DrunkenSailor
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- Joined
- Apr 11, 2017
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So every night the news channels harp on how destructive Trump's tariffs are to our economy. The majority of news stories are this company will no longer be importing x or this company will be raising prices on y. There have been multiple threads about inmates trying to figure out how to get supplies they need for their own businesses.
What's not being reported is what's going on in China. Today the people Bank of China (their version of the fed) injected 600bn yuan, roughly 82 billion into their banking system to ensure liquidity.
Earlier this week the pboc also announced that they would be issuing special bonds to raise additional capital totaling 286bn yuan. These special bonds are not included in chinas fiscal sovereign debt figure which is already at a record high 4%. The pboc plans to sell at least 500bn yuan of these bonds by June 4th.
The pboc is also revamping its method for pricing government issued bonds to allow banks to bid for loans from the pboc at different prices. The pboc has stopped releasing the cost of it's one year loans. It will be interesting to see if they release the 3 month and 6 month pricing or if they will keep cash injections through the bid process secret.
This month 1.7tn yuan of outright reverse purchase agreements came due which is the largest maturity event since the bank launched the short term liquidity instrument in October. Banks are petitioning the pboc for a reduction in reserve requirements as financial pressures mount.
Make no mistake, the tariffs are disrupting our economy, but it is having the desired effect overseas.
What's not being reported is what's going on in China. Today the people Bank of China (their version of the fed) injected 600bn yuan, roughly 82 billion into their banking system to ensure liquidity.
Earlier this week the pboc also announced that they would be issuing special bonds to raise additional capital totaling 286bn yuan. These special bonds are not included in chinas fiscal sovereign debt figure which is already at a record high 4%. The pboc plans to sell at least 500bn yuan of these bonds by June 4th.
The pboc is also revamping its method for pricing government issued bonds to allow banks to bid for loans from the pboc at different prices. The pboc has stopped releasing the cost of it's one year loans. It will be interesting to see if they release the 3 month and 6 month pricing or if they will keep cash injections through the bid process secret.
This month 1.7tn yuan of outright reverse purchase agreements came due which is the largest maturity event since the bank launched the short term liquidity instrument in October. Banks are petitioning the pboc for a reduction in reserve requirements as financial pressures mount.
Make no mistake, the tariffs are disrupting our economy, but it is having the desired effect overseas.
