China Economy Megathread

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My Imaginary GF: Jul 17, 2005; by R. Guyovich

VideoTapir posted:

That's beautiful.

Why the gently caress would you buy someone who broke up with you something in the first place?

# ? Jul 3, 2015 04:40

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# ? May 27, 2024 08:09

VideoTapir: Oct 18, 2005; He'll tire eventually.

To prove how much you love them so they will take you back, duh.

# ? Jul 3, 2015 04:41

Fall Sick and Die: Nov 22, 2003

"It's like you complain to the police about the rape of your wife" Chen said, "That's useless."

# ? Jul 3, 2015 04:50

Arglebargle III: Feb 21, 2006

My Imaginary GF posted:

Why the gently caress would you buy someone who broke up with you something in the first place?

How else will you marry your girlfriend ???

# ? Jul 3, 2015 05:08

My Imaginary GF: Jul 17, 2005; by R. Guyovich

VideoTapir posted:

To prove how much you love them so they will take you back, duh.

Why wouldn't they just pawn it and use the cash to go on vacation?

This mindset doesn't make sense to me.

Arglebargle III posted:

How else will you marry your girlfriend ???

Oh, I dunno, maybe by proposing while we're dating?

# ? Jul 3, 2015 05:23

rex rabidorum vires: Mar 26, 2007; KASPERI KAPANEN KASPERI KAPANEN KASPERI KAPANEN KASPERI KAPANEN KASPERI KAPANEN KASPERI KAPANEN KASPERI KAPANEN KASPERI KAPANEN KASPERI KAPANEN KASPERI KAPANEN KASPERI KAPANEN KASPERI KAPANEN KASPERI KAPANEN KASPERI KAPANEN KASPERI KAPANEN KASPERI KAPANEN KASPERI KAPANEN

The idea of tying their property bubble to the stock market bubble might be one of the dumbest loving policies I have ever seen. Who thought that was a good idea? Let's just shove all the depreciating assets into one big poo poo basket. In the '29 crash was that even allowed in the US? Leveraging on the margin was a big thing but I don't remember houses being used as leverage.

# ? Jul 3, 2015 13:10

namaste friends: Sep 18, 2004; by Smythe

http://www.ft.com/intl/cms/s/0/5aaf180e-212c-11e5-ab0f-6bb9974f25d0.html?siteedition=intl

quote:

Chinese authorities move to prop up market as rout deepens

China�s authorities targeted short sellers and market manipulators in a fresh attempt to arrest the slump in Chinese stocks, as the Shanghai Composite index capped its steepest three-week decline since 1992.

The market rout deepened on Friday, with the Shanghai index falling 5.8 per cent on Friday and the Shenzhen Composite shedding 5.4 per cent. The two indices have now fallen nearly 30 per cent since mid-June, despite frenetic attempts by Beijing to stave off a crash.

The stock market turmoil has become a concern for global investors who fear it could destabilise China�s economy at a time when it is already showing signs of a slowdown.
Friday�s declines came as the China Securities Regulatory Commission announced it had opened a probe into market manipulation, �based on reports of unusual movements� in securities and futures markets.

The investigation is likely to focus on short selling, amid reports on Friday that the futures exchange was urging traders not to short the market.
The CSRC�s move is the latest in a flurry of initiatives by authorities to arrest the stock market slide. The regulator has also relaxed rules on margin lending, cut trading fees and on Friday said it would slow the pace of initial public offerings.

Many investors have complained that the large volume of new share issues in recent weeks has siphoned off demand for existing stocks. IPOs were halted for 15 months between 2012 and 2014 in an effort to boost the flagging market.

Meanwhile, the regulator has made a series of late-night announcements aimed at restoring confidence, and China�s central bank last weekend lowered interest rates and eased reserve requirements.

But so far the measures have had little effect. The Shanghai Composite has now fallen 12.1 per cent since Monday, its third consecutive week of double-digit losses since hitting a seven-year high on June 12.

The Shanghai index is firmly in bear market territory, down 28.6 per cent since the June peak, while the tech-heavy Shenzhen Composite has fallen 33.2 per cent.
There were also signs on Friday that the stock market turmoil is beginning to reverberate beyond China. The Australian dollar, often traded as a proxy for China growth, is down 1.2 per cent to a six-year low of US$0.7539.

The 21st Century Business Herald, a Chinese daily newspaper, on Friday quoted multiple futures traders as saying they had received phone calls from the China Financial Futures Exchange instructing them not to short the market. Stock index futures are the main tool for placing bearish bets on mainland stocks, as short selling of individual shares is difficult.

Analysts say any effort to discourage short selling is probably coming from regulators, with exchange officials simply carrying out orders. The futures and stock exchanges are state-owned companies with close links to financial regulators.

Most market participants question whether illegal market manipulation is behind the market�s fall. Instead, they say investors are using index futures to hedge long positions in small and mid-cap stocks.

�In the futures market we have quantitative traders, algorithmic traders and short sellers. Everyone is there. And of course there are hedgers, too. The whole purpose of futures is for risk management,� said a trader at a major futures company in Shanghai. �After the big drop, what the market lacks most is confidence.�

The futures exchange on Thursday denied rumours that foreign investors including Goldman Sachs were using futures to place big bearish bets on mainland stocks, known as A shares.

The exchange said foreign investors with access to the futures market via the Qualified Foreign Institutional Investor (QFII) programme were only permitted to use futures for hedging operations and are not allowed to make directional bets. All recent trades by QFIIs complied with regulations, it said.

Small and mid-cap shares have been the biggest losers in the recent downturn, as investors have sought the relative safety of large-caps amid the turmoil. An index of large mainland-listed banks has fallen 15.1 per cent since June 12 compared with more than 28.6 per cent for the Shanghai Composite.

hay guys stop shorting pls

# ? Jul 3, 2015 13:28

Freezer: Apr 20, 2001; The Earth is the cradle of the mind, but one cannot stay in the cradle forever.

I'm sure another overnight interest rate cut over the weekend will permanently solve the problem.

# ? Jul 3, 2015 14:55

TheBalor: Jun 18, 2001

Is it possible these measures are making the problem worse?

# ? Jul 3, 2015 15:13

AtomikKrab: Jul 17, 2010; Keep on GOP rolling rolling rolling rolling.

I am not an expert on this poo poo, but uhm, shits on fire yo?

# ? Jul 3, 2015 15:15

My Imaginary GF: Jul 17, 2005; by R. Guyovich

AtomikKrab posted:

I am not an expert on this poo poo, but uhm, shits on fire yo?

Despite what some Chinese may think, we didn't start this fire.

# ? Jul 3, 2015 15:17

Arglebargle III: Feb 21, 2006

Anger at short sellers never changes.

# ? Jul 3, 2015 15:36

MickeyFinn: May 8, 2007; Biggie Smalls and Junior Mafia some mark ass bitches

Arglebargle III posted:

Anger at short sellers never changes.

But they are the ones irrationally and cynically making money off our misery!

# ? Jul 3, 2015 15:44

namaste friends: Sep 18, 2004; by Smythe

http://ftalphaville.ft.com/2015/07/03/2133598/this-is-nuts-china-blames-the-shorts/

quote:

Chinese regulators have markets exactly backwards.

Late on Thursday they announced an investigation into manipulation by short sellers, while the futures exchange seems to be discouraging people shorting, or betting on price falls.

In practical terms, the action failed: stocks fell again, leaving them down 12 per cent on the week and down more than a quarter from their peak three weeks ago, with extraordinary intra-day swings.

In principle, though, the action is just wrong. The reason the stock market is falling isn�t short sellers, it�s long sellers. More precisely, the hordes who�d been piling into stocks and pushing prices through the roof over the past year are selling, and that was entirely predictable (the difficult issue was when there would be a rout, not whether there would).

The root cause of all busts is the preceding boom, and the Chinese equity boom had all the hallmarks of a bubble: private investors frantically opening accounts as the market soared, a naive view that this time was different (the economy�s being transformed, and the government wants the market to go up) and lots and lots of leverage. When the only reason to buy overpriced shares is the hope of selling them on to a greater fool at an even more inflated price, the realisation that there may be no greater fools left leaves prices with only one way to go. And the frothiest stocks have to fall a very long way in China, with the two biggest companies on the Chinext tech market � both big enough to qualify for the S&P 500 were they American � trading at more than 100 times expected earnings. After a bubble, prices have to drop back to levels where bargain-hunters are willing to snap them up.

China�s authorities hope to avoid the 72 per cent fall they saw after their 2007 stock market bubble popped, coincidentally identical to the drop in the Nasdaq after the dotcom boom. As well as attacking short selling, they have cut rates and tried to ease the pressure on margin debt to allow yet more leverage to pile on top of what analysts say is probably already the most use of broker-supplied loans to buy stocks than ever before in recorded history. One of the barmiest rule changes was to allow brokers to accept pretty much anything from antiques to houses as collateral against loans; if the brokers were to take advantage of the rule change, customers could literally bet the house on shares going up. On top of that, on Friday the securities regulator confirmed it would slow the pace of IPOs, freeing up more cash to buy existing shares. If anyone wants to.

Ultimately the government has it in its power to turn the market round if it really wants to, since it can create unlimited money to buy shares, but so far there�s no sign that such uber-QE is under consideration.

China�s an authoritarian one-party state, so its efforts to bend the market to its will perhaps shouldn�t be a surprise. Western investors shouldn�t feel superior, though: Britain first banned short-selling in Bank of England stock just three years after the Old Lady of Threadneedle Street was set up in 1694, and short selling bans and probes have begun after plenty of the big market crashes since � including the post-Lehman collapse. It never did any good, and regulators and politicians never learnt the lesson: it�s almost never the shorts who cause the problem, but the longs who first drive prices way above reasonable levels, them rush to get out.

PS: Those many policymakers who think short-selling bans must work, since they stop the awful predatory bears betting on price falls, should read this paper from the New York Fed:

The 2008 ban on short sales failed to slow the decline in the price of financial stocks; in fact, prices fell markedly over the two weeks in which the ban was in effect and stabilized once it was lifted. Similarly, following the downgrade of the U.S. sovereign credit rating in 2011�another notable period of market stress�stocks subject to short-selling restrictions performed worse than stocks free of such restraints.

# ? Jul 3, 2015 15:50

Nonsense: Jan 26, 2007

Yes YESSSSS. China rises!

# ? Jul 3, 2015 17:36

The Lord of Hats: Aug 22, 2010; Hello, yes! Is being very good day for posting, no?

quote:

the two biggest companies on the Chinext tech market � both big enough to qualify for the S&P 500 were they American � trading at more than 100 times expected earnings.

# ? Jul 3, 2015 17:45

Mercury_Storm: Jun 12, 2003; *chomp chomp chomp*

So with these caps on how much a stock can drop in one day, I'm sure there's a cap one how much a stock can gain in one day too right? :allears:

# ? Jul 3, 2015 18:57

Fojar38: Sep 2, 2011; Sorry I meant to say I hope that the police use maximum force and kill or maim a bunch of innocent people, thus paving a way for a proletarian uprising and socialist utopia

also here's a stupid take
---------------------------->

Nonsense posted:

Yes YESSSSS. China rises!

Heh, looks like we're seeing the Great FALL of China. :smug:

original remark do not steal

# ? Jul 3, 2015 19:05

tsa: Feb 3, 2014

Cultural Imperial posted:

http://ftalphaville.ft.com/2015/07/03/2133598/this-is-nuts-china-blames-the-shorts/

Wow that whole "the economy�s being transformed" comes up every time doesn't it. In the US you heard in 06 that the computer models prevent any crash or of course in any of the DOW JONES 1 GAGILLION POINTS books.

# ? Jul 3, 2015 19:05

Spazzle: Jul 5, 2003

Short sellers continue to do god's work.

# ? Jul 3, 2015 19:06

dr_rat: Jun 4, 2001

Mercury_Storm posted:

So with these caps on how much a stock can drop in one day, I'm sure there's a cap one how much a stock can gain in one day too right?

Stock prices going to high, who are you Marx? Thats just not how capitalism works drat it. :argh:

Excuses me for a second while I take out a mortgage on my house to buy some more South Sea Company stocks.

# ? Jul 3, 2015 19:19

MickeyFinn: May 8, 2007; Biggie Smalls and Junior Mafia some mark ass bitches

One of the most interesting things about looking for news on this subject is that it seems to be referred to as a "share price crash" and not a "market crash," at least in my perusal of Google news. As if it is only the shares that are going down, the underlying market is totally healthy you guys!

# ? Jul 3, 2015 19:37

Vladimir Putin: Mar 17, 2007; by R. Guyovich

tsa posted:

Wow that whole "the economy�s being transformed" comes up every time doesn't it. In the US you heard in 06 that the computer models prevent any crash or of course in any of the DOW JONES 1 GAGILLION POINTS books.

That's actually a legit argument. You can't tell me that when a country transitions from agrarian to industrial or feudal to whatever that all the known rules may not apply.

# ? Jul 3, 2015 20:06

King Hong Kong: Nov 6, 2009; For we'll fight with a vim
that is dead sure to win.

dr_rat posted:

Stock prices going to high, who are you Marx? Thats just not how capitalism works drat it.

Excuses me for a second while I take out a mortgage on my house to buy some more South Sea Company stocks.

In three hundred years, people will refer to the South China Sea Bubble.

# ? Jul 3, 2015 20:42

Vladimir Putin: Mar 17, 2007; by R. Guyovich

King Hong Kong posted:

In three hundred years, people will refer to the South China Sea Bubble.

South China Sea Bubble Tea

# ? Jul 3, 2015 21:16

GoutPatrol: Oct 17, 2009; *Stupid Babby*

Vladimir Putin posted:

South China Sea Bubble Tea

Sounds incredibly poisonous.

# ? Jul 3, 2015 21:32

Fojar38: Sep 2, 2011; Sorry I meant to say I hope that the police use maximum force and kill or maim a bunch of innocent people, thus paving a way for a proletarian uprising and socialist utopia

also here's a stupid take
---------------------------->

Which is worse: The South China Sea or the Indian Ocean?

# ? Jul 3, 2015 22:35

I would blow Dane Cook: Dec 26, 2008

Mercury_Storm posted:

So with these caps on how much a stock can drop in one day, I'm sure there's a cap one how much a stock can gain in one day too right?

Actually there are!

# ? Jul 4, 2015 02:55

Arglebargle III: Feb 21, 2006

Mercury_Storm posted:

So with these caps on how much a stock can drop in one day, I'm sure there's a cap one how much a stock can gain in one day too right?

I guess it's a first-come first-served approach for the long sellers who want to get out at the peak. (No doubt their only objective in the first place.)

# ? Jul 4, 2015 03:04

Mercury_Storm: Jun 12, 2003; *chomp chomp chomp*

Wow, that is a surprise. Is it a 10% limit for gains as well?

# ? Jul 4, 2015 03:12

I would blow Dane Cook: Dec 26, 2008

I distinctly remember stocks hitting their 10% limit up day after day when the market was heading up.

# ? Jul 4, 2015 03:14

namaste friends: Sep 18, 2004; by Smythe

https://twitter.com/george_chen/status/617181712682913793

# ? Jul 4, 2015 05:10

I would blow Dane Cook: Dec 26, 2008

BREAKING: 21 MAJOR BROKERAGES IN CHINA DECIDE TO JOINTLY INVEST TOTAL 120B RMB IN BLUECHIP ETF FUNDS TO STABLISH MARKET - OFFICIAL STATEMENT

MORE: MAJOR CHINA BROKERAGES AGREE NOT TO SELL ANY STOCK UNDER THEIR OWN CAPITAL MANAGEMENT BEFORE SHANGHAI INDEX REBOUNDS TO 4,500 OR ABOVE

MORE: 21 KEY CHINESE BROKERAGES ENCOURAGE MAJOR SHAREHOLDERS IN ALL LISTED COMPANIES TO BUY BACK THEIR STOCKS TO BOOST INVESTORS' CONFIDENCE

https://twitter.com/george_chen/status/617204962817372161

Too little too late?

I would blow Dane Cook fucked around with this message at 06:49 on Jul 4, 2015

# ? Jul 4, 2015 06:39

The Lord of Hats: Aug 22, 2010; Hello, yes! Is being very good day for posting, no?

I think once you're at the point you're even opting to do an emergency response like that, the situation is irrevocably hosed. I mean, maybe this'll stall things, but I don't think it's actually going to renew anybody's confidence in the market, or even start to cover up the underlying issues.

# ? Jul 4, 2015 06:50

ocrumsprug: Sep 23, 2010; by LITERALLY AN ADMIN

Jumpingmanjim posted:

BREAKING: 21 MAJOR BROKERAGES IN CHINA DECIDE TO JOINTLY INVEST TOTAL 120B RMB IN BLUECHIP ETF FUNDS TO STABLISH MARKET - OFFICIAL STATEMENT

MORE: MAJOR CHINA BROKERAGES AGREE NOT TO SELL ANY STOCK UNDER THEIR OWN CAPITAL MANAGEMENT BEFORE SHANGHAI INDEX REBOUNDS TO 4,500 OR ABOVE

MORE: 21 KEY CHINESE BROKERAGES ENCOURAGE MAJOR SHAREHOLDERS IN ALL LISTED COMPANIES TO BUY BACK THEIR STOCKS TO BOOST INVESTORS' CONFIDENCE

https://twitter.com/george_chen/status/617204962817372161

Too little too late?

Has there ever been a bigger, flashier SELL EVERYTHING NOW sign in the history of markets?

# ? Jul 4, 2015 06:52

dr_rat: Jun 4, 2001

ocrumsprug posted:

Has there ever been a bigger, flashier SELL EVERYTHING NOW sign in the history of markets?

Cultural Imperial posted:

http://www.bloomberg.com/news/articles/2015-07-02/china-to-individual-investors-go-ahead-bet-the-house-on-stocks

hahahah

# ? Jul 4, 2015 06:58

Spazzle: Jul 5, 2003

This is very reminiscent of 1929.

# ? Jul 4, 2015 12:38

I would blow Dane Cook: Dec 26, 2008

quote:

DEVELOPING: After CSRC emergency meeting w/ 21 big Chinese brokerages this morning, PBOC, Huijin (sovereign fund) officials will meet later

Sources: if new 120 bln RMB brokerage rescue fund proves "not enough", Chinese Gov can inject more in market, incl pension fund, FX reserves

BREAKING: After CSRC emergency meeting this morning, NOW dozens big Chinese mutual fund bosses in meeting in Beijing to discuss trading plan

Chinese Gov-led China Fund Industry Association will later issue announcement to call on all local mutual funds to support CSRC rescue plan

BREAKING: China's 23 big mutual fund companies jointly agree to inject 27 billion RMB into market to buy stock funds

LATEST: CSRC has ordered 21 major brokerages must get 120B RMB capital ready by 11am Monday

25 big mutual finds jointly announce to accelerate new stock-focused fund issuances to boost market (CSRC)

BREAKING: China's State Council has ordered stock market regulator CSRC to suspend ALL new IPO approvals until market stabilizes - Caijing

https://twitter.com/george_chen

# ? Jul 4, 2015 12:46

Shifty Pony: Dec 28, 2004; Up ta somethin'

- Chinese Gov can inject more in market, incl pension fund, FX reserves

Oh yeah that's just a great idea. They wouldn't be stupid enough to do this would they?

This is establishing a very bad precedent that makes the Greenspan put look like child's play. One hell of amoral hazard if they try and even briefly succeed in holding up prices.

# ? Jul 4, 2015 13:50

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# ? May 27, 2024 08:09

Freezer: Apr 20, 2001; The Earth is the cradle of the mind, but one cannot stay in the cradle forever.

Shifty Pony posted:

- Chinese Gov can inject more in market, incl pension fund, FX reserves

Oh yeah that's just a great idea. They wouldn't be stupid enough to do this would they?

This is establishing a very bad precedent that makes the Greenspan put look like child's play. One hell of amoral hazard if they try and even briefly succeed in holding up prices.

It's also going "All in" in an effort to keep the stock market frothing, making sure that if it does fall it'll take down the whole economy with it.

It's pretty ridiculous really, as they're bypassing Capitalism's self regulating features. They should just make a law saying that the stock market is only allowed to go up and be done with it.

Freezer fucked around with this message at 14:20 on Jul 4, 2015

# ? Jul 4, 2015 14:16

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