China Threatens To Dump Dollar

[lannarebirth]

'No plans' to sell off greenback

By Xin Zhiming (China Daily)

13th august 2007

The US dollar plays an important role in the global monetary system and dollar assets are an important part of China's foreign exchange reserve, the central bank said yesterday.

The announcement by the People's Bank of China (PBOC), experts said, should scotch rumors that Beijing would sell off its US dollar reserve in response to Washington's pressure to revaluate the yuan.

So who should I believe? The PBOC? Or TV posters saying the opposite?

Clearly, high placed Chinese officials had read TV and realized we knew it was an empty threat.

Clearly, my grandfather was on to something, when he cautioned me at a young age to beware, as "paper never refused ink". The threat and the retraction carry absolutely the same weight, which is nothing.

[LaoPo]

China expresses confidence in U.S. dollar

By MarketWatch

Last Update: 2:00 PM ET Aug 12, 2007

NEW YORK (MarketWatch) -- China's central bank on Sunday said that dollar-denominated assets are an important part of its $1.33 trillion in foreign-exchange reserves and that the dollar has a "major position" in the global monetary system, news agencies reported.

The comments, expressed by an anonymous central-bank official via the Xinhua news agency, were in response to media reports suggesting Beijing might dump dollars.

Last Wednesday, the U.K. newspaper Telegraph quoted Chinese government economists as saying China might sell its dollar holdings should the U.S. imposed trade sanctions against the country.

The comments also come amid growing concerns about a global credit crunch, which forced key central banks to inject liquidity into the global financial system on Thursday and Friday.

The Chinese central-bank said its priorities in managing its $1.33 trillion of foreign-currency reserves were safety, liquidity and investment returns, in that order, China's official news agency Xinhua reported.

Some U.S. senators have recently stepped up pressure on China to let its currency, the yuan, appreciate, or face possible trade sanctions. The yuan, they say, is undervalued and gives Chinese-made goods an unfair advantage that hurts U.S. manufacturers.

China has also felt growing pressure to diversify its massive foreign-exchange reserves away from the dollar as the U.S. currency has continued to weaken.

The purchase of U.S. assets, such as Treasury bonds, has helped to keep U.S. interest rates fairly low. The yield of the 10-year Treasury bond is used to benchmark key loans such as mortgages or corporate loans. When bond prices fall, their yields rise, lifting the effective cost of borrowing.

A sell-off in the U.S. dollar and Treasury bonds would lead to a spike in U.S. interest rates, making it even harder to obtain loans for borrowers of all stripes.

End of Story

source:

Market Watch/Dow Jones.

http://www.marketwatch.com/news/story/chin...ist=SecMostRead

LaoPo

[lannarebirth]

'No plans' to sell off greenback

By Xin Zhiming (China Daily)

13th august 2007

The US dollar plays an important role in the global monetary system and dollar assets are an important part of China's foreign exchange reserve, the central bank said yesterday.

The announcement by the People's Bank of China (PBOC), experts said, should scotch rumors that Beijing would sell off its US dollar reserve in response to Washington's pressure to revaluate the yuan.

So who should I believe? The PBOC? Or TV posters saying the opposite?

Clearly, high placed Chinese officials had read TV and realized we knew it was an empty threat.

Clearly, my grandfather was on to something, when he cautioned me at a young age to beware, as "paper never refused ink". The threat and the retraction carry absolutely the same weight, which is nothing.

Well, it could have some value perhaps, if the intent is to obfuscate. Anyhow, I can't frind my link right now, but China's holdings in US treasuries have been declining the past several months by a few billion dollars per month. Japan (which holds much more paper) has remained about steady, and European countries, especially England, have been snapping it up from fairly low levels of ownership.

[palm]

'No plans' to sell off greenback

By Xin Zhiming (China Daily)

13th august 2007

The US dollar plays an important role in the global monetary system and dollar assets are an important part of China's foreign exchange reserve, the central bank said yesterday.

The announcement by the People's Bank of China (PBOC), experts said, should scotch rumors that Beijing would sell off its US dollar reserve in response to Washington's pressure to revaluate the yuan.

So who should I believe? The PBOC? Or TV posters saying the opposite?

there you go again...posting facts. why? good for what??

Sorry about that. Bad habit.

Though I did hear from a guy in a pub recently, that his mate knew someone who overheard some big Government person in China (or someplace around there), that they may dump dollars and buy gold ping pong balls instead - but only if they got any more cracking macro economic tips from a mate of their mate's friend who drank somewhere around Suk Soi 4.

Edited August 13, 2007 by palm

[Carmine6]

'No plans' to sell off greenback

By Xin Zhiming (China Daily)

13th august 2007

The US dollar plays an important role in the global monetary system and dollar assets are an important part of China's foreign exchange reserve, the central bank said yesterday.

The announcement by the People's Bank of China (PBOC), experts said, should scotch rumors that Beijing would sell off its US dollar reserve in response to Washington's pressure to revaluate the yuan.

So who should I believe? The PBOC? Or TV posters saying the opposite?

Clearly, high placed Chinese officials had read TV and realized we knew it was an empty threat.

Clearly, my grandfather was on to something, when he cautioned me at a young age to beware, as "paper never refused ink". The threat and the retraction carry absolutely the same weight, which is nothing.

Well, it could have some value perhaps, if the intent is to obfuscate. Anyhow, I can't frind my link right now, but China's holdings in US treasuries have been declining the past several months by a few billion dollars per month. Japan (which holds much more paper) has remained about steady, and European countries, especially England, have been snapping it up from fairly low levels of ownership.

Here's the link: http://www.ustreas.gov/tic/mfh.txt

It's 2 months delayed so we'll see what China has done lately. The UK has been buying recently. If you look at the yuan/$ currency exchange rate, it's been going sideways for about a month. Although that was after a pretty big sudden move so it's still somewhat on the same trend.

Oh yeah, note that Thailand has picked up about $1 to $2 billion in treasuries recently.

Edited August 13, 2007 by Carmine6

[LaoPo]

Here's the link: http://www.ustreas.gov/tic/mfh.txt

It's 2 months delayed so we'll see what China has done lately. The UK has been buying recently. If you look at the yuan/$ currency exchange rate, it's been going sideways for about a month. Although that was after a pretty big sudden move so it's still somewhat on the same trend.

Oh yeah, note that Thailand has picked up about $1 to $2 billion in treasuries recently.

Thanks for the link, Carmine6, interesting !

I don't think it's something to worry about. Don't forget China is looking for other investments, more profitable [than low-yielding treasuries], like the $3 Billion in Blackstone/USA and the intention to invest $2.2 Billion in Barclays/UK, amongst others.

Also, [foreign country] Holders of US treasuries increased their holdings more than 5,4 % in 1 year; may 2006 versus may 2007.

In the same period:

China's increased by 25.5%

Japan's declined by 3.3%

UK's declined by 3.8%

* Oil Exporters' increased by 17.8% These are the 4 largest Foreign Holders of US Treasuries. They hold a total of 66.4% of all [foreign hold] US Treasuries

Thailand's increased by 20.6%

* Oil exporters include Ecuador, Venezuela, Indonesia, Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, the United Arab Emirates, Algeria, Gabon, Libya, and Nigeria.

LaoPo

[LaoPo]

[China's] Growth rate of trade surplus slows down

Excerpts:

China's trade surplus growth slowed down in July from the first half of the year, with imports hitting a record high, the Customs said on Friday.

Imports touched $83.39 billion in July, reflecting a year-on-year increase of 26.9 percent, the General Administration of Customs said.

"It is the highest monthly volume," it said. Also, for the first time since April, monthly imports crossed $80 billion.

Many experts agree that China's surplus will remain high but the growth will slow down in the second half.

Despite many US people being worried that made-in-China products will flood the US market and hurt local industries, a US industrial association report illustrated "the widespread benefits to the US economy that have resulted from growing US exports to China".

The US-China Business Council said overall US exports when China grew 240 percent from 2000 through 2006.

Source: Bizchina/Chinadaily

LaoPo

[bingobongo]

Three Bubbles That Could Derail China's Economy:

http://www.bloomberg.com/apps/news?pid=206...id=ajGfZE0i6vJ4

[LaoPo]

Three Bubbles That Could Derail China's Economy:

http://www.bloomberg.com/apps/news?pid=206...id=ajGfZE0i6vJ4

Thanks Bingo; I read Bloomberg many times a day, but what puzzles me is what you're trying to say with your link ?

I'm not saying there isn't a 'bubble in many bubbles' like the article suggests.

The point is that many people forget that the Chinese stock markets are like stock-islands in the world...meaning that the money, invested in the Chinese stock markets, is....Chinese money, and NOT like the main world markets, 'world-money'.

Therefore the Chinese stock markets do not influence the other main markets and vice versa, just marginally.

If Chinese stocks tumble, it will hurt the Chinese investors, not for the major part the world markets.

Also: most of the -mainland- Chinese listed companies are making enormous profits and will, as such, not be hurt by the prices of stocks, they will continue producing.

LaoPo

[Carmine6]

[China's] Growth rate of trade surplus slows down

Excerpts:

China's trade surplus growth slowed down in July from the first half of the year, with imports hitting a record high, the Customs said on Friday.

Imports touched $83.39 billion in July, reflecting a year-on-year increase of 26.9 percent, the General Administration of Customs said.

"It is the highest monthly volume," it said. Also, for the first time since April, monthly imports crossed $80 billion.

Many experts agree that China's surplus will remain high but the growth will slow down in the second half.

Despite many US people being worried that made-in-China products will flood the US market and hurt local industries, a US industrial association report illustrated "the widespread benefits to the US economy that have resulted from growing US exports to China".

The US-China Business Council said overall US exports when China grew 240 percent from 2000 through 2006.

Source: Bizchina/Chinadaily

LaoPo

Thailand was $1.2 billion of that $83.4 billion. The first 5 months of Thai exports this year were 15% higher (baht) than last year's first 5 months. In dollar terms it's 27% higher. Imports from China were up 10% (baht, 22% in $) for that same period.

For 2000 to 2006, Thai exports to China were up 294% in baht terms and 313% in dollar terms.

[bingobongo]

Three Bubbles That Could Derail China's Economy:

http://www.bloomberg.com/apps/news?pid=206...id=ajGfZE0i6vJ4

Thanks Bingo; I read Bloomberg many times a day, but what puzzles me is what you're trying to say with your link ?

I'm not saying there isn't a 'bubble in many bubbles' like the article suggests.

The point is that many people forget that the Chinese stock markets are like stock-islands in the world...meaning that the money, invested in the Chinese stock markets, is....Chinese money, and NOT like the main world markets, 'world-money'.

Therefore the Chinese stock markets do not influence the other main markets and vice versa, just marginally.

If Chinese stocks tumble, it will hurt the Chinese investors, not for the major part the world markets.

Also: most of the -mainland- Chinese listed companies are making enormous profits and will, as such, not be hurt by the prices of stocks, they will continue producing.

LaoPo

China’s stock markets are now worth more then China’s GDP. Bad sign.

[palm]

Three Bubbles That Could Derail China's Economy:

http://www.bloomberg.com/apps/news?pid=206...id=ajGfZE0i6vJ4

Thanks Bingo; I read Bloomberg many times a day, but what puzzles me is what you're trying to say with your link ?

I'm not saying there isn't a 'bubble in many bubbles' like the article suggests.

The point is that many people forget that the Chinese stock markets are like stock-islands in the world...meaning that the money, invested in the Chinese stock markets, is....Chinese money, and NOT like the main world markets, 'world-money'.

Therefore the Chinese stock markets do not influence the other main markets and vice versa, just marginally.

If Chinese stocks tumble, it will hurt the Chinese investors, not for the major part the world markets.

Also: most of the -mainland- Chinese listed companies are making enormous profits and will, as such, not be hurt by the prices of stocks, they will continue producing.

LaoPo

China’s stock markets are now worth more then China’s GDP. Bad sign.

Ahhh... yet more financial advice from someone who can't even afford to own decent property in Thailand - follow such amazing financial advice and you too can be as poor, bitter and miserable has him.

[LaoPo]

Three Bubbles That Could Derail China's Economy:

http://www.bloomberg.com/apps/news?pid=206...id=ajGfZE0i6vJ4

Thanks Bingo; I read Bloomberg many times a day, but what puzzles me is what you're trying to say with your link ?

I'm not saying there isn't a 'bubble in many bubbles' like the article suggests.

The point is that many people forget that the Chinese stock markets are like stock-islands in the world...meaning that the money, invested in the Chinese stock markets, is....Chinese money, and NOT like the main world markets, 'world-money'.

Therefore the Chinese stock markets do not influence the other main markets and vice versa, just marginally.

If Chinese stocks tumble, it will hurt the Chinese investors, not for the major part the world markets.

Also: most of the -mainland- Chinese listed companies are making enormous profits and will, as such, not be hurt by the prices of stocks, they will continue producing.

LaoPo

China’s stock markets are now worth more then China’s GDP. Bad sign.

It's not just what's in the eye of the beholder:

"In addition, since a large portion of the stocks remained untradable at present, the circulation value of China's stock market only accounts for 33.99 percent of the total value."

Therefore, the headline:

Stock market value close to GDP, still has room to improve

Source:

http://www.chinadaily.com.cn/bizchina/2007...ent_6015683.htm

edit:

I would like to express that I am much more concerned about the present sub-prime mortgage problems in the US, and possibly upcoming same situation in the UK and Spain, than the stock markets in China.

The first have much more far reaching tentacles in the financial Banking systems & world markets than the latter.

LaoPo

Edited August 14, 2007 by LaoPo

[highdiver]

Three Bubbles That Could Derail China's Economy:

http://www.bloomberg.com/apps/news?pid=206...id=ajGfZE0i6vJ4

Thanks Bingo; I read Bloomberg many times a day, but what puzzles me is what you're trying to say with your link ?

I'm not saying there isn't a 'bubble in many bubbles' like the article suggests.

The point is that many people forget that the Chinese stock markets are like stock-islands in the world...meaning that the money, invested in the Chinese stock markets, is....Chinese money, and NOT like the main world markets, 'world-money'.

Therefore the Chinese stock markets do not influence the other main markets and vice versa, just marginally.

If Chinese stocks tumble, it will hurt the Chinese investors, not for the major part the world markets.

Also: most of the -mainland- Chinese listed companies are making enormous profits and will, as such, not be hurt by the prices of stocks, they will continue producing.

LaoPo

China’s stock markets are now worth more then China’s GDP. Bad sign.

It's not just what's in the eye of the beholder:

"In addition, since a large portion of the stocks remained untradable at present, the circulation value of China's stock market only accounts for 33.99 percent of the total value."

Therefore, the headline:

Stock market value close to GDP, still has room to improve

Source:

http://www.chinadaily.com.cn/bizchina/2007...ent_6015683.htm

edit:

I would like to express that I am much more concerned about the present sub-prime mortgage problems in the US, and possibly upcoming same situation in the UK and Spain, than the stock markets in China.

The first have much more far reaching tentacles in the financial Banking systems & world markets than the latter.

LaoPo

so so true.

[VegasVic]

Three Bubbles That Could Derail China's Economy:

http://www.bloomberg.com/apps/news?pid=206...id=ajGfZE0i6vJ4

Thanks Bingo; I read Bloomberg many times a day, but what puzzles me is what you're trying to say with your link ?

I'm not saying there isn't a 'bubble in many bubbles' like the article suggests.

The point is that many people forget that the Chinese stock markets are like stock-islands in the world...meaning that the money, invested in the Chinese stock markets, is....Chinese money, and NOT like the main world markets, 'world-money'.

Therefore the Chinese stock markets do not influence the other main markets and vice versa, just marginally.

If Chinese stocks tumble, it will hurt the Chinese investors, not for the major part the world markets.

Also: most of the -mainland- Chinese listed companies are making enormous profits and will, as such, not be hurt by the prices of stocks, they will continue producing.

LaoPo

If worldwide demand slows for those chinese goods then those enormous profits will shrink very quickly, at the same time the hedge funds and mutual funds will be selling off their positions and the final leg downward will be the chinese investors seeing their net worth shrink on a daily basis and this will become a self feeding cycle of selling. Those chinese investors (many in the new middle class) have never seen a bear market they have seen things go up virtually in a straight line except for the hiccup earlier this year, so when things begin to head south the panic will be uncontrolable. The fact that most of the investment in the chinese markets are by the chinese people will not help moderate the crash, it will in fact make it worse. Lao you seem to be a very bright individual but when it comes to the chinese markets you are so close to this situation that you apparently can't see forest because the trees are in the way. In any event I wish you the best of luck.

[LaoPo]

If worldwide demand slows for those chinese goods then those enormous profits will shrink very quickly, at the same time the hedge funds and mutual funds will be selling off their positions and the final leg downward will be the chinese investors seeing their net worth shrink on a daily basis and this will become a self feeding cycle of selling.

Those chinese investors (many in the new middle class) have never seen a bear market they have seen things go up virtually in a straight line except for the hiccup earlier this year, so when things begin to head south the panic will be uncontrolable.

The fact that most of the investment in the chinese markets are by the chinese people will not help moderate the crash, it will in fact make it worse.

Lao you seem to be a very bright individual but when it comes to the chinese markets you are so close to this situation that you apparently can't see forest because the trees are in the way. In any event I wish you the best of luck.

1. Mr. VegasVic, my webname is LaoPo, not Lao

2. Demand slows, profits will shrink ? Yes, you're right. That's the basic economical factor. The same all over the world. If demand slows, the Western world is buying less and that means the economical situation/growth is slowing in the same West; bad sign.

3. Chinese investors never seen a bear [stock] market ? Yes, that's right. But these same Chinese have been living under more horrible circumstances, most of their lives, than you or I have ever have been but they're able to adapt to any [bad[ situation better than Westerners...Why ? because they're savers, not spenders and although prices are rising there also, it's still fairly much cheaper to live around the clock than in the West.

4. Panic Uncontrolable ? You seem to forget that the Chinese stock markets, unless the Western markets, have a LIMIT of 10%-up or 10%-down PER DAY. That doesn't mean that a bear market couldn't happen of course, but it's better 'controlled', to protect the investors against themselves, than Western markets.

5. I'm not too close to the markets in China, I'm 10-12 hours by plane away, but visiting the country for some 30 years now, for business and privately; but that also counts for the US and Europe.

Mr. VegasVic, we're living in shaky times nowadays and both you and me can only hope the world system doesn't collapse...

btw: enjoy your next round of golf, ok ?

LaoPo

[TRIPxCORE]

If China really wanted to spite the U.S., this would be the right move to make dumping all their U.S. assets. As others have said though, China won't do this. China's main exporting country is the U.S. so to cause damage to the U.S. economy would be detrimental to the Chinese export market. This is just an empty threat.

[waldpyk]

no , i do not see it as an empty threat , it,s more a warning or better a reminder

"don't overstep our line , we have got you by the balls"

sure dumping part of the dollars would hurt , but it would hurt the us economy and the

confidence in the dollar even more

no need to do it just a small reminder to their us-partner

[lannarebirth]

Anything's possible. I just noticed this:

"August fed funds are now pricing in 100% odds of an intermeeting cut (meaning before the end of the month.) Back-month contracts are pricing in 100% odds of a second 1/4 point cut before year-end." Source markettells. com

Idiots!

BTW, I have many global markets showing waterfall selloff pattern. I show tomorrow to be an important day. We'll see.

[lannarebirth]

The US Dollar Index will close today at very strong resistance (it's primary downtred line), that it has thusfar been unable to breach. Tomorrow will be an interesting day in global markets.

[bingobongo]

now china and USA are playing tit for tat, you block my defective lead painted toys and antibiotic laden food and I will sell your debt .....and mighty brazil is stepping in to keep yields down.......

Brazil Treasury Purchases Jump to Record; China Sells

China, the biggest foreign holder of Treasuries after Japan, sold a net $14.7 billion of U.S. government debt from April through June, the first time the country has sold Treasuries in three straight months since November 2000.

http://www.bloomberg.com/apps/news?pid=206...&refer=home

Edited August 15, 2007 by bingobongo

[LaoPo]

now china and USA are playing tit for tat, you block my defective lead painted toys and antibiotic laden food and I will sell your debt .....and mighty brazil is stepping in to keep yields down.......

Brazil Treasury Purchases Jump to Record; China Sells

China, the biggest foreign holder of Treasuries after Japan, sold a net $14.7 billion of U.S. government debt from April through June, the first time the country has sold Treasuries in three straight months since November 2000.

http://www.bloomberg.com/apps/news?pid=206...&refer=home

What are you trying to say Bingobongo ?

I totally miss your point as Brazil is a country in debt, unlike China.

"For Brazil, buying a bigger proportion of assets in other currencies, betting on bigger gains, would be speculation that the central bank shouldn't engage in, he said."

" Swelling Debt

Brazil's total debt owed to creditors abroad -- including liabilities of companies and government -- rose to $182 billion at the end of June, from $157 billion a year earlier. The government's share of foreign debt has risen to $71.2 billion from $64.8 billion over the same period."

As far as the Total Foreign Holders of US Treasuries is concerned:

http://www.ustreas.gov/tic/mfh.txt

LaoPo

[Carmine6]

now china and USA are playing tit for tat, you block my defective lead painted toys and antibiotic laden food and I will sell your debt .....and mighty brazil is stepping in to keep yields down.......

Brazil Treasury Purchases Jump to Record; China Sells

China, the biggest foreign holder of Treasuries after Japan, sold a net $14.7 billion of U.S. government debt from April through June, the first time the country has sold Treasuries in three straight months since November 2000.

http://www.bloomberg.com/apps/news?pid=206...&refer=home

What are you trying to say Bingobongo ?

I totally miss your point as Brazil is a country in debt, unlike China.

"For Brazil, buying a bigger proportion of assets in other currencies, betting on bigger gains, would be speculation that the central bank shouldn't engage in, he said."

" Swelling Debt

Brazil's total debt owed to creditors abroad -- including liabilities of companies and government -- rose to $182 billion at the end of June, from $157 billion a year earlier. The government's share of foreign debt has risen to $71.2 billion from $64.8 billion over the same period."

As far as the Total Foreign Holders of US Treasuries is concerned:

http://www.ustreas.gov/tic/mfh.txt

LaoPo

I don't know what his point was, but let me say that China can sell all it wants, there are plenty of other buyers to pick it up. The yield has been decreasing because there is so much demand for US Treasuries with all the volatility. The UK picked up $22.5 billion from May to June. What's that all about?

Why did Thailand drop $900 million May to June when there's so much concern about the exchange rate?

[TRIPxCORE]

The U.S. economy is already in a recession, it just hasn't been announced yet.

[j_cheung]

If worldwide demand slows for those chinese goods then those enormous profits will shrink very quickly, at the same time the hedge funds and mutual funds will be selling off their positions and the final leg downward will be the chinese investors seeing their net worth shrink on a daily basis and this will become a self feeding cycle of selling.

Those chinese investors (many in the new middle class) have never seen a bear market they have seen things go up virtually in a straight line except for the hiccup earlier this year, so when things begin to head south the panic will be uncontrolable.

The fact that most of the investment in the chinese markets are by the chinese people will not help moderate the crash, it will in fact make it worse.

Lao you seem to be a very bright individual but when it comes to the chinese markets you are so close to this situation that you apparently can't see forest because the trees are in the way. In any event I wish you the best of luck.

1. Mr. VegasVic, my webname is LaoPo, not Lao

2. Demand slows, profits will shrink ? Yes, you're right. That's the basic economical factor. The same all over the world. If demand slows, the Western world is buying less and that means the economical situation/growth is slowing in the same West; bad sign.

3. Chinese investors never seen a bear [stock] market ? Yes, that's right. But these same Chinese have been living under more horrible circumstances, most of their lives, than you or I have ever have been but they're able to adapt to any [bad[ situation better than Westerners...Why ? because they're savers, not spenders and although prices are rising there also, it's still fairly much cheaper to live around the clock than in the West.

4. Panic Uncontrolable ? You seem to forget that the Chinese stock markets, unless the Western markets, have a LIMIT of 10%-up or 10%-down PER DAY. That doesn't mean that a bear market couldn't happen of course, but it's better 'controlled', to protect the investors against themselves, than Western markets.

5. I'm not too close to the markets in China, I'm 10-12 hours by plane away, but visiting the country for some 30 years now, for business and privately; but that also counts for the US and Europe.

Mr. VegasVic, we're living in shaky times nowadays and both you and me can only hope the world system doesn't collapse...

btw: enjoy your next round of golf, ok ?

LaoPo

Just to add:

3. The Mainland Chinese had never experienced a full fledged bear market? Hmm, I think several family friends are still smarting from their late "A" share buying spree at the peak of the last bull run back in '01 (that's almost a 5 year lull). Having said that, many more need more "woodshed" experiences to hammer in that point.

4. What's the use of that "control" if there are no buyers at each markdown (Liquidity Crunch like what the U.S. mortgage lenders are experiencing now)? IMO, the next bear market in the Chinese bourses would hit the so-called upcoming middle class & a few highly-leveraged "Da Kuans" (or Bao Fa Hu). The central government will definitely do all it can to support the peasants and migrant workers.

[LaoPo]

I don't know what his point was, but let me say that China can sell all it wants, there are plenty of other buyers to pick it up. The yield has been decreasing because there is so much demand for US Treasuries with all the volatility. The UK picked up $22.5 billion from May to June. What's that all about?

Why did Thailand drop $900 million May to June when there's so much concern about the exchange rate?

It's a political-talk 'game' between the 2 countries, US and China.

As for the 'plenty of other buyers' availability, liquidity is drying up now, very fast and worldwide.

This issue is no longer of importance of discussion as there are more serious problems:

Asian Stocks Drop, Set for Biggest Drop in 3 Years; Banks Falls

http://www.bloomberg.com/apps/news?pid=206...&refer=home

There's blood in he streets...

LaoPo

[Carmine6]

I don't know what his point was, but let me say that China can sell all it wants, there are plenty of other buyers to pick it up. The yield has been decreasing because there is so much demand for US Treasuries with all the volatility. The UK picked up $22.5 billion from May to June. What's that all about?

Why did Thailand drop $900 million May to June when there's so much concern about the exchange rate?

It's a political-talk 'game' between the 2 countries, US and China.

As for the 'plenty of other buyers' availability, liquidity is drying up now, very fast and worldwide.

This issue is no longer of importance of discussion as there are more serious problems:

Asian Stocks Drop, Set for Biggest Drop in 3 Years; Banks Falls

http://www.bloomberg.com/apps/news?pid=206...&refer=home

There's blood in he streets...

LaoPo

Liquidity is drying up, but it goes somewhere and in many cases that's government bonds, and not just US government bonds.

Here's an article about a "flight to safety" into Japanese bonds. http://www.abcmoney.co.uk/news/152007118854.htm

UK and Australia bond prices also rose though I can't find historical data.

If you go to the main page of that website, it looks like all Asian markets are dropping a lot today. http://www.abcmoney.co.uk/ Never used that site before, it came up when I tried to find historical UK interest rates. Glancing at the headlines, Hong Kong sharply lower as funds sell holdings to meet redemptions, Korea trading HALTED for 20 minutes after a 10% drop, Malaysia sharply lower. Philippine stocks have biggest 1 day loss since Feb. 28. Thai share plunge at the open.

[lannarebirth]

It's none of those things you read in the paper. It's the markdown for the 4 1/2 year business cycle lows. Someone is always willing to write about what the cause is, and someone is always willing to read it.

[VegasVic]

I don't know what his point was, but let me say that China can sell all it wants, there are plenty of other buyers to pick it up. The yield has been decreasing because there is so much demand for US Treasuries with all the volatility. The UK picked up $22.5 billion from May to June. What's that all about?

Why did Thailand drop $900 million May to June when there's so much concern about the exchange rate?

It's a political-talk 'game' between the 2 countries, US and China.

As for the 'plenty of other buyers' availability, liquidity is drying up now, very fast and worldwide.

This issue is no longer of importance of discussion as there are more serious problems:

Asian Stocks Drop, Set for Biggest Drop in 3 Years; Banks Falls

http://www.bloomberg.com/apps/news?pid=206...&refer=home

There's blood in he streets...

LaoPo

Liquidity is drying up, but it goes somewhere and in many cases that's government bonds, and not just US government bonds.

Here's an article about a "flight to safety" into Japanese bonds. http://www.abcmoney.co.uk/news/152007118854.htm

UK and Australia bond prices also rose though I can't find historical data.

If you go to the main page of that website, it looks like all Asian markets are dropping a lot today. http://www.abcmoney.co.uk/ Never used that site before, it came up when I tried to find historical UK interest rates. Glancing at the headlines, Hong Kong sharply lower as funds sell holdings to meet redemptions, Korea trading HALTED for 20 minutes after a 10% drop, Malaysia sharply lower. Philippine stocks have biggest 1 day loss since Feb. 28. Thai share plunge at the open.

Funds (both mutual and hegde) will continue to sell in order to meet redemtions, but the real crisis now is the yen carry trade unwinding just as I warned about earlier this summer. The BOT may get their weaker baht sooner than they thought, and without lifting a finger. I didn't see a worldwide recession as a very likely scenario earlier this year, but now it appears that it is a very real possibility. Break out the umbrellas and get yourselves into a cash position!

[bingobongo]

all is not well in the land of the dragon.......if the poor rural masses are not happy, it will get interesting

China's Sharp Jump in Food Prices, Which Have Risen 15.4 Percent, Fuels Inflation Fears

The price surge has alarmed Chinese leaders, who remember that 1989's Tiananmen Square pro-democracy protests were driven in part by anger at raging inflation that exceeded 18 percent a year.

http://biz.yahoo.com/ap/070819/china_infla...fears.html?.v=3