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Arglebargle III posted:What am I looking at, the central bank's interest rate going from 2%-12% in under a week? The rate banks charge each other for short term loans. The stories I have read were filled with economists saying that lending isn't actually available at the (awful) rates quoted. Is that just a matter of the most doom and gloom people getting quoted or is credit actually frozen?
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Jun 21, 2013 02:17
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Arglebargle III posted:What am I looking at, the central bank's interest rate going from 2%-12% in under a week? Sounds like it is interbank loans. Loans from one bank to another. Looks like credit is freezing up hard.
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Jun 21, 2013 02:19
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Yeah, people have been expecting this for a while, there has been a massive overexpansion of credit at the provincial level and you can only pump it so long. Granted, there is the honest question if the government would allow those smaller bankers to fail because it is going to otherwise it is going to cause a country wide panic of over a billion people.
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Jun 21, 2013 02:40
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So basically the poo poo is about to hit the fan in China?Fine-able Offense posted:So far the PBoC decided to go with Option 2, but it remains to be seen if they have the sack to keep it up when things get really shirty next week.
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Jun 21, 2013 02:49
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Yeah yeah, banks, economic collapse, whatever. Check this out, guys. One of the great things about Hong Kong's Basic Law is that all government publications, including TV PSA's have to have an English version. I've saved roughly one billion of these, so take a look. Let's start us off with some  glorious propaganda:https://www.youtube.com/watch?v=yuusnfwxGgE It's so sickeningly I never thought I'd see stuff like this in Hong Kong.Horrible failed housing policy videos: https://www.youtube.com/watch?v=N1ClGItC0nY This one is from three years ago. How did that work out? https://www.youtube.com/watch?v=mpVjfYIAjsY Don't be a dick to minorities: https://www.youtube.com/watch?v=KAfQw3hWB5Y https://www.youtube.com/watch?v=PNYjpb7ElV4 CY Leung will make everything better: https://www.youtube.com/watch?v=1K3sA5eIenI This one is great. Yeah, life is miserable. Suck it up and deal with it, you bitch: https://www.youtube.com/watch?v=-tgAHUyMsd4 And finally, the gooniest PSA. Note the first problem they call out: https://www.youtube.com/watch?v=Tf5pZbXYHjs Deep State of Mind fucked around with this message at 03:53 on Jun 21, 2013 |
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Jun 21, 2013 03:06
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I-t-t--its beautiful, they should have sent a poet 
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Jun 21, 2013 03:27
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Y-Hat posted:So basically the poo poo is about to hit the fan in China? The interbank/money market rate just dropped 3.84% down to 7.90%, so the PBOC seems to be taking action but there are serious problems with the Chinese banking system. Ultimately, it still doesn't look good but the central bank might be able to flood the market enough to provide liquidity but I don't know how they are going to handle the real structural problems with the Chinese banking system. All of those ads are hilarious in their own special way, but there is such a stark difference between the first ad (produced in the PRC?) and the other Hong Kong ones.
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Jun 21, 2013 03:32
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Y-Hat posted:What happens next week? Assuming the PBoC doesn't cave and print more money... have you seen "It's A Wonderful Life"?
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Jun 21, 2013 04:14
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Fine-able Offense posted:Assuming the PBoC doesn't cave and print more money... have you seen "It's A Wonderful Life"? http://www.cnbc.com/id/100830406 quote:China's central bank continued to test the resilience of local lenders to withstand a cash crunch on Thursday, as money market rates soared once again and short-term rates hit record highs.
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Jun 21, 2013 07:58
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This is a relevant PSA to the Chinese financial system https://www.youtube.com/watch?v=WNMnfbhhun0
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Jun 21, 2013 09:28
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Bloodnose posted:This is a relevant PSA to the Chinese financial system chineseeconomy.wmv?
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Jun 21, 2013 09:31
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Bloodnose posted:Don't be a dick to minorities: And which minorities would those be?
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Jun 21, 2013 15:03
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Yeah I guess everyone in those videos is pretty much Chinese. Religious minorities and people with stupid opinions, I guess. Here's some real brown people: https://www.youtube.com/watch?v=OxneD5Zpy6o e: 1 brown person. Very light-skinned woman of subcontinent descent.
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Jun 21, 2013 15:07
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chineseeconomy.txt indeed I am not a banking regulator by trade, but isn't a banking stress test something you do with the auditors under artificial conditions. This seems closer to opening up in a room with an automatic, and checking to see who survived the stress of it all afterwards.
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Jun 21, 2013 15:50
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Could you trust the at risk institutions to provide accurate books and every last one of the auditors to not take bribes? An artificial stress test might be completely useless.
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Jun 21, 2013 16:13
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Shifty Pony posted:Could you trust the at risk institutions to provide accurate books and every last one of the auditors to not take bribes? An artificial stress test might be completely useless. Oh, it *would* be absolutely useless. That's why ya gotta do an unannounced liquidity removal and see who starts hurting the most.
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Jun 21, 2013 16:37
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On a lighter note, hairy leggings are a popular thing for women in China to steer away "perverts."
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Jun 22, 2013 04:02
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Y-Hat posted:On a lighter note, hairy leggings are a popular thing for women in China to steer away "perverts." Not this pervert! 
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Jun 22, 2013 08:34
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In more paradoxical news: Cheating is fair and just.
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Jun 22, 2013 10:42
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WarpedNaba posted:In more paradoxical news: Cheating is fair and just. It's weird but they have a point. If the entire system is corrupt and cheating is so rampant suddenly going all out and trying to prevent it in one small city puts those students at a huge disadvantage. Of course this cheating mentality is in pretty much every educational institution all the way up to the universities. The stigma is so bad that published research papers coming out of China aren't taken seriously by the rest of the academic communities. I did like the quote "An invigilator named Li Yong was punched in the nose by a father. Mr Li had confiscated a mobile phone from his son and then refused a bribe to return the handset" Was he punched for taking the phone or refusing a bribe? Either way things like this will happen when you suddenly try to make people obey the law in a system that has condoned enormous levels of graft and corruption for decades.
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Jun 22, 2013 11:26
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I like that word, "invigilator." Like something out of WH40K.
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Jun 22, 2013 12:40
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Shouldn't that interest rate fracas last week have affected the value of the RMB? It hardly moved at all.
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Jun 23, 2013 15:06
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pentyne posted:It's weird but they have a point. If the entire system is corrupt and cheating is so rampant suddenly going all out and trying to prevent it in one small city puts those students at a huge disadvantage. If there is a thing called overcompetition, China has shown us why it's terrible.
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Jun 23, 2013 22:27
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VideoTapir posted:Shouldn't that interest rate fracas last week have affected the value of the RMB? It hardly moved at all. Probably because China still has relatively stringent capital controls. Also, whatever appreciation the rising interest rates would have created, the PBoC would have intervened as they always do by printing a bunch of RMB and dumping it on the foreign exchange.
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Jun 23, 2013 22:30
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VideoTapir posted:I like that word, "invigilator." Like something out of WH40K. In the ancient Scottish universities a janitor is traditionally called a "servitor". No joke. I must admit that I am struggling to get excited about the China-crunch portents despite the fact that Robert Peston (one of the four horsemen of the Apocalypse) has appeared on some of the BBC's China noise recently. In the back of my mind there is a strong suspicion that the central government has alot of cash stuck up its butt. Like, alot. If anything went wrong then they could probably fix it somehow, but the trick would be in getting the cash out of their butt without it smelling like poo poo. [edit] buttcache
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Jun 23, 2013 23:28
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It's always possible they are trying to face reality and force a correction on the system. The real test will be allowing household purchasing power to rise so they can balance exports/imports using domestic consumption. How long can they keep it up as the well-connected eat some dirt? 
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Jun 23, 2013 23:49
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Bloodnose posted:This is a relevant PSA to the Chinese financial system 
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Jun 24, 2013 00:07
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GuestBob posted:I must admit that I am struggling to get excited about the China-crunch portents despite the fact that Robert Peston (one of the four horsemen of the Apocalypse) has appeared on some of the BBC's China noise recently. In the back of my mind there is a strong suspicion that the central government has alot of cash stuck up its butt. Like, alot. If anything went wrong then they could probably fix it somehow, but the trick would be in getting the cash out of their butt without it smelling like poo poo. It isn't just a question about China's ability to rescue its financial system in the midst of a credit crunch. They can print the money just fine and they aren't dependent on foreign capital inflows like other countries were during the 1997 Asian Financial Crisis. The real problem is what happens afterwards. So much of China's recent growth is due to massive investments fueled by cheap credit. Furthermore, so much of people's wealth (not just the rich but including a good chunk the middle class) is tied up in either opaque financial instruments or mostly unregulated shadow banking companies that fueled the boom. With a credit crunch, you'll have the double whammy of loss of cheap credit and loss of savings.
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Jun 24, 2013 02:18
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CIGNX posted:Furthermore, so much of people's wealth (not just the rich but including a good chunk the middle class) is tied up in either opaque financial instruments or mostly unregulated shadow banking companies that fueled the boom. With a credit crunch, you'll have the double whammy of loss of cheap credit and loss of savings. I am not sure about the middle class (might depend on your interpretation of "middle class" though), most of the regular Chinese people I know buy houses as an investment and the whole family pitches in like billio to pay the mortgage off in something ridiculous like three or four years. To be fair though, it's not like I actually inquire about whether my friends avail themselves of opaque financial instruments and shadow banks, so maybe they do and I just don't know it. Certainly, if the housing market crashes then alot of people will be screwed and there will be mass rioting on the streets and the end of days will come. That is, unless the state somehow steps in to rescue the situation (and the state is far more involved in property than in any other country I know). I have no idea how they would do this either but the sky is the limit when it comes to ridiculous government rules in China so move directly to Hohot, if you pass Go collect $200. God only knows what rich Chinese people do with their money though and I'll totally second the notion that most of it comes from grey income channels. Oh yes. But they're totally rich so gently caress 'em. GuestBob fucked around with this message at 02:53 on Jun 24, 2013 |
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Jun 24, 2013 02:46
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ReindeerF posted:And we all know what the vampire originated as an allegory for Rabies.
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Jun 24, 2013 02:52
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GuestBob posted:(and the state is far more involved in property than in any other country I know). The giant state-owned behemoths using their absurd resources to profiteer on the housing market with luxury developments is one of the main problems in the housing bubble. I don't know why the government doesn't just make some rule that state-owned enterprises can only build affordable public housing or something.
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Jun 24, 2013 03:32
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pentyne posted:Of course this cheating mentality is in pretty much every educational institution all the way up to the universities. The stigma is so bad that published research papers coming out of China aren't taken seriously by the rest of the academic communities. Not just in China either. Recently the SATs in Korea were cancelled entirely because the cheating was so bad, so Korean kids wanting to go to US universities either have to be rich enough to take the test in Japan instead or are just hosed this year.
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Jun 24, 2013 05:52
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GuestBob posted:I am not sure about the middle class (might depend on your interpretation of "middle class" though), most of the regular Chinese people I know buy houses as an investment and the whole family pitches in like billio to pay the mortgage off in something ridiculous like three or four years. Actually, you're right. Looking back at some of my notes, they were looking at "affluent but not rich" households with assets valued between $100,000 and $1 million USD, which is definitely not middle class in China. But the point I was trying to make was that there will be a void left in the economy once this investment-oriented economic model is cut off from cheap credit. China has spent the better part of this decade growing through investment (not stocks and bond, but buildings, infrastructure, and equipment), which was made possible by cheap credit. So many industries and jobs are tied to this continuous and unsustainable growth of investment. What could possibly replace all of these fallen industries and still maintain anything near 7-8% growth in GDP. Furthermore, the credit crunch may cause irreversible damage when investments begin to fail and people start losing their savings. If China wants to rebalance its economy towards consumption to restart economic growth, why do they think people will want to increase their spending on goods and services after losing so much of their wealth in real estate. I'm not advocating that the government keep propping up the real estate market, but they are in a genuine hosed-either-way situation.
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Jun 24, 2013 11:15
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CIGNX posted:What could possibly replace all of these fallen industries and still maintain anything near 7-8% growth in GDP. Legalize gambling. Also, shrinking labour forc means that a few industires can shrink without hitting employment figures. I think that officially the "middle class" in China is a household income of over 50,000RMB/annum with a home and a car (or looking to acquire these). I think that this is a bit low for T1 cities, but it is accurate for bumscratch county Henan, which is where I live. Domestic consumption in China has huge potential but as long as people are content to have three generations living in the same apartment and laoma Wong will achingly pedal five kilometers on a thousand year old bicycle to save 3jiao/jing on her weekly purchase of leeks it just isn't going to happen. Pretty much the only way you are going to get Chinese people to buy consumer goods is if you cover them in gold leaf so they become an investment of some kind.
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Jun 25, 2013 02:30
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GuestBob posted:Pretty much the only way you are going to get Chinese people to buy consumer goods is if you cover them in gold leaf so they become an investment of some kind.
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Jun 25, 2013 02:39
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Which may be a good thing because the Chinese wealth-transfer scheme that is disguised as savings accounts needs to end sooner or later.
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Jun 25, 2013 03:36
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Does anything think this emergent financial crisis will be the reason the PRC finally tries to shut down money laundering junkets? By this point all the Macau casinos are owned by foreign interests and they'd probably go ballistic if China clamped down and casino revenue dropped by 90%.
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Jun 25, 2013 03:42
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GuestBob posted:Pretty much the only way you are going to get Chinese people to buy consumer goods is if you cover them in gold leaf so they become an investment of some kind. Our consumer goods sales in China are growing really fast and at this point we're selling tens of millions of USD of basically iPod docks per year.
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Jun 25, 2013 03:58
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So if I want someone in China to buy my washing machine then I need to have it made by Apple? It's no good for Chinese companies if the bulk of income is spent on imported products and not time honoured domestic brands such as Supor, Haier and Flying Pigeon.
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Jun 25, 2013 05:14
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GuestBob posted:So if I want someone in China to buy my washing machine then I need to have it made by Apple? It's no good for Chinese companies if the bulk of income is spent on imported products and not time honoured domestic brands such as Supor, Haier and Flying Pigeon. No, I don't think that's necessarily the case. But there is a (not exactly undeserved imo) common perception that imported goods are generally higher quality, or at least more reliable. That's a tough obstacle, especially since in a lot of cases it's absolutely deserved. Also it's not completely bad for Chinese companies anyway, since a lot of those same "imported" consumer goods are actually designed and manufactured by Chinese companies. But given the choice of a good product for a good price made by a Chinese company, a lot of people will buy it.
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Jun 25, 2013 06:59
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