{"id":16350,"date":"2016-01-12T12:08:22","date_gmt":"2016-01-12T17:08:22","guid":{"rendered":"http:\/\/olduvai.ca\/?p=16350"},"modified":"2016-01-12T12:09:17","modified_gmt":"2016-01-12T17:09:17","slug":"what-will-china-dump-next-after-treasuries-to-keep-control","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=16350","title":{"rendered":"What Will China Dump Next, After Treasuries, to Keep Control?"},"content":{"rendered":"<header>\n<h3 class=\"entry-title\"><a href=\"http:\/\/wolfstreet.com\/2016\/01\/11\/what-will-china-dump-next-after-treasuries-to-keep-control\/\" target=\"_blank\">What Will China Dump Next, After Treasuries, to Keep Control?<\/a><\/h3>\n<p class=\"entry-meta\"><strong>\u201cPractically boundless\u201d future capital outflows.<\/strong><\/p>\n<\/header>\n<div class=\"entry-content\">\n<p>\u201cBeneath all of the financial turbulence there lurks, in my view, a credit crisis; I fear the worst now,\u201d UBS economic adviser George Magnus told\u00a0<a href=\"http:\/\/www.bloomberg.com\/news\/articles\/2016-01-11\/magnus-fears-the-worst-for-china-economy-as-credit-squeeze-lurks\">Bloomberg TV<\/a>\u00a0today. The reform agenda \u201chas stalled,\u201d he said, and \u201cthings are looking much bleaker for China going forward.\u201d<\/p>\n<p>And so on Monday, we got another flavor of it.<\/p>\n<p>The Shanghai Composite index plunged 5.3%, to 3016, down 15% so far this year. The Shenzhen Composite fell 6.6%. Hong Kong\u2019s Hang Seng fell 2.8% to 19888, below 20000 for the first time since June 2013, and down 30% from its April high.<\/p>\n<p>Everyone had hoped that China\u2019s \u201cNational Team\u201d would jump into the fray and bail everyone else out, but it didn\u2019t. And the People\u2019s Bank of China didn\u2019t offer any big new remedies either. But it did stabilize the yuan after it had dropped 1.5% against the dollar last week, and about 6% since mid-August.<\/p>\n<p>In Hong Kong, interbank yuan lending rates broke all records since the Treasury Markets Association started compiling the data in June 2013, with the overnight Hong Kong Interbank Offered Rate\u00a0<a href=\"http:\/\/www.bloomberg.com\/news\/articles\/2016-01-11\/hong-kong-yuan-interbank-rate-rises-by-record-to-all-time-high\">spiking<\/a>\u00a0939 basis points to 13.4%.<\/p>\n<p>And copper did it again, ratting on China\u2019s real economy. Copper goes into anything from skyscrapers to smartphones. China is the world\u2019s largest copper consumer, accounting for over 40% of global demand. And on Monday, copper dropped 2.6% to $1.97 per pound, the lowest level since May 2009.<\/p>\n<p>Buffeted by, among other things, fears about slowing demand from the industrial sector in China, oil plunged \u2013 with WTI down 6.1% to $31.13 a barrel<\/p>\n<p>To prop up the yuan and counter the impact of capital flight, China had dumped $510 billion of foreign exchange reserves last year, drawing them down to a three-year low of $3.33 trillion. And that was just the beginning.<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>What Will China Dump Next, After Treasuries, to Keep Control? \u201cPractically boundless\u201d future capital outflows. \u201cBeneath all of the financial turbulence there lurks, in my view, a credit crisis; I fear the worst now,\u201d UBS economic adviser George Magnus told\u00a0Bloomberg TV\u00a0today. The reform agenda \u201chas stalled,\u201d he said, and \u201cthings are looking much bleaker for [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[130,403,11636,6537,11635,1138,11637,4254,4255],"class_list":["post-16350","post","type-post","status-publish","format-standard","hentry","category-economics","tag-china","tag-hong-kong","tag-interbank-lending-rates","tag-shanghai-composite","tag-shenzhen-composite","tag-stock-market","tag-treasuries","tag-wolf-richter","tag-wolfstreet"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/16350","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=16350"}],"version-history":[{"count":2,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/16350\/revisions"}],"predecessor-version":[{"id":16352,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/16350\/revisions\/16352"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=16350"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=16350"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=16350"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}