June 29, 2015

Bits Bucket for June 29, 2015

Post off-topic ideas, links, and Craigslist finds here.

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Comment by Professor Bear
2015-06-29 00:26:51

Risk off!

Comment by Professor Bear
2015-06-29 00:29:40

Marketwatch dot com
Market Pulse
U.S. stock futures show large losses as Greek crisis intensifies
By Michael Kitchen
Published: June 28, 2015 9:28 p.m. ET

U.S. stock-index futures were quoted significantly lower early Monday, pricing in an increased likelihood that Greece could default on its debts after Athens announced a referendum on the nation’s bailout terms. About 12 hours ahead of the open of U.S. markets, futures for the S&P 500 were off 1.6%, while quotes for the CBT eMini Dow Jones Industrial Average futures and eMini Nasdaq 100 futures were down 1.4% and 1.5%, respectively. Still, the trio were off their earlier lows and could change considerably ahead of the start of trade in New York, especially after the European markets open.

Comment by Puggs
2015-06-29 09:18:44

Whaaaaaaaaaa. Cry babies gonna cry.

Comment by GuillotineRenovator
2015-06-29 11:50:35


Comment by Professor Bear
2015-06-29 20:35:33

Some folks find it exciting to read who won last night’s ballgame.

I prefer reading up about the financial panic du juor.

Different strokes for different folks…

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Comment by Professor Bear
2015-06-29 00:32:42

Marketwatch dot com
Market Pulse
Oil futures fall on Greek crisis, rising dollar
By Michael Kitchen
Published: June 28, 2015 11:37 p.m. ET

Oil futures moved lower in electronic trade early Monday, pushed down by concerns about a possible Greek default and a consequently stronger U.S. dollar. By midday in East Asia, New York-traded August crude-oil futures CLQ5, -1.76% were down 89 cents, or 1.5%, at $58.76 a barrel on the Globex trading platform. London-traded rival benchmark Brent crude LCOQ5, -1.71% was weaker by 82 cents, or 1.3%, at $62.43 a barrel. The drop came as stocks sold off across Asia following Greece’s decision to hold a referendum on the nation’s bailout terms, significantly raising the risk of a default. The Greek fears also drove investors into some “safe haven” assets, including the U.S. dollar, with the ICE Dollar Index up 0.7% for the day at 96.15, according to FactSet. A rising dollar can weigh on dollar-denominated commodities — such as crude oil — by making them more expensive to holders of other currencies.

Comment by Professor Bear
2015-06-29 00:37:29

Marketwatch dot com
Market Pulse
China stocks swing wildly after cut to rates, reserve ratio
By Laura He
Published: June 28, 2015 10:30 p.m. ET

HONG KONG (MarketWatch) — Chinese stocks posted wild swings in the first half-hour of Monday morning trade, as the Chinese central bank’s latest interest-rate cuts weighed against a regional selloff amid concerns about a possible Greek default. The Shanghai Composite Index (SHCOMP, -3.34%) opened 2.5% higher, then fell to a 2.1% loss, and then swung back to a 1.8% gain. The index sank a combined 10.6% on Thursday and Friday of last week, followed by a rare move Saturday by the People’s Bank of China to cut both interest rates and the amount of cash certain banks must hold as reserves in order to bolster bank lending and boost economic growth.

Comment by palmetto
2015-06-29 05:39:46

Sum ting rong.

Wi tu lo.

Comment by Blue Skye
2015-06-29 07:11:25

“The sudden collapse of mainland equity markets has wiped a combined 16.35 trillion yuan ($2.63 trillion) off market capitalization - more than the GDP of Brazil - since a June 12 peak, dealing substantial damage to retail investors’ confidence in just a few short weeks.

“Lu Yahu, a 40-year-old stock investor, said he would use any rebound as a chance to sell off his remaining stocks, as he’s convinced the bull run is dead.

“I have no confidence in China’s economy. It’s not going to get better in the next 20 years.”


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Comment by Albuquerquedan
2015-06-29 07:18:00

And on a YOY basis how much wealth has been created?

Comment by Albuquerquedan
2015-06-29 07:29:23

To help you figure it out, still better than a 100% return YOY and over a 20% gain just since the beginning of this year for China, the U.S. flat as a pancake:


Comment by Blue Skye
2015-06-29 07:43:54

Falling through key support is not soaring Dan.

Another thing you are wrong about, Chinese savers do not have $21 Trillion in the bank.

Comment by palmetto
2015-06-29 07:54:56

What I wants ta know is, what’s happening with the property that mainland Chinese own here in the US. Will “For Sale” signs be going up en masse?

Something about all this reminds me of Japan in the US during the 1980s, without the shoulder pads.

Comment by Albuquerquedan
2015-06-29 08:06:53

Chinese savers do not have $21 Trillion in the bank.

Then why is that number appearing in the press?

Comment by Blue Skye
2015-06-29 08:13:09

Seriously, you have to think about things you read, and give them a reality check.

Comment by Albuquerquedan
2015-06-29 08:30:27

Good advice and you should follow it. The Chinese are broke but they are buying up the world seems to be the contradictory view this board mainly holds. Sorry, it cannot be both. My view is very consistent with CIA’s view on China that it probably the world’s biggest economy and it is still growing rapidly.

Comment by In Colorado
2015-06-29 08:50:24

What I wants ta know is, what’s happening with the property that mainland Chinese own here in the US. Will “For Sale” signs be going up en masse?

I suspect that most of those buyers have also expatriated enough cash to the USA to fund their “retirements” once they bail out of China.

Comment by Blue Skye
2015-06-29 09:26:54

“My view is very consistent with CIA’s view…”

Still, you are wrong about the Chinese having $21 Trillion in savings deposits. Nothing personal, it is simply incorrect.

Comment by Professor Bear
2015-06-29 20:42:38

“The Chinese are broke but they are buying up the world seems to be the contradictory view this board mainly holds.”

It does seem paradoxical at first glance, but we saw an analogous phenomenon in the pre-2008 period as debt-funded California home owners used their liberated equity to invest in residential properties in neighboring states. Once the debt-funded Ponzi scheme imploded, the flood of California-funded investment dried up.

I’m expecting the same to eventually happen on a global scale for the debt-funded Chinese investors who have been snapping up properties all over the planet. An incoming tsunami tide lifts all boats, only to leave them stranded on dry land upon recession.

Comment by rms
2015-06-29 11:36:35

“Wi tu lo.”


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Comment by GuillotineRenovator
2015-06-29 11:55:51

The Chinese eCONomy is in full meltdown.

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Comment by Califoh20
2015-06-29 16:04:41

Yipee! I doubled down on (FXP)

Comment by Pangolin
2015-06-29 06:26:35

Down 10 percent? Yawn.

Comment by Professor Bear
2015-06-29 06:32:00

That’s just over the past two trading days.

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Comment by Albuquerquedan
2015-06-29 07:16:29

And considering the U.S. and China which stock market is up this year and which market is looking to be down?

Comment by Pangolin
2015-06-29 07:39:16

Up down, up down.

Comment by Professor Bear
2015-06-29 08:18:58

It’s true that the Dow Jones Industrial Average is in negative territory for the year (as of today! ). However, the spectacular crash in Chinese stock prices over the past two weeks utterly dwarfs any similar moves this year in U.S. stocks.

Comment by Albuquerquedan
2015-06-29 08:31:55

You usually have big corrections after you have had big moves up. It is normal.

Comment by Professor Bear
2015-06-29 08:42:32


Right. Corrections of this magnitude normally happen about once every two decades.

Comment by Albuquerquedan
2015-06-29 08:50:14

China is still a developing nation thus its stock market acts like a developing nation’s stock market and large movements are the norm.

Comment by Mafia Blocks
2015-06-29 11:56:22

…..large movements down is the norm Mr. Dan Crowman.

“China Stocks Free Fall Into A Bear Market”


Comment by Puggs
2015-06-29 09:20:13

Wake me up when we zip past 12K.

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Comment by Professor Bear
2015-06-29 00:53:19

ET Markets
Global brokerage expect risk-off market reaction in the short term ahead of Greece referendum
29 Jun, 2015, 0902 hrs IST, ECONOMICTIMES.COM
Most global brokerages expect that the referendum will take place as scheduled, though there is a possibility it will not.

The Greek government has called a referendum on the latest proposals from the creditor institutions to be held on Sunday, 5 July.

The question to be put in the referendum is in essence: Do you approve/agree with the latest proposal of the institutions. The Greek government will campaign for a ‘no’ vote.

Prime Minister Alexis Tsipras’s decision to hold a referendum on July 5 on whether Greece should accept the proposal put forward by the official creditors is a negative event from a market perspective, say brokerages.

“It’s not just that a referendum was called after the current bailout expires. It’s also that the government will campaign for a rejection of the bailout agreement by the Greeks,” Morgan Stanley said in a note.

“The decision of the Greek government to break off negotiations with the official lenders and call for a referendum on whether Greece should accept extra austerity is likely to trigger a confidence crisis in the country,” said in a note. “This decision makes us more bearish regardless of whether the referendum ultimately happens, or which way it swings,” the note added.

Comment by Professor Bear
2015-06-29 00:59:26

WSJ dot com
12:04 pm ET
Jun 28, 2015
Economy & Business
Greece’s Weekend Curveball Creates ‘Worst Scenario for Risk’
By Chiara Albanese
Greek Prime Minister Alexis Tsipras (R) with members of his cabinet during a debate on the referendum.
European Pressphoto Agency

When markets closed Friday, a deal for Greece was still in sight. On Monday morning, a chain of events set off by Greece’s decision to change course and put creditors’ demands to a referendum is set to put Greece’s banks in a dire spot while making a big dent in risk appetite in the markets, analysts said over the weekend.

The euro is already feeling the effects, falling 1.41% against the U.S. dollar to $1.10 in New Zealand trading.

Sunday’s decision by the European Central Bank to keep emergency loans for banks frozen at Friday’s levels means the country’s banking system is now “on the brink of something awful,” Citigroup C +0.27% strategists said Sunday.

Greek capital controls look increasingly likely, while Greece is due to make a payment to the IMF Tuesday “that no one expects to be paid,” said Citigroup’s currency strategists.

“Capital controls may be just around the corner, suggesting Grexit chances are higher than they were on Friday,” Citigroup’s strategists said, adding that stiffer demands on the quality of collateral are also a risk once the ECB meets again next week.

UniCredit’s economist Erik Nielsen said the final decision on whether Greece will exit the eurozone, and the ECB’s willingness to provide money to keep the banks afloat — or otherwise — will not be taken without political cover at the highest level.

A Greek official said Sunday that Greek banks would be closed on Monday.

So what does all this mean for markets?

Expect a flight to quality. Contagion may be contained, and ministers have signaled they will do everything to preserve stability, but relative investor calm before the weekend will be put to the test.

Analysts said the euro is likely to take a hit. Citi analysts expect the euro to be lower from at the open, and is viewing it sinking further. “Though communications from Greece so far have suggested no capital controls, no bank closures – the scale of deposit outflows for the past few sessions suggests this may not be feasible.” When it becomes clearer that banks are out of cash, or that the IMF won’t be paid, it expects the euro to fall by more than two figures.

Simon Derrick, chief markets strategist at BNY Mellon, said a note this weekend that a Grexit “would fundamentally alter our understanding of the second most traded currency in the world. Rather than being a single currency it would now be no more than a fixed peg exchange rate system. This, in turn, would force investors to fundamentally reassess country risk within the Eurozone.”

Comment by GuillotineRenovator
2015-06-29 14:07:45

Who are the tools lining up at the ATM machines, and why did they wait so long? I guess they were playing chicken with their money.

Comment by Professor Bear
2015-06-29 20:44:38

He who panics first, panics best.

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Comment by rms
2015-06-29 21:48:58


Comment by Prime_Is_Contained
2015-06-30 08:29:56

He who panics first, panics best.

Not necessarily—I would have been a lot better off if I had panicked a bit later!!

Comment by Professor Bear
2015-06-29 05:01:51

Marketwatch dot com

Swiss central bank reacts to Greek crisis by stepping in to stabilize franc

Need to Know
Greek debt crisis: ‘Something awful’ this way comes
By Shawn Langlois
Published: June 29, 2015 6:27 a.m. ET
Critical intelligence before the U.S. market opens
An anti-austerity protester burns a euro note during a demonstration outside the EU offices in Athens on Sunday.

The next “final” twist in the exhausting Greek drama is upon us, and it’s looking like “something awful” is about to befall the country’s banking system, Citigroup analysts said yesterday.

A deal was on the table Friday, but the ECB’s move over the weekend to freeze emergency loans for Greek banks has led to capital controls and, in turn, has increased the odds of a Greek exit from the euro zone. For investors, it means a battered euro, wrecked equities and maybe, just maybe, a more reluctant Fed when it comes to ramping up interest rates.

So far, the U.S. stock market is starting this holiday-shortened week with a sound thrashing. It was even worse in Asia, where the Shanghai Composite SHCOMP, -3.34% broke lower into bear-market territory despite a surprise interest-rate cut over the weekend. Technology, in particular, was slammed.

While the butterfly wings in Greece seem, at least to some degree, to be rattling markets all over the world, one hedge funder and blogger is hardly sweating the Hellenic end game.

“There’s a lot we can’t know. But there’s also a lot we do know, and pretty much all of it has changed for the better,” Mark Dow, author of Behavioral Macro, wrote. “When I look at Grexit, I see a world in much better fundamental position to avoid the cascading systemic contagion we (rightly) feared as recently as a year ago. Now is the time to do what the system could not handle in 2010: get Greece off the toxic medication and onto a path of growth and dignity.”
Key market gauges

Dow YMU5, -0.98% and S&P ESU5, -1.01% futures are down about 1%. Europe SXXP, -2.31% is also faltering in the early going while Asia ADOW, -1.91% closed with deep cuts after an abysmal stretch last week. The euro EURUSD, -0.5284% is moving lower, as expected. Gold GCM5, +0.00% was higher, but oil CLU5, -2.12% fell into the red.

Comment by Albuquerquedan
2015-06-29 06:45:18

In Shanghai, the only city where I know how to get weekly figures, housing sales were up 69% week on week. What this board does not get is China will not accept less than around 7% growth this year. If it needs to, it will cut interest rates again, easy to do when your one year rate is around 5% and inflation is running about 1.3% and/or it will increase fiscal stimulus which is easy to do when the national debt is running around 20% compared to our 100%+. I will have very little time to post today. Big difference in the Chinese stock market is contrary to the last two months, China wants it up and not down. The controlled burn is over. What this board should be looking at if it wants to know where the black swan is flying look to PR where they have run out of OPM and where many U.S. based pension funds have money.

Comment by Albuquerquedan
2015-06-29 06:58:35

This is a move I fully expected and it will soon boost Chinese shares whether the board thinks it is a good move or not. It was just announced today so we will see how it impacts the stock market tomorrow. The Chinese have tons of ammunition to keep things rolling along while we have expended all our bullets hence the Feds desire to reload by increasing interest rates:

BEIJING, June 29 (Xinhua) — China’s pension fund will likely be allowed to invest into the stock market to keep value, central authorities said Monday.
An official guideline has been drafted by the Ministry of Human Resources and Social Security and Ministry of Finance. It will seek public opinion until July 13.

The move aims to improve investment management and supervision of the social security fund and diversify investment channels.

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Comment by Albuquerquedan
2015-06-29 07:11:20

Why the PTB are filling their adult diapers over China and it is not because it is collapsing but because it is displacing the U.S. banksters:


Comment by Albuquerquedan
2015-06-29 07:15:15

Excerpt from link, the U.S. government did everything in its power to stop this from happening subjecting everyone of the countries from not joining:

Pakistan, among 57 other founding members of the Asian Infrastructure Investment Bank (AIIB), signed articles of agreement in Beijing on Monday.

“We believe the bank will be an important platform to convert abundant savings in the region into investment to help regional economies achieve sustainable and rapid development and contribute to the world economy,” said Pakistan’s Finance Minister Senator Muhammad Ishaq Dar, representing the country at ceremony.

“Energy and communications infrastructure development is much needed in the region and we believe that the AIIB will cater to the needs of the region and compliment the availability of resources in the region,” he said.

Dar added that the China-Pakistan Economic Corridor project, which involves communications infrastructure and power generation projects would provide an integrating platform for more than three billion people in Central, West and South Asia, the Middle East and Africa.

The increase in financial flows, investment, trade and digitalization would bring peace and prosperity to the region, enhance competitiveness of the countries, contribute to reducing regional disparities and social inequality and improve life expectancy and quality of life in the region, he added.

Comment by Blue Skye
2015-06-29 07:23:03

We’re not looking for a black swan, rather a black crow.

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Comment by Albuquerquedan
2015-06-29 07:32:29

I suggest you eat it with a lot of green chili since China will grow by around 7% for the second year in a roll just like I predicted.

Comment by Albuquerquedan
2015-06-29 07:33:37

roll=row, (autocorrect)

Comment by Blue Skye
2015-06-29 07:47:59

The thing about the China GDP number is that it is a man made number. This according to the top CCP guy. Show some other proof of your claim.

Comment by Albuquerquedan
2015-06-29 08:35:59

You are just like the IRS protestors that claim we have a voluntary income tax system, because an IRS commissioner once called it “voluntary.” Try not paying your taxes and see how “voluntary” it was. The point of the Chinese official is that all GDP figures for all countries have errors because they are created by men.

Comment by Albuquerquedan
Comment by Albuquerquedan
2015-06-29 09:02:23


CHINA is considering reform of personal income tax this year, Finance Minister Lou Jiwei said yesterday.

China grossed 443 billion yuan (US$71 billion) last year from the tax, 3.2 percent above the budgetary expectation, Lou said when briefing lawmakers on the government’s final accounts for 2014.

He attributed the overrun to growth of urban incomes being quicker than expected.

There have been arguments for raising the tax exemption threshold of 3,500 yuan per month to 10,000 yuan.

Lou said income tax reform is not just about thresholds, but must consider overall income and spending, such as mortgage costs.

Of China’s 18 current taxes, only three — personal income tax, corporate income tax, and vehicle and vessel tax — are levied through legislation, while the rest are imposed through formal or provisional regulations by the State Council.

Comment by Puggs
2015-06-29 13:54:44

You can’t grow if nobody is buying yer stuff. And that’s where this sucker is headed.

Comment by Albuquerquedan
2015-06-29 14:36:04

You can’t grow if nobody is buying yer stuff. And that’s where this sucker is headed.

Certainly, you can it has been forty plus years since we have run trade surpluses. China is at a point where its growth can entirely be internal. In fact, that is why services are growing so quickly both quality services such as law and accounting and the KFC type jobs. However, we count KFC jobs so why shouldn’t China? Chinese can afford to buy the products it produces now, it wasn’t the case twenty years ago but now their internal market for autos is twenty five million with the vast majority being produced in China both under foreign and domestic brands.

Comment by oxide
2015-06-29 07:35:40

China is like one of those classic radio stations: “all the hits of the 70s, 80s, 90s, and today!”

Compared to the US, the have the manufacturing jobs of the 1970’s, the blue collar outsourcing of the 1980s, the market bubble and “knowledge job” myth of the 1990s, and the interest rate cuts of the 2000s, all rolled into one.

China is walking the same path that the US did, only compressed into 15 years instead of 40. I expect them to complete the transition — i.e. by exhausting interest rate tricks and outsourcing the knowledge jobs — in another 4-5 years. They will then turn into a bifurcated nation of rich hiding their wealth and lucky ducky chow-mien deliver guys. They will be like the US, but with two key differences: (1) Since the cycle is 15 years instead of 40, the population will still be relatively young and healthy (2) their environment is polluted like crazy. The two may cancel each other out.

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Comment by Albuquerquedan
2015-06-29 07:42:00

One big exception the Chinese have modern factories and have invested to keep those factories modern, we failed to do that after Reagan left office. Thus, the reason they still have soaring productivity and wages, we have neither we have stagnant wages and actually dropping productivity.

Comment by Blue Skye
2015-06-29 07:52:52

“the population will still be relatively young and healthy…”

US baby boom.

China one-child policy.

Comment by In Colorado
2015-06-29 08:52:15

“the population will still be relatively young and healthy…”

US baby boom.

China one-child policy.

Correct, China is graying and fast.

Comment by Albuquerquedan
2015-06-29 08:55:26

And it is relaxing the one child policy.

Comment by oxide
2015-06-29 09:00:42

Age structure (2014):

0-14 years: 17.1% (male 124,340,516/female 107,287,324)
15-24 years: 14.7% (male 105,763,058/female 93,903,845)
25-54 years: 47.2% (male 327,130,324/female 313,029,536)
55-64 years: 11.3% (male 77,751,100/female 75,737,968)
65 years and over: 9.6% (male 62,646,075/female 68,102,830) (2014 est.)


The population bumps are in the 20’s and the 40’s. So if China goes to crap in, say, 10 years, the populuation will still be 50-60… still a bit young to suck up retirements and health care (assuming they get any).

I also don’t expect the same amount of chronic disease in China, since their food is not saturated with bad oils and added sugar and corn derivatives (is it?).

Comment by Adult Diapers
2015-06-29 00:28:33

In observance of today’s one year anniversary of the declaration of the caliphate, I have placed a hand drawn cartoon of the prophet Muhammad inside my adult diaper to express my sentiments toward ISIS

Comment by Adult Diapers
Comment by Adult Diapers
2015-06-29 05:12:39

Scripting a narrative, the title of this article is:

“State Trooper Who Shot Escaped Inmate Hailed as Hero”


Comment by Professor Bear
2015-06-29 06:46:30

Is this better?

“Open Season on Escaped Murderers”

Comment by Adult Diapers
2015-06-29 07:10:13

You live in Southern California

Remember the Chris Corner manhunt?

Comment by drumminj
2015-06-29 07:25:02

Chris Dorner

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Comment by Adult Diapers
2015-06-29 07:32:43

Auto Correct

Comment by taxpayers
2015-06-29 08:01:48

only if white is shot
u o me brigades arrive

Comment by Professor Bear
2015-06-29 05:16:00

Are markets exhibiting calm in reaction to shifting Grexit prospects?

Comment by Professor Bear
2015-06-29 05:25:44

World View: Global Financial Crisis — Greece, China, Puerto Rico Teetering on the Brink
by John J. Xenakis
28 Jun 2015
This morning’s key headlines from GenerationalDynamics.com
* China makes desperate move to prevent stock market crash
* Puerto Rico’s governor says the island’s debts are ‘not payable’
* Greece’s Tsipras appeals for calm after banks are forced to close
* How complex systems fail

China makes desperate move to prevent stock market crash

As we’ve been reporting, China’s stock markets have been in free fall since June 12, falling almost 20 percent in a couple of weeks.

Desperate Chinese officials are scrambling to stop the implosion and restore the bubble, and so the People’s Bank of China (PBOC) made a major move, cutting interest rates sharply, to a record low. This makes more money available to banks, which officials hope will flow into the stock markets and prop up stock prices.

According to a Nomura analyst quoted by ZeroHedge:

The policy easing should be viewed as a measure to contain the risk of a hard landing or systemic crisis rather than one to achieve faster growth. In this case, the stronger-than-expected monetary easing may help stem the decline in the equity market following a 10.6 percent drop over the past two trading days. The positive wealth effect of the equity market on consumption or aggregate demand is limited in China, but an equity market collapse would hurt millions of mid-class households and pose great danger to the economy and social stability.

In other words, the purpose of the policy measure is to prop up the stock market, but it will have little effect on growth, which is the “normal” purpose of interest rate easing. Whether it will even succeed in propping up the stock market and preventing “an equity market collapse” remains to be seen in the next few days.

As of this writing on Sunday evening ET (Monday morning in Shanghai), stocks are up two percent, though it’s been bouncing in and out of negative territory.

Puerto Rico’s governor says the island’s debts are ‘not payable’

In an admission that will have wide-ranging financial repercussions, Puerto Rico’s governor Alejandro García Padilla has announced that the island territory will be unable to pay off its $72 billion in debts. According to Padilla:

The debt is not payable. There is no other option. I would love to have an easier option. This is not politics; this is math.

This was not a surprise. As I wrote in March, a bankruptcy was a virtual certainty, probably as early in July.

Many people have invested in Puerto Rico bonds because they pay 10 percent interest (yields) and because under federal law they’re “triple-tax free,” meaning that you can earn 10 percent interest every year and not have to pay federal, state or municipal tax on the interest you collect. It’s a sweet deal, provided that Puerto Rico doesn’t go bankrupt, because if it does, then you lose most or all of your initial investment.

The unemployment rate is 13.7 percent. Only 700,000 of the 3.5 million people, or 20 percent, work in the private sector. The other 80 percent either are on welfare, or they receive unemployment or other aid, or they work for the government. Year after year, Puerto Rico sells more and more bonds, and investors eat them up because of the high tax-free yields. But now their string has run out. (NY Times and Reuters)

Greece’s Tsipras appeals for calm after banks are forced to close

Greece’s banks will be closed indefinitely, starting on Monday, after the European Central Bank (ECB) announced that it will end liquidity funding that was being used to prevent a Greek banking collapse.

As we reported yesterday, Greece’s prime minister Alexis Tsipras suddenly terminated negotiations with the European lending institutions, surprising everyone, and called for a referendum of the Greek people on July 5. The Eurogroup of eurozone finance ministers met without Greece present, to take steps for the protection of the eurozone.

They announced the termination of Greece’s bailout program, but left open the question of whether the European Central Bank (ECB) would continue the Emergency Liquidity Assistance (ELA) program. Greeks have been withdrawing billions of euros from their savings accounts in recent weeks, as much as a billion euros each day in the last week. This has been made possible by the ECB’s ELA program, which provided liquidity to the Greek banks so that withdrawals were possible.

On Sunday, the ECB announced that the ELA would be terminated immediately. Tsipras went on nationwide tv and appealed for calm, saying that everyone’s savings, salaries and pensions were safe. He announced that the banks and stock markets would not open on Monday, and would remain closed at least until July 7.

Tsipras also announced that capital controls would be imposed. ATMs will be open on Monday, but bank withdrawals will be sharply limited, to as little as 60 euros per person per day.

On July 5 there is supposed to be a national referendum in Greece. The referendum will be a vote on a bailout proposal that has already been terminated, and will no longer exist. There’s a lot of hopin’ and prayin’ going on, but no matter what analysts say, no one has any clue what will happen.

How complex systems fail

When complex systems fail, it’s seldom because of one problem, because each potential problem has usually been foreseen and a workaround developed.

Catastrophic system failures happen when several problems occur at once, and interact in a way that was not predictable.

Today we have major financial crises in China, in Europe and in Puerto Rico. In each case, officials have made some preparations. But can the global financial system handle all three simultaneously?

Comment by palmetto
2015-06-29 05:42:07


Comment by Albuquerquedan
2015-06-29 06:59:51

We can only hope.

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Comment by In Colorado
2015-06-29 08:54:47


And quit the Free Sh!t Army? I doubt it. Puerto Rico isn’t going anywhere.

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Comment by Anonymous
2015-06-29 11:08:30


Comment by Puggs
2015-06-29 09:26:23

Sumptin’ for nuthin’… Now you’ll git nothing and like it.

Comment by cactus
2015-06-29 09:42:54

Many people have invested in Puerto Rico bonds because they pay 10 percent interest (yields) and because under federal law they’re “triple-tax free,”

This has to be old news 6 months ago T Rowe Price was bragging how they pulled out of PR bonds. Did their HWK according to the newsletter.

Comment by Professor Bear
2015-06-29 05:28:15

Business Day
Asia Markets Slide on Fears About Greece; China Extends Tumble
JUNE 28, 2015

HONG KONG — Asian stock markets slumped on Monday as Greece’s financial difficulties triggered worry about possible broader harm to the global financial system. An interest rate cut by Beijing on Saturday failed to stem the fall in Chinese stock markets beyond the first hour of trading.

The euro also dropped 1.5 cents against the dollar, to a value of $1.1017, as investors worried that Greece’s troubles would have a spillover effect and make European assets less attractive.

Greece has been struggling for a solution to its debt troubles for years. But the speed with which its government called a national referendum and shut its banks appeared to have caught at least some investors off guard. “Most people’s consensus forecast was for them to muddle through with some kind of a deal, so it has taken people a little bit by surprise,” said Kymberly Martin, the senior market strategist at the Bank of New Zealand.

The Japanese stock market fell 2.4 percent in midafternoon trade; the Australian market dipped 2.2 percent; and the South Korean market was down 1.3 percent. The price of gold, an asset that tends to become more popular during times of financial or political instability, climbed $12 an ounce, to $1,185.20.

Concerns about Greece more than offset any lift from China’s interest rate cut on Saturday. China’s own stock markets were the worse performers by midday, with share prices tumbling 5.4 percent in Shanghai and 7 percent in Shenzhen, after plunging more than 7 percent on Friday.

Comment by Albuquerquedan
2015-06-29 15:46:00

China’s own stock markets were the worse performers by midday, with share prices tumbling 5.4 percent in Shanghai and 7 percent in Shenzhen, after plunging more than 7 percent on Friday.

And they were well off those lows by the end of the day but you leave that out.

Comment by Albuquerquedan
2015-06-29 15:53:08

3.34% is quite the improvement from the lows.

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Comment by Professor Bear
2015-06-29 20:49:20

Nonetheless, it adds up to more than a 20% loss when tallied with the past two weeks’ experience.

Comment by Professor Bear
2015-06-29 05:32:35

Asia-Pacific Markets
Asian equities plunge as Greece weighs on sentiment
See Kit Tang
4 Hours Ago

Stock markets in China continued to head south amid volatile trade on Monday, with investors shrugging off fresh easing from the People’s Bank of China’s (PBOC) over the weekend. Elsewhere in the region, equities witnessed a huge selloff after Greece failed to clinch a deal with its international lenders over the weekend.

Greece desperately needs emergency funding to repay its loans by June 30 and the debt-stricken nation is now headed for a bailout referendum on July 5, authorized by Greek lawmakers over the weekend. A yes vote will mean that Greeks are willing accept the latest bailout terms offered by creditors to Athens, while a rejection will likely increase Greece’s chances of exiting the Eurozone.

According to Reuters, Greek government officials have confirmed early Monday that banks will be closed until July 6, while ATMs will reopen later in the day with a daily withdrawal limit of 60 euros.

In Asian trade, the euro fell as low as $1.0953, touching a one-month low, while dollar-yen dropped as much as 1 percent to 122.64.

Meanwhile, U.S. stock index futures opened down 1.6 percent as chances of a Greek default heightened.

On Friday, Wall Street finished mixed, with the blue-chip Dow edging up 0.3 percent and the S&P 500 ending flat. The Nasdaq Composite led losses with a 0.6 percent fall.

Mainland markets fall

Despite the PBOC unveiling a bigger-than-expected easing package over the weekend, the correction in China’s Shanghai Composite index showed no signs of braking, with the Shanghai bourse closing down 3.3 percent at its lowest level since April 16.

The PBOC lowered its benchmark lending rates by 25 basis points to 4.85 percent and reduced one-year benchmark deposit rates by 25 basis points to 2 percent on Saturday. The rate cuts come on the back of a drastic 7.4 percent plunge on Friday, which saw the Shanghai Composite nursing its worst single-day loss since January 19. For the past two weeks, the index has fallen more than 20 percent.

“We haven’t seen [such easing] since the crisis in 2008 [and] this opens up a lot of room to support the market. This came on the back of broad issues revolving the fundamentals in the economy and a 20 percent correction in the stock market,” Neeraj Seth, head of Asian Credit at BlackRock, told CNBC. “These are clear signs that the government is serious about the economy and stock market stability.”

However, Monday’s slump showed the Chinese central bank has failed to remedy the stock market fluctuations.

It appears that the forced clearance of leverage accounts continued to be the dominant driver of the market at the moment. If the meltdown continues at the current pace, which could trigger systemic instability, we would expect further stabilizing measures from the government,” wrote Aidan Yao, senior emerging market economist at AXA Investment Managers, citing the examples of asking institutions to halt the squaring of leverage accounts, and allowing state-owned investment funds to invest more in the equity market.

Comment by Albuquerquedan
2015-06-29 07:44:21

Shanghai bourse closing down 3.3 percent at its lowest level since April 16.

Lowest point since April 16th, o the humanity.

Comment by Professor Bear
2015-06-29 08:23:41

Right after massive stimulus which you said would staunch the bleeding…

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Comment by Albuquerquedan
2015-06-29 08:53:39

Perhaps the Greece announcement that brought down the entire world has something to do with it? China’s decline was in line with the other Asian markets.

Comment by redmondjp
2015-06-29 09:40:06

Oh sure, let’s blame it all on Greece . . .

Comment by Professor Bear
2015-06-29 10:29:50

Like nobody could have foreseen the Greek tragedy that was five years in the making…

Comment by Mafia Blocks
2015-06-29 11:15:51

No different than the massive global housing bubble just starting to pop.

Comment by Professor Bear
2015-06-29 11:46:42

“China’s decline was in line with the other Asian markets.”

You mean the ones whose governments didn’t put into force massive stimulus on multiple fronts over the past weekend?

Comment by Albuquerquedan
2015-06-29 14:26:05

Like nobody could have foreseen the Greek tragedy that was five years in the making…

Why was the U.S. market off by so much today?

Comment by Professor Bear
2015-06-29 20:50:43

“Why was the U.S. market off by so much today?”

Asian flu?

Comment by Professor Bear
2015-06-29 05:35:05


Comment by Professor Bear
2015-06-29 05:38:38

Panic Sets in Among Hardy Hedge Fund Investors Remaining in Greece
Greeks lined up outside the National Bank of Greece. The prime minister said the banks would not open on Monday.
Credit Eirini Vourloumis for The New York Times

ATHENS — For investors around the world looking at Greece, there was but one question Sunday: What is going to happen when the markets open?

On Sunday night, the prime minister, Alexis Tsipras, said in a televised address that Greece’s banks and stock market would be closed on Monday, as Athens tries to avert a financial collapse.

But the question of what happens when the markets do open is particularly acute for the hedge fund investors — including luminaries like David Einhorn and John Paulson — who have collectively poured more than 10 billion euros, or $11 billion, into Greek government bonds, bank stocks and a slew of other investments.

Through the weekend, Nicholas L. Papapolitis, a corporate lawyer here, was working round the clock comforting and cajoling his frantic hedge fund clients.

“People are freaking out,” said Mr. Papapolitis, 32, his eyes red and his voice hoarse. “They have made some really big bets on Greece.

But there is no getting around the truth of the matter, he said. Without a deal with its European creditors, the country will default and Greek stocks and bonds will tank when the markets open.

On the ground here, the surprise decision of Mr. Tsipras, to hold a referendum has turned what was a bank jog into more of a sprint, with most Greeks anticipating the move to close the banks on Monday.

Panicky depositors spent the weekend pulling an estimated one billion euros from the banking system, stashing the cash in their houses or exchanging them for bulging bags of gold coins.

The yields on Greek government bonds, now around 12 percent, are expected to soar as investors rush to unload their positions in a market that of late has become extremely hard to trade.

Bank stocks, when the stock market opens, will also be hit with a selling wave, as they cannot survive if the European Central Bank withdraws its emergency lending program.

There are not as many hedge funds in Greece as there were a year ago, when it is estimated that around 100 foreign funds were sitting on big investment stakes. Their bet was that the previous Greek government would be able to complete the arduous process of economic reform in Greece that started five years ago.

When it became clear that a radical Syriza government under Mr. Tsipras would come to power, many investors quickly turned heel, dumping their Greek government bonds and bank stocks in large numbers before and after the election.

But a brave, hardy few stayed put — around 40 to 50, local brokers estimate — taking the view that while the new left-wing government could hardly be described as investor friendly, it would ultimately agree to a deal with Europe. It would be a bumpy ride for sure, but for those taking the long view that Greece would remain in the eurozone, holding on to their investments as opposed to selling them in a panic seemed the better course of action.

For now, at least, that seems to be a terrible misjudgment, especially if Greece defaults and leaves the euro.

Most of the hedge fund money in Greece is invested in about 30 billion euros of freshly minted Greek government debt securities that emerged from the 2012 restructuring of private sector bonds.

The largest investors include Japonica Partners in Rhode Island, the French investment funds H20 and Carmignac, and an assortment of other hedge funds like Farallon, Fortress, York Capital, Baupost, Knighthead and Greylock Capital.

A number of hedge funds have also made big bets on Greek banks, despite their thin levels of capital and nonperforming loans of around 50 percent of assets.

Comment by tresho
2015-06-29 13:09:33

A more accurate version of the headline: “Well deserved and long overdue panic sets in among foolhardy investors in a deadbeat nation”

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Comment by Professor Bear
2015-06-29 20:57:00

I was lookin’ for a bailout in all the wrong places
Lookin’ for a bailout in too many faces
Searchin’ their lies, lookin’ for traces
Of money I’m dreamin’ of
Hopin’ to find a mark and a sucker
I’ll bless the day my losses recover,
Another shark- lookin’ for loot.

Comment by Professor Bear
2015-06-29 05:48:32

Asia markets hit by Greece fears, Shanghai plunges
June 29, 2015, 4:19 pm TWN

Asian equities tumbled Monday on expectations of a Greek eurozone exit after Athens announced a referendum on creditors’ proposals, while Chinese stocks gyrated wildly after losing some 20 percent in the past two weeks.

Shanghai saw a 10 percent swing from gains to losses, extending a painful sell-off since hitting a June 12 peak, with a weekend central bank interest rate cut unable to offset profit-taking and a tightening of trading rules.

Tokyo ended down 2.88 percent, or 596.20 points, at 20,109.95, Sydney shed 2.33 percent, or 123.4 points, to 5,422.5, and Seoul was 1.42 percent off, giving back 29.77 points to 2,060.49.

Hong Kong tumbled 3.63 percent at one point before sitting 2.55 percent lower in the afternoon.

Shanghai, which rose 2.5 percent in early exchanges, collapsed 7.58 percent in the afternoon despite the rate cut, although it clawed back some losses to sit 3.45 percent lower in late trade.

Shenzhen was 6.18 percent lower in late trade after rallying 1.77 percent in the first few minutes.

China’s strict capital controls and limits on foreign investment mean its stock market is largely detached from other major bourses, and its recent ascent has been driven by domestic policy factors.

Comment by Professor Bear
2015-06-29 05:52:09

Greece is a thriller, but China is a horror show
Business Spectator
June 29, 2015 9:14AM
Alan Kohler
Business Spectator editor in chief

For Australia Greece is a distant thriller, but China is a nearby horror show.

On Friday the Shanghai Composite index dropped 7.4 per cent, and two-thirds of the listed stocks hit their 10 per cent daily downward limit. Since June 12 intraday peak the index has lost 19 per cent.

On Saturday the People’s Bank of China cut both deposit and lending rates by 0.25 per cent and the reserve requirement ratio by 0.5 per cent for agricultural and SME companies.

The monetary easing itself wouldn’t have been prompted by the stockmarket fall on Friday, but the timing would have been.

All indications are that GDP growth in China is now falling well short of the government’s target of 7 per cent. Despite three rounds of interest rate cuts since November, before the weekend, monetary conditions had actually been getting tighter.

That’s because the real exchange rate has been rising because of the yuan’s peg to the US dollar and also because, with inflation in decline, real interest rates have barely fallen.

Meanwhile the stockmarket is an obvious bubble. Likewise real estate. A dual shake-out of both markets seems to be in prospect.

Before Friday the Shanghai Composite index increased two and a half time in 12 months.

Although the average price earnings ratio was 30.5, the median was 78. The difference is due to the fact that the market is dominated by the banks, and they have been left behind in the speculative mania because even China’s crazed punters are worried about the level of bank debt and the potential for loan impairment if the property market crashes as well.

Almost 8 million new brokerage accounts were opened in the first quarter of this year, and another 4 million in the last week of May alone. According to data published by Bloomberg, more than two-thirds of new investors never attended or graduated from high school. In other words, the taxi drivers and bellhops are in.

The Chinese stockmarket is a sentiment-driven casino, not a vehicle for investment. Earnings growth of listed companies this year is minus 1 per cent while their aggregate market value has doubled.

As a result the main impact on the economy of a stockmarket crash, if that’s what we are seeing, would be through confidence, not actual losses, which would be why the PBoC acted swiftly on Saturday to loosen monetary policy again.

In theory, household balance sheets in China are strong. Bank deposits are 100 per cent of GDP and the allocation to equities is around 10 per cent of GDP. And the use of margin debt, while high in aggregate, appears to be confined to a relatively small number of people.

Nevertheless the Chinese economy as a whole is bloated on debt after years of economic stimulation based on debt-funded infrastructure spending by local governments and a roaring real estate boom in the four major cities.

Residential property prices in Beijing and Shanghai seem to have increased at an annual rate of more than 40 per cent in May and more than 50 per cent of recent debt growth has been concentrated on real estate.

This seems to be the real reason monetary policy in China has been ineffective: the banks are concerned about overexposure to property and have pulled back on lending everywhere.

That’s why Saturday’s cut in the reserve requirement ratio was confined to the agriculture and SME sectors in an attempt to get the employing parts of the economy moving.

But the fundamental question about the Chinese economy is about the banks and whether they can remain solvent in the event of a double crash of both real estate and the stockmarket.

Comment by Anonymous
2015-06-29 11:11:34

“All indications are that GDP growth in China is now falling well short of the government’s target of 7 per cent.” Can’t happen! A-Dan said so!!

Comment by Albuquerquedan
2015-06-29 15:44:28

“All indications are that GDP growth in China is now falling well short of the government’s target of 7 per cent.”

A conclusory statement with no facts to support it. If it were happening the Chinese would be cutting interest rates more than 1/4 percent to support the economy and would be announcing a new massive infrastructure project.

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Comment by Professor Bear
2015-06-29 06:08:17

Bulletin U.S. stocks set to tumble at open with Greece on the brink

Gold futures get a lift as Greece moves into chaos
Published: June 29, 2015 8:48 a.m. ET
By Mark DeCambre
AFP/Getty Images
Will gold get a boost from Greece’s crisis?

Gold futures were getting a lift Monday from turmoil in Europe, stemming from the European Central Bank’s decision to cap funds to Greek banks on Sunday, after the country said it would hold a referendum on whether to accept the terms of international creditors as it vies for fresh rescue funds.

The stunning weekend moves by Greece, led by Prime Minister Alexis Tsipras, and the response by its European creditors have pushed the Hellenic Republic to the precipice of defaulting on a June 30 payment to the International Monetary Fund and exiting the euro.

Gold has benefited from the Greek turmoil as investors traditionally seek out the metal as a haven asset during times of distress.

Prices for August gold GCQ5, +0.78% were up roughly $5.10, or 0.4%, at $1,178 an ounce on the Comex Monday. On Friday, it settled $1.40 higher at $1,173.40, marking the precious metal’s biggest gain since June 18 as the drama in Greece intensified heading into the weekend.

September silver SIU5, +0.71% was up 4 cents, or 0.2%, at $15.77, leaving the metal little changed from its Friday finish of $15.768.

However, gold’s upward momentum is likely being kept in check by a dollar that has strengthened against the euro and rival currencies amid the developing Greek crisis. The ICE U.S. Dollar Index DXY, -0.72% was ticking higher, up 0.1%, at 95.5370 on Monday. A strong dollar can weigh on dollar-denominated gold.

Gold may see be seeing some buying momentum over the short term as investors look to scoop up the yellow metal, which has languished under $1,200 an ounce, noted Barclays in a June 29 note. “Gold’s retreat back below $1,200/oz mark has prompted investors to increase exposure to gold,” Barclays analysts said. Over the longer term the bank maintains a bearish stance toward gold:

“But we would caution that we remain in the seasonally slow period for [gold] demand and believe the floor for prices looks vulnerable,” Barclays wrote.

Comment by Selfish Hoarder
2015-06-29 06:48:49

Bitcoin up 2.5% in the last 24 hours. You can buy BTC right away with the apps. For precious metals in physical form I can expect people around the world to casually take more fiat out of their savings accounts in the next few days and visit their nearest coin dealer. Metals prices will go up but take a few days to be significant. Meanwhile S&P down 0.77% as of right now, 6:48 am PST

Comment by Selfish Hoarder
2015-06-29 06:51:15

…funny how the asset that is the least controlled by central banks is up the most.

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Comment by Professor Bear
2015-06-29 06:53:09

Any selloff on Wall Street will be mitigated by the flight to quality move into U.S. assets.

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Comment by Selfish Hoarder
2015-06-29 07:03:12

But “Wall Street” is about U.S. assets. Right now the Euro is advanced over the Dollar as well, up 1.53% vs the Dollar. So there goes that theory.

Comment by Professor Bear
2015-06-29 07:18:08

We must be reading different sources.

The Wall Street Journal
Foreign Exchange
Greek Drama Hits Euro, Boosts Yen
Investors wary as Greek banks will remain shut Monday and referendum approaches
By Tatsuo Ito and Rebecca Howard
Updated June 28, 2015 11:19 p.m. ET

The euro took a tumble after Greek Prime Minister Alexis Tsipras made a call to hold a referendum on July 5 on country’s debt conditions, followed by news the European Central Bank won’t increase the lifeline of emergency liquidity that has been sustaining Greece’s banks.

In early Asian trade, the common currency briefly sank to a one-month low of ¥133.76. Against the U.S. dollar, it fell to as low as $1.0950 compared with $1.1205 in New York Friday.

Comment by Professor Bear
2015-06-29 13:10:31

“Right now the Euro is advanced over the Dollar as well,…”

When the facts change, I change my mind.

– John Maynard Keynes

Trying out a new theory:

- The recent strength of the dollar is predicated on near-term Fed liftoff.

- The Grexit crisis greatly reduces the probability of near-term Fed liftoff.

- A lower probability for the scenario which underpins dollar strength has led to dollar weakness.

Comment by Anonymous
2015-06-29 11:09:38

There can’t be anything wrong in China! A-Dan said so!

Comment by Adult Diapers
Comment by Albuquerquedan
2015-06-29 06:47:26

The continued political use of the AGW hoax, now it is being used to justify immigration which will hold down U.S. wages.

Comment by Adult Diapers
2015-06-29 07:35:28

I’m not here to debate this warmism

The progressive chorus should be waking up at noon eastern time in about 90 minutes to engage in your warmist debate

Comment by Albuquerquedan
2015-06-29 14:48:55

From IAfrica, what this is about and what is has been about for several decades, the globalists are using the disproven AGW theory to get the rich countries to build the infrastructure they need in the poor countries for their sweat shop factories:

Brazil, China, India and South Africa voiced disappointment Sunday over the failure of rich countries to come up with billions of dollars needed to help them sign on to a landmark climate change deal.

Ministers and top negotiators from the four key countries met in New York to close ranks as talks on the climate deal head into crucial months before a Paris conference in December.

In a joint statement, they expressed “disappointment over the continued lack of any clear roadmap for developed countries to provide $100 billion per year by 2020, as well as on substantially scaling up financial support after 2020.”

The world’s developed countries agreed in 2010 to mobilize $100 billion a year by 2020 to help poorer nations adapt to the impacts of climate change and reduce their emissions.

Those commitments have fallen short by about $70-billion, according to the World Bank.

“There is still a clear expectation and so I hope the developing countries can fulfill their commitment before the Paris meeting,” China’s envoy for climate change Xie Zhenhua told reporters.

World governments will try to forge a new global deal to address climate change at a UN climate conference in December, with both developed and developing countries committing to cutting greenhouse gas emissions.

Financing to help developing nations cut emissions and adapt to climate change remains a key issue.

South Africa’s Environment Minister Edna Molewa stressed that “the four countries sitting around this table have been, on our own, doing a lot of work” on climate change.

“It is important that this scaling up happens,” she said. “Adaptation requires a lot of money.”

Technology for the south

India’s chief negotiator Ravi Prasad emphasized the need for developed countries to share emissions-cutting and clean-energy technology with poor nations to bring them onboard the global effort to address climate change.

“Without the concomitant flow of technology support, for many developing countries and poor economies, it will be impossible to move on to any such trajectory in the near future,” said Prasad.

While pressing demands for climate financing, the four countries stressed that they will be working closely together in the months ahead to help clinch a deal in Paris that they said was urgently needed.

Brazil’s Environment Minister Izabella Teixeira said the four countries were committed to work hard to avoid a repeat of the 2009 Copenhagen climate conference that ended in failure.

“We cannot postpone this agenda, this agreement,” said Teixeira.

China’s Xie said negotiations were achieving progress.

“We are eliminating differences. We are very positive and very hopeful for the success of the Paris meeting,” he said.

China, the world’s biggest greenhouse gas emitter, has joined forces with India, the third largest emitter, along with Brazil, which ranks among the top 10 and South Africa, which boasts the continent’s most developed economy.


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Comment by aNYCdj
2015-06-29 05:25:59

well about time…..Renting, especially if you don’t have a steady job or don’t plan to be in the same place for 10 years, “is just going to make your life easier,”


Comment by oxide
2015-06-29 10:21:58

but home ownership is like parenthood, he added: “First of all, do you really want to buy a house? It’s sort of like having a baby: You’re going to be working, you’re going to be worrying about this house. It’s going to break down, you’re going to get termites, you’re going to have a snowstorm and have to get the roof shoveled, all these things. And then on top of that, it keeps needing painting and maintenance, and it’s a headache.” [Shiller, to Money]

I don’t have children, but it sounds like a good analogy.

Comment by Blue Skye
2015-06-29 11:08:00

I have four children, which is a bigger investment than a house.

They required a lot of interest, but at least my children are appreciative.

Comment by Albuquerquedan
2015-06-29 16:09:52

They must not be teenagers.

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Comment by Blue Skye
2015-06-29 18:51:27

LOL, no, they are grownups.

Comment by Professor Bear
2015-06-29 21:01:48

We have one of them million dollar investments in a family of four as well, maybe considerably more given CA living costs.

Your Money
Average cost of raising a child hits $245,000

By Melanie Hicken
New parents be warned: It could cost nearly a quarter of a million dollars to raise your child — and that’s not even including the cost of college.

To raise a child born in 2013 to the age of 18, it will cost a middle-income couple just over $245,000, according to newly released estimates from the U.S. Department of Agriculture. That’s up $4,260, or almost 2%, from the year before.

Estimates can vary widely depending on where you live and how much you earn.

High-income families who live in the urban Northeast, for example, are projected to spend nearly $455,000 to raise their child to the age of 18, while low-income rural families will spend much less, an estimated $145,500, according to the report.

Comment by Puggs
2015-06-29 14:10:39

Cash buy a small house, small lot zero scape. Maintenance free as possible. Own no rentals. Problem solved.

Kids are great. Houses can suck - especially BIG houses.

Comment by Adult Diapers
2015-06-29 05:38:27

Someone on HBB asked about this last week, here the attendees at this weekend’s Western Conservative Summit voice their opinions on legalized marijuana:


Comment by palmetto
2015-06-29 05:44:23

It’s all happenin’….

Comment by Adult Diapers
2015-06-29 05:57:34

Go time?

Comment by Puggs
2015-06-29 09:22:07

Nah, not till we have some confirmation on the Iran deal and see what happens next on Ukraine’s door step.

Comment by phony scandals
2015-06-29 09:35:50

Hillary’s monthly Botox shots?

Comment by Anonymous
2015-06-29 11:14:32


Comment by Professor Bear
2015-06-29 05:57:14

Is that the fat lady I hear singing about China’s stock market woes?

Comment by palmetto
2015-06-29 06:21:52

Priceless, PB. It actually took a few minutes before I got the joke.

Comment by Professor Bear
2015-06-29 06:34:45

It would have been funnier if the singer were less lovely and lithe.

Comment by Professor Bear
2015-06-29 06:30:56

Marketwatch dot com
Asia Markets
Chinese stocks close in bear-market territory as Greece unravels
By Gregor Stuart Hunter
Published: June 29, 2015 5:59 a.m. ET
Shutterstock/Zhu Difeng

Asian markets were roiled Monday, as China’s stocks closed in bear-market territory, and uncertainty about Greece shook sentiment across the region.

A move by China’s central bank over the weekend to cut interest rates failed to give a sustained lift to China’s main stock market, which has fallen 21.5% from a high on June 12, crossing the 20% threshold that defines a bear market. Stocks have been under pressure over the past two weeks after a yearlong debt-fueled rally.

Comment by Anonymous
2015-06-29 11:17:25

“…crossing the 20% threshold that defines a bear market.” I thought a downward correction of 20% or more (esp in a span of two weeks) constitutes a crash!?

Comment by Adult Diapers
2015-06-29 06:16:12

Scripting a narrative

This is the top headline on the Drudge Report right now, and just updated within the past few hours. Of all of the “news” happening in the world today, Drudge chooses to lead with this:


Comment by Professor Bear
2015-06-29 06:50:10

Speaks volumes about the intelligence of their readers.

Comment by phony scandals
2015-06-29 09:03:43

“Speaks volumes about the intelligence of their readers.”

Have you ever watched any of those Mark Dice videos?

You mention Obama or racism and they will sign anything. :)

Obama Supporters Sign Petition to NUKE CHINA in Response to …
http://www.youtube.com/watch?v=oqkk19lIXmI - 427k -

Comment by MightyMike
2015-06-29 10:24:12

The guy doesn’t actually verify that the people are Obama supporters. He doesn’t bother to ask them whether they support the president.

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Comment by phony scandals
2015-06-29 10:36:10

“The guy doesn’t actually verify that the people are Obama supporters. He doesn’t bother to ask them whether they support the president.”

http://www.youtube.com/watch?v=ss2hULhXf04 - 168k -

Comment by Raymond K Hessel
2015-06-29 14:29:13

The guy doesn’t actually verify that the people are Obama supporters. He doesn’t bother to ask them whether they support the president.

If they are stupid, it is self-evident that they are Obama, McCain, or Romney supporters.

Comment by Adult Diapers
2015-06-29 07:29:34

This is an article written by real journalists who want to take away your guns:


Comment by Puggs
2015-06-29 13:57:04

What guns???

Comment by rms
2015-06-29 22:01:27

Israel didn’t appear on those gun ownership charts.

Comment by Puggs
2015-06-29 09:10:07

Git yer contagion on.

Summer will swing into a “September Spectacular”. History doesn’t repeat but it often rhymes.

Comment by rj chicago
2015-06-29 10:12:53

Meanwhile back in the state formerly called the Land of Lincoln and is now dubbed ILLANNOY and the city of Ch*tcago……weekend tally as follows…..


Comment by Anonymous
2015-06-29 11:24:00

Where’s the outrage over all THESE killings? I guess #blacklivesmatter only kicks in depending on who pulls the trigger?!

Comment by MightyMike
2015-06-29 11:33:02

Go travel to those neighborhoods where the murders took place. You should be able to find some outrage there.

Comment by Albuquerquedan
2015-06-29 15:57:26

He doesn’t want to be number 214.

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Comment by rj chicago
2015-06-29 11:28:27

Current count year to date - 213 dead and rising in the City of blow hards.

Comment by palmetto
2015-06-29 11:34:38

rj, did you see my apology to you the other day? I don’t blame you for being upset, at my post. It wasn’t you I was really responding to, anyway. It’s all these pundits who want us to “rise up” while they lecture from their computers and keyboards.

Anyway, please accept my sincere apology and know that I have a great deal of respect and empathy for you.

What’s the latest on Hastert, btw?

Comment by rj chicago
2015-06-29 14:27:35

Hey there Palmy;
No harm no foul. Keep it coming…..


And so you and others know…..where I am comin from in response to Palmy (the underlying thing if you will) the thing I really like about this blog is on several levels:
a) folks here come from different points of view - that keeps me sharp and involved;
b) folks on this site are intelligent - sometimes irreverent and irrational but I see the intelligence in the comments;
c) folks here provide useful - on the ground information that gives me a greater perspective than what I could get here in my burg in Chicago;
d) The topics covered are really great - PBear on finance and econ, HA on his posts with housing markets, Rally and his pot business and on and on…..interesting stuff to chew on and I don’t mean brownies there Rally.
d) I am not alone in my sentiments. There is a palpable sense of what the f is going on out there in our messed up world with some gravity thrown in. Sometimes I feel like I have been cast to the wilderness as many just roll their eyes when I try to have a discussion with them. Kinda like “there he goes again” crying foul and the world is coming to an end.
I find I am reassured from time to time by posts that challenge me and get me out of my pity party and others that just flare me up and others that provide a sympathetic ear to stuff that just gnaws at me if you get my drift.

So….I say all this just to encourage everyone who posts here and reads here (hopefully coming back to post) that there is value in alot of what is said.
As has been noted before “The truth is hard at times”.
Keep it coming!!!

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Comment by palmetto
2015-06-29 14:46:33

Whew, thanks, I feel better, really. It actually ate at me that I might have discouraged and upset someone who deserves support, not dissing.

You are a bigger person than you know. I can be a real cynical hole sometimes.

Comment by Albuquerquedan
2015-06-29 16:16:59

Very few people apologize on this blog so you are one of the bigger persons.

Comment by Califoh20
2015-06-29 12:36:54

we should experiment with Chic. Make it like Texas and really easy to get a gun, see if everyone is armed will shootings go down as the NRA thinks. Why not?

Comment by phony scandals
2015-06-29 10:26:11

Goldman-Sachs Boss, Bilderberg Member Peter Sutherland: Europe Needs More Refugees from Africa, Syria

Declares mass migration good economically and socially

by Kurt Nimmo | Infowars.com | June 29, 2015

Following a meeting with Pope Francis, the boss of Goldman-Sachs International and Bilderberg attendee Peter Sutherland said European countries have not taken their “fair share” of refugees from African countries and Syria.

Sutherland told RTÉ radio 240,000 immigrants flooding into Europe each year is not an economic burden on countries such as Germany and the United Kingdom.

On the contrary, he said, a quarter million or more immigrants a year represents an economic and social benefit for Europe, Britain and Ireland.

“Governments have to lead by giving the positive news that migrants are good for a community, economically and every other way rather than constantly expressing them as a burden because they are not really a burden,” Sutherland said. “Within a very short period of time they contribute positively to the community in which they live.”

Sutherland cited studies he said demonstrate the economic benefits of mass migration into Europe from Africa and elsewhere.
Migrants Cost Europe Billions

A report by University College London, however, found that migrants in fact represent a huge economic drain on host countries.

According to the study, non-European migrants living in Britain have drained public finances by almost £120 billion since 1995.

The situation is similar in Germany, by far Europe’s most prosperous and productive nation.

In December, the president of the Ifo Institute for Economic Research, Hans-Werner Sinn, contradicted a study carried out by the Bertelsmann Foundation that concluded each immigrant to the country contributed 22 billion euros ($26,863) to the welfare state in 2012.

Sinn told Frankfurter Allgemeine that in fact “on the net balance sheet, immigration cost the state more in social costs and other issues than it brings in through taxes and social contributions.”

“Faced with this situation, we should finally begin a non-ideological debate on immigration policy which is not driven by the quest for political correctness,” he added.

Despite numerous studies showing the negative economic and social impact of mass migration on Germany and Europe, the European Union, the political establishment and the corporate media are in favor of it.

“Uncontrolled, unskilled Third World immigration is the economics of the madhouse, yet respectable politicians like Herr Schaeuble (Finance Minister) in Germany support it and, until recently, virtually the whole British political establishment were gung-ho for it, and still would be were it not for Nigel Farage,” writes Vincent Cooper.
Failed Multicultrualism

Contrary to proclamations by Sutherland, Schaeuble, and the political establishment in Europe, the mass migration of Muslims into a largely Christian Europe has resulted in a serious social crisis.

“Europe’s high youth unemployment rate and limited economic mobility has long been cited as a major factor for young people becoming radicalized and joining terrorist organizations like the Islamic State militant groups,” writes Howard Koplowitz .

He cites German Chancellor Angela Merkel who once supported the idea of multiculturalism in Germany.

“We kidded ourselves a while. We said: ‘[Immigrants] won’t stay, sometime they will be gone,’ but this isn’t reality,” she said, according to the BBC. “And of course, the approach [to build] a multicultural [society] and to live side by side and to enjoy each other … has failed, utterly failed.”

Comment by In Colorado
2015-06-29 13:41:52

Declares mass migration good economically and socially

Because nothing is better than importing uneducated people who are culturally incompatible with the host nation.

He cites German Chancellor Angela Merkel who once supported the idea of multiculturalism in Germany.

“We kidded ourselves a while. We said: ‘[Immigrants] won’t stay, sometime they will be gone,’ but this isn’t reality,” she said, according to the BBC. “And of course, the approach [to build] a multicultural [society] and to live side by side and to enjoy each other … has failed, utterly failed.”

If Merkel said that, then there is still hope for Germany.

Comment by phony scandals
2015-06-29 10:33:07

America’s most expensive states to live in 2015

1. Hawaii

2. Connecticut

3. New York

4. Alaska

5. California

6. New Jersey

7. Oregon

8. Massachusetts

9. Rhode Island

10. Vermont


Comment by Blue Skye
2015-06-29 11:04:22

The most expensive state to live in the state of indentured slavery. Wherever you go, there you are.

Comment by Puggs
2015-06-29 13:55:55

Every state should be listed at today’s prices. Keep yer cash at the ready.

Comment by Mafia Blocks
2015-06-29 11:20:28

Crater in the morning
Crater in the evening
Crater at suppertime.

When you got cratering demand for housing, you’ll have losses for all time.

Comment by X-GSfixr
2015-06-29 11:50:34

Story (as related to me):

Little brother sold his house in San Diego area.

One of the things he had to do was call an exterminator and put a tent over the house, the apply bug killer liberally

So the exterminator comes out, brother and family have to leave. Exterminator tents the house. When they are done they open all the windows and doors, pack their crap, and leave. Without bothering to inform my brother.

Did I mention that the house is in a solidly “diverse” part of San Diego area?

So he comes back around 5:00pm. The place looks like the Fergeson Quik Trip. Everything portable has been carried off, including their passports, Social Security paperwork, personal papers……..

He suspects that all of his docs were in TJ before he got home. which is really going to be a lot of fun, if someone uses them to forge some IDs

Did I mention that this is the brother that is the Border Patrol agent?
His buds at the station can hardly wait until somebody shows up at the border, using his ID.

Comment by redmondjp
2015-06-29 12:02:57

I smell a lawsuit!

Comment by palmetto
2015-06-29 14:23:42

major lawsuit. In fact, I’d bet money this was an inside job, probably tipped off their amigos and just conveniently “forgot” to call your brother.

Comment by Professor Bear
2015-06-29 15:18:07

OMG! Worst tenting nightmare, ever?

Comment by Califoh20
2015-06-29 16:03:30

Attorneys win again!

Comment by Albuquerquedan
2015-06-29 16:14:07

We always do. The only thing that could hurt us is if everyone followed the ten commandments but we have thousands of years of history which proves that is very unlikely. Moreover concerning that point, the trend is our friend.

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Comment by phony scandals
2015-06-29 16:16:19

Is there any licensing of exterminators in San Diego?

If so, did this dude have one?

Down here people regularly get screwed hiring unlicensed fencing, roofing, remodel etc. contractors who gave them low bids and either screwed up and leave or take deposits do next to nothing and split.

The real problem is they get away with it because you can’t get blood from a turnip. They have no money, there is no workers comp or liability insurance, no license to suspend or revoke.

I hope this is not the case with your brother and he is reimbursed for his losses.

Comment by Raymond K Hessel
2015-06-29 13:02:11

Another non-hate crime to be consigned to the MSM’s memory hole. And here I thought access to affordable health care would mollify this murderous rage….


Comment by Puggs
2015-06-29 15:01:46

Global spanking….

You’ve had since 2008 to change your ways, learn from mistakes, but you didn’t listen, you didn’t learn.

So here you go…. This is gonna hurt you more than me.

Comment by Professor Bear
2015-06-29 15:14:47

(Phew!) At least the contagion is manageable this go round!!

Comment by Professor Bear
2015-06-29 15:16:44

It’s a controlled burn!

June 29, 2015 5:11 pm
Greek crisis triggers ‘manageable contagion’
Giorgos, a 77-year-old pensioner from Athens, sits outside a branch of the National Bank of Greece as he waits along with dozens of other pensioners, hoping to get their pensions in Athens, Greece June 29, 2015. Greece closed its banks and imposed capital controls on Sunday to check the growing strains on its crippled financial system, bringing the prospect of being forced out of the euro into plain sight.

The sudden escalation of the Greek crisis triggered a sharp sell-off in European shares and the bonds of other southern eurozone countries, but fell short of threatening disruptive contagion effects across the continent.

After steep initial falls, prices rebounded on Monday, leaving the continent’s main stock and debt markets looking no more than bruised by events unfolding in Greece.

“What we’re seeing so far is a very manageable market reaction,” says Ralf Preusser, head of European rates at Bank of America Merrill Lynch. “The only word for the market reaction is ‘orderly’,” adds Nick Gartside, chief investment officer for fixed income at JPMorgan Asset Management.

“Given the fact that the country [Greece] has introduced capital controls and closed their banks this is a reflection that the market still considers the Greek situation as possible to handle,” Yngve Slyngstad, chief executive of the Norwegian oil fund, the world’s largest sovereign wealth fund, told the Financial Times

If sustained, “manageable contagion” would come as a relief to eurozone policy makers anxious to preserve Europe’s monetary union, and contrast with the market dramas during the region’s 2011-12 debt crisis.

But for some market experts, the calm was surreal. “We don’t know whether it is the sort of calm where one is in the eye of the storm and suddenly a cow goes floating past your house and you realise it’s actually manic — or whether markets have socialised the risk from Greece,” says one trader.

Paul McNamara, fund manager at GAM, said: “While Europe is in a stronger position than it was in the eurozone crisis, if Greece leaves it will hurt ‘peripheral’ countries. There may not be immediate effects, but in the long term it will be a toxic event for Spain, Portugal and Italy.”

Comment by Albuquerquedan
2015-06-29 15:51:40

Actually, what Greece doesn’t get and I have been saying it for months is Germany would rather Greece leave than Germany have to pay for increased aid to Spain, Portugal and Italy. Germany would like to make an example of Greece and its stupid leftist government did not see that Greece has lost all its leverage. If Greece wins anything all the other basket case countries in the Euro zone will want the same thing and Ireland which did things right and is now recovering will be irate.

Comment by phony scandals
2015-06-29 15:58:11


The unanimous Declaration of the thirteen united States of America

When in the Course of human events it becomes necessary for one people to dissolve the political bands which have connected them with another and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature’s God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation.

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. — That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, — That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.

Comment by Raymond K Hessel
2015-06-29 15:58:21

Eric Holder collects his payoff - $77 million - for not jailing any bankers.


Comment by Anonymous
2015-06-29 18:37:56

So Holder is at JPMC…Will Obama get on the GS payroll after he leaves office?

Comment by Professor Bear
2015-06-29 21:04:14

No need to waste time with that when you can earn $200K for one speaking engagement.

Comment by Puggs
2015-06-29 16:18:18

This might be an interesting week. Time to get out the Redenbacher.

Comment by Raymond K Hessel
2015-06-29 17:03:09
Comment by Raymond K Hessel
Comment by Raymond K Hessel
2015-06-29 19:52:22

Pop goes the (Chinese) Ponzi equity market…to be followed by ours in the fullness of time.


Comment by Professor Bear
2015-06-29 20:02:43

“The outcome of all this policy-panic - CHINEXT (China’s Nasdaq) is down another 6% today (down 25% in 3 days) and aside from CSI-300 futures, all other major Chinese indices are in free-fall.”

Wonder how much margin debt just got flushed?

Comment by Professor Bear
2015-06-29 19:49:05

Marketwatch dot com
The Margin
Greece crowdfunding campaign draws more than 500 pledges
By Tom Bemis
Published: June 29, 2015 7:22 p.m. ET
Getty Images
A Greek national flag (ADAM BERRY/AFP/Getty Images)

While residents of Europe’s functioning economies may be suffering from donor fatigue, an enterprising Londoner remains undaunted.

Thom Feeny has launched a Greek Bailout Fund on Indiegogo.

The fund seeks to raise 1.6 billion euros, the amount Greece owes the IMF for its next interest payment, due Tuesday.

Per his crowdfunding page, Feeny figures the 503 million people in the European Union need only pony up 6 euros each for a Greek Feta and Olive salad to solve the immediate debt crisis.

Those pledging 10 euros qualify for a voucher good for a bottle of ouzo, while those able to donate 25 euros qualify for a bottle of Greek wine.

By late Monday, more than 500 people had pledged a total of more than 8,000 euros, leaving just 1,599,992,000 euros to go.

Comment by Professor Bear
2015-06-29 21:54:45

Any chance the Chinese government would try to prop up its stock market through direct stock purchases (aka outright manipulation)?

Comment by Califoh20
2015-06-29 21:56:40

I read:

Canada has actually discovered the cost to treat heroin addiction is actually cheaper than the cost to fight it.

If the US ends the war on drugs, think of the job losses.

Comment by Professor Bear
2015-06-29 21:56:41

China stocks extend selloff; rest of Asia shrug off Greece risks
See Kit Tang
2 Hours Ago

China’s stock markets took another tumble early Tuesday, underperforming the region which mostly recovered from the previous day’s heavy selloff, as Greece inched nearer toward a debt default.

According to Reuters, Greece will not be paying a 1.6 billion euro loan installment due to the International Monetary Fund (IMF) on Tuesday, citing a Greek government official. The cash-strapped country needed emergency funding to make the payment, but negotiations for a cash-for-reform package between Athens and its creditors broke down over the weekend after Greek Prime Minister Alexis Trspras called for a surprise referendum.

Overnight, Greece-related fears took a toll on Wall Street shares. The blue-chip Dow and the S&P 500 wiped out gains for the year, down 1.95 and 2.09 percent, respectively. The Nasdaq Composite lost 2.4 percent to end below the 5,000 mark for the first time since May 13.

Mainland indices extend selloff

China’s Shanghai Composite index fell further into bear-market territory early Tuesday, down 4.7 percent to hit its lowest level since April 3.

The CSI300 index of the largest listed companies in Shanghai and Shenzhen tanked 3.5 percent, while the Shenzhen Composite slumped 6.2 percent from the get-go.

The sharp correction in the mainland stock markets showed no signs of relief even as the People’s Bank of China (PBOC) unveiled a bigger-than-expected easing package over the weekend.

Comment by Professor Bear
2015-06-29 21:58:00

Bears ignore PBOC to maul China stocks
See Kit Tang
20 Hours Ago

Equities in China finished in bear-market territory on Monday, even as the country’s central bank rolled out a bigger-than-expected easing package over the weekend aimed at stabilizing the market.

The benchmark Shanghai Composite opened up almost 1 percent briefly before slipping deeper into negative territory over the course of the day, losing as much as 7.5 percent to hit an intra-day low of 3,875.04. The Shanghai bourse eventually clawed back some lost ground to end down 3.3 percent at a more than two-month low.

Since June 12, the benchmark index has fallen 21.5 percent from a high of 5166.35, breaching the 20 percent threshold that defines a bear market. Analysts attribute the dramatic plunge to a raft of initial public offerings (IPOs) that locked up an estimated 6.7 trillion yuan ($1.1 trillion) worth of funds, as well as regulatory efforts to rein in excessive levels of leverage.

This sharp correction, accompanied by bouts of extreme volatility, is in stark contrast to the blistering run-up that saw the Shanghai Composite soaring more than 150 percent over the past 12 months.

Comment by Professor Bear
2015-06-29 22:01:03

What are the consequences of a government openly and directly propping up the prices of its own stock markets through direct purchases?

China is allowing its massive pension fund to buy stocks to support the shaky market
David Scutt, Business Insider Australia
Jun. 29, 2015, 11:38 PM
Caishen, the Chinese god of wealth/prosperity/fortune ChinaReuters/Pichi ChuangA performer dressed as Caishen, the Chinese god of wealth/prosperity/fortune, holds a container shaped like a prosperous gold ingot, in front of an electronic board displaying stock information at a brokerage house on the first day back to work after the Chinese Lunar New Year holidays in Taipei.

Chinese policymakers, fresh from watching the nation’s stock market slump more than 20% in the past two weeks, are calling in the cavalry to support the market.

According to a report from Bloomberg policymakers “will allow its basic endowment pension fund to invest in stock markets, according to draft regulations posted on the Ministry of Finance’s website”.

The fund also will be allowed to invest in domestic bonds, stock funds, private equities, stock-index futures and treasury futures, according to the draft statement posted by the government.

A rapid run-up in stock prices over the past year, something that propelled major Chinese indices to gains in excess of 140%, has unraveled in recent weeks as investors, many of them leveraged, were forced to sell down their positions on the back of steep intraday losses.

Last weekend China’s central bank, the PBOC, looked to support markets by delivering a 0.25% cut to benchmark one-year interest rates along with lowering the reserve ratio requirement for some institutions by 0.5%.

Going off the price action seen yesterday, those moves have failed to calm investor nerves. The benchmark Shanghai Composite index fell by 3.3%, following a 7.4% loss on Friday, with the daily points range the largest seen in the history of the index. It was also the largest daily percentage range since February 20, 1997.

Comment by Professor Bear
2015-06-29 22:02:53

Chinese stocks are tumbling again
Paul Colgan, Business Insider Australia
Jun. 29, 2015, 10:48 PM 947 1
An investor stands in front of an electronic board showing stock information at a brokerage in Shanghai December 31, 2014.

The selling is on again in China.

The Shanghai Composite plunged 5% in early trade, following the pattern of daily losses over the past week. It has recovered slightly in what is becoming familiar volatility on the Chinese markets.

The continuing falls follow an interest rate cut announced by China’s central bank on Sunday, and news that Beijing will allow its massive pension fund to buy stocks to support the market, which is now in official bear market territory after falling 25% in 11 days.

ChiNext, the tech-heavy index, is down 38% in 16 days.

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