China Bans Short Selling, Plans Massive Liquidity Injection To Prevent Market Crash

From Zero Hedge:

Judging by the collapse in Chinese futures and the Offshore Yuan over the past week, China's key cash equity index - The Shanghai Composite - is set to plunge around 6-8% as the market re-opens for the first time since Lunar New Year (and the coronavorus chaos).

China stock futures have tumbled...

Source: Bloomberg

And Offshore Yuan is fighting at the 7.00/USD level...

Source: Bloomberg

Which of course will not do for the nation has to maintain the appearance of a minor flesh-wound than a catastrophic coronary. And so, as Bloomberg reports, China unveiled a raft of measures over the weekend to aid companies hit by the coronavirus outbreak and also shore up financial markets.

Quarantative easing?

The People's Bank of China announced that the total injection announced was 1.2 trillion yuan, the largest single-day addition of its kind in data going back to 2004. The money will be supplied using reverse repurchase agreements to ensure liquidity is “reasonably ample” during the outbreak, according to the PBOC.

The new measures follow the announcement last week that China’s biggest banks will lower interest rates for firms in Hubei, the center of the outbreak.

However, as Tommy Xie, an economist at Oversea-Chinese Banking Corp notes, the net effect of this admittedly huge liquidity injection is much lower as there are more than 1 trillion yuan of short-term funds scheduled to mature on Monday.

“The amount of the net injection isn’t huge. The PBOC may want to retain some flexibility, which means it can add more liquidity in the rest of the week if the sentiment is too bad."

Source: Bloomberg

Finally, we wonder if even this additional liquidity injection will be big enough as judging by Dr.Copper, the Chinese economy is about to be hit by the biggest shock in recent history...

Source: Bloomberg

And China's credit impulse - the lifeline of its economic growth - is barely positive and rolling over...

Source: Bloomberg

In addition to the concrete measures, Bloomberg notes that senior officials from various regulators and the central bank put out statements urging brokerages and funds to guide investors to “rationally and objectively” evaluate the impact of the epidemic, calling it “short-term and temporary.”

Financial regulators said they have “full confidence” they can keep the economy stable in the long term, according to the Saturday statement, which urged investors not to be affected by “irrational sentiment.”

We are not quite sure what they mean by "irrational sentiment," as it seems entirely rational to expect economic growth to slow and earnings to be pressured lower given the nation is practically on total lockdown for the foreseeable future.

And if you think that is just conjecture, here is a local business owner with the truth on the ground...

Jordan Schneider 司马乔丹@jordanschnyc

CEO of restaurant chain 西贝 says he can only pay salaries for 3 more months before his cash runs out. Calls for relief from stupid govt policy (傻政策）otherwise will have to layoff workers and create social unrest. 100k views before blocked on wechat https://bbs.wenxuecity.com/financenews/11173.html …

163

9:20 AM - Feb 1, 2020 · Kuala Lumpur City, Kuala Lumpur Federal Territory

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Jordan Schneider 司马乔丹@jordanschnyc

Replying to @jordanschnyc

Said back during SARS it was easier to cope since they didn’t have to pay salaries. Now labor makes up 30% of their costs vs just 15% in 2003 and firms have to keep paying.

16

9:20 AM - Feb 1, 2020 · Kuala Lumpur City, Kuala Lumpur Federal Territory

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Jordan Schneider 司马乔丹@jordanschnyc

Replying to @jordanschnyc

Says that cutting interest rates is a drop in the bucket, instead wants the government to write off 2020 taxes and take up some of slack when paying salaries

16

9:20 AM - Feb 1, 2020 · Kuala Lumpur City, Kuala Lumpur Federal Territory

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1.2 trillion yuan is nothing like enough...and they have a plan for that - ban selling, similar to what Beijing did at the height of its 2015 stock market crash.

曾錚 Jennifer Zeng@jenniferatntd

Notice about stock market in #China. No one is allowed to sell when the market resume on Feb. 3. Biding price to be controlled before opening, no net sell before Feb. 7. Needs special permission for sales over 10M yuan. #CCP fearing market crash #Coronavirus #CoronavirusOutbreak

1,014

11:33 AM - Feb 2, 2020

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The Business Source@GlobalTimesBiz

Out of concern over widespread stock selling amid the #coronavirus outbreak, China's #stock regulator will ban short sales of securities starting from Monday: reports

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11:43 AM - Feb 2, 2020

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And 21st Century Herald confirms that China's securities regulator CSRC has reportedly notified brokerages to suspend short selling of stocks from Feb 3...

YUAN TALKS@YuanTalks

#China's securities regulator CSRC has reportedly notified brokerages to suspend short selling of stocks from Feb 3, according to the 21st Century Business Herald.

933

9:43 AM - Feb 2, 2020

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So the Chinese 'market' is now Hotel California - you can check out any time, but you can never leave!

The Primary Mechanism Of Your Oppression Is Not Hidden At All

Authored by Caitlin Johnstone via Medium.com,

I write a lot about government secrecy and the importance of whistleblowers, leakers and leak publishers, and for good reason: governments which can hide their wicked deeds from public accountability will do so whenever possible. It’s impossible for the public to use democracy for ensuring their government behaves in the way they desire if they aren’t allowed to be informed about what that behavior even is.

These things get lots of attention in conspiracy circles and dissident political factions. Quite a few eyes are fixed on the veil of government opacity and the persecution of those brave souls who try to shed light on what’s going on behind it. Not enough eyes, but quite a few.

What gets less attention, much to our detriment, is the fact that the primary mechanism of our oppression and exploitation is happening right out in front of our faces.

The nonstop campaign by bought politicians, owned news outlets, and manipulated social media platforms to control the dominant narratives about what’s going on in the world contribute vastly more to the sickness of our society than government secrecy does. We know this from experience: any time a whistleblower exposes secret information about the malfeasance of powerful governments like NSA surveillance or Collateral Murder, we see not public accountability, nor demands for sweeping systemic changes to prevent such malfeasance from reoccurring, but a bunch of narrative management from the political/media class.

This narrative management is used to shift attention away from the information that was revealed and onto the fact that the person who revealed it broke the law or misbehaved in some way. It’s used to convince people that the revelations aren’t actually a big deal, or that it was already basically public knowledge anyway. And it’s used to manipulate public attention on to the next hot story of the day and memory hole it underneath the white noise of the media news churn. And nothing changes.

We’ve seen it happening over and over and over again. The narrative management machine has gotten so effective and efficient that it’s been able to completely ignore the recent revelation that the US, UK and France almost certainly bombed Syria in 2018 for a completely false reason. A few half-assed Bellingcat spin jobs and an otherwise total media blackout, and it’s like the whole thing never happened.

What this tells us is that our first and foremost problem is not the fact that conspiracies are happening behind a curtain of government secrecy, but that the way people think, act and vote is being actively manipulated right out in the open. Government secrecy is indeed one aspect of establishment narrative control, but controlling the public’s access to information is only one aspect. The bigger part of it is controlling how the public thinks about information.

The reason people never use the power of their superior numbers to force real change, even though they’re being exploited and oppressed in myriad ways by the ruling class, is because they’ve been propagandized into accepting the status quo as desirable (or at least normal). The propaganda of the political/media class is therefore the establishment’s front line of defense. Its most powerful, and essential, weapon.

This is important for dissidents of all stripes to understand, because it means we’re not just passively waiting around for another Manning or Snowden or an Ian Henderson to give us information which we can use to fight the oppression machine. Those individuals have done a great public service, but the battle to awaken human consciousness to what’s really going on in our world is in no way limited to leakers and whistleblowers. It is not at the mercy of government secrecy.

If you are engaged in any type of media, you are engaging the narrative matrix which keeps the public asleep and complacent. It doesn’t matter if you have a Twitter account, a Youtube account, some flyers or a can of spray paint: if you are capable of getting any kind of message out there, you are able to directly influence the mechanism of your oppression. You are able to inform people that they are being lied to, you are able to explain why, and you are able to point them to where they can find more information.This is extremely empowering. You do not need to wait around hoping that some bombshell piece of information makes it past all the various security checks and spinmeisters and triggers a real social awakening. You can be that information. You can become a catalyst for that awakening.

The key to turning this ship around does not lie hidden somewhere behind a veil of government opacity. It lies in you. It lies in all of us. We can begin awakening our fellow humans right now by attacking the narrative management of the propaganda machine that sits right in front of us, unarmored and unhidden.