The Chinese stock market is crashing. The “authorities” are attempting to arrest the crash… although the rise and fall by itself only represents a transfer of wealth between those that sold at the top and those that bought at the top and now have huge losses.
Source : ZeroHedge.
The government is now threatening to jail short-sellers after having closed trading in over a thousand shares, prohibited large financials from selling , etc…. Is this a free market ? This is the next leader of finance or just another country run by an oligarchy who really don’t know what they are doing?
Would you trust your money to the Chinese ? Are you sure they might not seize foreign money if they needed it ? You bet your yuan they would. and the Chinese Yuan is supposed to be the new reserve currency ?
BRICS – A Moniker Created by Goldman Sachs
Surely by now we recognize the whole BRICS charade – – is not a real alternative to the West. They represent the neo-marxist world that the West is rapidly being converted into. None of them offer freedom from tyrannical governments. The US enjoyed World domination for nearly a hundred years due to the two world wars which the oligarchs engineered. The rest of the world has now rebounded as it should based on population, education, resources, and focus – but it does not make those countries paragons of virtue. Beware of those that peddle the BRICS lie of a brave new world – the personalities on TV repeatedly or even repeatedly in alternative media like ZH are disinformation agents …and then there are tons of useful idiots that will believe the big lie and regurgitate and socialize the message.
China and USA are the same – those who know me from 15 years ago will recognize my prediction that the goal was to make the US like China, not the other way around. Goal Achieved. They look like identical sisters to me.
On the market side, today we had a large bounce up in China. However, the bubble will crash eventually. It is always 2 steps in one direction and then 1 step back. The decline will occur and typically 6-9 months later you will get the full recession and in this case the Chinese depression. You can check all the major market crashes 2008,2001,etc – when they lead to recessions they do so by about 6 months. Given the massive fixed investment push by the commies for the last 20 years, I expect a wipe out – we did not get the full recession in 2008 as they surprisingly had the capacity to inject even more stimulus into an already heavily fixed investment based economy. Oil will go to 30 and possibly go to 20… but more on these commodity wipeout predictions in another post.
The picture is now almost complete for the big Chinese recession/depression that will shake the world. The effect of the crash is not in the wealth – that is just transferred – but in the lack of confidence. It makes for a lot of losers – though we never hear much about the winners. But the crash itself makes everyone in the country feel like a loser, even if one gets out early. Like soccer crazy countries feel like after their teams are eliminated from World Cup, a depressed feeling hangs in the air. The spectacular crash damages the collective psyche, deflates confidence , and causes one to pause and rethink. The recession is the pause that refreshes and the crash in the market is one of the ways that activity levels are turned downward.