Via Bloomie: A string of defaults by Chinese state-owned companies has sent shockwaves across the world’s second-largest credit market. But some bonds have fared much worse than others as investors clamber to avoid the next potential blowup. Among the most notable losers: notes issued by Pingdingshan Tianan Coal Mining Co., Jizhong Energy Group Co., Tianjin TEDA Investment Holding
Via News: It doesn’t sound all that riveting: the fifth plenum of the 19th Communist Party of China’s central committee. Nor does the 14th five-year-plan that sprung from the rubberstamping event, held in Beijing at the end of last month. But buried beneath the bureaucratic bumpf is a radical new plan that China hopes will
Bartho wrote a nice piece yesterday: There has been a spate of Chinese companies defaulting on their bond repayments in the past few weeks, sending anxious ripples through the market that have even touched China’s sovereign bond yields and caused its central bank to pump liquidity into its bond market to try to calm it.
Chinese data for October was out late yesterday and it shows an economy with a fading stimulus pulse. Industrial production was up 1.8% YTD and a more encouraging 6.9% YOY. Fixed asset investment was up 1.8% YTD and retail sales are still the laggard down 5.9% YTD but up 4.3% YOY: The all-important real estate
Associate Professor Salvatore Babones has released a new report at the Centre for Independent Studies entitled “A House Divided: The AFRB and China’s Subnational Diplomacy in Australia”, which explains how China uses subnational diplomacy to exert influence over Australia. Below is the Executive Summary: Australia is an open society awash in Chinese foreign influence operations,
No end in sight to the latest round of Chinese debt with October leading at 690tr yuan for banks and 1.42tr for total social financing: New loans are thumping along: The rolling annual says it all: Non-bank finance is back big but it’s not so much shadow these days as it is bonds: M2 fell
Via Sinocism: The communique for the Fifth Plenum is out, there were no big surprises. There is a lot of focus on self-reliance, especially in technology, as well as security and military modernization, and of course opening and dual circulation. The US is not mentioned but risks and opportunities from the New Era of US-China
Australia could literally bomb Beijing right now and it would happily keep taking our iron ore. The reason is simple. Iron ore is the key commodity input into CCP power. Only by sucking in a billion tonnes of the stuff can it sustain the useless building of empty stuff that keeps folks employed and not
Via Sinocism: It is Fifth Plenum week as the fifth plenary session of the 19th Central Committee of the Chinese Communist Party meets in Beijing from Monday through Thursday. Today Xi gave a work report and presented the “discussion drafts” of the proposals for the 14th Five-Year (2021-2025) Plan for Economic and Social Development and
Sadly, yes, at Domain: Prime Minister Scott Morrison’s push to deliver 1000 megawatts of new gas-fired power capacity into the nation’s main energy grid could discourage investment in battery technology, imperil the clean energy transition and risk financial losses for the taxpayer-backed Snowy Hydro scheme. Experts and industry insiders told The Sydney Morning Herald and
Not at all. Via NBS, new home prices up 0.34% in September and 4.6% over the year: 45 out of 70 cities rose in real terms which is not your grandfather’s property boom by a long way: The demographic spread was unchanged with third-tier cities leading. Top tiers are soft: This is weak stuff for
China dropped its Q3 data dump late yesterday so let’s take a look. Year to date GDP came in at 4.9%: The growth internals for September were 1.2% for industrial production YTD, fixed asset investment 0.8% YTD and retail sales -7.2% YTD but 3.3% YOY: Property sales were solid in Q3 but have lately tumbled:
China’s PBOC released new yuan loans for September last night it remains credit pedal to the metal with total social financing at 3.48tr yuan of which 1.9tr was bank lending: The non-bank share has rebound strongly but that is distorted by the inclusion of local government bonds these days: The three month moving average of
I am not worried about this at all. China cannot afford to let a daisy chain of failures rip through its ponzi-developer sector. It is the key policy lever for stimulus as the world stumbles through COVID. Via Bloomie: China Evergrande Group took a major step toward avoiding a cash crunch that had threatened to roil
China’s latest batch of NBS PMIs are out and show no surprises. Manufacturing is struggling: In September , the Purchasing Managers Index ( PMI ) of China’s manufacturing industry was 51.5% , an increase of 0.5 percentage points from the previous month , indicating that the manufacturing industry has rebounded. Services, read construction, is booming: In September , the non-manufacturing business activity index was 55.9% , an increase of 0.7 percentage
Via ZH: Is China’s housing bubble – the main “wealth effect” for hundreds of millions of middle class Chinese – finally about to burst? On Friday, trading in onshore bonds of China Evergrande, China’s second largest and the world’s most indebted property developer, was halted after reports it was seeking government help to stave off
Wolf wankers at the FT: Just two days before President Xi Jinping was scheduled to speak to Chancellor Angela Merkel last week, China blocked all pork imports from Germany. The ostensible reason was the death of a single German wild boar from African swine fever, a disease already endemic in China. But some analysts jumped
Vai FTAlphaville: This is a guest post by Michael Pettis, a finance professor at Peking University and a senior fellow at the Carnegie-Tsinghua Center. His new book ‘Trade Wars are Class Wars’ was co-authored with former FT Alphavillain Matt Klein and is available at all good book stores. On Tuesday, China’s National Bureau of Statistics
Below find a full review of this week’s China data. Apologies for the lateness. Had some “issues”. First out was August credit which has had its ears pinned back with TSF at an impressive 3.58tr yuan. Banks made up a lousy 1.2tr of that: Meaning that shadow finance is roaring ahead again, though this now
One of the biggest positives to come out of the COVID-19 pandemic is that its has forced the federal government to grow some cajones and stand up to Chinese Communist Party (CCP) bullying. The latest salvo comes from Australia’s top diplomat, DFAT Secretary Frances Adamson, who in a detailed interview in the Weekend Australian vowed
Via Sinocism: DOD Releases 2020 Report on Military and Security Developments Involving the People’s Republic of China > U.S. DEPARTMENT OF DEFENSE > Release This report accounts for the PRC’s national strategy and the drivers of China’s security behavior and military strategy, covers key developments in China’s military modernization and reform, and provides new insights
The one-trick pony stumbles on. The latest Chian manufacturing PMI managed weak growth: In August , the Purchasing Managers Index ( PMI ) of China’s manufacturing industry was 51.0% , a slight decrease of 0.1 percentage point from the previous month , indicating that the overall manufacturing industry was operating smoothly. New orders grinding higher. New export orders still falling which is pretty remarkable. But
Loads of China data last week during my illness. Let’s catch up. New yuan loans (TSF) were pretty lousy at 1.69tr: Shadow banking share remains off the leash again: The impulse is starting to fade as 3MMA rolls: Rolling annual is still booming: M2 not so much at 11.1%: Broad credit eked out another gain
Via China’s NBS comes the manufacturing PMI: In July , China’s Manufacturing Purchasing Managers Index ( PMI ) was 51.1% , an increase of 0.2 percentage points from the previous month , and was above the threshold for five consecutive months. Export orders bottoming. Services PMI: In July , the non-manufacturing business activity index was 54.2% , a decrease of 0.2 percentage points from the previous month , and continued to remain above the threshold.
For sale. One wolf warrior liver: Meanwhile, our charming Nazi CCP mates are at it again. It’s all our fault you see, via Global Times: After the Morrison government is reported to be launching investigations of Chinese flagship platforms TikTok, WeChat and Sina Weibo, following the US that is considering a ban on the short
Via Ray Dalio: The Big Cycle of the United States and the Dollar, Part 1 This is Part 1 of a two-part chapter on the US Empire and its path along the archetypical big cycle of dominant powers. It covers the period up through World War II. In Part 2, we will cover from the
Chinese data for June is out and is exactly as expected. Quarterly GDP snapped back 9.6% to deliver 3.2% GDP on the year: Internals for the June month continued the recent pattern. Industrial production is rebounding fast at 4.8% year on year and -1.3% YTD. Fixed asset investment is down -3.1% YTD and retail is
Alarming video footage has leaked of Chinese Communist Party (CCP) police threatening Chinese Australians that speak out against the authoritarian Xi Jinping regime: The #CCP will hunt you down wherever you go: Witness this video of a Chinese police officer threatening @Horror_Zoo, who lives in Australia, over her tweets about Xi Jinping. CCP insinuates it
The more things change the more they remain the same, via Bloomie: Faced with the prospect of restricted access to U.S. dollars, China’s answer is to get more people to use its own currency instead. The increasing spillover of Sino-American tensions into the financial sphere has ignited a fresh push by China to promote the
China likes to pretend that it’s not unleashing credit stimulus but it is. New yuan loans for June are out and evidence is unequivocal. Total social financing was at 3.43tr yuan with banks accounting for 1.81tr of that: Shadow banks are back in a big way: The surge in new loans is obvious year on
