Rumor Regurgitation Time: China To The Rescue... All Over Again

Tyler Durden's picture

In case one is wondering what lit a fire under the EURUSD and the ES' ass in the past 30 minutes, why it is the trusty old fall back - China, to which all algos respond every single time like stung donkeys as if on command. Because just as the EURUSD was about to retrace the lows as the realization that the EOD rumor was nothing but an infrared herring, something else had to step in an continue to rumor-based levitation. Sure enough, that something was the Chinese central bank.

  • CHINA PBOC'S ZHOU SAYS HE'S CONFIDENT EU WILL SOLVE CRISIS: MNI
  • CHINA PBOC'S ZHOU SAYS HE SUPPORTS EU, ECB MEASURES: MNI
  • PBOC'S ZHOU: CHINA WILL PARTICIPATE IN RESOLVING EU DEBT CRISIS
  • CHINA PBOC GOVERNOR ZHOU SAYS HE HAS CONFIDENCE IN EURO: MNI

And that's all it took to life the ES by over 10 points in minutes.

Sure enough, it took the market less thatn 24 hours to forget this piece of bailout trivia, from Reuters:

The head of China's $410 billion sovereign wealth fund CIC brushed aside a call by German Chancellor Angela Merkel to buy European government debt, saying such investments were "difficult" for long-term investors.

 

In comments ahead of a China-EU summit starting on Tuesday, Lou Jiwei, chairman of China Investment Corp (CIC), said any fresh injection of funds into Europe would be in industrial and other real assets, not government bonds.

 

His comments struck a sharper tone than a commentary in the Communist Party mouthpiece, the People's Daily, which sought to reassure the European Union that China had no intention to "buy up Europe."

Or, heaven forbid, recall this piece from 36 hours ago, via the FT, confirming that China can barely bail out its banks, let alone focus on Europe:

China has instructed its banks to embark on a mammoth roll-over of loans to local governments, delaying the country’s reckoning with debts that have clouded its economic prospects.

 

China’s stimulus response to the global financial crisis saddled its provinces and cities with Rmb10.7tn ($1.7tn) in debts – about a quarter of the country’s output – and more than half those loans are scheduled to come due over the next three years.

 

Since the principal on many of the loans is not repayable, banks have started extending maturities for local governments to avoid a wave of defaults, bankers and analysts familiar with the matter told the Financial Times. One person briefed on the plan said in some cases the maturities would be extended by as much as four years.

 

While some analysts have warned that many loans will still go bad and that a roll-over only postpones the problem, government advisers believe that it will give Beijing time to find a more permanent solution to its debt troubles.

 

“An appropriate maturity extension is in the banks’ interest,” said Fan Jianping, chief economist of the State Information Centre, a think-tank within the government’s powerful planning agency.

Lunatics, meet asylum control room. What is funniest, however, is that everyone forgets that Germany, which saw an implosion in ts industrial production last night, now desperately needs a weak Euro at all costs, even if that means a perpetual crisis in Greece, and pledges of no bailout from China. But then again, "the market" does what SkyNet wants. And what SkyNet wants, only SkyNet comprehends.

Rumor half life: 1-3 hours.

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RobotTrader's picture

Rosie strikes again.

Xibalba's picture

This is Chinese for SOLD TO YOU

UP Forester's picture

All your industrials are belong to us, roundeye!

Manthong's picture

Whew..

Thank goodness it really happened..

                     I thought it was the drugs.

And.. "algos respond every single time like stung donkeys as if on command"

I don't think any "IF" is involved.

 

TruthInSunshine's picture

RoboTard has a raging boner because the Nikkei is only 94% off its 1989 high in real terms (75% in nominal terms), and U.S. indexes are down about 55% from their early 2000 highs in real $$$ terms, and are actually near their nominal levels (if one discounts the fact that the indexes have seen many former ticker symbols crash and burn, and go bye-bye, with the charlatans of the indexes rotating new ticker symbols in for those of the departed; which makes it an even sicker scam).

A system built on a foundation of the [quick]sand of CONfidence.

That & central bank interventionism (printing fiat in large batches rendering each additional unit of fiat more marginal than the last; aka diminishing returns) is all that's keeping the Ponzi on life support.

And people are waking up to the con in the words of CONfidence in larger numbers and more quickly (thanks to the internet, where they can get exposure to radical ideas such as going deeper into debt doesn't lead to resolution of debt cancer) than ever before, so let's see how long the fractional reserve charlatans can run with it, now.

The more that Asians buy into the rally-on-the-rumor pops, the more confident I am that the inevitable meltdown is closer at hand. Asians are hands down the worst investors in the world, and prolific gamblers on top of that (although Asians crush American, British and just about any 'westerners' when it comes to saving vs. becoming debt slaves, so I won't deny them that far better cultural habit vs our prolific, cancerous culture of debt serfdom).

Nikkei syndrome, bitches.

[And if Siegel came out of his Ivory Tower bunker to speak of unicorns and rainbows, and spew his 'stocks are the best asset class over the long run' bullshit, even as bonds have kicked the ass of equities to the curb not just for 10, or 20, or 30, but for 40 years now....damn, I am going to love the crash.]

i root for that fat jersey governor's picture

Tyler and the rest of losers on this site - do all the bitching you want now cuz tomorrow the china/eu pack is going to run you over - market is going to the moon

TruthInSunshine's picture

2000 called you a bitch. 2007 said your vagina hurts. You're going to be bleeding of the rectum soon, Wiesenthal.

This vaporware illusion of a market is the historical rhyme to 1932, only now investors in equities will be four times bitten in 11 years (and thrice bitten in 3 years).

Stick a fork in the Ponzi. If the whores on Wall Street aren't dumping with both hands, I'll buy you an oil painting of Jim Cramer or Jesse Livermore (your option).

GernB's picture

What part of "rumor" is hard to understand.

spartan speculation's picture

Tyler you could also add this to your article http://www.bloomberg.com/news/2012-02-15/asian-stocks-rise-as-greek-bailout-progress-yen-s-slide-boost-outlook.html  notice the headline

Asian Stocks Rise on China Pledge to Help Europe

 . then inside this artilce 

 

 

China’s Support

Futures on the Standard & Poor’s 500 Index advanced 0.5 percent today. The index lost 0.1 percent in New York yesterday, paring an earlier decline of as much as 0.8 percent as U.S. retail sales trailed estimates after sales of automobiles unexpectedly declined.

Elpida slumped 14 percent to 322 yen after saying it saw “uncertainty” over remaining in business because it hasn’t secured financing. The company, which reported 311.7 billion yen revenue in the 12 months to Dec. 31, has 210.8 billion yen of debt maturing this year, according to data compiled by Bloomberg. The shares earlier touched their lowest level since at least November 2004.

South Korean and Taiwanese competitors rose. Samsung Electronics (005930), South Korea’s biggest exporter of consumer electronics, rose 5.2 percent to 1.14 million won. Samsung may separate its liquid-crystal-display business, the Electronics Times reported today. Hynix Semiconductor, a maker of semiconductors such as dynamic random access memory, gained 5.3 percent to 29,000 won.

 

 

Where in this entire article is there anything that china is pledging anything to support the EU crisis ?? WTF is going on in these markets ??? how can we even call these markets anymore. 

GernB's picture

You can even read the Market Watch report and read the actual reporting on what was said and it was not that they intended to invest in Europe, but that they support the measures the Eurozone has taken.

LongSoupLine's picture

 

 

More Sun Tzu...

 

All war is based on deception

ACP's picture

Or just an excuse for Madman Bernanke to ramp es up to 1355.75, which......oh...he just did!

So will be Wednesday be the pre-planned peak at 1374 + or -?

Those "in the know" BOT at 1530 EST, those outside the loop started buying at 2115 EST.

Cdad's picture

Again...it is just painful to watch this market.  It is sooooo obviously just a mainpulated bucket of lark's vomit at this point.  How desperate is Larry "100% in equities" Fink if this kind of sheer stupidity is holding up his now bloated book of equities that every Average Joe in the nation has put back to him? 

The market is gone.  There are only ones and zeros...and I don't think Americans even give a shit about the stock market, anymore.  Just sad, really.

John Law Lives's picture

"It is sooooo obviously just a mainpulated bucket of lark's vomit at this point."

Nice one.  That is a colorful (and accurate) description.

candyman's picture

where you been Cdad. I like your stuff.

resurger's picture

WOW!

ASIA IS UP BY 3%

vast-dom's picture

ASIAN MARKETS PICK UP STEAM ON SHIT FUMES AND RUMORS

LET THE SINKHOLE TANK ALREADY

trade the day's picture

imagine what will happen to the markets when they hear that whitney houston died. 

lotsoffun's picture

or whoopie.  or oprah?

i mean really  - i'm not sure elvis or marilyn are really dead either.

it makes perfect sense that china will buy ecb and ust bonds.  forever.

 

Wipeout2097's picture

ZH parroting British media again...

 

 

Bear's picture

24/7 Are we now at that the cliff's edge or at the foot of the mountain ... time for a few straddles

Bud Denton's picture

China is going to save everyone.  That is because they get rich selling to everyone.  So they have lots of money.

No, they do not need for their customers like Europe to have money to buy Chinese stuff.  They can loan them the money to buy the stuff--you know, give it to them on credit.  Forever.  The obamahitler says so, and he would never lie.

It is boorish to suggest that a Hitler is a Hitler.  The Obamahitler is different.

This time is different.

Pass the Kool-aid.

Mr Lennon Hendrix's picture

Shirakawa loves playing stocks.  Look at Japan go!

bobola's picture

Don't forget to hit robo's red G spot before you comment.

Maybe the EU tells China 'Buy our bonds or we quit buying your antifreeze tainted milk'.

fonzannoon's picture

with all due respect earlier it was a reuters article that the greek guy to be said he would sign a document. Now it is China rumors. I think the explanation of the last 30 minutes today is a lot simplier. The market is not allowed to close with negative momentum under any circumstances from here on out. It could possible spark an asia selloff sparking a european sell off. The market under certain circumstances may be allowed to be down for the day but closing momentum has to be positive.

Global Hunter's picture

ya as I allude to below they can play the "china to the rescue card in the pm" and then in the am europe won't have the paperwork ready for the Chinese and then next pm China agree to terms" but in the am the Finns show up to throw a wrench in the plans and on and on and on and on

Cdad's picture

You are both morons if you really think this kind of "news" is going to cause real capital to move into markets.  This is options junkie stuff.  This is crooked and complicit market maker stuff.  This is market credibility destroying stuff that is not serving the long side of the market.

Get real.

fonzannoon's picture

You just made my point if you read what I wrote.

Get lost

 

 

matrix2012's picture

"real capital" may not move in...

but watch, there are still many passionate sheeples to harvest...  errrgh

 

Faux news and all the trumpets still get lot of audiences dont they?

 

Get the reality straight

Randall Cabot's picture

Good observation. Same pattern with Europe, it nearly always gets viagra'd in the last 15 minutes too so that closing momo is positive to calm the US markets. I wish I knew this a few weeks ago!

Schmuck Raker's picture

Maybe the German and EZ GDP numbers are going to be atrocious so they're doubling up on the rumors tonight.

junkyardjack's picture

Well the rich in China are definitely looking for ways to get their capital out of their own shit hole so they can flee the sinking ship.  What better than a bail out to exchange some currency and then rip it back out once you're on your life boat out of China. Even if they lose a little on the trade, who cares the money was stolen anyway

frostfan's picture

The Chinese are way too busy watching Jeremy Lin to deal with these European jokers.

LINSANITY!!!!!!!!!!!!!!!!!!

 

UP Forester's picture

Did you e-mail the White House and tell 'em with $40 you can save the market?

Central Bankster's picture

He's likely correct.  Time stamp on the marketwatch article is 9:23 which coincides perfectly with the spike in the futures contracts.

jomama's picture

i hate it when i hit that save button twice, too.

Global Hunter's picture

The ECB should probably be able to get the proper paperwork to the Chinese by about 2027 or at least come to an agreement by then.

matrix2012's picture

europa should instead whisper persuasively to china "buy our bonds, now!" or "we gonna loot n plunder you as in 1900" or sell you hopium...your call!

eight-nation alliance :D

Martial's picture

I heard it was Botswana. This is official. Botswana is the new China. We are saved. Yay.

Father Lucifer's picture

Thanks for the info Tyler.

monopoly's picture

This is madness. And some call this "investing". What a waste.

YesWeKahn's picture

How does Bernanke think of AAPL being a trillion $ company?

disabledvet's picture

the subject of China is BY FAR the Tylers' biggest "re-hypothekarokeness" problem. Chimerica is anything but. The run rates on these Chinese factories that will be necessary in order to remain profitable are simply staggering. Almost as staggering as the scales of efficiency and quality control that they have attained. Think of "the Detroit model" gone global. I have NO CLUE how it works...but that trade surplus don't lie. To me what sums the the ENTIRE story about.."China"...is "the new guy playing for the New York Knickerbockers." He sits on the bench, and sits on the bench, and sits on the bench...and "then plays and the Dolan family makes a billion dollars." I'm trying to imagine that happening in the trucking industry but somehow...i can't. Anywho...here's my view of how "the deal went down from 2008 to today":
http://www.youtube.com/watch?feature=player_detailpage&v=FDhGS4EJS8M

ebworthen's picture

China has hundreds of millions (billions) of citizens who are slaves to the PLA (Peoples "Liberation" Army - an oxymoron if ever there was one).

ZERO property rights, individual rights, labor laws, etc., etc.

You make the local party chief happy or you lose everything, get raped, or die.

This "inconvenient" truth has fueled Apple's rise, along with the offshoring of countless Western jobs.

Somehow, the slavery of billions will lead the world to a "better place".

Meanwhile, in Oz, the former citizens of U.S.S.A. are delegated to joining the skullduggery, milking the system, or going "off-grid" and being labeled as domestic terrorists.

Global Winter in the Kondratieff sense, but in the delusion of memories past and forgotten morals and principles it is spackled as "green shoots" and "recovery" bullshit over the crack on the ass of a dying republic and over Human Liberty.