will not be limited to one city of Wuyishan.

and from 21st Century Business Herald (via Google Translate):

Empty.

 

May 31, the edge of the Fuzhou West, Fauci Lake Garden north-floor six-story is a mess, the whole layer of the huge office space only a few grid, ceiling air-conditioning, including all items have been looted. about 300 square meters of space can be seen everywhere damaged ceiling and scraps of paper waste, and even the Office of the Chairman of the glass door was smashed.

 

"In the middle of the night on the 28th, happened here the mob looting took indoor items is a member of the full mall, an angry crowd smashed the decoration." Fauci Lake Garden security told this reporter.

 

This is where many members had placed 100% of fortune dream mall stronghold. This reporter saw a full-affected member notice pasted on its door bearing the words: you full members and the victims go to Fuzhou Economic Investigation Team focus, and discuss funeral.

 

"Full mall claimed more than 20 million members, covering 23 provinces and cities." Member surnamed Chen, told this reporter, "the causes of things heard the full mall owners Yao Jianqing and senior have escaped more than 10 billion Pao Lu. "

 

On the evening of May 31, the reporter learned from the Fuzhou police, Yao Jianqing was the same day was five brigade of the Fuzhou Public Security Bureau of Economic Investigation Detachment from the field and arrested and brought to the suspected charges of illegal deposits from the public, within a short time the police have registered the cheated amount of tens of millions million.

 

Involved in this case the number and amount, is still the legend diverse. Since the filing due May 29, made a report people are doing it, has not yet specific statistics on the amount involved and the victim number.

 

May 28 night in Fuzhou, looting, and has rapidly spread to northern Fujian Wuyishan City.

 

The Wuyishan banks a run

 

Hundred percent rebate comes from Fuzhou mall collapse event, but soon make waves in Wuyishan City, 356 kilometers away.

 

"In the evening of May 30, there are rumors that the relevant state departments to rectify rebate network, it may freeze the personal bank account." Number of Wuyishan local residents confirmed to this reporter, "so people flocked to the bank teller, 31 withdrawals crowd formed the climax, are overcrowded urban areas, Construction Bank, Agricultural Bank of China, ICBC even Wuyi University, backdoor teller machines. "

 

"Wuyishan public Ma told the reporter, the evening of May 31, downstairs are loud call notification queue to take money out noise, thunder kept the motorcycle on the streets," Wuyishan crazy, "she said, her husband is 100% rebate mall members.

 

"Rebate network the country's most active areas of Wuyishan." A local source revealed to him every day to listen to friends and colleagues talk about rebate network, earn money to buy a car also. March to April this year, most people throw money to rebate network, buy tens of thousands of people, or even hundreds of thousands of millions to buy. "

 

Many local people said hundred percent rebate mall development in the Wuyi mountains of many shops and became an "investment" for quick profits, and slowly evolved over time and some people operating mode, to attract more to the more ordinary citizens to join.

 

The reporter learned from multiple sources, Following the Wuyishan whole city crazy, Jian'ou, Shaowu, Shunchang, Pucheng counties belong to northern Fujian, a variety of names, "Money begets money" rebate "riches" game the same hot.

 

But because of a sudden the same thing, and increasing number of withdrawals and report the number of people involved and the amount of these places is also not specific statistics.

 

"Money begets money" riches game

 

In, Fauci Lake Garden looting has been the passage of time, but until the afternoon of May 31, not when someone thirty-five together to come here to find out the full rebate mall situation.

 

While in front of a piece of paper "announcement", said the arrears of rent, the landlord has the right to use recovery.

 

Property of the building told reporters the full rebate Mall to move into here at the end of the original tenants of the housing Yao Yuan, Fujian Jianou.

 

The reporter learned that operate 100% rebate Mall enterprise Fuzhou Yi Health Science and Technology Development Co., Ltd. (hereinafter referred to Yi Johnson).

 

Trade and Industry data show that Yi Health was founded on December 23, 2011, 10 million yuan of registered capital, is the software industry, business scope is very heterogeneous, including daily necessities, building materials, dozens of industries. The legal representative of the company for the original Yao Jianqing, March 31 and May 24 this year has changed to Feng tour wang, Weiping. The shareholders have also gone through two changes the Yao Jianqing, how to spend months changed to swim Wang, Feng, Fan Baoyu, and then change Weiping Gao and Ke Qimin.

 

The reporters found that the friendship born on December 25 last year, the Company changed to its present name by the the Jian'ou full E-Commerce Co., Ltd. ", founder of Yao Jianqing Department of Fujian Jian'ou, aged 39.

 

May 7 to 8, Yi Johnson was held in Fuzhou West Lake Hotel a national dealer meeting, a member of more than 500 from all 23 provinces and cities, agents, distributors attended the meeting. A percentage rebate mall dealers said.

 

According to its disclosure, in the so-called National Dealer Meeting

 

Publicity, only the 8th to the 14th week of May, Yi Johnson absorption member of several hundred million of funds. The same month on the 14th, the old site of the "100 per cent rebate of friendship Johnson Close, 18, named the" 100 per cent Mall new website, suction gold numerous two-day promotional activities.

 

The reporter learned from more than members mouth, Yao Jianqing began in May 2011 through the network of shopping malls full, to receive a 5% fee the way development agents and franchisees, and to absorb the member funds, commitment to 100 days back to this, net profit in 400 days of high returns, "Money begets money" profit mode.

 

The Fujian rebates network collapse scam involving 23 provinces and cities

 

The initial approach, Member Shopping 1 million in the franchisee, to pay 1600 yuan Yi Johnson, Yi & Johnson $ 20 per day rebate to members, for a total rebate of 500 days. With a membership of more and more, later converted to 1600 dollars you can get $ 20 per day rebate paid directly to the friendship Johnson, Yi Johnson received from members daily 20 yuan rebates 5% fee.

 

Yi Health want only take the model of development of the regional agency "offline" to grow the membership team. "Agents of the initial fee is $ 10,000, and promotional activities during the price is 5000 yuan, Fujian Province, one agent said. According to the odd members, full mall agents to join more than 6000 in the country.

 

The reporter May 31 the bank bills and customer information display, Yi Johnson call the members of the rebate a few hundred to several thousand dollars, the amount of remittance Join majority for a few thousand to several million .

 

More involved in the amount of Fuzhou, Fuqing City, under the jurisdiction of, a few people together tens of millions of dollars. "A member said," after the outbreak of the fuse is also a few people be informed of the change of friendship born shareholders. force new legal representative Weiping return of investment funds, resulting in the collapse of 100% rebate Mall. "

Not good, not good at all.

 


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Fri, 06/01/2012 - 15:30 | Link to Comment kato
kato's picture

Realize that the vast majority of you who post here repeatedly are one step removed from the citizens of Rock Ridge. Or worse. Still, you are useful in increasing ZH’s page view count. Now back to your Bud Light and Axe body wash for the week-end.

Fri, 06/01/2012 - 15:33 | Link to Comment fonzannoon
fonzannoon's picture

Is that you Brian Wesbury?

Fri, 06/01/2012 - 15:41 | Link to Comment Colombian Gringo
Colombian Gringo's picture

What do you call a Chinese 69?
Two Can Chew!

Fri, 06/01/2012 - 15:43 | Link to Comment kralizec
kralizec's picture

phuc mei, dat rotsa raughs!

Fri, 06/01/2012 - 17:20 | Link to Comment AldousHuxley
AldousHuxley's picture

Chinese will push FXI down to $30 at EMA....

 

then QE will come from Chinese banks

Sat, 06/02/2012 - 01:43 | Link to Comment Oh regional Indian
Oh regional Indian's picture

I wrote this in May 2008:

v China is staggering under its own curious set of circumstances of a large population set “herded” into rapid “development” mode, much like India.  Most of the “gains” are hype. Credit, cheap and plenty until recently (private equity had moved it into the right hands in preceding years), being the sole driver (flogger?) of growth.

 

v The sub prime mess (and all its attendant tentacles of cause and effect in the world financial systems) is scary with just the lit fuse sparking.  When it really goes off, all bets are off.  Talk of lack of understanding of higher order cause and effect.

v Energy prices are reset in the public mind at dizzying rate (12 dollars a barrel of Brent Sweet Crude is not such old memory), currently 130 dollars a barrel.  Associated inflationary impact is hitting the majority of the world’s population.

 

v On a similar somber note, a discussion on our world’s geo political situation. Every major war in history was a resource war as is every major conflict today. There is a relentlessly hawkish bias in the global dialogue, with too many vested interests in the war – pie.  Oil, minerals, territory / markets and now water. Also, in large theatre wars, multi-generational trauma creates multi-generational conflicts.  Grim but true.

 

v An increasingly nuclear world adds the requisite potential for a runaway reaction!  Our world is ever increasingly polarized with ever greater potential for conflict.

1460-days-ago-ensign-principles-world-view/

Some of us saw it coming..... long ago. That was when I verifiably put it on paper. Have been saying it since 2006.

ori

Sat, 06/02/2012 - 11:37 | Link to Comment dracos_ghost
dracos_ghost's picture

then QE will come from Chinese banks

 

Yeah, from the direct line to the US Treasury recently announced. China has a liquidity problem like everyone else. Their peg is killing them. It's a great mercantilist weapon when money is flowing like Big Gulps in Manhatten but they need to float the yuan immediately. It's a "take some bad medicine now" or life support not much later decision.

It seems the Chinese gubmint would rather avoid social unrest at all costs instead of fiscal responsibility. They have become fully westernized.

Fri, 06/01/2012 - 15:44 | Link to Comment montana1978
montana1978's picture

I find your comment to be totally unacceptable!

 

-John
Brand New (Non-Titled) 2013 Ford Mustang Shelby Cobra 2 Door Convertible
http://cgi.ebay.com/ebaymotors/?cmd=ViewItem&_trksid=p3984.m1555.l2649&item=190685701637&sspagename=STRK%3AMESELX%3AIT

Fri, 06/01/2012 - 15:47 | Link to Comment Colombian Gringo
Colombian Gringo's picture

This Chinese chap goes into a bank to change some currency. After receiving his money he asks, "How come I came in here with same amount of money as yesterday but today I get less Yuans in return?"
The banker says, "Fluctuations."
The Chinese guy replies, "Fluck you Blitish too."

Fri, 06/01/2012 - 15:56 | Link to Comment in4mayshun
in4mayshun's picture

Global Bank runs... all part of the plan. Now the world governments can unveil an all-electronic currency and blame it on the people for hoarding physical currency.

Assheads.

Fri, 06/01/2012 - 16:09 | Link to Comment Poetic injustice
Poetic injustice's picture

Is AnAnonymous standing in bank queue already and so missing this topic?

Fri, 06/01/2012 - 16:20 | Link to Comment Ms. Erable
Ms. Erable's picture

Naw, he's practicing his roadside-shitting skills as part of his Chinese Citizenism training.

Fri, 06/01/2012 - 17:41 | Link to Comment DosZap
DosZap's picture

Global Bank runs... all part of the plan. Now the world governments can unveil an all-electronic currency and blame it on the people for hoarding physical currency.

If that happens, gonna be a lot of smelting, and new jewelry being worn.............and multiple boating accidents.

ZH folks need to stay off boats, bitchezz cannot operate boats,esp with their stashes on board.

Reality, I do not see that yet,too many folks demand tangible money, and not all have or use banks...............and never will.

And, backed by full lack of faith in the uber successful Soverigns?

Fri, 06/01/2012 - 23:47 | Link to Comment Estrella
Estrella's picture

Cash continues to be king in the world where I exist. Perhaps my world is unique. I don't think so. I pay my subs and my customers pay me (and I dutifully report it all to the King's tax men) in cash. Seriously, my little business is almost all cash. (And I DO report it, because, I am scared to death of the King's thugs.) But, that is just what I see.

Fri, 06/01/2012 - 19:42 | Link to Comment JohnKozac
JohnKozac's picture

I once saw people get this angry when Popeye's ran out of chicken legs.

Fri, 06/01/2012 - 16:36 | Link to Comment Peter Pan
Peter Pan's picture

Or a meal for two with a terrible view.

Fri, 06/01/2012 - 23:30 | Link to Comment Shazam342
Shazam342's picture

only if they are cannibals

Fri, 06/01/2012 - 15:36 | Link to Comment Clueless Economist
Clueless Economist's picture

STFU...who are you, one of those trained seals serving as wallpaper at O's speech today?

Fri, 06/01/2012 - 15:41 | Link to Comment slaughterer
slaughterer's picture

It looks like the syndicate bank goons monitoring this site have decided to break company rules and post their frustration here.  Where are you from JPM, GS, WFC?

Fri, 06/01/2012 - 15:46 | Link to Comment CommunityStandard
CommunityStandard's picture

Warning: don't feed the trolls.

Fri, 06/01/2012 - 15:34 | Link to Comment ArrestBobRubin
ArrestBobRubin's picture

Not now Kato!

It's Freaky Friday.

 

Fri, 06/01/2012 - 18:43 | Link to Comment Ineverslice
Ineverslice's picture

Does your dog bite?

Fri, 06/01/2012 - 15:36 | Link to Comment Conman
Conman's picture

Why i never...  you are completely wrong i only drink Zimas and use Old Spice. Now wherss my ammo and bucket food.

Fri, 06/01/2012 - 15:38 | Link to Comment xtop23
xtop23's picture

Don't hate the player hate the game friend.

The loss of confidence in the banks around the world is hardly the ZH readerships fault.

Look to your politicians who pretend to run the world as enlightened elders, but couldn't run a lemonade stand properly.

Fri, 06/01/2012 - 17:21 | Link to Comment DosZap
DosZap's picture

Look to your politicians who pretend to run the world as enlightened elders, but couldn't run a lemonade stand properly.

IF they were honest they could.But if your guaranteed no loss, why be honest, Snatch n Grab.

Fri, 06/01/2012 - 17:54 | Link to Comment michael_engineer
michael_engineer's picture

Or practice IBGYBG (I'll be gone, you'll be gone)

Sat, 06/02/2012 - 19:11 | Link to Comment Winston Churchill
Winston Churchill's picture

Dom't know about the lemonade stand.

The state of every country in the world is beginning to

make Zimbabwe look good.At least you know your

fucked living there.No more extend and pray.

Fri, 06/01/2012 - 15:40 | Link to Comment EscapeKey
EscapeKey's picture

Oh I see, we should all be over commenting on the Keynesian boards, about how great a job Bernanke is doing, how the US Dollar has "historically" been the safest asset, and how every problem can be solved through large injections of liquidity.

Fri, 06/01/2012 - 16:05 | Link to Comment Stimulati
Stimulati's picture

The policies you speak of and which are underway are the policies of Milton Friedman, and not Keynes.

Fri, 06/01/2012 - 16:06 | Link to Comment EscapeKey
EscapeKey's picture

Yes, of couse, because Keynes said something about countercyclical public spending, which is about as likely to happen as the tooth fairy arriving on christmas eve.

Fri, 06/01/2012 - 16:10 | Link to Comment Stimulati
Stimulati's picture

Do you remember Al Gore and his lockbox?  Just because the voters don't get the policy right doesn't mean Keynes is wrong.

Fri, 06/01/2012 - 16:13 | Link to Comment EscapeKey
EscapeKey's picture

Yes, and if we attempt to introduce communism just once more, it'll definitely work.

Fri, 06/01/2012 - 16:16 | Link to Comment Stimulati
Stimulati's picture

That's just ignorant

Fri, 06/01/2012 - 16:17 | Link to Comment EscapeKey
EscapeKey's picture

Exactly. And despite that, we still have people thinking that Keynes's countercyclical theories actually work in reality, when it should be obvious to everyone that no-one would ever vote in a politician who'd actually carry out his policies.

Fri, 06/01/2012 - 16:29 | Link to Comment Stimulati
Stimulati's picture

Modern Keynes - you only apply fiscal stimulus (government spending) at the zero lower bound.  Flooding the banks with money is Milton Friedman.  Just asking for you to get your economic theories right.  Believe what you want.

Fri, 06/01/2012 - 20:04 | Link to Comment Kayman
Kayman's picture

Stimulati

And which economic philosophy espoused theft ? The Chicago School and Keynes' disciples simply provide cover for the criminals in charge.

Fri, 06/01/2012 - 16:26 | Link to Comment BigJim
BigJim's picture

Mind you, if we only go for policies that our sheepy fellows will vote for...

Fri, 06/01/2012 - 19:51 | Link to Comment marxist
marxist's picture

Communism can't be introduced. It will arise naturally as material circumstances dictate, as did capitalism at the collapse of feudalism in England. With the exhaustion of the value from land and the enclosing of common lands within private title, it was natural that these developments would extend themselves to greater and greater commodification of the rest of the commons as well as intangibles. America and the other colonies of England opened up the rest of the world to this system. As we approach full globalisation of capitalism, the bubble and bust nature of the system will increasingly pauperise the mass of the population...the material dialecticism that Marx spoke of....or the unseen hand of the material world which dictates the course of humankind and the civil systems that we order our affairs under. Incidentally, the paradoxical nature of capitalism will increasingly test the best of most analysts abilities as we alternately lurch between deregulation and interventionism in a bid to ensure that the periods of bust do not overwhelm the process of accumulation.

Eventually this will give way to a systemic cataclysm...which will either see a descent into terminal barbarism or the rise of a system that is antithetical to capitalism. However, this is not the end as this period will be a transition to one that finally synthesises both capitalism and its antithesis.

Sat, 06/02/2012 - 22:13 | Link to Comment ffart
ffart's picture

The people of Washington state voted for the privatization of liquor sales. Now I can go to Costco and buy enough vodka to fill a bathtub for $30. How's that for a communist victory.

Fri, 06/01/2012 - 22:55 | Link to Comment dougngen
dougngen's picture

winning....

John Maynard Keynes

/sarc

Fri, 06/01/2012 - 15:40 | Link to Comment LFMayor
LFMayor's picture

Where is this Rock Ridge you speak of, shit bird?

Fri, 06/01/2012 - 15:46 | Link to Comment Nordberg
Nordberg's picture

Just past the Gov William J. Le Petomane Thruway.

Fri, 06/01/2012 - 16:11 | Link to Comment brooklynlou
brooklynlou's picture

Make sure you bring a shitload of dimes. It don't take EZPass ...

Fri, 06/01/2012 - 15:42 | Link to Comment Dr. Engali
Dr. Engali's picture

We welcome strangers like yourself here. You have a purty face. Bend over and squeel like a pig boy......you are a boy aren't you?

Fri, 06/01/2012 - 16:18 | Link to Comment ITrustMyGut
ITrustMyGut's picture

w00t!

*squeal*

*shifty eyes*

Fri, 06/01/2012 - 15:44 | Link to Comment LawsofPhysics
LawsofPhysics's picture

...says the anonmous blogger posting on ZH.  Thanks for the tremendous insight Kato.  

Fri, 06/01/2012 - 15:45 | Link to Comment the 300000000th...
the 300000000th percent's picture

you cant co-op me mr sneaky pants!

Fri, 06/01/2012 - 15:48 | Link to Comment chump666
chump666's picture

marketwatch told you to go long right?

dumb a-holes missed the meltdown in China.  

ZH didn't.  

I drink quality Tequila

Fri, 06/01/2012 - 15:59 | Link to Comment JohnG
JohnG's picture

Fuck you kato, just fuck you.

Fri, 06/01/2012 - 16:04 | Link to Comment debtor of last ...
debtor of last resort's picture

ZH is going to NYSE next month. Buy some stocks?

Fri, 06/01/2012 - 16:07 | Link to Comment debtor of last ...
debtor of last resort's picture

you bet they are doing better than facialbook ......

Fri, 06/01/2012 - 16:10 | Link to Comment ImnotPOTUS
ImnotPOTUS's picture

Beg all you want but we are not taking in the Irish.

Mr. Johnson don't you agree with Geoffery Lebowski?

Fri, 06/01/2012 - 16:31 | Link to Comment Ms. Erable
Ms. Erable's picture

We definitely need a better class of troll around here - this kato troll is stuck on full retard.

Fri, 06/01/2012 - 18:03 | Link to Comment NotApplicable
NotApplicable's picture

Currently, over half of the thread is people taking his troll-bait, so I'd say he's found a seat in first class.

Sometimes, it makes me wish I'd payed attention in school.

I could'a been a contender!

Fri, 06/01/2012 - 22:17 | Link to Comment Buck Johnson
Buck Johnson's picture

Listen, the Chinese economy is a big ponzi scheme and it's about to come apart real soon including India.

Sat, 06/02/2012 - 01:06 | Link to Comment Oh regional Indian
Oh regional Indian's picture

Iz tru.

ori

Sat, 06/02/2012 - 13:27 | Link to Comment dracos_ghost
dracos_ghost's picture

Yup, in fact I'd say the world is shitting a BRIC.

Sat, 06/02/2012 - 00:57 | Link to Comment WallowaMountainMan
WallowaMountainMan's picture

"Realize that the vast majority of you who post here repeatedly are one step removed from the citizens of Rock Ridge. Or worse."

who u callin a 'citizen' ?

sure 'Or worse' is ok, cause 'citizen' aint that low a standard. i.e. use politician instead.

 

"Now back to your Bud Light and Axe body wash for the week-end."

man i gotta say...." Now back ' is a tad optimistic. i could barely get thru one bottle of the bud light/axel body wash combo, let alone consider 'back" as the next step.

Fri, 06/01/2012 - 15:42 | Link to Comment Dr. Kananga
Dr. Kananga's picture

"As the company went bust and the boss disappeared, the members ... became rather angry, and went to the office of this company in Fuzhou to protest and smash things."

Gives new meaning to the phrase "Chinese Take-Out" eh?

Fri, 06/01/2012 - 18:51 | Link to Comment Ineverslice
Ineverslice's picture

Currently in full Ponzi mode....this one will get Hot n' Sour.

In all seriousness, massive amounts of very hard working Chinese will get stir fried, and it will leave a mark.

Fri, 06/01/2012 - 15:33 | Link to Comment ArrestBobRubin
ArrestBobRubin's picture

Chop chop!

Fri, 06/01/2012 - 15:35 | Link to Comment eclectic syncretist
eclectic syncretist's picture

And we have been thinking that China would have the resources to come to our rescue.  Hmmmm.... might have to re-evaluate that presumption now.

Fri, 06/01/2012 - 15:40 | Link to Comment Rainman
Rainman's picture

Larry Lang called it 7 months ago.

" EVERY PROVINCE IN CHINA IS GREECE " !!

http://www.mining.com/2011/11/16/every-province-in-china-is-greece-larry-lang/

Fri, 06/01/2012 - 15:35 | Link to Comment midgetrannyporn
midgetrannyporn's picture

Not trusting banks is "crazy?"

Fri, 06/01/2012 - 15:35 | Link to Comment PicassoInActions
PicassoInActions's picture

Chna will move soon to use us $. Than they won't need to peg.

Fri, 06/01/2012 - 15:46 | Link to Comment xtop23
xtop23's picture

Yeah, that'll happen

Fri, 06/01/2012 - 15:36 | Link to Comment carbonmutant
carbonmutant's picture

Do they have ATMs on the Wall?

Fri, 06/01/2012 - 17:49 | Link to Comment fnordfnordfnord
fnordfnordfnord's picture

yup

Fri, 06/01/2012 - 15:36 | Link to Comment Let The Wurlitz...
Let The Wurlitzer Play's picture

Soon the Chinese will be selling their gold, copper and ore stockpiles to pay debts.  They will be doing it at a loss.

 

Fri, 06/01/2012 - 15:41 | Link to Comment EscapeKey
EscapeKey's picture

Yes, they will DEFINITELY not just start selling their $1tn worth of US Teasuries if it comes to that.

Fri, 06/01/2012 - 15:53 | Link to Comment xtop23
xtop23's picture

Can you say bond market implosion?

Fri, 06/01/2012 - 15:55 | Link to Comment LawsofPhysics
LawsofPhysics's picture

...and the Fed will DEFINITELY not buy those treasuries up either.

Fri, 06/01/2012 - 16:03 | Link to Comment EscapeKey
EscapeKey's picture

Of course they won't. The Primary Dealers will, and then engage in repo's with the Federal Reserve in exchange for cash.

You see, DEFINITELY not the Fed buying the treasuries.

Just like adding to the reserves of the PDs is DEFINITELY not the equivalent of printing cash, because there's no physical pieces of paper involved.

/John Law was way ahead of his time.

Fri, 06/01/2012 - 16:17 | Link to Comment LawsofPhysics
LawsofPhysics's picture

same as it ever was.  Well, at least until the supply chains break and real things are no longer being delivered.  Then, and only then, will things get interesting.

 

With the taxpayer  still paying for the Fed's repo.  Awesome, banks win again.

Fri, 06/01/2012 - 16:25 | Link to Comment EscapeKey
EscapeKey's picture

Ah, don't worry. The Fed will deliver some speeches, throw in the word "sterilized" to make it all sound better, and claim innocence when it inevitably breaks down.

See, because it's all the fault of those Austrians, who are in no seat of power.

Fri, 06/01/2012 - 23:29 | Link to Comment Demonoid
Demonoid's picture

Not a problem. When it comes time to bluntly speak Truth to Power, remember that our man in the White House knows more than a thing or two about the Austrian language.

Fri, 06/01/2012 - 16:22 | Link to Comment chump666
chump666's picture

and the yield return is...? whilst the USD is bid.  The Fed will struggle if China liquidates and it looks like they are at the cusp. It was coming.  Commodities were being dumped 3mths back and Asia started selling and buying USDs.  Why? Mostly on inflation fears, that and they have a huge indust complex which is stuggling with higher operational costs and demand destruction.  This has bad as you could imagine.

The creditors of the world are in trouble + EZ bond/credit markets a total mess = major pain trade ahead

Fri, 06/01/2012 - 15:42 | Link to Comment Cranios
Cranios's picture

IS THIS THE FINANCIAL EQIVALENT OF A CHINESE FIRE DRILL?

Fri, 06/01/2012 - 15:46 | Link to Comment barliman
barliman's picture

 

No ...

... this the Chinese equivalent of  FINANCIAL fire drill.

You SHOUTING, wacist plick!

;->

barliman

Fri, 06/01/2012 - 20:44 | Link to Comment Matt
Matt's picture

Chinese FIRE drill.

FIRE = Finance, Insurance, Real Estate.

Fri, 06/01/2012 - 15:42 | Link to Comment LFMayor
LFMayor's picture

Hey AnAnon, what inside scoop you got for us on this one?  It's gonna be a hell of a scrabble score if you can weave "US AMERICAN COSUMERISM" in with this shit.

and p.s.,  stop spreading lies about Tianamen square to your relatives.  you wouldn't want the authorities to find out.

Fri, 06/01/2012 - 16:31 | Link to Comment BigJim
BigJim's picture

"Pyramid ponzi schemes are hallmark of US Citizenism, which is everywhere and eternal, even in China" - AnAnonymous, chief Zerohedge US Citizenism expert, and all-round douchebag.

Fri, 06/01/2012 - 15:43 | Link to Comment barliman
barliman's picture

 

Today China ...

... Monday, Germany ...

and the only thing that would stop those folks from cashing out?

Tuesday ... Germexit*

(* another trademark from Barliman Buggers Bernanke, Inc.)

barliman

Sat, 06/02/2012 - 18:38 | Link to Comment Winston Churchill
Winston Churchill's picture

Or Spexit.

Fri, 06/01/2012 - 15:45 | Link to Comment williambanzai7
williambanzai7's picture

Sounds like a classic social media Ponzi to me.

Fri, 06/01/2012 - 15:46 | Link to Comment barliman
barliman's picture

 

SavingFaceBook?

barliman

Fri, 06/01/2012 - 16:01 | Link to Comment onebir
onebir's picture

Yep - & unfortunately also a fairly typical Chinese investment fraud.

But the bank run is not what's typically meant by bank run. (ie it's motivated by fears regulators will freeze accounts, rather than fears wht bank is bust...)

Fri, 06/01/2012 - 15:47 | Link to Comment Sudden Debt
Sudden Debt's picture

It happens to the best of banks...
Already more than a few times....
But taxpayers will pay the bill in the end... They always do.

Fri, 06/01/2012 - 15:52 | Link to Comment Jonas Parker
Jonas Parker's picture

I dunno how the American taxpayers will be stuck paying for this one... but I'm sure we will!

Fri, 06/01/2012 - 16:50 | Link to Comment ebworthen
ebworthen's picture

Currency swaps to keep the Renminbi (Yuan, whatever the fuck they call it) low relative to Dollar so flat screens and plastic crap stays cheap at WalMart.

Sat, 06/02/2012 - 02:13 | Link to Comment Sudden Debt
Sudden Debt's picture

On a long enough timeline, you will pay for it.

Fri, 06/01/2012 - 15:47 | Link to Comment Stackers
Stackers's picture

Blackened Peking Duck ?

Fri, 06/01/2012 - 15:47 | Link to Comment jimmyjames
jimmyjames's picture

"people are not borrowing, but selling assets to pay down debts, and/or holding cash"

************

Sounds like a spoonful of deflation to me-

Fri, 06/01/2012 - 15:49 | Link to Comment Pairadimes
Pairadimes's picture

This is priced in, I'm sure.

Fri, 06/01/2012 - 16:00 | Link to Comment EscapeKey
EscapeKey's picture

In fact, it's strongly bullish!

Fri, 06/01/2012 - 15:50 | Link to Comment Quinvarius
Quinvarius's picture

If you don't have gold yet, you are probably screwed.

Fri, 06/01/2012 - 16:19 | Link to Comment ArrestBobRubin
ArrestBobRubin's picture

Naaah,, there's still time and the price is still a joke. But folks better get a move on.

Silver is what you should be thinking about in terms of true scarcity of above-ground stocks. And talk about a JOKE of a price? Who cares if it goes lower... Just buy as much as you can afford, month in and month out.

When you buy silver and gold, remember that you're just swapping some paper "money" for some of the Real kind. Do it for the long term, while you can. The lower the price, the more ya get in return for your trash cash.

Fri, 06/01/2012 - 15:52 | Link to Comment Jayda1850
Jayda1850's picture

now boss is arrested, charged with taking deposits from the public illegally.

kinda fucked up that china actually prosecutes this type of fraud while in the US, corzine walks around free as a bird. what a great country I live in!

Fri, 06/01/2012 - 16:15 | Link to Comment onebir
onebir's picture

If the boss was as connected Corzine, he'd be just as free.... 

Fri, 06/01/2012 - 17:33 | Link to Comment DosZap
DosZap's picture

now boss is arrested, charged with taking deposits from the public illegally.

And they mete out Western (Old West Justice) there......7.62 Tok,to the back of the head.

We no pway awound hewe!!!!!!!!!!!!

Fri, 06/01/2012 - 17:42 | Link to Comment TimmyB
TimmyB's picture

This type of fraud in China gets you executed. 

 

http://www.reuters.com/article/2009/12/08/us-china-execution-idUSTRE5B71VC20091208

 

Fri, 06/01/2012 - 18:06 | Link to Comment NotApplicable
NotApplicable's picture

You mean publicly getting caught in this type of fraud. Mafias know nothing but fraud. Occasional executions are just the price they have to pay to maintain the facade of credible government in the eyes of the sheeple.

Fri, 06/01/2012 - 15:51 | Link to Comment Your Creator
Your Creator's picture

Wait til earnings(losses) hit next quarter. what red flags?

Fri, 06/01/2012 - 15:56 | Link to Comment kalasend
kalasend's picture

Yawn. Non-news. 

Wake me up when this does lead to a bigger run.

Fri, 06/01/2012 - 15:59 | Link to Comment JLee2027
JLee2027's picture

Well the banks are all Ponzi schemes aren't they?

Fri, 06/01/2012 - 16:01 | Link to Comment ArrestBobRubin
ArrestBobRubin's picture

The Chinese have figured it out for 3500 years, they'll figure this out too.

Meanwhile, ya better make a run on physical silver over here. Hopefully you have lots of rice, too.

Silver Manipulation- This Too Will Pass
Fri, 06/01/2012 - 16:11 | Link to Comment ebworthen
ebworthen's picture

"Give me my cash now and shove your casino markets and corrupt banks up your asses!" seems to have international appeal.

Bullish for Gold and Silver.

Fri, 06/01/2012 - 16:06 | Link to Comment Ned Zeppelin
Ned Zeppelin's picture

No 3 pm ramp job today.  PPT left early. Way in the red.  Monday, hmmmmm. . . . . . Need some kind of rumor Sunday night.  Some sort of new E (add capital letters of your choice) program to dice, split and otherwise candowntheroadittize this whole unfortunate Euro sovereign and bank debt problem.

But how?

Fri, 06/01/2012 - 16:08 | Link to Comment Debugas
Debugas's picture

looks like classic russian MMM ponzi

 

http://en.wikipedia.org/wiki/MMM_%28Ponzi_scheme_company%29

Fri, 06/01/2012 - 16:12 | Link to Comment EvlTheCat
EvlTheCat's picture

While sad.  It is nice to see that when the Chinese get shafted they loot and burn the offenders.

The amusing thing is, I remember not to long ago, an article here at ZH where several Chinese patrons were bashing "Amercian's" about being to shortsighted to invest in gold, and they would laugh all the way to the bank when our economy collapses.  I suggested that maybe they were assuming to much about their fellow countrymen and women.  Where I was promptly down voted into a blood red sea of ignorance.  It seems after all, that there is a level playing field, when it comes to bad choices in fruit machine investments, across the world.

In American terms this is called an, "I told you so".

Fri, 06/01/2012 - 16:14 | Link to Comment Temporalist
Temporalist's picture

"and discuss funeral"

That is what ZH has been doing for years but the bitch won't die!

Fri, 06/01/2012 - 16:20 | Link to Comment BudFox2012
BudFox2012's picture

Wonder how long before the Chinese have to print up rickshaws full of cash, just like the "enlightened" western countries...

Fri, 06/01/2012 - 16:36 | Link to Comment combatsnoopy
combatsnoopy's picture

They can always back the value of the Yuan with Jimi Hendrix chips.  

Fri, 06/01/2012 - 16:22 | Link to Comment Lionhead
Lionhead's picture

"As a result of this, people started queuing up at virtually all banks the next day.  One local resident told the reporter that the city “has gone crazy”."  Yes, the greatest fear of central bank planners everywhere can be summed up in two words, "Currency Backwardation."  Paper in hand is worth more than thousands in digital format & we know there isn't enough "paper" to satisfy the bank customers.

Fri, 06/01/2012 - 16:47 | Link to Comment jimmyjames
jimmyjames's picture

Paper in hand is worth more than thousands in digital format & we know there isn't enough "paper" to satisfy the bank customers.

*********

Absolutely and if there isn't enough paper to find its way into the peasants grubby little hands--will they print it and bail them out?

I doubt it--

Fri, 06/01/2012 - 16:30 | Link to Comment ThisIsBob
ThisIsBob's picture

Reminds me of  recent advice from El-Erian:  "If you see a line at your bank, get in it."

Fri, 06/01/2012 - 18:31 | Link to Comment machineh
machineh's picture

"If you see a line at your bank ... CUT INTO IT!"

Fri, 06/01/2012 - 21:01 | Link to Comment Matt
Matt's picture

During a real panic, cutting in line might get you killed.

warning: violent.

http://www.youtube.com/watch?v=9IdM84YVmV0

Fri, 06/01/2012 - 16:30 | Link to Comment Morphine Drip
Morphine Drip's picture

In breaking news the Chinese government has decided to relax media censorship and let in American Idol and porn.

Fri, 06/01/2012 - 16:34 | Link to Comment combatsnoopy
combatsnoopy's picture

Their banks should've put Remnibi slots in the lobby.  They say that Asians are the best and the brightest, but I've been forced to question that.  

Fri, 06/01/2012 - 16:57 | Link to Comment falak pema
falak pema's picture

bank runs now are very much in fashion; its like a louis vuitton plastic suitcase; a must! If you don't have a bank run in your country your are out of fashion! 

Fri, 06/01/2012 - 16:56 | Link to Comment q99x2
q99x2's picture

Madoff's demons must have escaped prison and set up camp across the world.

Fri, 06/01/2012 - 17:02 | Link to Comment Infinite QE
Infinite QE's picture

You really get to now see why people have been panic buying gold in China. Imagine a department store in America selling bullion with customers three to four deep in numerous lines. 

Fri, 06/01/2012 - 17:30 | Link to Comment mliu_01
mliu_01's picture

Come on this is not a bank run!!!

it is madoff event. someone played ponzi on those people. That is all. Not a bank run.

Fri, 06/01/2012 - 21:05 | Link to Comment Matt
Matt's picture

Did you read the article?

There was a ponzi. it failed. then the government announced it would freeze the bank accounts of everyone involved so they could investigate.

This triggered a rush for all the people to take their money out of the banks.

While the cause is different than everyone fleeing a collapsing bank, the result is the same.

Fri, 06/01/2012 - 17:30 | Link to Comment mliu_01
mliu_01's picture

Come on this is not a bank run!!!

it is madoff event. someone played ponzi on those people. That is all. Not a bank run.

Fri, 06/01/2012 - 17:43 | Link to Comment roadhazard
roadhazard's picture

"No mow sweet tea fo you !"

Fri, 06/01/2012 - 18:11 | Link to Comment oldgasII
oldgasII's picture

Things could get very bad in China if there is a perception of the loss of the Mandate of Heaven.  The various groups in the government could use financial unrest as an excuse to take power, the PLA vs the Princes vs new Cadre and etc. (See Warring States Period). 

Oh well, TIMMMMBBBEEERRRRRRR.

Fri, 06/01/2012 - 18:27 | Link to Comment jonjon831983
jonjon831983's picture

Wow, this is sad.

I'm sure if people thiought it to be legit, they were able to secure a good return on their cash... terrible... if many lost life savings.

Heard there is one in Russia that specifically says they are a pyramid, and uses Paypal - it's turned into... Russian ... (thinking of Roulette, but that's already taken).

Fri, 06/01/2012 - 19:09 | Link to Comment HungrySeagull
HungrySeagull's picture

That pleases me, if the Chinese are getting out of Debt...

It matches what I and wife are doing.

Ya know.. that would be a Historical Change in our World History when we refuse to play the debt/credit card/student loan/borrowing game no more.

No cash so solly. Here is your internet account kit.

Fri, 06/01/2012 - 19:26 | Link to Comment slewie the pi-rat
slewie the pi-rat's picture

i read every word

hopium delayed is hopium denied

talk about fungibility, tho:  timmah and christineL go to madrid and when they split, there's a bank run in china

"we want our pictures ofMao!"

theParty, involved in transmission of power and bag-manBingo, must be pleased at the demand for the fiat coupons, comrade BiCheZ!

Fri, 06/01/2012 - 19:38 | Link to Comment gwar5
gwar5's picture

Chinese can stop the runs with tanks and guns while they load up on more of the global gold still available. 

 

 

 

Fri, 06/01/2012 - 21:43 | Link to Comment Ned Zeppelin
Ned Zeppelin's picture

Same as will happen in the US - no gold owners will be allowed to win this game, and the power of fiat will be enforced at gunpoint if need be for those who doubt it.   If you own gold, and plan on that being your way out of this mess, better load up on that other precious metal, lead.

Fri, 06/01/2012 - 19:49 | Link to Comment John Wilmot
John Wilmot's picture

The economic miracle in China is exactly like the economic miracle in the Soviet Union, or NAZI Germany for that matter - they were all basically inflationary booms brought about by massive central planning, and or pure propaganda divorced from anything resembling reality, and the socialist fellow-travellers in the Western media duly lapped it up like the useful idiots they were/are.

Eventually the Chinese boom will bust, maybe we're seeing the start of that now. I'd sure love to see all the China boot-lickers in the media eat shit for their years of shameless propaganda.

Fri, 06/01/2012 - 21:41 | Link to Comment Ned Zeppelin
Ned Zeppelin's picture

Exactly. Thank you.  I listened to some a-hole from HSBS practcially cum over the arwaves on Bloomberg earlier this week waxing poetic on how the Chinese are freaking geniuses at central planning, clearly intimating jeez why don't we all get on board this totalitarian f-ing train.  A- hole.

Sat, 06/02/2012 - 08:13 | Link to Comment Bogdog
Bogdog's picture

It would be effing awesome to see China implode RIGHT now, ahead of Europe, ahead of Amerika. It would buy us some time to get our shit in order. FLIGHT TO THE ALLMIGHTY DOLLAR. T-bills to the stars and beyond!!!!

Sat, 06/02/2012 - 08:08 | Link to Comment Bogdog
Bogdog's picture

Looks like a combo pyramid and ponzi scheme. The chinese did Madoff better than Madoff. It's Madoff 2.0. And with that better scam will come the better punishment, a 7.6x39 through the skull. 

Sat, 06/02/2012 - 08:47 | Link to Comment RoadKill
RoadKill's picture

I've said this before but one of the Black Swans we are going to see in he next few years is China waking up one day and finding put $1 trillion of their foreign reserves are missing.

Political corruption is rampant there. Every local mayor has stuffed $50mm into offshore accounts. The land men are making fortunes by stealing land from peasants and selling it to developers.

This will likely be discovered right at the same time as the housing market implodes AND the banks discover how bad their industrial loan book is.

The collapse of China will be EPIC. Central planning at it's maximum for over 50 years.

Sat, 06/02/2012 - 09:15 | Link to Comment Flying Tiger Comics
Flying Tiger Comics's picture

This is what I love, and by love I mean hate, when the lapdog media propagandise about some third world dictatorship or kleptocracy being the next big thing or the next tiger economy etcetera.

China is Nazi Germany redux, and like Nazi Germany it's a creature of foreign bankers, created to provide the Hegelian alternative to the US. Puppet shows. Shadows on the wall.

Remember when Japan was the big cheese? All on borrowed money? Hm, very convincing. Here we are again.

Countries that can't eradicate leprosy, cholera and slavery are not the equal let alone the superior of any anglosphere nation. They are reversionary pod people farms.

Sat, 06/02/2012 - 10:09 | Link to Comment Dre4dwolf
Dre4dwolf's picture

Soon the govt will make it illegal to pay down debt, with the goal in mind of keeping everyone in debt forever, o wait .... its pretty much like that now.... for a good portion of the population.

Sat, 06/02/2012 - 13:40 | Link to Comment dracos_ghost
dracos_ghost's picture

It may not be illegal to pay down debt, but if you pay down debt, it is NEGATIVE on your credit rating. Seems to me to be a textbook definition of indentured servitude.

Sat, 06/02/2012 - 10:52 | Link to Comment El Yunque
El Yunque's picture

All your jars are belong to us.

Welcome bank Sealy, Simmons, and Kerr.

Free beach towel are every withdrawal over 1000 chicken feet.

Fuckit, pass the Huy Fong.

Sat, 06/02/2012 - 18:22 | Link to Comment Winston Smith 2009
Winston Smith 2009's picture

The most relevant portion from my quick scan of the Google translated Chinese web page seems to be the following passage:

"In the evening of May 30, there are rumors that the relevant state departments to rectify rebate network, it may freeze the personal bank account." Number of Wuyishan local residents confirmed to this reporter, "so people flocked to the bank teller, 31 withdrawals crowd formed the climax, are overcrowded urban areas, Construction Bank, Agricultural Bank of China, ICBC even Wuyi University, backdoor teller machines."

Below is the Google translation of the entire Chinese article linked to above.  Perhaps "rebate network" and "Mall" have some other meaning in Chinese?:

The Fujian rebates network collapse scam involving 23 provinces and cities 21st Century Business Herald looked Fuzhou reported 2012-06-01 01:05:50 Comments 0 read the news anytime, anywhere Core Tip: "100 per cent Mall claiming more than 20 million members, involving 23 provinces and cities. One surnamed member said," started when I heard the full mall owners Yao Jianqing and senior have escaped more than 10 billion Pao Lu. "

Empty.

May 31, the edge of the Fuzhou West, Fauci Lake Garden north-floor six-story is a mess, the whole layer of the huge office space only a few grid, ceiling air-conditioning, including all items have been looted. about 300 square meters of space can be seen everywhere damaged ceiling and scraps of paper waste, and even the Office of the Chairman of the glass door was smashed.

"In the middle of the night on the 28th, happened here the mob looting took indoor items is a member of the full mall, an angry crowd smashed the decoration." Fauci Lake Garden security told this reporter.

This is where many members had placed 100% of fortune dream mall stronghold. This reporter saw a full-affected member notice pasted on its door bearing the words: you full members and the victims go to Fuzhou Economic Investigation Team focus, and discuss funeral.

"Full mall claimed more than 20 million members, covering 23 provinces and cities." Member surnamed Chen, told this reporter, "the causes of things heard the full mall owners Yao Jianqing and senior have escaped more than 10 billion Pao Lu. "

On the evening of May 31, the reporter learned from the Fuzhou police, Yao Jianqing was the same day was five brigade of the Fuzhou Public Security Bureau of Economic Investigation Detachment from the field and arrested and brought to the suspected charges of illegal deposits from the public, within a short time the police have registered the cheated amount of tens of millions million.

Involved in this case the number and amount, is still the legend diverse. Since the filing due May 29, made a report people are doing it, has not yet specific statistics on the amount involved and the victim number.

May 28 night in Fuzhou, looting, and has rapidly spread to northern Fujian Wuyishan City.

The Wuyishan banks a run

Hundred percent rebate comes from Fuzhou mall collapse event, but soon make waves in Wuyishan City, 356 kilometers away.

"In the evening of May 30, there are rumors that the relevant state departments to rectify rebate network, it may freeze the personal bank account." Number of Wuyishan local residents confirmed to this reporter, "so people flocked to the bank teller, 31 withdrawals crowd formed the climax, are overcrowded urban areas, Construction Bank, Agricultural Bank of China, ICBC even Wuyi University, backdoor teller machines. "

"Wuyishan public Ma told the reporter, the evening of May 31, downstairs are loud call notification queue to take money out noise, thunder kept the motorcycle on the streets," Wuyishan crazy, "she said, her husband is 100% rebate mall members.

"Rebate network the country's most active areas of Wuyishan." A local source revealed to him every day to listen to friends and colleagues talk about rebate network, earn money to buy a car also. March to April this year, most people throw money to rebate network, buy tens of thousands of people, or even hundreds of thousands of millions to buy. "

Many local people said hundred percent rebate mall development in the Wuyi mountains of many shops and became an "investment" for quick profits, and slowly evolved over time and some people operating mode, to attract more to the more ordinary citizens to join.

The reporter learned from multiple sources, Following the Wuyishan whole city crazy, Jian'ou, Shaowu, Shunchang, Pucheng counties belong to northern Fujian, a variety of names, "Money begets money" rebate "riches" game the same hot.

But because of a sudden the same thing, and increasing number of withdrawals and report the number of people involved and the amount of these places is also not specific statistics.

"Money begets money" riches game

In, Fauci Lake Garden looting has been the passage of time, but until the afternoon of May 31, not when someone thirty-five together to come here to find out the full rebate mall situation.

While in front of a piece of paper "announcement", said the arrears of rent, the landlord has the right to use recovery.

Property of the building told reporters the full rebate Mall to move into here at the end of the original tenants of the housing Yao Yuan, Fujian Jianou.

The reporter learned that operate 100% rebate Mall enterprise Fuzhou Yi Health Science and Technology Development Co., Ltd. (hereinafter referred to Yi Johnson).

Trade and Industry data show that Yi Health was founded on December 23, 2011, 10 million yuan of registered capital, is the software industry, business scope is very heterogeneous, including daily necessities, building materials, dozens of industries. The legal representative of the company for the original Yao Jianqing, March 31 and May 24 this year has changed to Feng tour wang, Weiping. The shareholders have also gone through two changes the Yao Jianqing, how to spend months changed to swim Wang, Feng, Fan Baoyu, and then change Weiping Gao and Ke Qimin.

The reporters found that the friendship born on December 25 last year, the Company changed to its present name by the the Jian'ou full E-Commerce Co., Ltd. ", founder of Yao Jianqing Department of Fujian Jian'ou, aged 39.

May 7 to 8, Yi Johnson was held in Fuzhou West Lake Hotel a national dealer meeting, a member of more than 500 from all 23 provinces and cities, agents, distributors attended the meeting. A percentage rebate mall dealers said.

According to its disclosure, in the so-called National Dealer Meeting

Publicity, only the 8th to the 14th week of May, Yi Johnson absorption member of several hundred million of funds. The same month on the 14th, the old site of the "100 per cent rebate of friendship Johnson Close, 18, named the" 100 per cent Mall new website, suction gold numerous two-day promotional activities.

The reporter learned from more than members mouth, Yao Jianqing began in May 2011 through the network of shopping malls full, to receive a 5% fee the way development agents and franchisees, and to absorb the member funds, commitment to 100 days back to this, net profit in 400 days of high returns, "Money begets money" profit mode.

The Fujian rebates network collapse scam involving 23 provinces and cities

The initial approach, Member Shopping 1 million in the franchisee, to pay 1600 yuan Yi Johnson, Yi & Johnson $ 20 per day rebate to members, for a total rebate of 500 days. With a membership of more and more, later converted to 1600 dollars you can get $ 20 per day rebate paid directly to the friendship Johnson, Yi Johnson received from members daily 20 yuan rebates 5% fee.

Yi Health wantonly take the model of development of the regional agency "offline" to grow the membership team. "Agents of the initial fee is $ 10,000, and promotional activities during the price is 5000 yuan, Fujian Province, one agent said. According to the odd members, full mall agents to join more than 6000 in the country.

The reporter May 31 the bank bills and customer information display, Yi Johnson call the members of the rebate a few hundred to several thousand dollars, the amount of remittance Join majority for a few thousand to several million .

More involved in the amount of Fuzhou, Fuqing City, under the jurisdiction of, a few people together tens of millions of dollars. "A member said," after the outbreak of the fuse is also a few people be informed of the change of friendship born shareholders. force new legal representative Weiping return of investment funds, resulting in the collapse of 100% rebate Mall. "

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