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Remember when stuff such as the following was written exclusively on “conspiracy” tin-foil blogs by deranged lunatics who could not appreciate the brilliance of the neo-Keynesian system and central-planning by academics, in all its glory? Good times.

Here is Bank of America’s Athanasios Vamvakidis channeling Tyler Durden circa 2009

The real cost of QE

QE was not a free lunch after all

If only it was that easy to print our way out of a global crisis. Eight years after the crisis, we are still debating about whether the recovery has gained enough of a momentum to allow exit from crisis-driven policies and start hiking rates from zero. The world economy has actually lost momentum this year (Chart 1), deflation risks have increased (Chart 2), and EM indicators and overall market volatility have reached crisis levels (see Chart 3). All this is despite unprecedented expansion of central bank balance sheets (Chart 4). Things may have been worse otherwise, but in hindsight we believe relying too much on unconventional monetary policies was not a free lunch after all.

We should have known something was wrong

The Fed “taper tantrum” could have been the first warning that QE had gone too far. The Fed’s announcement in June 2013 that they would consider tapering QE, contingent upon continued positive data, triggered a sharp market sell-off, particularly in EM. The aggressive search for yield, which intensified after the Fed announced QE3—or QE infinity as markets called it—came to a sudden stop. QE was not for infinity after all. The Fed tried to reassure markets that QE tapering was still policy easing and that its end would not imply rate hikes immediately, but the markets apparently thought otherwise. A key takeaway was not that QE had already gone too far, but that announcing its tapering may have been a mistake. The Fed waited until December to start tapering, although the market had already priced its beginning in September.

…click on the above link to read the rest of the article…

What’s The Worst That Could Happen?

October 2, 2015

What’s The Worst That Could Happen?

Via ConvergEx’s Nicholas Colas,

The 30 stocks of the Dow Jones Industrial Average currently trade for an average of 14.8x next year’s consensus earnings. But… Everyone knows Wall Street analysts are always too optimistic, so what if we just look at the lowest estimate for each company? That “Worst Case scenario” P/E is 16.7x – not “Cheap”, but not crazy expensive either – and incorporates a decline in earnings from 2015 of 1.5%.

As tempting as it is to say “Buy stocks” with this math, the truth is hazier. In reality, markets currently discount this “Worst case” as the “Base case”. With the 10 year Treasury yielding 2.1%, that 16.7x multiple is where stocks should actually trade.

The driver of this market pessimism sits at the top of the income statement – the Street’s worst case revenue estimates call for a decline of 1.7% in 2016. Now, Q3 earnings season is unlikely to provide much comfort here; why should corporate managements go out on a guidance limb when their stocks are down on the year? All this points to further volatility in October, and with a bias to the downside.

Of all the words of tongue or pen, the dumbest are these: “What’s the worst that could happen?” I imagine every stupid stunt ever uploaded to Youtube started life with that question. Skateboard off the roof of your parent’s house into the pool… Taunt the chimps at the zoo… Jump a bike over 17 of your friends… That phrase is cursed. Even a movie of the same name, starring Martin Lawrence and Danny DeVito, only has a 10% approval rating on Rotten Tomatoes.

In financial markets, however, this is one of the most important questions you can ask. A few examples:

Every hedge fund uses some form of risk management to understand the worst case scenario for their portfolio. In general, the larger the firm and more complex the strategy, the more elaborate the analysis.

…click on the above link to read the rest of the article…

This Is The Endgame, According To Deutsche Bank

October 2, 2015

This Is The Endgame, According To Deutsche Bank

DB’s Jim Reid lays out the “endgame” scenario, one which this website first said is inevitable back in 2009. With Citi and Macquarie already on board, expect what was once merely the figment of a “deranged tinfoil conspiracy-theory blog’s” imagination, to become global monetary policy. And yes, the real endgame is the one we have said from day one: total fiat (and conventional economics) collapse.

* * *

From Deutsche Bank’s chief credit strateigst

Our thesis over the last few years has basically been that the global financial system/economic fundamentals are so bad that its good for financial assets given it forces central banks into extraordinary stimulus and for them to continue to buy assets in never before seen volumes. The system failed in 2008/09 and rather than allow a proper creative destruction cleansing, policy makers have been aggressively propping it up ever since. This has surely led to a large level of inefficiency in the system which helps explain weak post crisis growth and thus forces them to do even more thus supporting asset prices if not the global economy.

However since the summer this theory has been severely tested by China’s equity bubble bursting, China’s small ‘shock’ devaluation and the start of a rundown in reserves for the first time in over a decade. We’ve also seen associated commodities and EM woes, endless unsettling speculation about the Fed’s next move and more recently the idiosyncratic corporate scandal around VW and funding concerns around Glencore. The hits keep on coming. Is it now so bad it’s actually bad again?

The most recent leg of the sell-off begun after the Fed held rates steady two weeks ago as the narrative focused on either this reflecting worrying economic concerns or a Fed that is a slave to financial markets and losing credibility. So do we think we’re now entering a period where central banks are increasingly impotent?

…click on the above link to read the rest of the article…

Powder Kegs Exploding: Violence Escalates In Turkey, Yemen As Mid-East Tips Towards Chaos

September 7, 2015

Powder Kegs Exploding: Violence Escalates In Turkey, Yemen As Mid-East Tips Towards Chaos

On Friday we checked in on two of the world’s most important conflicts: 1) that which is unfolding in Turkey where President Recep Tayyip Erdo?an has effectively granted Washington access to Incirlik (you know, for “anti-terror” sorties) in exchange for NATO’s acquiescence to a brutal crackdown on the Kurds as AKP looks to usurp Turkey’s fragile deomcracy, and 2) that which is unfolding in Yemen, where a Saudi-led coalition isfighting to restore the government of Abd Rabbuh Mansur Hadi.

In Turkey, Erdogan has successfully undermined the coalition building process necessitating new elections in November when he hopes the escalation of violence across the country will prompt voters to restore AKP’s parliamentary majority allowing the President to rewrite the constitution and consolidate his power. Journalists are being arrested, a terror “tip line” has been set up, a 24-hour Erodgan Presidential TV channel is in the works, and the country has, for all intents and purposes, been plunged into civil war with ISIS acting as a smokescreen for Erdogan’s power grab.

As for Yemen, the Iran-backed Houthis have been driven back by Saudi and UAE troops but the problem, asWSJ noted last week, is that the ragtag militia in Aden is “a motley group that spans the spectrum from southern secessionists to ultraconservative Salafi Islamists to supporters of al Qaeda.” In other words, it doesn’t seem all that far-fetched to suggest that should restoring Hadi ultimately prove to be impossible, an independent South Yemen could end up falling into the hands of extremists, which would be ironic not only for the fact that it would represent the latest example of US foreign policy gone horribly awry, but also because according to at least one source, the Saleh government – whose fighters are now allied with the Houthis – for years worked with AQP while accepting US anti-terror funding. Notably, were Yemen to split in two, it would also effectively create a permanent Iranian colony on Saudi Arabia’s southern border.

…click on the above link to read the rest of the article…

The Numbers Are In: China Dumps A Record $94 Billion In US Treasurys In One Month

September 7, 2015

The Numbers Are In: China Dumps A Record $94 Billion In US Treasurys In One Month

Shortly after the PBoC’s move to devalue the yuan, we noted with some alarm that it looked as though China may have drawn down its reserves by more than $100 billion in the space of just two weeks. That, we went on the point out, would represent a stunning increase over the previous pace of the country’s reserve draw down, which we’ve began documenting months ahead of the devaluation (see here, for instance). We went on to estimate, based on the estimated size of the RMB carry trade unwind, how large the FX reserve liquidation might need to be to offset capital outflows and finally, late last week, we suggested that China’s official FX reserve data was set to become the new risk-on/off trigger for nervous, erratic markets. In short, the pace at which Beijing is burning through its USD assets in defense of the yuan has serious implications not only for investors’ collective perception of market stability, but for yields on core paper, for global liquidity, and for US monetary policy.

On Monday we got the official data from China and sure enough, we find out that the PBoC liquidated around $94 billion in reserves during the month of August and as Goldman argues (see below), the “real” figure might have been closer to $115 billion. Whatever the case, it’s a staggering burn rate and needless to say, were the PBoC to continue to liquidate its assets at this pace, it would necessitate a raft of RRR cuts and hundreds of billions in short-term liquidity ops to ensure that money market don’t seize up in the face of the liquidity drain.

…click on the above link to read the rest of the article…

The IMF Just Confirmed The Nightmare Scenario For Central Banks Is Now In Play

September 5, 2015

The IMF Just Confirmed The Nightmare Scenario For Central Banks Is Now In Play

The most important piece of news announced today was also, as usually happens, the most underreported: it had nothing to do with US jobs, with the Fed’s hiking intentions, with China, or even the ongoing “1998-style” carnage in emerging markets. Instead, it was the admission by ECB governing council member Ewald Nowotny that what we said about the ECB hitting a supply brick wall, was right. Specifically, earlier today Bloomberg quoted the Austrian central banker that the ECB asset-backed securities purchasing program “hasn’t been as successful as we’d hoped.”

Why? “It’s simply because they are running out. There are simply too few of these structured products out there.”

So six months later, the ECB begrudgingly admitted what we said in March 2015, in “A Complete Preview Of Q€ — And Why It Will Fail“, was correct. Namely this:

… the ECB is monetizing over half of gross issuance (and more than twice net issuance) and a cool 12% of eurozone GDP. The latter figure there could easily rise if GDP contracts and Q€ is expanded, a scenario which should certainly not be ruled out given Europe’s fragile economic situation and expectations for the ECB to remain accommodative for the foreseeable future. In fact, the market is already talking about the likelihood that the program will be expanded/extended.

… while we hate to beat a dead horse, the sheer lunacy of a bond buying program that is only constrained by the fact that there simply aren’t enough bonds to buy, cannot possibly be overstated.

Among the program’s many inherent absurdities are the glaring disparity between the size of the program and the amount of net euro fixed income issuance and the more nuanced fact that the effects of previous ECB easing efforts virtually ensure that Q€ cannot succeed.

(Actually, we said all of the above first all the way back in 2012, but that’s irrelevant.)

…click on the above link to read the rest of the article…

China Takes “10 Steps Back,” Slaps 20% Reserve Requirement On Currency Forwards

September 1, 2015

China Takes “10 Steps Back,” Slaps 20% Reserve Requirement On Currency Forwards

Overnight, China decided to take steps to reduce “macro financial risks.”

And by that they mean “do something quick to help ease pressure on the yuan” and by extension, on the PBoC’s rapidly depleting FX reserves.

To that end, starting October 15 banks will have to hold the equivalent of 20% of clients’ FX forward positions with the PBoC, where the money will sit, frozen, for a year, at 0% interest.

Obviously, that will drive up the cost of taking speculative positions which the PBoC hopes will help narrow the gap between onshore and offshore yuan and bring down volatility, although the degree to which this will help fill the CNY-CNH spread looks like an open question.

“It’s a move to ease the reduction in foreign-exchange reserves,” Tommy Ong, managing director for treasury and markets at DBS Bank Hong Kong, tells Bloomberg. “It will also remove lots of speculative trades that aim at short-term gains as the reserves have a minimum lock-up period of one year,” adds Stan Chart’s Becky Liu.

Here’s a bit of color from FX strategy desks via Bloomberg:

Andy Ji, Singapore-based currency strategist at CBA:
- This is typical FX control, as it limits the FX forward positions
- PBOC has intervened before in the forward market, but imposing the 20% limit on outstanding forward position will require less intervention effort
- Spread on CNY and CNH may not substantially narrow on this move alone, as global demand on dollar remains high and China economic grow remains slow
Fiona Lim, Singapore-based senior FX analyst at Maybank:
- This seems to be another move to discourage yuan forward selling and to lower yuan depreciation expectations
- Offshore-onshore yuan gap has been pretty persistent because of yuan depreciation expectations and officials want to narrow the gap
- Gap will be sustained as the economy continues to remain under pressure
  …click on the above link to read the rest of the article…

How China Cornered The Fed With Its “Worst Case” Capital Outflow Countdown

August 31, 2015

How China Cornered The Fed With Its “Worst Case” Capital Outflow Countdown

Last week, in “What China’s Treasury Liquidation Means: $1 Trillion QE In Reverse,” we took a look at the potential size of the RMB carry trade, noting that according to BofAML, the unwind could, in the worst case scenario, be somewhere on the order of $1 trillion.

Extrapolating from that and applying Citi’s take on the impact of EM reserve drawdowns on 10Y UST yields (which, incidentally, is based on “Financing US Debt: Is There Enough Money in the World – and at What Cost?“, by John Kitchen and Menzie Chinn from 2011), we noted that potentially, if China were to use its FX reserves to offset the pressure on the yuan from the unwind of the great RMB carry, the effect could be to put more than 200bps of upward pressure on the 10Y yield.

Going farther, we also said that $1 trillion in FX reserve liquidation by the PBoC would essentially negate around 60% of QE3. In other words, China’s persistent FX interventions amount to reverse QE or, as Deutsche Bank calls is “quantitative tightening.”

Now, SocGen is out with a description of China’s “impossible trinity” or “trilemma”. Here’s the critical passage:

The PBoC is caught in an awkward position: not letting the currency go requires significant FX intervention that will not prevent ongoing capital outflows but which will result in tightening domestic liquidity conditions; but letting the currency go risks more immense capital outflow pressures in the immediate short term, external debt defaults and possibly further domestic investment deceleration. Furthermore, it has to consider the painful repercussions globally that could result from any sharp RMB depreciation.

…click on the above link to read the rest of the article…

Here’s Why The Markets Have Suddenly Become So Turbulent

August 29, 2015

Here’s Why The Markets Have Suddenly Become So Turbulent

A perfect storm of failing trends

When stock markets are free-falling 10+% in a matter of days, it’s natural to seek some answers to the question “why now?”

Some are saying it was all the result of high-frequency trading (HFT), while others point to China’s modest devaluation of its currency the renminbi (a.k.a. yuan) as the trigger.

Trying to finger the proximate cause of the mini-crash is an interesting parlor game, but does it really help us identify the trends that will shape markets going forward?

We might do better to look for trends that will eventually drag markets up or down, regardless of HFT, currency revaluations, etc.

Five Interconnected Trends

At the risk of stating the obvious, let’s list the major trends that are already visible.

The China Story is Over

And I don’t mean the high growth forever fantasy tale, I mean the entire China narrative is over:

That export-dependent China can seamlessly transition to a self-supporting consumer economy.
That China can become a value story now that the growth story is done.
That central planning will ably guide the Chinese economy through every rough patch.
That corruption is being excised from the system.
That the asset bubbles inflated by a quadrupling of debt from $7 trillion in 2007 to $28 trillion can all be deflated without harming the wealth effect or future debt expansion.
That development-dependent local governments will effortlessly find new funding sources when land development slows.
That workers displaced by declining exports and automation will quickly find high-paying employment elsewhere in the economy.

I could go on, but you get the point: the entire Story is over. (I explained why in a previous essay, Is China’s “Black Box” Economy About to Come Apart? )

…click on the above link to read the rest of the article…

“Central Bankers Look Naked… & Investors Have Nothing Else To Believe In”

August 26, 2015

“Central Bankers Look Naked… & Investors Have Nothing Else To Believe In”

Via RBS’ Alberto Gallo,

“Policymakers responded to the financial crisis with easy monetary policy and low interest rates. The critics — including us — argued against ‘solving a debt crisis with more debt.’ Put differently, we said that QE was necessary, but not sufficient for a recovery. We are now coming to the moment of reckoning: central bankers look naked, and markets have nothing else to believe in.“

The Emperor Is Naked…

As The FiscalTimes details,

Gallo believes an overreliance on excess liquidity has actually hindered capital investment — as companies have focused on debt-funded share buybacks and dividend hikes instead — limiting the global economy’s potential growth rate.

Now, contagion from China — lower commodity prices, lower demand, currency volatility — has revealed the structural vulnerabilities. More stimulus, in his words, “could be self-defeating without fiscal and reform support.”

As for Fed hike timing, Gallo sees the odds of a September liftoff at just 30 percent, down from 36 percent last week, based on futures market pricing. December odds are at 60 percent.

The open question is: Should the Fed delay its rate hike and the People’s Bank of China ease, will stocks actually rebound? Or has the Pavlovian reaction function been broken by a loss of confidence? We’re about to find out.

What If The “Crash” Is as Rigged as Everything Else?

August 26, 2015

What If The “Crash” Is as Rigged as Everything Else?

Take your pick–here’s three good reasons to engineer a “crash” that benefits the few at the expense of the many.

There is an almost touching faith that markets are rigged when they loft higher, but unrigged when they crash. Who’s to say this crash isn’t rigged? A few things about this “crash” (11% decline from all time highs now qualifies as a “crash”) don’t pass the sniff test.

Exhibit 1: VIX volatility Index soars to “the world is ending” levels when the S&P 500 drops a relatively modest 11%. The VIX above 50 is historically associated with declines of 20% or more–double the current drop.

When the VIX spiked above 50 in 2008, the market ended up down 57%. Now that’s a crash.

Exhibit 2: The VIX soared and the market cratered at the end of options expiration week (OEX), maximizing pain for the majority of punters. Generally speaking, OEX weeks are up. The exceptions are out of the blue lightning bolts such as the collapse of a major investment bank.

Was a modest devaluation in China’s yuan really that unexpected, given the yuan’s peg to the U.S. dollar which has risen 20% in the past year? Sorry, that doesn’t pass the sniff test.

Exhibit 3: When the VIX spiked above 30 in October 2014, signaling panic, the Federal Reserve unleashed the Bullard Put, i.e. the Fed’s willingness to unleash stimulus in the form of QE 4. Markets reversed sharply and the VIX collapsed.

Now the VIX tops 50 and the Federal Reserve issues an absurd statement that it doesn’t respond to equity markets. Well then what was the Bullard Put in October, 2014? Mere coincidence? Sorry, that doesn’t pass the sniff test.

Why would “somebody” engineer a mini-crash and send volatility to “the world is ending” levels? There are a couple of possibilities.

…click on the above link to read the rest of the article…

Counterintuitive: (Some) volatility is good for you, stability not so much

August 23, 2015

Counterintuitive: (Some) volatility is good for you, stability not so much

With stock markets around the world plunging and commodity prices in free fall, it seems appropriate to return to a theme which I’ve taken up previously: That a certain amount of volatility is good for humans and the systems they build, and that attempts to stifle the natural and healthy volatility of a system can lead to greater and even catastrophic volatility in the end.

All of this runs counter to the propaganda with which we are regaled on a daily basis. For example, investors are told that the lower the volatility of their portfolios, the lower the risk. But, in 2008 that turned out not to be true. More recently, as volatility in the widely watched S&P 500 settled down to historic lows this year, investors believed that the magic of low volatility was here to stay. Central banks–through their periodic interventions when markets began to fall–had somehow engineered a no-lose situation for investors. It was going to be clear sailing ahead for…well, forever if you listen to Wall Street.

The history of volatility in markets and in life suggests that high volatility lies just around the bend after a prolonged period of low volatility. It is impossible to say what would trigger the kind of crash we saw in 2008. For now, the Chinese stock market crash and recent negative economic news in China and the United States have unnerved many investors. The Chinese stock market is now more than halfway to a 2008-style meltdown. Stocks in Europe and the United States have finally started to fall in earnest after holding up and even advancing in the face ofmajor declines in emerging markets such as Brazil, Indonesia, Malaysia, and Turkey. Money rushed from the emerging markets to major developed economies looking for–you guessed it–stability.

…click on the above link to read the rest of the article…

Global Markets Turmoil After China Extends Currency War To 2nd Day – Devalues Yuan To 4 Year Lows

August 12, 2015

Global Markets Turmoil After China Extends Currency War To 2nd Day – Devalues Yuan To 4 Year Lows

Chinese stocks opened lower, extending yesterday’s losses, after The PBOC weakened its Yuan FIX dramatically for the 2nd consecutive day(from 6.1162 Monday to 6.2298 last night to 6.3306). Offshore Yuan fell another 9 handles against the USD after China closed but was hovering at 6.40 as the market opens (now at 11 hnadles weaker at 6.51). Bear in mind the utter devastation in Chinese credit markets that data showed occurred in July, it remains ironic that for the 3rd days in a row, Chinese margin debt balances grew. Before the real fun and games started, Chinese officials once again exclaimed that their data is real (denying any mismatches between GDP Deflator and CPI) as China CDS spiked to 2 year highs. US equity futures are tumbling, bonds bid, and gold bouncing off the initial jerk lower.

PBOC makes some comments (like last night’s)…

*PBOC SAYS NO ECONOMIC BASIS FOR YUAN’S CONSTANT DEVALUATION
*PBOC SAYS YUAN WON’T CONTINUOUSLY DEVALUE
*PBOC SAYS MOVE OF YUAN REFERENCE PRICE IS NORMAL
*CHINA YUAN MECHANISM CHANGE MAKES FIXING RATES MORE REASONABLE

And then there is this (from Xinhua):

China’s state-owned news 4-year lowsagency Xinhua said: “China is not waging a currency war; merely fixing a discrepancy.”

“The central parity rate revision was designed to make the yuan more market-driven and in line with market expectations,” it said in a comment piece published on its web site.

“The lower exchange rate was just a byproduct, not the goal.”

The “one-off” adjustment has now become two… some context for the size of this move…

*MNI: CHINA PBOC WED YUAN FIXING LOWEST SINCE OCT 11, 2012

Onshore Yuan breaks above 6.41 – trades to 4 years lows against the USD…

…click on the above link to read the rest of the article…

This Is What Global Currency War Looks Like: A Complete History Of Recent FX Interventions

August 11, 2015

This Is What Global Currency War Looks Like: A Complete History Of Recent FX Interventions

After the dramatic collapse in the SNB’s defense of the Swiss Franc peg to the Euro, there was a period of relative FX peace in which few if any central banks engaged in outright currency intervention (aside from the countless rate cuts so far in 2015 in response to the soaring strength of the USD, which has risen dramatically over the past year for all the wrong reasons). Then China last night reminded us what happens when in a centrally-planned world one or more markets take too great advantage of relative FX differentials, in this case Japan, whose Yen plunged from USDJPY 80 to 125, and the Euro, which tumbled from EURUSD 1.40 to just above parity.

Now, it’s China’s turn.

But as we pointed out before, FX interventions never take place in a vacuum, and especially during periods of rising dollar strength, when the entire FX world, and especially exporters and mercantilists, go berserk.

Furthermore as Stone McCarthy notes, “this is the sort of “international development” that the Fed will need to keep an eye on and assess as conditions align for the start of policy normalization.” The reason is simple: what China just did could make a rate hike impossible as multinational US corporations will be slammed with a double whammy of soaring dollar and sliding CNY, making US exports that much tougher. And as we won’t tire of repeating, the Fed can not print trade.

And just to help remind readers of what happens when the entire world engages in wholesale currency war, here is a complete list of all the recent FX interventions, courtesy of Stone McCarthy.

Summary of Recent FX Interventions:

The last period of any significant Fed interventions in foreign exchange markets was during 1994-1995 when the dollar reached all time lows against what were then the benchmark currencies of the Japanese yen and German deutsche mark, and the period of the Mexican Peso Crisis. After that, it was acting to defend the value of the yen and new-minted euro.

…click on the above link to read the rest of the article…

The Irony Of Market Manipulation

July 28, 2015

The Irony Of Market Manipulation

Having gazed ominously at the extreme monetary policy smoke-and-mirrors intervention in bond markets, and previously explained that “the stock market is to important to leave to the vagaries of an actual market.“ While the rest of the world’s central banks’ direct (BoJ) and indirect (Fed, ECB) manipulation of equity markets, nobody bats an eyelid; but when PBOC steps on market volatility’s throat (like a bull in a China bear store), people start complaining… finally. There is no difference – none! And no lesser Asian expert than Stephen Roach warns that we should be afraid, very afraid as he states, the great irony of manipulation, he explains, is that “the more we depend on markets, the less we trust them.”

BoJ is directly buying Japanese Stocks and the rest of the world’s central banks are buying bonds with both hands and feet… for the first time ever, central banks are set to monetize all global government debt, something we showed previously…

But with China’s heavy handed “measures” seemed to save the world (until the last 2 days)…

9-Jul-15 Thurs CSRC:
1) suspended reviews of IPOs & other secondary market fundraising activities from Jul 9;
2) asked listcos to choose 1 out of 5 measures (including share buyback by major shareholders, companies and senior executives, employee stock buyback
incentive & employee stock ownership) to protect share price.
China Banking Regulatory Commission (CBRC):
1) allowed banks to roll over matured loans pledged by stocks;
2) encouraged banks to provide liquidity to China Securities Finance Corp Ltd. (CSFC) & offer financing to listed companies to buy back shares.
China Insurance Regulatory Commission (CIRC): insurance asset mgt companies should not demand early repayment from brokers for debt products on margin financing.
Minister of Public Security & CSRC: to investigate malicious short selling activities on Jul 9.
State-Owned Assets Supervision & Admin Commission (SASAC): asked provincial SASACs to submit daily report if local SOEs’ increased stock holdings starting Jul 9.
CSFC: issued Rmb80bn short-term note in interbank market on Jul 9, yield at 4.5% p.a., duration at 3 months; and will purchase mutual fund products to stabilize liquidity.

…click on the above link to read the rest of the article…

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