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Thread: Charting China's Imminent Implosion

  1. #421
    Anxieties about the knock-on impact to the global economy from the coronavirus outbreak, which appears on track to shave whole percentage points off China's GDP, have pushed stock futures back into the red Thursday morning.

    But during an interview with Maria Bartiromo that aired on Thursday, Commerce Secretary Wilbur Ross argued that the North American economy might benefit from the outbreak as companies "reevaluate their supply chains" to factor in emergent outbreak risk.


    While Ross insisted that he didn't want to appear insensitive, it's pretty clear to him that the outbreak could help "accelerate the return of jobs to North America."

    "First of all, every American's heart has to go out to the victims of the coronavirus. I don't want to talk about a victory lap over a very unfortunate very malignant disease. But the fact is, it does give business another thing to consider when they go through their review of their supply chain. On top of all the other things - you had SARS, you had the African swine virus there, now you have this - it's another risk factor that people need to take into account."
    "I think it will help to accelerate the return of jobs to North America, some to the US and some to Mexico as well," Ross said.
    Watch the clip below:
    Secretary Wilbur Ross says coronavirus will be good for [checks notes] American jobs: "I think it will help to accelerate the return of jobs to North America." pic.twitter.com/Y4SbDIcTi4
    — Aaron Rupar (@atrupar) January 30, 2020
    Bartiromo conceded that Ross had made an interesting point.
    "Ah, that's a good point," Bartiromo responds.


    More at: https://www.zerohedge.com/political/...s-back-america
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
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  3. #422
    Over most of January, the situation in China has gone from bad to worse to worst-nightmare with factories and stores shuttered for weeks, citizens in every province under martial-law lockdowns, and coronovirus cases (and deaths) soaring at faster-than-prior-pandemic rates.

    So it should be no surprise then that China's Service Economy expanded at an accelerating rate in January according to the latest government-provided PMI data.
    Yes, you heard that right, against expectations of a slowdown (as would be expected with most of the nation hunkering down in terror), the National Bureau of Statistics reports that the non-manufacturing gauge improved to 54.1, compared with 53.5 the previous month (and better than the 53.0 expected).


    Reportedly, due to the Lunar New Year holiday, the surveys were conducted between Jan. 15 and Jan. 20, rather than between the 20th and 25th of each month as normal.
    And you know how badly manipulated this survey is when the China's National Bureau of Statistics issues an additional statement admitting that "the impact of coronavirus is not fully reflected in January's PMI survey," suggesting that "future trends need to be observed."
    However, if that is the case then what is more problematic is the fact the first official indicator of the Chinese manufacturing economy in 2020 signaled the nation’s factories were struggling even before the country shut down for the Lunar New Year and the coronavirus outbreak worsened.
    We suspect, judging by the record collapse in (Dr.) Copper, that the manipulated-ly perfect 50.0 - neither expanding or contracting - will need to be adjusted for some sense of reality soon...

    However, while the overall manufacturing survey dipped, the Steel industry PMI index surged to 47.1 from 43.1 in December.
    So to sum up - China's worst ever epidemic, killing hundreds and putting 10s of thousands in hospital, shutting down factories, stores, and all transportation across the entire nation at one of its busiest most consumption-heavy times of year prompted a tiny drop in Manufacturing, a rise in the Services industry, and a surge in the Steel Industry!!!!


    As a reminder, Nomura economists led by Lu Ting wrote in a recent report to clients that:
    ...the economic hit to China could exceed that seen during the SARS outbreak of 2003.
    Gross domestic product growth could “materially drop” this quarter from the 6% pace at the end of 2019, maybe even more than the 2 percentage point deceleration seen in the second quarter of 2003.
    Just don't tell the survey respondents!!

    More at: https://www.zerohedge.com/economics/...millions-under
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  4. #423
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  5. #424
    The epicenter of the outbreak is Wuhan, one of China’s largest manufacturing centers. Foxconn and Pegatron have operations there, as do memory manufacturers such as XMC (nor flash) and Yangtze Memory Technologies Co. (non-volatile memory).
    Auto producers, such as General Motors, Honda, Volkswagen, BMW and Daimler also populate the region.
    The electronics industry is poised for a cascading disruption that could change industry growth forecasts for the year. Bill McLean, president of semiconductor research firm IC Insights, said the virus has exacerbated the economic unease that has stalled semiconductor capital investment.
    “Brexit, trade issues and now the coronavirus are causing global uncertainty,” he said at a Boston-based forum. “Uncertainty causes [businesses and consumers] to freeze.” Worldwide, semiconductor capital spending is forecast to decrease by roughly 6 percent this year, from $103.5 billion in 2019 to roughly $97.6 billion.
    Zhang Ming, an economist at government-backed think-tank the Chinese Academy of Social Sciences, warned that the virus could push China’s economic growth below 5 per cent a year in the first quarter, reported the Financial Times. Economic consensus currently puts China’s GDP growth at 5.7 percent. That average has steadily declined since 2018, according to McLean. — EE Times
    More than 300 of the Global Top 500 companies have a presence in Wuhan, including Microsoft and Siemens. Wuhan is located in the Hubei Province.
    Wuhan has 10 car factories, including those Honda, Renault, PSA and General Motors. The car industry represents around 20 percent of the city’s economy and employs 200,000 people directly and more than a million indirectly.


    More at: https://www.zerohedge.com/geopolitic...ck-coronavirus
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment



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  7. #425
    China’s official demographic data in 2019 has seriously overestimated the country’s actual birth rate and population size, a grave mistake that will lead to disastrous policymaking if leaders blindly take these numbers as fact.

    My estimates show that China’s actual population size should be 1.279 billion at the end of 2019, or 121 million fewer than the officially stated 1.4 billion. The actual number of births in China last year should be about 10 million instead of 14.65 million, as reported by the National Bureau of Statistics.

    It doesn’t require rocket science to see the absurdity of China’s official demographic data. For instance, the statistics bureau said China had 15.23 million births in 2018, but the Health Statistics Yearbook compiled by China’s health care authority, which cover new births in all hospitals, showed that there were only 13.62 million.

    The hospital delivery rate is 99.9 per cent in China, which may account for some of the discrepancy of 1.61 million births. But this still doesn’t account for the bulk of the 1.61 million “births”.


    In fact, the number of births released in the Health Statistics Yearbook is overestimated. For example, the yearbook announced that there were 14.54 million births in 2015, but the micro-census showed that only 11 million people were actually born.

    The difference is because, firstly, the number of births is often inflated so that individuals and hospitals can claim more medical subsidies. Secondly, as more than 20 social benefits are tied to one’s place of birth, under the hukou household registration system, some parents buy additional birth certificates to provide a “dual citizenship” to their newborn.

    According to a 2016 report by the Democracy and Legal System Times, 4,000 blank birth certificates at a hospital in Mengcheng county, Anhui province, were stolen and sold. On April 30 last year, the official website of the Commission for Discipline Inspection of Chenzhou city, Hunan province, disclosed that the administrators of two township hospitals sold hundreds of blank birth certificates.

    One root problem of China’s population overstatement is the population control policy. The more “excessive” China’s population size looks, the more necessary this policy is. As such, the statistics bureau has been constantly inflating China’s population data in the past three decades. For example, census data showed that the fertility rates in 2000 and 2010 were only 1.22 and 1.18, but the statistics bureau revised them to 1.64 and 1.5 (based on the officially announced number of babies born).


    Since the first-order fertility rate accounts for 71 per cent of the total fertility rate in 2000, if the total rate was 1.64, the first-order rate should be as high as 1.16 births per woman, which means there was no infertility, no DINK (double income, no kids) couples, or that many women had twins. This shows how ridiculous the official demographic data is.

    China's ethnic minorities do not implement the one-child policy, so there was no need to hide births. The fertility rate of the 34 non-Muslim minorities was 1.64 in 2000 and 1.41 in 2010. The level of social development of the Han Chinese is higher than that of minorities, which means that if China implemented the same fertility policy as minorities, the fertility rates in 2000 and 2010 would only be 1.48 and 1.30; under the one-child policy, how could the rates be 1.64 and 1.5?


    The 2000 census showed that only 14.08 million were born in 2000, but the statistics bureau revised it to 17.71 million. However, there were only 14.26 million secondary students in 2014, and 13.57 million people aged 15 in the 2015 micro-census.

    The statistics bureau boasts that the two-child policy has boosted fertility, as the number of births in 2017 increased by 680,000 compared to 2015, of which 76 per cent were in Shandong province. The number of births in Shandong increased from 1.23 million in 2015 to 1.75 million in 2017, which is unbelievable because sales of infant-related products and the number of patients with pregnancy complications have not increased significantly.

    More at: https://www.scmp.com/comment/opinion...and-population
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  8. #426
    China’s central bank said it will inject 1.2 trillion yuan ($174 billion) worth of liquidity into the markets via reverse repo operations on Monday as its stock markets prepare to reopen amid an outbreak of a new coronavirus.

    Chinese authorities have pledged to use various monetary policy tools to ensure liquidity remains reasonably ample and to support firms affected by the virus epidemic, which has so far claimed 305 lives, all but one in China.
    The People’s Bank of China made the announcement in a statement on Sunday, adding the total liquidity in the banking system will be 900 billion yuan higher than the same period in 2019 after the injection.
    According to Reuters calculations based on official central bank data, 1.05 trillion yuan worth of reverse repos are set to mature on Monday, meaning that 150 billion yuan in net cash will be injected.


    To support firms affected by the epidemic, the CSRC said companies that had expiring stock pledge agreements could apply for extensions with securities firms, and it would urge corporate bond investors to extend the maturity dates of debt.
    The CSRC is also considering launching hedging tools for the A-share market to help alleviate market panic and will suspend evening sessions of futures trading starting from Monday, it said.

    More at: https://www.reuters.com/article/us-c...-idUSKBN1ZW074
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  9. #427
    As previewed on Friday and again earlier today when we noted the latest trades in China's A50 futures...

    ... China's reopening from the long Lunar New Year holiday was set to be ugly, and sure enough with Chinese stocks resuming trade at 9am on Monday, a wave of selling was unleashed culminating in nothing short of a bloodbath with the Shanghai Composite crashing 9% at the open, down by the most since the bursting of China's 2015 stock bubble, and wiping out 12 months worth of gains in a corona moment.


    Not even the hilarious beat in China's Manufacturing PMI (this time from Caixin), which somehow surpased expectations of a 51.0 print by the smallest amount possible at 51.1 (down from 51.5) despite a major portion of China's population under quarantine and the economy hitting a brick wall, had any impact on stocks.

    What is odd is that this is happening even as China earlier in the day barred short selling, which only means the central bank made a huge oversight and should have also banned all selling altogether.
    As stocks collapse the flight to safety is predictably on with 10Y Chinese bond tumbling in yield to 3%, matching the lowest yield since late 2016...

    ... while spiking in price.

    The selloff wasn't limited just to stocks, however, with China’s benchmark iron ore contract falling by its daily limit of 8%, with copper, crude and palm oil also plunging by the maximum allowed. As Bloomberg notes, regions accounting for about 90% of copper smelting, 60% of steel production, 65% of oil refining and 40% of coal output have told firms to delay restarting operations until at least Feb. 10.
    This is bad news for anyone still holding on to dreams of a Chinese economic renaissance, as the following correlation between China's macro surprise index and copper demonstrates.

    China's bloodbath is taking place even as the PBOC scrambled earlier in the day to inject a gross 1.2 trillion in liquidity which however as we explained, was woefully inadequate because when netting off the 1 trillion in short-term reverse repo funds scheduled to mature on Monday, the liquidity injection amounted to a far more modest 150BN yuan, or just over $27BN.

    The lack of any notable impact from China's reverse repo injection probably explains why shortly after the catastrophic open, the PBOC also cut rates on both its 7 day and 14 day-reverse repo from 2.5% to 2.4%, and from 2.65% to 2.55% respectively.



    Then, as a result of the unexpected additional easing, the Yuan promptly slumped back under 7.00, potentially risking the framework of the US-China trade deal, and the reversal in the US Treasury's designation of China as a currency manipulator.



    More at: https://www.zerohedge.com/markets/ch...ervention-rate
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  10. #428
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  11. #429
    Macau said Tuesday it will temporarily close all casinos as the gambling hub battles the deadly coronavirus, cutting off the lifeblood of the city's economy.
    The move came as the former Portuguese colony confirmed its tenth case of the virus, which has killed more than 400 people in China, infected tens of thousands, and spread to more than 20 countries.
    Chief Executive Ho Iat-seng, a pro-Beijing appointee who took office in December, said the gambling industry would close for two weeks, but warned that could be extended if the virus continues to spread.
    "This is a difficult decision, but we have to do it for the health of our Macau residents," he told reporters.
    He said he would meet gaming industry representatives on Tuesday afternoon and announce precise timings soon after.
    Gaming stocks plunged after the announcement, with Sands China down 2.4 percent, Galaxy Entertainment down four percent and Wynn Macau down 1.9 percent in afternoon trading.
    The only other time Macau has closed its casinos was in 2018, when the city was hit directly by a typhoon.
    On Tuesday, health authorities announced two fresh infections -- one a woman who worked in the gaming industry.
    As the only place in China where gambling is allowed, Macau's casinos account for about 80 percent of government revenue.
    Some 35 million people visited the densely crowded city of just 632,000 people last year -- the vast majority mainland Chinese heading to casinos which rake in each week what Las Vegas takes in a month.
    The virus has hammered the industry over what would usually be one of its busiest periods -- the Lunar New Year holidays.
    The number of visitors plunged 80 percent in the past week.

    More at: https://news.yahoo.com/macau-close-c...055758037.html
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  12. #430
    (Reuters) - U.S. stock index futures jumped 1% on Tuesday, signaling a recovery for Wall Street from a sharp coronavirus-led pullback last week, with fresh intervention by China’s central bank calming investor nerves.

    In a bid to cushion the economic blow of the epidemic, China injected 1.7 trillion yuan ($242.74 billion) via reverse repos on Monday and Tuesday, helping Chinese stocks reverse some losses and lifting the world equity index.
    ...
    https://www.reuters.com/article/us-u...-idUSKBN1ZY1QG
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  13. #431
    Everything is wonderful Wednesday morning, because an unverified report from Chinese state television sparked a massive surge in equity futures as the Communist Party-controlled media intimated that the coronavirus might soon be cured.
    Cure or no cure, it's clear the Chinese are going all-in on propaganda for the sake of preserving 'social cohesion'. It might sound crazy, but it's beyond the grasp of algos to process the likelihood that Beijing is simply trying to regain control of the narrative as they struggle to get in front of the inevitable reckoning with the truth.
    Economists have been trying to gauge the blowback from the outbreak as the virus begins to disrupt global supply chains, but as more factories on the mainland announce extended shutdowns and delays, that's getting increasingly difficult to do.
    Yesterday, we noted how Hyundai Motor Co. and its sister Kia Motors Corp. suspended production lines in South Korea after it was hit with a parts shortage from China as the virus outbreak broadened.

    Now there is a new report that could create huge problems for America's most valuable company: Apple supplier Foxconn said Wednesday that its facilities in China could take several weeks to resume full production, or at least that's what one source with insider knowledge told Reuters.
    Foxconn is responsible for assembling Apple iPhones in China.


    We noted Monday that Foxconn halted "almost all" of its production lines until Feb. 10.
    Any production delays after that could dramatically impact Apple's iPhone shipments abroad.
    Reuters' source said full resumption for production at the company's factories might not arrive until late February or early March.

    More at: https://www.zerohedge.com/markets/fo...-late-february
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  14. #432
    Copper traders in China, the world’s largest buyer of the metal, have asked miners from Chile to Nigeria to cancel or delay shipments as the deadly coronavirus outbreak hits demand.
    Multiple Chinese copper buyers said they had scrapped or postponed overseas orders by declaring force majeure since the end of January, when Beijing began to report a surge in coronavirus infections.



    Copper, a barometer for the health of the global economy, is the latest commodity to fall victim to the epidemic.
    China’s efforts to contain the virus, ranging from restricting highway traffic to extending the lunar new year holiday, have affected industrial activity and raised concerns about growth in the world’s second-biggest economy.
    Chinese buyers of liquefied natural gas have also considered declaring force majeure, a clause that identifies natural disasters or other unavoidable catastrophes as cause for not fulfilling a contract.
    “Coronavirus has had a huge impact on copper demand as downstream users [involved in processing raw copper] have stopped acquiring raw material,” said a manager at Guangzhou Zhongshan Trade, a non-ferrous metal trading firm in southern China that focuses on copper and antimony.
    Guangzhou Zhongshan this week asked suppliers in Chile and Somalia to delay shipments of 500 tonnes of copper worth about Rmb25m ($3.57m) for at least a week. It has also cancelled a preliminary contract with a seller in Somalia and has stopped placing new orders.
    “The epidemic is not just a China issue, it is a global problem,” the manager said, adding that its customers had not objected to its decision.
    Business activity at Guangzhou’s port, one of the biggest in China for commodities trading, has plunged with fewer than a third of workers on duty, the manager added.
    In the coming weeks at least a dozen other Chinese copper buyers could use force majeure to try to renegotiate copper import contracts, said traders in the city. Guangzhou is about 1,000km south of Wuhan, the outbreak’s centre.
    Copper users, ranging from car companies to home appliance makers, face a sharp drop in sales if the outbreak continues to worsen.
    Consultancy Wood Mackenzie said demand for copper-related products could suffer “further disruptions” after more than a dozen provinces imposed restrictions on people’s movements in an attempt to contain the disease.

    More at: https://dnyuz.com/2020/02/07/chinese...force-majeure/
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment



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  16. #433
    Apple's main iPhone assembler Foxconn has told employees not to return to work at its Shenzhen facility in China when the extended Lunar New Year break ends on February 10, according to a memo obtained by Bloomberg.

    "To safeguard everyone's health and safety and comply with government virus prevention measures, we urge you not to return to Shenzhen," Foxconn wrote in a text message sent to employees. "We'll update you on the situation in the city. The company will protect everyone's work-related rights and interests in the duration. As for the happy reunion date in Shenzhen, please wait for further notice."
    Foxconn has reportedly halted almost all of its production in China as the government and businesses attempt to contain the coronavirus outbreak in the country, where more than 31,000 cases have been reported so far.

    It's unclear whether the Shenzhen policy extends to all employees or to Foxconn's other facilities. Earlier this week, the *iPhone* manufacturer said it planned to resume full-scale production by February 10. Other Apple suppliers such as Quanta Computer, Inventec and LG Display also said they would go back to work next week in China, but sticking to that plan seems less certain by the day.

    More at: https://www.macrumors.com/2020/02/07...-from-shenzen/
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  17. #434
    For years, China has been the biggest buyer for farmers in Thailand, Myanmar and Vietnam, Nikkei reports. Now, with the coronavirus closing down importers and weighing on demand, farmers are being forced to instead sell their products in local markets for a serious discount.
    "The coronavirus has undoubtedly hurt business," said Maung Phyu, a 48-year-old farmer north of Yangon, in an interview with the Nikkei Asian Review. "There aren't many things the [Myanmar] government can do for us in this situation."

    Over the last decade, as China's population boomed, the county became the biggest buyer of fruits and vegetables from its neighbors. Thailand and Vietnam now export about 25% of their agricultural products to China, while Myanmar sends more than 50% of its harvest according to ASEANStats.

    In the poorest, most rural parts of these three countries, farming is critical: without it, local economies could collapse.
    One farmer said he sent dozens of truckloads of fruit to the border with China's Yunnan Province every day during the harvest season. Now, those shipments have stopped, while some have spoiled after being unexpectedly held up at the border.
    Three years ago, Maung Phyu contracted with several Chinese traders to supply watermelons and muskmelons. Almost every day during the harvest season, he would send truckloads of fruit to Muse, a border town in China's southernmost Yunnan Province. He sent 70 shipments in December followed by 120 in January.
    But now all shipments have stopped, and even transporting goods to the border is discouraged. "We were told not to send our produce to the border, as there was nobody to buy it," said Maung Phyu.
    Fishery products like crabs and eels are also being held up, said a commerce ministry official in Muse.
    The situation has forced Maung Phyu to sell at domestic markets in Yangon, where watermelons go for only 3,000 kyat to 5,000 kyat ($2.00 to $3.50) each, compared with 10,000 kyat on the export market. Muskmelons also only fetch 50% to 70%. "Many farmers haven't harvested their crops, and when they do they'll have nowhere to bring them," he said.
    Since millions of Chinese have been ordered not to leave their homes, shopping for fresh fruit and vegetables has become far more difficult.
    He said the lockdowns in Chinese cities have disrupted logistics while tighter border inspections have lengthened wait times, causing fruit to spoil before it gets to market. "Chinese have been ordered to stay home, and that means no shoppers," said Jira. "And if they manage to go out, they only buy necessities, not durian."
    Thailand's durian farmers, who recently expanded their operations following a spike in demand for durian in China, are being left in the lurch.

    More at: https://www.zerohedge.com/geopolitic...ammers-farmers
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  18. #435
    Soon the only food that will be affordable in China, is coronabat stew.
    With over 400 million people across dozens of Chinese cities living in lock down as a result of the Coronavirus pandemic, crippling global supply chains and grinding China's economy to a halt, it is easy to forget that China has been battling another major viral epidemic for the past two years: namely the African Swing Fever virus, aka "pig ebola" which killed off over half of China's pig population in the past year, sending pork prices soaring, and unleashing a tidal wave of inflation.
    Well, moments ago, the world got a stark reminder of this when China reported that in January, its CPI jumped by whopping 5.4% Y/Y, the highest print in nine years...


    ... driven by a surge in pork prices, which reversed a rare drop in December when the slid by 5.6%, rising 8.5% in just ont month, and a record 116% compared to a year ago.

    This unprecedented surge in pork CPI meant that China's food CPI rose a record 20.6% in January, also the highest on record, as China's population, now ordered to live under self-imposed quarantine, suddenly finds it can no longer afford to buy food .

    Needless to say, this is suddenly a major problem for China, whose central bank has in the past two weeks unleashed an unprecedented liquidity tsunami, including the biggest ever reverse repo injection...

    ... in hopes of stabilizing the stock market. Well, oops, because some of this liquidity now appears to be making its way into the broader economy, and is making already scarce food (aside from bat stew of course) even more unaffordable, and the already depressed and dejected Chinese population even more hungry, and angry.


    More at: https://www.zerohedge.com/economics/...d-central-bank
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  19. #436
    Bloomberg cited a new report via China Merchants Securities (CMSC) that said new apartment sales crashed 90% in the first week of February over the same period last year. Sales of existing homes in 8 cities plunged 91% over the same period.
    "The sector is bracing for a worse impact than the 2003 SARS pandemic," said Bai Yanjun, an analyst at property-consulting firm China Index Holdings Ltd. "In 2003, the home market was on a cyclical rise. Now, it's already reeling from an adjustment."
    Long before the coronavirus outbreak, China's housing market has been on shaky grounds amid declining demand, stricter mortgage requirements, and price discounts.
    The latest shock: two-thirds of China's economy has come to a standstill, could generate enough pessimism to pop the country's massive housing bubble.

    After all, coronavirus is a mass distraction from the overall domestic problems the Communist Party of China (CPC) faces.
    The CPC failed to stimulate the economy last year, with credit impulse not turning up as expected. The virus outbreak has allowed the CPC to scapegoat the slowdown and the inevitable crash.
    "…China's ability to stimulate its economy is now virtually nil, since China's record debt load has now made it virtually impossible to push the country's credit impulse higher," we noted last week.

    Real estate transactions have been forbidden in many cities. This means fire sales could be seen once selling restrictions end.
    E-House China Enterprise Holdings Ltd.'s research institute said four units per day were being sold in Beijing last week, and this is down from several hundred per day during the same period in the previous year.
    China International Capital Corp. analyst Eric Zhang said demand could pick back up in April, assuming the virus outbreak is under control.


    However, residents in major cities are frightened by the virus outbreak and how easily it spreads in apartment buildings.


    More at: https://www.zerohedge.com/markets/wo...-week-february
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  20. #437
    OPEC has dramatically lowered its forecast for oil demand growth this year, citing China's coronavirus outbreak as the "major factor" behind its decision.

    In a closely-watched monthly report published Wednesday, the Middle East-dominated producer group downwardly revised its outlook for global oil demand growth to 0.99 million barrels per day (bpd) in 2020. That's down by 0.23 million bpd from the previous month's estimate.
    ...
    https://www.cnbc.com/2020/02/12/opec...h-in-2020.html

    OPEC says oil demand is going to fall roughly 20% of baseline due to impacts of coronavirus on China (and the world).


    ...
    The coronavirus outbreak in China has generated economic waves that are rocking global commodities markets and disrupting the supply networks that act as the backbone of the global economy.

    “We’re seeing a rippling out,” said Ed Morse, global head of commodities research at Citigroup in New York. “And we don’t see it stopping.”

    Prices for key industrial raw materials such as copper, iron ore, nickel, aluminum and liquid natural gas have plummeted since the virus emerged. Currencies of countries that export these goods at high rates, including Brazil, South Africa and Australia, are near their lowest levels in recent memory. And manufacturers, mining companies and commodity producers of all stripes are weighing whether they will be forced to cut back on production for fear of adding to a growing inventory glut.

    The woes of the commodities markets — arguably the worst-performing asset in financial markets this year — reflect the basic reality that China’s industry-heavy economy is the most important consumer of raw materials on earth.
    ...
    Commodities markets have tumbled as those factories idled. Iron ore is down more than 10 percent this year. Copper is down about 8 percent, as is nickel, a key ingredient for stainless steel. Zinc and aluminum are both down more than 5 percent in 2020.
    ...
    One of China’s largest importers of liquefied natural gas, China National Offshore Oil Corporation, or CNOOC, was one of the entities to invoke a “force majeure” clause, according to multiple news reports. Asian gas prices tumbled in response; benchmark prices for North Asian liquid natural gas are down more than 30 percent in 2020.

    Copper prices have also been tested as China’s construction and automotive industries have stalled. BHP said it was monitoring the situation and was “working closely with our copper customers” as they returned from the holiday.

    For some, the decline in copper is an ominous sign: Copper has long been considered an unofficial leading indicator of the direction of the global economy, because of its close connection to the industrial sector.

    On Tuesday, the Federal Reserve chair, Jerome H. Powell, told House Financial Services Committee members that the central bank was “closely monitoring the emergence of the coronavirus, which could lead to disruptions in China that spill over to the rest of the global economy.”

    Whether the downturn is a blip or a serious shock is as much a question of epidemiology as economics.

    If the spread of the virus starts to slow — as many expect it will — commodities will most likely rebound as production returns to normal and inventories that have been built up over the past few weeks gradually shrink.

    “A lot of what’s happened in some of these commodity prices is more speculation that it gets worse before it gets better,” said John LaForge, the head of real asset strategy at Wells Fargo Investment Institute. “My guess is that commodity prices bounce pretty quickly.”

    Others are not so sure.

    Mr. Morse, at Citigroup, said several key markets — like crude oil — had already been showing softness, suggesting that the global economy was weak even before the virus hit. That could complicate any quick rebound for commodities prices.

    “The market has been thinking that there’s going to be a V-shaped recovery at some point,” he said. “And we don’t think that’s in the cards.”
    https://www.nytimes.com/2020/02/11/b...mmodities.html

    Industrial commodities are hardest hit from slowdowns in China's manufacturing.

    Chinese President Xi Jinping warned top officials last week that efforts to contain the new coronavirus had gone too far, threatening the country’s economy, sources told Reuters, days before Beijing rolled out measures to soften the blow.

    With growth at its slowest in nearly three decades, China’s leaders seem eager to strike a balance between protecting an already-slowing economy and stamping out an epidemic that has killed more than 1,000 people and infected more than 40,000.

    After reviewing reports on the outbreak from the National Development and Reform Commission (NDRC) and other economic departments, Xi told local officials during a Feb 3 meeting of the Politburo’s Standing Committee that some of the actions taken to contain the virus are harming the economy, said two people familiar with the meeting, who declined to be named because of the sensitivity of the matter.

    He urged them to refrain from “more restrictive measures”, the two people said.
    ...
    https://www.reuters.com/article/us-c...-idUSKBN2050JL

    Turn those machines back on!

    I compiled a "brief" history of events since October 2008 that are defining the global currency war and the role that gold is playing:

    Tin Foil Hats, Economic Reality and the Total Perspective Vortex

    Also, have you contacted your Congressional Rep and asked them co-sponsor Ron Paul's Rep. Paul Broun Jr.'s HR 1098 77: Free Competition in Currencies Act?

  21. #438
    Quote Originally Posted by Swordsmyth View Post
    Bloomberg cited a new report via China Merchants Securities (CMSC) that said new apartment sales crashed 90% in the first week of February over the same period last year. Sales of existing homes in 8 cities plunged 91% over the same period.
    "The sector is bracing for a worse impact than the 2003 SARS pandemic," said Bai Yanjun, an analyst at property-consulting firm China Index Holdings Ltd. "In 2003, the home market was on a cyclical rise. Now, it's already reeling from an adjustment."
    Long before the coronavirus outbreak, China's housing market has been on shaky grounds amid declining demand, stricter mortgage requirements, and price discounts.
    The latest shock: two-thirds of China's economy has come to a standstill, could generate enough pessimism to pop the country's massive housing bubble.

    After all, coronavirus is a mass distraction from the overall domestic problems the Communist Party of China (CPC) faces.
    The CPC failed to stimulate the economy last year, with credit impulse not turning up as expected. The virus outbreak has allowed the CPC to scapegoat the slowdown and the inevitable crash.
    "…China's ability to stimulate its economy is now virtually nil, since China's record debt load has now made it virtually impossible to push the country's credit impulse higher," we noted last week.

    Real estate transactions have been forbidden in many cities. This means fire sales could be seen once selling restrictions end.
    E-House China Enterprise Holdings Ltd.'s research institute said four units per day were being sold in Beijing last week, and this is down from several hundred per day during the same period in the previous year.
    China International Capital Corp. analyst Eric Zhang said demand could pick back up in April, assuming the virus outbreak is under control.


    However, residents in major cities are frightened by the virus outbreak and how easily it spreads in apartment buildings.


    More at: https://www.zerohedge.com/markets/wo...-week-february
    I was perplexed when I first heard this route, but I read that the ďtransmission through apartment pipesĒ has a lot to do with the lack of S- and P-traps and proper venting of plumbing. Makes more sense now bc improper venting and use of traps can allow sewer gases (and any other airborne particles) to infiltrate the living space. I donít know the the plumbing codes in China/Asia and if this is true, but it would at least help explain the theory.

  22. #439
    14+ plus new cases
    240+ new deaths in Hubei alone

  23. #440
    Quote Originally Posted by ghengis86 View Post
    14+ plus new cases
    240+ new deaths in Hubei alone
    One big reason China's #COVID19 new case numbers seem to be slowing down is testing has in places stopped:
    "Huanggang City has id'ed 10 instits to conduct testing, w/a daily testing capacity of 900…The previous stocks were all tested on February 9."https://t.co/m1Bs3JuGsQ
    — Laurie Garrett (@Laurie_Garrett) February 12, 2020

    Who knows what the real numbers are?
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment



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  25. #441
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  26. #442
    In our ongoing attempts to glean some objective insight into what is actually happening "on the ground" in the notoriously opaque China, whose economy has been hammered by the Coronavirus epidemic, yesterday we showed several "alternative" economic indicators such as real-time measurements of air pollution (a proxy for industrial output), daily coal consumption (a proxy for electricity usage and manufacturing) and traffic congestion levels (a proxy for commerce and mobility), before concluding that China's economy appears to have ground to a halt.
    That conclusion was cemented after looking at some other real-time charts which suggest that there is a very high probability that China's GDP in Q1 will not only flatline, but crater deep in the red for one simple reason: there is no economic activity taking place whatsoever.
    We start with China's infrastructure and fixed asset investment, which until recently accounted for the bulk of Chinese GDP. As Goldman writes in an overnight report, in the Feb 7-13 week, steel apparent demand is down a whopping 40%, but that's only because flat steel is down "only" 12% Y/Y as some car plants have ordered their employee to return to work (likely against their will as the epidemic still rages).


    However, it is the far more important - for China's GDP - construction steel sector where apparent demand has literally hit the bottom of the chart, down an unprecedented 88% Y/Y or as Goldman puts it, "construction steel demand is approaching zero."

    But wait, there's more.
    Courtesy of Capital Economics, which has compiled a handy breakdown of real-time China indicators, we can see the full extent of just how pervasive the crash in China's economy has been, starting with familiar indicator, the average road congestion across 100 Chinese cities, which has collapsed into the New Year and has since failed to rebound.

    Parallel to this, daily passenger traffic has also flatlined since the New Year and has yet to post an even modest rebound.

    And the biggest shocker: a total collapse in passenger traffic (measured in person-km y/y % change), largely due to the quarantine that has been imposed on hundreds of millions of Chinese citizens.

    And while we already noted the plunge in coal consumption in power plants as Chinese electricity use has cratered...

    ...what is perhaps most striking, is the devastation facing the Chinese real estate sector where property sales across 30 major cities have basically frozen.

    Finally, and most ominously perhaps, as the economy craters and internal supply chains fray, prices for everyday staples such as food are soaring as China faces not only economic collapse, but also surging prices for critical goods, such as food as shown in the wholesale food price index chart below...

    More at: https://www.zerohedge.com/economics/...proaching-zero
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  27. #443
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  28. #444
    Last week we reminded readers that unless Beijing manages to contain the coronavirus epidemic, China faces a fate far worse than just reported its first ever 0% (or negative) GDP print in history. For those who missed it, here it is again: back in November, we reported that as part of a stress test conducted by China's central bank in the first half of 2019, 30 medium- and large-sized banks were tested; In the base-case scenario, assuming GDP growth dropped to 5.3% - nine out of 30 major banks failed and saw their capital adequacy ratio drop to 13.47% from 14.43%. In the worst-case scenario, assuming GDP growth dropped to 4.15%, some 2% below the latest official GDP print, more than half of China's banks, or 17 out of the 30 major banks failed the test. Needless to say, the implications for a Chinese financial system - whose size is roughly $41 trillion - having over $20 trillion in "problematic" bank assets, would be dire.
    Well, with GDP set to print negative if Goldman is right (with risk clearly to the downside as China's economy remains completely paralyzed)...

    ... every single Chinese bank is set to fail a "hypothetical" stress test, and the immediate result is an exponential surge in bad debt. The result, as we discussed in detail last week, is that the bad loan ratio at the nation's 30 biggest banks would soar at least five-fold, and potentially far, far more, flooding the country with trillions in non-performing loans, and unleashing a tsunami of bank defaults.

    Of course, regular readers are well aware that China's banks are already suffering record loan defaults as the economy last year expanded at the slowest pace in three decades while bankruptcies soared. As extensively covered here previously, the slump tore through the nation’s $41 trillion banking system, forcing not only the first bank seizure in two decades as Baoshang Bank was nationalized , but also bailouts at Bank of Jinzhou, China's Heng Feng Bank, as well as two very troubling bank runs at China's Henan Yichuan Rural Commercial Bank at the start of the month, and then more recently at Yingkou Coastal Bank.

    All that may be a walk in the park compared to what is coming next.
    "The banking industry is taking a big hit," You Chun, a Shanghai-based analyst at National Institution for Finance & Development told Bloomberg. "The outbreak has already damaged China’s most vibrant small businesses and if it prolongs, many firms will go under and be unable to repay their loans."
    According to a recent Bloomberg report, S&P estimates that a worst-case scenario (one which however saw GDP remain well in positive territory) would cause bad debt to balloon by 5.6 trillion yuan ($800 billion), for an NPL ratio of about 6.3%, adding to the already daunting 2.4 trillion yuan of non-performing loans China’s banks are sitting on (a number which, like the details of the viral epidemic, is largely massaged lower and the real number is far higher according to even conservative skeptics).
    S&P also expects that banks with operations concentrated in Hubei province and its capital city of Wuhan, the epicenter and the region worst hit by the virus, will likely see the greatest increase in problem loans. The region had 4.6 trillion yuan of outstanding loans held by 160 local and foreign banks at the end of 2018, with more than half in Wuhan. The five big state banks had 2.6 trillion yuan of exposure in the region, followed by 78 local rural lenders, according to official data.
    Meanwhile, exposing the plight of small bushiness, most of which are indebted to China's banks, a recent nationwide survey showed that about 30% said they expect to see revenue plunge more than 50% this year because of the virus and 85% said they are unable to maintain operations for more than three months with cash currently available. Perhaps they were exaggerating in hopes of garnering enough sympathy from Beijing for a blanket bailout; or perhaps they were just telling the truth.
    Finally, the market is increasingly worried that all this bad debt will have a dire impact on bank assets: consider that the “big four” state-owned lenders, which together control more than $14 trillion of assets, currently trade at an average 0.6 times their forecast book value, near a record low. This also means that in the eyes of the market, as much as $6 trillion in bank assets are currently worthless.
    All of this led us to conclude last week that "nothing short of a coronavirus cataclysm faces both China's banks and small businesses if the coronavirus isn't contained in the coming weeks."
    In retrospect, there is one thing we forgot to footnote, and that is that China could buy some extra time if the central bank suspend financial rules and moves the goalposts once again.
    And so, just three days after our first article on China's looming bad debt catastrophe, that's precisely what the PBOC has opted to do, because as Reuters writes, on Saturday the PBOC said that the country's lenders will tolerate higher levels of bad loans, part of efforts to support firms hit by the coronavirus epidemic.
    "We will support qualified firms so that they can resume work and production as soon as possible, helping maintain stable operations of the economy and minimizing the epidemic's impact," Fan Yifei, a vice governor at the People's Bank of China, told a news conference.
    He added that the problem will be manageable as China has a relatively low bad loan ratio.
    What the PBOC really means is that China's zombie companies are about to take zombification to a preciously unseen level, as neither the central bank nor its SOE-commercial bank proxies will demand cash payments amounting to billions if not trillions of dollars from debtors, who will plead "force majeure" as part of their debt default explanation. In other words, we may be about to see the biggest "under the table" debt jubilee in history, as thousands of companies are absolved from the consequences of having too much debt.


    Separately, during the same briefing, Liang Tao, vice chairman of the China Banking and Insurance Regulatory Commission, said that lending for key investment projects will be sped up, while Xuan Changneng, vice head of the country's foreign exchange regulator, said China was expected to maintain a small current account surplus and keep a basic balance in international payments. We wouldn't hold our breath for a surplus if China is indeed producing nothing as real-time indicators suggest.
    And just so the message that debt will flow no matter what is heard loud and clear, on Friday, said Liang Tao, vice-chairman of the China Banking and Insurance Regulatory Commission said that financial institutions in the banking sector had provided more than 537 billion yuan ($77 billion) in credit to fight against the novel coronavirus outbreak as of noon on Friday.
    "The regulator will soon launch more measures to give stronger credit support to various industries," said Liang at a news conference held by the State Council Information Office on Saturday. "It will continue to lead banks' efforts on increasing loans to small and micro enterprises, making loans accessible to a larger number of small businesses, and further lowering their lending costs."
    Hilariously, Liang highlighted the importance for banks to take accurate measures to renew loans for small businesses to reduce their financial pressure. It wasn't clear just how burdening the small businesses with even more debt they will never be able to repay reduces financial pressure, but we can only assume that this is what is known as financial strategy with Chinese characteristics.

    More at: https://www.zerohedge.com/economics/...void-financial
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  29. #445
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  30. #446
    ...
    A comparison of the latest forecasts from the world’s three big oil agencies — the International Energy Agency, the U.S. Energy Information Administration and the Organization of Petroleum Exporting Countries — highlights the huge uncertainty that exists over the virus’s repercussions for oil demand. As may be expected for a body representing oil producers, OPEC sees the impact as minimal, having just cut its first-quarter forecast for global oil demand by only 400,000 barrels a day. That looks like wishful thinking. The IEA’s revision is three times as big, and if its forecast bears out, it’s deep enough to tip the world into its first year-on-year drop in demand in more than a decade.
    ...
    More: https://www.bloomberg.com/opinion/ar...d?srnd=opinion
    I compiled a "brief" history of events since October 2008 that are defining the global currency war and the role that gold is playing:

    Tin Foil Hats, Economic Reality and the Total Perspective Vortex

    Also, have you contacted your Congressional Rep and asked them co-sponsor Ron Paul's Rep. Paul Broun Jr.'s HR 1098 77: Free Competition in Currencies Act?

  31. #447
    A growing number of China’s private companies have cut wages, delayed paychecks or stopped paying staff completely, saying that the economic toll of the coronavirus has left them unable to cover their labor costs.To slow the spread of the virus that’s claimed more than 2,000 lives, Chinese authorities and big employers have encouraged people to stay home. Shopping malls and restaurants are empty; amusement parks and theaters are closed; non-essential travel is all but forbidden.
    What’s good for containment has been lousy for business. With classes canceled at a coding-and-robotics school in Hangzhou, employees will lose 30% to 50% of their wages. The Lionsgate Entertainment World theme park in Zhuhai is closed, and workers have been told to use up their paid vacation time and get ready for unpaid leave.“A week of unpaid leave is very painful,” said Jason Lam, 32, who was furloughed from his job as a chef in a high-end restaurant in Hong Kong’s Tsim Sha Tsui neighborhood. “I don’t have enough income to cover my spending this month.”
    Across China, companies are telling workers that there’s no money for them -- or that they shouldn’t have to pay full salaries to quarantined employees who don’t come to work. It’s too soon to say how many people have lost wages as a result of the outbreak, but in a survey of more than 9,500 workers by Chinese recruitment website Zhaopin, more than one-third said they were aware it was a possibility.
    The salary freezes are further evidence of the economic hit to China’s volatile private sector -- the fastest growing part of the world’s second-biggest economy -- and among small firms especially. It also suggests the stress will extend beyond the health risks to the financial pain that comes with job cuts and salary instability.“The coronavirus may hit Chinese consumption harder than SARS 17 years ago,” said Chang Shu, Chief Asia Economist for Bloomberg Intelligence. “And SARS walloped consumption.”
    By law, companies have to comply with a full pay cycle in February before cutting wages to the minimum, said Edgar Choi, a Shenzhen-based lawyer and author of “Commercial Law in a Minute.” For companies that aren’t making enough to cover payroll, it’s permissible to delay salaries, as long as staff get the money they’re owed eventually.Choi said he’s heard from thousands of foreign workers who say their payments have been cut in half this month or halted althogether. That, he said, is illegal. “A lot of these employees are foreigners, they don’t know Chinese,” he said. “Whatever their boss tells them, that’s it. It’s easy for them to get bullied.”NIO Inc., an electric car-maker based in Shanghai, recently delayed paychecks by a week. The company’s chairman William Li also encouraged employees to accept restricted stock units in lieu of a cash bonus.
    At Foxconn Technology Group’s Shenzhen factory, workers returning from the Lunar New Year break are quarantined in the dorms before they can return to work. They’re getting paid, but only about one-third of what they’d earn if they were working.Without full, regular paychecks and few places to spend them these days anyway, Chinese consumers could cut spending in some categories to zero, said Bloomberg’s Shu. And it may not bounce back: For example, she said, if you skip your daily latte for two months, you’re not likely to make up for those missed drinks later in the year.

    More at: https://finance.yahoo.com/news/chine...020241284.html
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  32. #448
    There was a palpable sense of disappointment last night when instead of cutting its benchmark overnight interest rates as some - notably Goldman Sachs - had speculated might happen, the PBOC announced that it would only lower its benchmark 1- and 5-year lending rates, i.e., Loan Prime Rate, by 10bps to 4.05% and 5bps to 4.75% respectively, a move that was widely anticipated.

    The underwhelming rate cuts left analysts asking for more as consensus emerged that piecemeal lending rate cuts can only help the Chinese economy so much, especially if China is indeed set to unleash fiscal austerity as local Chinese media reported over the weekend: “The ten basis point reduction will help companies weather the damage from the coronavirus at the margins,” Julian Evans-Pritchard, senior China economist at consultancy Capital Economics, wrote in a note after PBOC published its latest loan prime rates. “But even if the ... cut is passed on to all borrowers, that would only decrease average one-year bank lending rates from 5.44% to 5.34%. The ability of firms to postpone loan repayments and access loans on preferential terms will matter more in the near-term."
    However the market's bitter taste from the underwhelming rate cut was quickly reversed after the PBOC reported its latest monthly credit data, which was a whopper, blowing out market expectations: total social financing, the broadest credit aggregate, soared by over 5 trillion yuan, the biggest one month injection on record, surprising the market to the upside mainly on higher government bond issuance. According to Goldman, "this mainly reflected the economic conditions and policy stance as the economic impacts from the virus were still rising."

    Here is the summary from the January credit stats:

    • Total social financing: RMB 5070BN in January, vs. consensus: RMB 4200bn.
    • New CNY loans: RMB 3340BN in January; consensus: RMB 3100BN.
    • Outstanding CNY loan growth: 12.1% yoy in January vs December: 12.3% yoy
    • M2: 8.4% yoy in January vs. consensus: 8.6% yoy, and above December's 8.2% yoy

    Putting it in context, the total credit injection of more than 5 trillion yuan, or roughly $725 billion, in one month, was the single biggest on record.

    The surge in TSF was mostly the result of another solid month in new yuan loan growth, which increased by 3.34BN, also the biggest monthly increase on record.

    According to the PBOC, TSF stock growth (after adding all government bonds) was 10.9% yoy in January, the same as December. The implied month-on-month growth of TSF stock accelerated to 12.6% (seasonally adjusted annual rate) from 11.1% in December, largely due to a burst in local government debt. If we exclude central government bonds and general local government bonds from the TSF flows, the TSF stock growth moderated marginally to 11.0% yoy in January from 11.1% in December.
    Issuance of local government special bonds is one of the key tools of fiscal policy. According to Wind statistics, local government special bonds of RMB 63bn have been issued in the first 20 days of February and another RMB 56bn of special bonds are in the pipeline as of Feb. 25 (Exhibit 3).

    That said, since the local government debt does eventually enter the local economy, even if under the form of embezzlement and corruption, there is no reason to exclude it, which means that January saw the biggest credit injection in Chinese history.
    But the most notable change, was the first positive print in China's shadow banking proxy since March 2019, which increased by CNY181BN, in what according to Goldman was the "clearest policy signal" in the month's data.



    More at: https://www.zerohedge.com/markets/ch...economic-crash
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment



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  34. #449
    Choked off from suppliers, workers, and logistics networks, China’s manufacturing base is facing a multitude of unprecedented challenges, as coronavirus containment efforts hamper factories’ efforts to reopen.

    Many of those that have been granted permission to resume operations face critical shortages of staff, with huge swathes of China still under lockdown and some local workers afraid to leave their homes. Others cannot access the materials needed to make their products, and even if they could, the shutdown of shops and marketplaces around China means demand has been sapped.

    Those who manage to assail the challenges, meanwhile, have found that trucking, shipping and freight services are thin on the ground, as China’s famed logistical machine also struggles to find workers
    and navigate provincial border checkpoints that have popped up across the country

    “It really is death by a thousand cuts,” said John Evans, managing director of Tractus Asia, a company that has 20 years’ experience helping firms move to China, but which over the past two has had more enquiries from businesses looking to leave. “This is a black swan event and I don’t think we’ve seen anything like it in recent history, in terms of the economic and supply chain impact in China and across the globe.”


    Australian company B&R Enclosures, which makes units for protecting industrial equipment, said the outbreak has cut it off from suppliers and delayed the return of its migrant workers from their hometowns, following the extended Lunar New Year break. Only 15 per cent have come back, B&R China general manager Marko Dimitrijevic said.

    “All supply chains are having trouble, it’s very serious,” he said. “Even if we declare force majeure [to avoid paying hefty damages for late deliveries], we will not be delivering and that means many of us will risk losing our customers. For many companies, this could mean bankruptcy.”

    Dimitrijevic said he had to charter special buses to transport his workers
    from other parts of China back to Suzhou, a city west of Shanghai. When they returned, he had to book hotel rooms to house them for another 14 days in quarantine as their neighbours “will not let them go home”. He was paying about 350 yuan (US$50) in accommodation for each employee.

    “While work has officially started last week, most employees were still quarantined or just on their way back due to lack of transport,” Dimitrijevic said. “It would be about a month in production delays by the time we start next week, and by then we would not even be able to run full operations.”


    Based on the Baidu Migration Index, analysts at Nomura estimated that only 25.6 per cent of migrant workers had returned to work across 15 sample cities by February 19, compared to 101.3 per cent a year earlier.

    Refing Enterprise Group, one of China’s three largest producers of piping for plumbing, drainage and gas fields, is facing severe losses across its nationwide factories, which are all in various states of idleness.

    Its plants in Hubei – the epicentre of the coronavirus outbreak
    – and Tianjin remain in total shutdown. A factory in the central Chinese city of Xian is operating at roughly 40 per cent, as is a plant in Foshan, part of China’s manufacturing heartland in Guangdong, said operations and quality director Robin Yang.

    “February is usually boom season for us, where we take orders from many of our customers,” said Yang, speaking from the company headquarters in Foshan. “But this year we have only taken about 20 million yuan (US$2.85 million) worth of new orders versus 400 million yuan (US$57 million) last year. We have to assume the demand is still there, but it is delayed.”


    There have been reports of cargo ships being marooned at sea, with ports in countries with strict coronavirus quarantine rules such as Australia, Singapore and the United States not permitting shipping personnel to enter their ports if they have been in China over the past 14 days.

    Andy Lane, Asia director at shipping analysis firm Sea Intelligence, said that Australia had seized two ships from China, belonging to Singaporean line PIL and Chinese line COSCO, with the crew now undergoing a 14-day quarantine period before they can unload their cargo.

    While 43 sailings from Chinese ports to the US West Coast were cancelled before the Lunar New Year holiday in anticipation of the seasonal slowdown, “ subsequent to the holidays starting and we would say directly related to the virus, a further 19 sailings were cancelled”, Lane said.

    A further two cargo sailings were cancelled from China to the US East Coast, five from Asian ports to North Europe and five from Asia to Mediterranean ports, he added.


    A survey by the American Chamber of Commerce in Shanghai released this week found that almost 80 per cent of respondents in the manufacturing sector were unable to staff their production lines.

    An overwhelming 92 per cent of the 100 Australian and global businesses surveyed by the Australian Chamber of Commerce Shanghai last week, meanwhile, said the outbreak would have a negative impact on their revenue in the first quarter of this year, with more than half saying it could dent their top-line earnings by more than 20 per cent.

    These results suggest that foreign companies might re-evaluate their relationships with China. For many, the virus comes after two long years dealing with trade war tariffs
    and has added to the sense of China fatigue. It is for some “the straw that broke the camel’s back”, said Evans, from Tractus.

    More at: https://www.scmp.com/economy/china-e...-pummelled-all
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  35. #450
    China's chicken farmers had been looking forward to a bumper year.But an unprecedented lockdown on people and goods to curb the coronavirus outbreak has disrupted the short but intense poultry lifecycle, threatening output of meat just as the world's most populous country faces a massive pork shortfall.
    China's poultry production expanded by 12% last year to 22.39 million tonnes, after farmers sought to plug the gap from the pork shortage caused by African swine fever that ravaged the domestic hog herd.


    About half of China's chickens are raised by individual farmers involved in only one or two steps of the chicken chain, rather than integrated operations.
    But that has made them vulnerable to the restrictions on movement and labour shortage resulting from Beijing's efforts to curb the spread of a new coronavirus that has killed more than 2,200 people and infected around 75,000.
    Many roads to villages across the country are still blocked, despite government efforts to ease problems for vital industries like food, hampering feed deliveries and movement of birds.
    Some feed mills and slaughterhouses are still shut, while others are only starting to reopen after extended holidays and operating below capacity.
    That has upset the flow of a supply chain that starts with the sale of day-old chicks by hatcheries to breeding farms, continues with distribution of broiler chickens to growers, and ends in the slaughter of fattened birds, all in less than a year.
    "Every step needs to work at the same pace, otherwise there will be an imbalance," said Pan Chenjun, senior analyst at Rabobank.
    Pan Xingle, who raises chickens in Yi county in Hebei province for a slaughterhouse under contract, is still waiting to slaughter 16,000 birds that are already more than 50 days old.
    Broilers used for cheap meat by fast-food chains and public canteens reach their maximum weight of 2.6 kg (5.7 lb) in around 40 days.
    But the slaughterhouse has only just reopened after an extended holiday and farmers are queuing to kill their chickens.
    "I was told I'll need to wait for at least another 10 days," said Pan.
    That means Pan won't be restocking his farm with new chicks for a while longer, hurting business for some of the 45 million breeders that raise 'parent stock' around China.


    Prices for the day-old-chicks sold by those breeders are currently below cost, ranging from 1.4 yuan to 2.5 yuan (about 20 to 35 U.S. cents) per chick. The average price last year was 6.8 yuan.
    Zhang Yanguang, manager of breeding farm Beijing Lvyan Poultry Centre located in a village in the northwest of the capital, said even if he could sell his chicks, roads to the village are still blocked, and trucks can neither go in nor out.
    Worse, most of the slaughterhouses in the northeast and northwest of China are still shut so he can't get rid of unwanted birds either.
    "The whole market is closed down," he said, estimating slaughter capacity is currently only running at around 30%.
    If pressure on farms like Zhang's continues past this month, it could force some out of business, said Pan, the analyst, hitting the hatcheries further upstream that raise grandparent stock to produce the breeders.
    "Then the hatcheries will have to destroy day-old chicks or eggs," she said.


    Similar challenges are facing egg farmers who are unable to get fresh eggs to market nor replace their old hens.
    "We are selling our chicks really cheap, as little as 1.5 yuan instead of 4 yuan, so we're losing money," said Wang Lianzeng, chairman of Huayu Agricultural Science and Technology Co Ltd, one of the country's largest hatcheries for laying hens.

    More at: https://finance.yahoo.com/news/china...064330369.html
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankindÖitís people I canít stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

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