Chinese markets plunge again causing more global shudders

[snoop1130]

Chinese markets plunge again causing more global shudders
Euronews

CHINA -- The volatility in Chinese markets has continued. They were down sharply at the close on Monday, dragging Asian markets down with them.

The Shanghai Composite was 5.33 percent down, on top of the 10 percent plunge last week that sparked a global sell-off of risky assets.

The Shenzhen Composite was down even more – 6.6 percent, while the Hang Seng index was down 2.76 percent.

The fluctuations on Asian markets and falling oil prices combined to cause the Moscow stock exchange to drop more than four percent.

Russia’s troubled rouble fell to levels against the dollar and euro not seen since the currency slump of December 2014.

European shares inched down towards their lowest level in more than three months as doubts grew about Beijing’s ability to manage the world’s second biggest economy.

The weekend saw more weak data and China has let the yuan strengthen for a second consecutive session.

Source: http://www.euronews.com/2016/01/11/chinese-markets-plunge-again-causing-more-global-shudders/

-- (c) Copyright Euronews 2016-01-11

[khwaibah]

And down the crapper China goes dragging Thailand along with it and quit few others.

[NeverSure]

China is seriously crashing. It's big run is over. It's cashed in most of its liquidity trying to prop up its economy and its debt has soared. It really has no more bullets left.

Its labor is no longer cheap and shipping costs to and from China and the West are too high to make it pay for manufacturing. Robots are replacing a lot of cheap labor.

We're watching another communist dictatorship, in a long line of them, in its death throes. Communist China and Russia - the two biggest losers on the planet.

Cheers.

[JHolmesJr]

i must say i much preferred life the way it was.....way before the crooks who brought us globalisation took us down this ruinous path.

[laowai1960]

It really has no more bullets left.

Apart from 3.6 trillion US dollars of foreign reserves; that is 3,600 billion; that is USD3,600,000,000,000; that is 9 years of Thailand's total GDP.

[Publicus]

 

It really has no more bullets left.

Apart from 3.6 trillion US dollars of foreign reserves; that is 3,600 billion; that is USD3,600,000,000,000; that is 9 years of Thailand's total GDP.

The 3.6 is the total value of the CCP's combined foreign reserves. It is not all in USD. USD value in their reserves are estimated to be $1.1 Trillion, maybe $1.2 Tn. Not any more however.

Societe General last week estimated from bond market activity globally the CCP Boyz in Beijing have sold $1.2 Trillion of forex since September. Daiwa Securities in September forecast 20% off GDP by 2020 but that looks like it might need revision to more lost and sooner.

Lombard Research says the Boyz in 2016 will have to sell another $2 Trillion of forex, perhaps as much as $2.5 Trillion. This is called reserve reversal and it is the end of the road for any country caught up in it. Forex reserves are in reversal and the yuan is submerging into depreciation. Deflation took full effect this time last year. Fifty percent of all bank loans are tied up in the bursting housing bubble. Banks are bone dry of liquidity so the central bank needs to sell forex reserves to get usd. Strange thing is, they need usd desperately cause there's not enough yuan. Yet the more usd they grab hold of an throw into the mix, the fewer yuan there are....etc etc as the dog chases its tail until the dumb mutt collapses.

CCP forex reserves presently total something like $3.4 Trillion of instruments of US, Euros, Yen, Pounds. That's it. Nothing significant in Russian rubles, nothing significant in Brazil reals, nothing significant in South Africa rands or in any other loser currencies of the now defunct and busted Brics to include their rah-rah lights out development bank.

Thailand btw will survive very comfortably throughout all of this. There are a lot of CCP proposals on the table worth many billions of imaginary dollars, baht, yuan. It's a matter of two lands of make-believe that delight in waving the magic wand. What is worse for Thailand however is to end up alone.

[copa8]

China is seriously crashing. It's big run is over. It's cashed in most of its liquidity trying to prop up its economy and its debt has soared. It really has no more bullets left.

Its labor is no longer cheap and shipping costs to and from China and the West are too high to make it pay for manufacturing. Robots are replacing a lot of cheap labor.

We're watching another communist dictatorship, in a long line of them, in its death throes. Communist China and Russia - the two biggest losers on the planet.

Cheers.

Just curious and serious question, but where would the world be after 2008 without China acting as the world's growth engine?

[NeverSure]

It really has no more bullets left.

Apart from 3.6 trillion US dollars of foreign reserves; that is 3,600 billion; that is USD3,600,000,000,000; that is 9 years of Thailand's total GDP.

Uh, You haven't been paying attention to how much of that they've sold trying to prop up their failing economy and even their stock market.

Don't forget that China HAS to have a lot of USD to engage in international trade - its biggest business. No one will accept Yuan for payment and it's all done in USD. China has sold about as much of its foreign reserves (US treasuries) as it can without going out of business. It can't keep selling more to raise cash as it has been.

It's out of bullets.

Cheers.

[Publicus]

China's capital account is largely closed. The consequence is that It contributes nothing measurable to global capital growth or development. China sells products it makes for other people to buy and by using other people's money. China deals in prices, not capital. Prices are fluid and reflect global markets. CCP's capital is almost entirely internal, limited to domestic infrastructure and some tiddlywinks projects abroad.

Capital creation drives global markets. Capital creation and management is the force in global growth, from machinery to technology to bucks in global circulation. Trade is a (popular and profitable) byproduct of capital creation, development, growth. CCP China is not a player in creating capital or in driving capital growth. Never was, never will be.

[Publicus]

 

China is seriously crashing. It's big run is over. It's cashed in most of its liquidity trying to prop up its economy and its debt has soared. It really has no more bullets left.

Its labor is no longer cheap and shipping costs to and from China and the West are too high to make it pay for manufacturing. Robots are replacing a lot of cheap labor.

We're watching another communist dictatorship, in a long line of them, in its death throes. Communist China and Russia - the two biggest losers on the planet.

Cheers.

Just curious and serious question, but where would the world be after 2008 without China acting as the world's growth engine?

CCP China is not a "growth engine." It is a manufacturing and trade machine. The manufacturing is wearing thin and the machine has worn out. Other machines of manufacturing and trade are already replacing it, witness Vietnam, Kenya, Mexico and many more.

CCP could grow its GDP from 2008 only by purchasing usd in cash and as T-Bills for its forex reserves. Without the massive purchases of US Treasuries the yuan would have appreciated by a great deal, by more than enough to make the CCP's export economy impossible, not to mention created a strong inflation. Beijing buying up T-Bills preserved itself. CCP China hasn't done anything on its own, nor does the world owe CCP China any favors.

Just as few have noticed the CCP central bank's bulk sales of T-Bills the past several months, few will notice the decline of the CCP's massively wrongheaded economy. CCP's bulk sales of T-Bills have had no effect on the USA economy or finance sectors, as predicted and as long advised. Even now the hyper-sensitive stock markets globally are settling down. They knew this huge CCP domestic mess was coming.

2015 was the year CCP Boyz exposed themselves as flying by the seat of their pants. They'd been doing it all along, they just can't hide the internal mess any longer. The mess is too big and it has too strong a stink.

[NeverSure]

China is seriously crashing. It's big run is over. It's cashed in most of its liquidity trying to prop up its economy and its debt has soared. It really has no more bullets left.

Its labor is no longer cheap and shipping costs to and from China and the West are too high to make it pay for manufacturing. Robots are replacing a lot of cheap labor.

We're watching another communist dictatorship, in a long line of them, in its death throes. Communist China and Russia - the two biggest losers on the planet.

Cheers.

Just curious and serious question, but where would the world be after 2008 without China acting as the world's growth engine?

Below is your answer, even though he didn't quote you. He's spot on. Read it.

China's capital account is largely closed. The consequence is that It contributes nothing measurable to global capital growth or development. China sells products it makes for other people to buy and by using other people's money. China deals in prices, not capital. Prices are fluid and reflect global markets. CCP's capital is almost entirely internal, limited to domestic infrastructure and some tiddlywinks projects abroad.

Capital creation drives global markets. Capital creation and management is the force in global growth, from machinery to technology to bucks in global circulation. Trade is a (popular and profitable) byproduct of capital creation, development, growth. CCP China is not a player in creating capital or in driving capital growth. Never was, never will be.

[OMGImInPattaya]

Watch you head for falling BRICs

[OMGImInPattaya]

And down the crapper China goes dragging Thailand along with it and quit few others.

OMG likes...makes things cheap for 'muricans

[OMGImInPattaya]

 

China is seriously crashing. It's big run is over. It's cashed in most of its liquidity trying to prop up its economy and its debt has soared. It really has no more bullets left.

Its labor is no longer cheap and shipping costs to and from China and the West are too high to make it pay for manufacturing. Robots are replacing a lot of cheap labor.

We're watching another communist dictatorship, in a long line of them, in its death throes. Communist China and Russia - the two biggest losers on the planet.

Cheers.

Just curious and serious question, but where would the world be after 2008 without China acting as the world's growth engine?

CCP China is not a "growth engine." It is a manufacturing and trade machine. The manufacturing is wearing thin and the machine has worn out. Other machines of manufacturing and trade are already replacing it, witness Vietnam, Kenya, Mexico and many more.

CCP could grow its GDP from 2008 only by purchasing usd in cash and as T-Bills for its forex reserves. Without the massive purchases of US Treasuries the yuan would have appreciated by a great deal, by more than enough to make the CCP's export economy impossible, not to mention created a strong inflation. Beijing buying up T-Bills preserved itself. CCP China hasn't done anything on its own, nor does the world owe CCP China any favors.

Just as few have noticed the CCP central bank's bulk sales of T-Bills the past several months, few will notice the decline of the CCP's massively wrongheaded economy. CCP's bulk sales of T-Bills have had no effect on the USA economy or finance sectors, as predicted and as long advised. Even now the hyper-sensitive stock markets globally are settling down. They knew this huge CCP domestic mess was coming.

2015 was the year CCP Boyz exposed themselves as flying by the seat of their pants. They'd been doing it all along, they just can't hide the internal mess any longer. The mess is too big and it has too strong a stink.

What so many people don't get is the Chinese work (literally) for the US, as well as being our toxic waste dump, and not the other way around. China could drop off the face of the earth and it wouldn't affect the united states much but China would shrivel up and die if not for exports to America and imports of commodities and capital goods from same. America has always had the upper-hand in this relationship despite the Chinese holding a few trillion in T-bills.

[Publicus]

 

China is seriously crashing. It's big run is over. It's cashed in most of its liquidity trying to prop up its economy and its debt has soared. It really has no more bullets left.

Its labor is no longer cheap and shipping costs to and from China and the West are too high to make it pay for manufacturing. Robots are replacing a lot of cheap labor.

We're watching another communist dictatorship, in a long line of them, in its death throes. Communist China and Russia - the two biggest losers on the planet.

Cheers.

Just curious and serious question, but where would the world be after 2008 without China acting as the world's growth engine?

CCP China is not a "growth engine." It is a manufacturing and trade machine. The manufacturing is wearing thin and the machine has worn out. Other machines of manufacturing and trade are already replacing it, witness Vietnam, Kenya, Mexico and many more.

CCP could grow its GDP from 2008 only by purchasing usd in cash and as T-Bills for its forex reserves. Without the massive purchases of US Treasuries the yuan would have appreciated by a great deal, by more than enough to make the CCP's export economy impossible, not to mention created a strong inflation. Beijing buying up T-Bills preserved itself. CCP China hasn't done anything on its own, nor does the world owe CCP China any favors.

Just as few have noticed the CCP central bank's bulk sales of T-Bills the past several months, few will notice the decline of the CCP's massively wrongheaded economy. CCP's bulk sales of T-Bills have had no effect on the USA economy or finance sectors, as predicted and as long advised. Even now the hyper-sensitive stock markets globally are settling down. They knew this huge CCP domestic mess was coming.

2015 was the year CCP Boyz exposed themselves as flying by the seat of their pants. They'd been doing it all along, they just can't hide the internal mess any longer. The mess is too big and it has too strong a stink.

What so many people don't get is the Chinese work (literally) for the US, as well as being our toxic waste dump, and not the other way around. China could drop off the face of the earth and it wouldn't affect the united states much but China would shrivel up and die if not for exports to America and imports of commodities and capital goods from same. America has always had the upper-hand in this relationship despite the Chinese holding a few trillion in T-bills.

Indeed.

The most amusing aspect of it all, at least to me at TVF, are the Brics fanboyz, those who put their money on the once and never Brics.

There are these guyz who actually believed the United States would place its national security, its existence, its fate, into the hands of an evil foreign government or governments.

The countries involved are Russia which is run by the Chekist Putin in his tsarist-commissar mindset.

There's the People's Republic of China which is a wholly owned subsidiary of the Chinese 21st Century Fascist Communist Party, CCP.

Brazil is not necessarily the same kind of ancient place led by primitive elites rooted in some dark past on another continent, but Brazil made the same error as Thailand, which is to think of itself in terms of exploitation. Brazil had thought it spoke as some part of The Global South versus the rich and powerful Empire of The Global North and its evil ways. The global north simply being the West.

India survives and it is in fact prospering under its recently elected Prime Minister Narendra Modi of the BJP who is openly pro-USA and openly opposed to the CCP Dictators in Beijing. India had never been more than a marginal-observer member of the now defunct Brics. The turning point for India was the Russian aggression in Ukraine and the CCP Boyz moves in the South China Sea. Sanctions on Russia froze the Russian economy, and CCP's aggressions made their long term intentions unmistakable, especially when CCP told Modi "the Indian Ocean is not Indian."

India spent 2015 signing new "strategic agreements" with Japan, Vietnam, Australia, Malaysia, Singapore, United States. India has moved strategically to shift large elements of its military from the border with Pakistan to the north and its border with China. It's constructed huge naval and air bases in the Andaman islands at the north end of the Malacca Strait which is one of the world's strategic chokepoints. Japan has also completed its major strategic shift to reposition the bulk of its armed forces from the north where they'd defended against Russia to the south to defend against CCP China.

In short, CCP has restored nothing because there was nothing to restore. Its Marxist-Leninist-Maoist aggressiveness and wrongheaded ideas about political economy are taking it down the same path as the CCCP. Putin's Chekist Russia is speeding toward its own great bric wall.

[NeverSure]

 

CCP China is not a "growth engine." It is a manufacturing and trade machine. The manufacturing is wearing thin and the machine has worn out. Other machines of manufacturing and trade are already replacing it, witness Vietnam, Kenya, Mexico and many more.

CCP could grow its GDP from 2008 only by purchasing usd in cash and as T-Bills for its forex reserves. Without the massive purchases of US Treasuries the yuan would have appreciated by a great deal, by more than enough to make the CCP's export economy impossible, not to mention created a strong inflation. Beijing buying up T-Bills preserved itself. CCP China hasn't done anything on its own, nor does the world owe CCP China any favors.

Just as few have noticed the CCP central bank's bulk sales of T-Bills the past several months, few will notice the decline of the CCP's massively wrongheaded economy. CCP's bulk sales of T-Bills have had no effect on the USA economy or finance sectors, as predicted and as long advised. Even now the hyper-sensitive stock markets globally are settling down. They knew this huge CCP domestic mess was coming.

2015 was the year CCP Boyz exposed themselves as flying by the seat of their pants. They'd been doing it all along, they just can't hide the internal mess any longer. The mess is too big and it has too strong a stink.

What so many people don't get is the Chinese work (literally) for the US, as well as being our toxic waste dump, and not the other way around. China could drop off the face of the earth and it wouldn't affect the united states much but China would shrivel up and die if not for exports to America and imports of commodities and capital goods from same. America has always had the upper-hand in this relationship despite the Chinese holding a few trillion in T-bills.

Correct, except China doesn't hold "a few trillion" in T-bills. It may not even hold 1 trillion. No one knows for sure but China has been selling T bills to raise cash because it's broke.

China holds the T bills so it can engage in international trade. They represent USD to back those trades. The Yuan isn't internationally negotiable as people don't want it. They want USD in payment.

If China sells much more of its "US debt" it will be out of the international trading biz. It HAS to own those dollars. China is in deep doo doo.

Cheers.

[FangFerang]

China is seriously crashing. It's big run is over. It's cashed in most of its liquidity trying to prop up its economy and its debt has soared. It really has no more bullets left.

Its labor is no longer cheap and shipping costs to and from China and the West are too high to make it pay for manufacturing. Robots are replacing a lot of cheap labor.

We're watching another communist dictatorship, in a long line of them, in its death throes. Communist China and Russia - the two biggest losers on the planet.

Cheers.

You seem to be from a planet no one has visited yet. Is there any intelligent life there?

The Chinese are undergoing growing pains, nothing more.

At least that's what serious economists are saying. Does your planet have economists? They're different than cashiers or book keepers.

Maybe you should read a few books before you visit Earth. That way you at least can talk to first grade children and play jump rope. Hold off on the ho scotch, though. That requires neurons and muscles.

[craigt3365]

China is seriously crashing. It's big run is over. It's cashed in most of its liquidity trying to prop up its economy and its debt has soared. It really has no more bullets left.

Its labor is no longer cheap and shipping costs to and from China and the West are too high to make it pay for manufacturing. Robots are replacing a lot of cheap labor.

We're watching another communist dictatorship, in a long line of them, in its death throes. Communist China and Russia - the two biggest losers on the planet.

Cheers.

You seem to be from a planet no one has visited yet. Is there any intelligent life there?

The Chinese are undergoing growing pains, nothing more.

At least that's what serious economists are saying. Does your planet have economists? They're different than cashiers or book keepers.

Maybe you should read a few books before you visit Earth. That way you at least can talk to first grade children and play jump rope. Hold off on the ho scotch, though. That requires neurons and muscles.

The major economists are saying nobody knows what's going to happen next. Primarily because no reliable data comes from their government. Power output rose by a very small amount last year. Not enough to support the economic growth that's being reported. Imports are down 20%. These are more than growing pains. Much more.

They are hoping China only has a small cold, but are afraid it could be much worse.

[timendres]

China is seriously crashing. It's big run is over. It's cashed in most of its liquidity trying to prop up its economy and its debt has soared. It really has no more bullets left.

Its labor is no longer cheap and shipping costs to and from China and the West are too high to make it pay for manufacturing. Robots are replacing a lot of cheap labor.

We're watching another communist dictatorship, in a long line of them, in its death throes. Communist China and Russia - the two biggest losers on the planet.

Cheers.

You seem to be from a planet no one has visited yet. Is there any intelligent life there?

The Chinese are undergoing growing pains, nothing more.

At least that's what serious economists are saying. Does your planet have economists? They're different than cashiers or book keepers.

Maybe you should read a few books before you visit Earth. That way you at least can talk to first grade children and play jump rope. Hold off on the ho scotch, though. That requires neurons and muscles.

The major economists are saying nobody knows what's going to happen next. Primarily because no reliable data comes from their government. Power output rose by a very small amount last year. Not enough to support the economic growth that's being reported. Imports are down 20%. These are more than growing pains. Much more.

They are hoping China only has a small cold, but are afraid it could be much worse.

Economists, historically, have been only marginally better than throwing darts. Combined with the lack of reliable data mentioned above, I suspect darts are on par.

Not only does China have significant and serious financial issues coming home to roost, they also have very serious environmental issues to deal with. Combined with the ever-smoldering social tensions, this seems like a powder keg in the making.

Mix all of this with the still-as-yet unresolved financial crisis of 2008, and central banks continuing to try to outrun a debt load that feels like a rottweiler nipping at your heels, and things are really starting to look interesting.

[Prbkk]

It really has no more bullets left.

Apart from 3.6 trillion US dollars of foreign reserves; that is 3,600 billion; that is USD3,600,000,000,000; that is 9 years of Thailand's total GDP.

Uh, You haven't been paying attention to how much of that they've sold trying to prop up their failing economy and even their stock market.

Don't forget that China HAS to have a lot of USD to engage in international trade - its biggest business. No one will accept Yuan for payment and it's all done in USD. China has sold about as much of its foreign reserves (US treasuries) as it can without going out of business. It can't keep selling more to raise cash as it has been.

It's out of bullets.

Cheers.

Growing pains rather than terminal illness. In any case, there won't be any glee about this in the US because if push comes to shove the Chinese might start dumping US debt (as could Japan) and send the U.S. economy into an unrecoverable tail spin. It's a problem for the whole world.

[Publicus]

It really has no more bullets left.

Apart from 3.6 trillion US dollars of foreign reserves; that is 3,600 billion; that is USD3,600,000,000,000; that is 9 years of Thailand's total GDP.

Uh, You haven't been paying attention to how much of that they've sold trying to prop up their failing economy and even their stock market.

Don't forget that China HAS to have a lot of USD to engage in international trade - its biggest business. No one will accept Yuan for payment and it's all done in USD. China has sold about as much of its foreign reserves (US treasuries) as it can without going out of business. It can't keep selling more to raise cash as it has been.

It's out of bullets.

Cheers.

Growing pains rather than terminal illness. In any case, there won't be any glee about this in the US because if push comes to shove the Chinese might start dumping US debt (as could Japan) and send the U.S. economy into an unrecoverable tail spin. It's a problem for the whole world.

Societe General last week estimated Beijing has sold $1.2 Trillion of its forex reserves since September. Dogmatic glib people haven't noticed because it hasn't had any impact on the USA economy. The markets continue to eat up US T-Bills, as we knew they would.

Do try to keep up.

Estimates are that CCP Boyz in Beijing will need to sell twice that this year. It's called reserve reversal and its is bad news to any country caught up in it.

Bubbles are bursting all over the CCP China so it's time to burst yours too. Long past time in fact.

[Prbkk]

It really has no more bullets left.

Apart from 3.6 trillion US dollars of foreign reserves; that is 3,600 billion; that is USD3,600,000,000,000; that is 9 years of Thailand's total GDP.

Uh, You haven't been paying attention to how much of that they've sold trying to prop up their failing economy and even their stock market.

Don't forget that China HAS to have a lot of USD to engage in international trade - its biggest business. No one will accept Yuan for payment and it's all done in USD. China has sold about as much of its foreign reserves (US treasuries) as it can without going out of business. It can't keep selling more to raise cash as it has been.

It's out of bullets.

Cheers.

Growing pains rather than terminal illness. In any case, there won't be any glee about this in the US because if push comes to shove the Chinese might start dumping US debt (as could Japan) and send the U.S. economy into an unrecoverable tail spin. It's a problem for the whole world.

Societe General last week estimated Beijing has sold $1.2 Trillion of its forex reserves since September. Dogmatic glib people haven't noticed because it hasn't had any impact on the USA economy. The markets continue to eat up US T-Bills, as we knew they would.

Do try to keep up.

Estimates are that CCP Boyz in Beijing will need to sell twice that this year. It's called reserve reversal and its is bad news to any country caught up in it.

Bubbles are bursting all over the CCP China so it's time to burst yours too. Long past time in fact.

No one disputes that the problems in China are serious. What is under-estimated in many quarters is the spin-off effect on the U.S. economy. Unsustainable debt levels and the 2 biggest buyers of that debt no longer buying ...not a great scenario for the U.S. economy. And in this context the Fed decided to increase interest rates? Mortgage rates will increase, the $ will become grossly overvalued and the economy will slow if not go into another recession.

[OMGImInPattaya]

It really has no more bullets left.

Apart from 3.6 trillion US dollars of foreign reserves; that is 3,600 billion; that is USD3,600,000,000,000; that is 9 years of Thailand's total GDP.

Uh, You haven't been paying attention to how much of that they've sold trying to prop up their failing economy and even their stock market.

Don't forget that China HAS to have a lot of USD to engage in international trade - its biggest business. No one will accept Yuan for payment and it's all done in USD. China has sold about as much of its foreign reserves (US treasuries) as it can without going out of business. It can't keep selling more to raise cash as it has been.

It's out of bullets.

Cheers.

Growing pains rather than terminal illness. In any case, there won't be any glee about this in the US because if push comes to shove the Chinese might start dumping US debt (as could Japan) and send the U.S. economy into an unrecoverable tail spin. It's a problem for the whole world.

How would that be a problem for anyone but China itself? Those T-bills and notes, and the interest they provide, are the best economic thing China has got going at the moment. Only an out of their mind Chinese central banker or President would EVER get rid of them. And even if they did...so what...doesn't effect the US at all...some other lucky investor or country gets to buy them and makes a rock-solid investment. Why in the heck to you think all these central banks stuff their vaults with the stuff and never sell it...because they're still the platinum standard investment and the foundation of most other countries monetary stability and fiscal policies.

[Srikcir]

China is seriously crashing. It's big run is over. It's cashed in most of its liquidity trying to prop up its economy and its debt has soared. It really has no more bullets left.

Its labor is no longer cheap and shipping costs to and from China and the West are too high to make it pay for manufacturing. Robots are replacing a lot of cheap labor.

We're watching another communist dictatorship, in a long line of them, in its death throes. Communist China and Russia - the two biggest losers on the planet.

Cheers.

You seem to be from a planet no one has visited yet. Is there any intelligent life there?

The Chinese are undergoing growing pains, nothing more.

At least that's what serious economists are saying. Does your planet have economists? They're different than cashiers or book keepers.

Maybe you should read a few books before you visit Earth. That way you at least can talk to first grade children and play jump rope. Hold off on the ho scotch, though. That requires neurons and muscles.

"What serious economists are saying"

Like a weatherman, an economist is usually only 50% right and NO ONE CARES.

[Prbkk]

It really has no more bullets left.

Apart from 3.6 trillion US dollars of foreign reserves; that is 3,600 billion; that is USD3,600,000,000,000; that is 9 years of Thailand's total GDP.

Uh, You haven't been paying attention to how much of that they've sold trying to prop up their failing economy and even their stock market.

Don't forget that China HAS to have a lot of USD to engage in international trade - its biggest business. No one will accept Yuan for payment and it's all done in USD. China has sold about as much of its foreign reserves (US treasuries) as it can without going out of business. It can't keep selling more to raise cash as it has been.

It's out of bullets.

Cheers.

Growing pains rather than terminal illness. In any case, there won't be any glee about this in the US because if push comes to shove the Chinese might start dumping US debt (as could Japan) and send the U.S. economy into an unrecoverable tail spin. It's a problem for the whole world.

How would that be a problem for anyone but China itself? Those T-bills and notes, and the interest they provide, are the best economic thing China has got going at the moment. Only an out of their mind Chinese central banker or President would EVER get rid of them. And even if they did...so what...doesn't effect the US at all...some other lucky investor or country gets to buy them and makes a rock-solid investment. Why in the heck to you think all these central banks stuff their vaults with the stuff and never sell it...because they're still the platinum standard investment and the foundation of most other countries monetary stability and fiscal policies.

Your argument assumes there are others out there able to buy....and I can't see where that money is going to come from. Most of the U.S. debt is domestic but in recent decades a significant chunk of it has been bought by China and Japan. They no longer have the money and are net sellers. Unless the domestic demand increases there will be a shortfall as no other country can buy in those volumes. If the debt level is not reduced...and there is a shortage of buyers....then that would force a damaging increase in interest rates.

[ExpatOilWorker]

 

It really has no more bullets left.

Apart from 3.6 trillion US dollars of foreign reserves; that is 3,600 billion; that is USD3,600,000,000,000; that is 9 years of Thailand's total GDP.

The 3.6 is the total value of the CCP's combined foreign reserves. It is not all in USD. USD value in their reserves are estimated to be $1.1 Trillion, maybe $1.2 Tn. Not any more however.

Societe General last week estimated from bond market activity globally the CCP Boyz in Beijing have sold $1.2 Trillion of forex since September. Daiwa Securities in September forecast 20% off GDP by 2020 but that looks like it might need revision to more lost and sooner.

Lombard Research says the Boyz in 2016 will have to sell another $2 Trillion of forex, perhaps as much as $2.5 Trillion. This is called reserve reversal and it is the end of the road for any country caught up in it. Forex reserves are in reversal and the yuan is submerging into depreciation. Deflation took full effect this time last year. Fifty percent of all bank loans are tied up in the bursting housing bubble. Banks are bone dry of liquidity so the central bank needs to sell forex reserves to get usd. Strange thing is, they need usd desperately cause there's not enough yuan. Yet the more usd they grab hold of an throw into the mix, the fewer yuan there are....etc etc as the dog chases its tail until the dumb mutt collapses.

CCP forex reserves presently total something like $3.4 Trillion of instruments of US, Euros, Yen, Pounds. That's it. Nothing significant in Russian rubles, nothing significant in Brazil reals, nothing significant in South Africa rands or in any other loser currencies of the now defunct and busted Brics to include their rah-rah lights out development bank.

Thailand btw will survive very comfortably throughout all of this. There are a lot of CCP proposals on the table worth many billions of imaginary dollars, baht, yuan. It's a matter of two lands of make-believe that delight in waving the magic wand. What is worse for Thailand however is to end up alone.

I am sure you are correct, but can you explain this in a few more details. How can China be short on yuan?

[Steely Dan]

China may have its own parochial issues, but it will no doubt lead the rest down, there is already serious technical damage done to the bull market trend for the U.S market and the rest should follow likewise. Stock markets seem to be able to ignore geopolitics as well as economics for ages, then for a reason that seemed obvious with the benefit of hindsight reality catches up.

In the case of China the saber rattling in the South China Sea was a big clue they were in economic trouble.

[OMGImInPattaya]

It really has no more bullets left.

Apart from 3.6 trillion US dollars of foreign reserves; that is 3,600 billion; that is USD3,600,000,000,000; that is 9 years of Thailand's total GDP.

Uh, You haven't been paying attention to how much of that they've sold trying to prop up their failing economy and even their stock market.

Don't forget that China HAS to have a lot of USD to engage in international trade - its biggest business. No one will accept Yuan for payment and it's all done in USD. China has sold about as much of its foreign reserves (US treasuries) as it can without going out of business. It can't keep selling more to raise cash as it has been.

It's out of bullets.

Cheers.

Growing pains rather than terminal illness. In any case, there won't be any glee about this in the US because if push comes to shove the Chinese might start dumping US debt (as could Japan) and send the U.S. economy into an unrecoverable tail spin. It's a problem for the whole world.

How would that be a problem for anyone but China itself? Those T-bills and notes, and the interest they provide, are the best economic thing China has got going at the moment. Only an out of their mind Chinese central banker or President would EVER get rid of them. And even if they did...so what...doesn't effect the US at all...some other lucky investor or country gets to buy them and makes a rock-solid investment. Why in the heck to you think all these central banks stuff their vaults with the stuff and never sell it...because they're still the platinum standard investment and the foundation of most other countries monetary stability and fiscal policies.

Your argument assumes there are others out there able to buy....and I can't see where that money is going to come from. Most of the U.S. debt is domestic but in recent decades a significant chunk of it has been bought by China and Japan. They no longer have the money and are net sellers. Unless the domestic demand increases there will be a shortfall as no other country can buy in those volumes. If the debt level is not reduced...and there is a shortage of buyers....then that would force a damaging increase in interest rates.

The debt has already been sold by the US Treasury...so whatever price the Chinese get for it in the secondary market doesn't effect the US Treasury or interest rates...these are set at the original sale. In any case, there has never been, and is not likely to be, any shortage of buyers for US government debt, especially at the current time, with the lack of stable and safe alternatives at the moment. You gloom and doomsters have been shown to be wrong with all your predictions regarding the US's debt load...but never stops you guys from saying that disaster is right around the corner...probably just talking up bad bets you've made against the direction of Treasuries. With interest rates still pretty much at zero, I think the US economy and savers could withstand a rise interest rates to historical norms just fine.

[ExpatOilWorker]

What is happening here?

"China aims at speculators with offshore yuan rates of 94%"

http://in.reuters.com/article/us-china-offshore-yuan-idINKCN0UQ1JC20160112

[Publicus]

 

It really has no more bullets left.

Apart from 3.6 trillion US dollars of foreign reserves; that is 3,600 billion; that is USD3,600,000,000,000; that is 9 years of Thailand's total GDP.

The 3.6 is the total value of the CCP's combined foreign reserves. It is not all in USD. USD value in their reserves are estimated to be $1.1 Trillion, maybe $1.2 Tn. Not any more however.

Societe General last week estimated from bond market activity globally the CCP Boyz in Beijing have sold $1.2 Trillion of forex since September. Daiwa Securities in September forecast 20% off GDP by 2020 but that looks like it might need revision to more lost and sooner.

Lombard Research says the Boyz in 2016 will have to sell another $2 Trillion of forex, perhaps as much as $2.5 Trillion. This is called reserve reversal and it is the end of the road for any country caught up in it. Forex reserves are in reversal and the yuan is submerging into depreciation. Deflation took full effect this time last year. Fifty percent of all bank loans are tied up in the bursting housing bubble. Banks are bone dry of liquidity so the central bank needs to sell forex reserves to get usd. Strange thing is, they need usd desperately cause there's not enough yuan. Yet the more usd they grab hold of an throw into the mix, the fewer yuan there are....etc etc as the dog chases its tail until the dumb mutt collapses.

CCP forex reserves presently total something like $3.4 Trillion of instruments of US, Euros, Yen, Pounds. That's it. Nothing significant in Russian rubles, nothing significant in Brazil reals, nothing significant in South Africa rands or in any other loser currencies of the now defunct and busted Brics to include their rah-rah lights out development bank.

Thailand btw will survive very comfortably throughout all of this. There are a lot of CCP proposals on the table worth many billions of imaginary dollars, baht, yuan. It's a matter of two lands of make-believe that delight in waving the magic wand. What is worse for Thailand however is to end up alone.

I am sure you are correct, but can you explain this in a few more details. How can China be short on yuan?

In a sentence, CCP has to pay more yuan to buy fewer usd.

The reason to begin with is that yuan naturally strengthens against the usd as China exports goods to the US. To keep exports going and growing, Beijing must depreciate the always strengthening yuan (rmb).

Manufactured goods leave the country where more new workers are being paid. So preventing a concomitant balooning inflation is also necessary. Constantly depreciating the yuan tends to this problem too. (CCP's only serious post-1990 inflation occurred in 2008 and 2009 when the US financial blowout took with it a lot of expectations, rules, practices.)

Since 2009 the People's Bank of China has printed four times more money than the Fed in its three rounds of QE. CCP Boyz liked it so much they kept right on doing it regardless. Now the Boyz are $28 Trillion in debt and having to depreciate the yuan. Deflation is in and people are saving up to half their income. Beijing needs usd cause the yuan is spent, expended, busted.

GDP growth this year was maybe 2% if they're lucky. CCP has it all together already however and it will in a few days announce GDP for 2015 and we can bet it will be close to the standard 7%. It might even be a miraculous 6.9%. Western governments btw don't get their GDP stuff together till at least March for some, April for others, and for still others not until May. (CCP has fast calculators.)

The long and the short of it is that Beijing has fewer usd to buy back yuan once the currency speculators start to circle. Currency speculators are already circling. Many here remember the former LOS in 1997.