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Chinese Fund Managers Sentenced to Death after Cheating Investors out of 1 Billion USD

HANGZHOU – Two brothers and their father were sentenced to death on Monday for cheating 15,000 investors out of over $1.1 billion in east China’s Zhejiang province. Ji Wenhua, president of the Yintai Real Estate and Investment Group, was sentenced to death for the crime

Gold at $7,000 article goes viral in Chinese media

Dan Collins CMR “Gold going to $7,000”, an article today in the Chinese media is going viral and one of the most viewed articles in the financial press. The article references American Jim Rickards and his concept of comparing inflation-adjusted gold prices. Most Chinese economists

Western paper markets manipulate gold prices lower as China takes the real stuff off the market.

It’s not uncommon for the large Wall Street banks to combine in shorting an entire years supply of minded silver in a single day.The same goes for all commodities. Endless paper printing getting funneled to Wall Street has destroyed all real price discovery. Capitalism fails

“American Collapse Theory” Gaining Ground in China

Dan Collins CMR When I moved to China back in 1998 I was surprised to learn how highly the Chinese thought of America. Of course China was a much poorer place back then but coming from the Detroit area I couldn’t fathom where was all

Chanos is back….This is getting sad

Chanos is back! His short China thesis is very long in the tooth but as it goes with most ego maniacs he cannot accept failure or that fact that he might be wrong. Being wrong on an entire country where you have never visited and

China Car Sales Up 22.6% -The Chinese economy is collapsing?

You have to laugh at the whole “China will collapse crowd” on CNBC and even respected sites like Zero Hedge. Personally, I love the Zerohedge stuff. They understand the ponzi-financial fraud-money printing-welfare state economy that now envelops the West. But China is a real economy,

Cloud Computing in China booming as American giants are pushed out

D.Collins CMR China’s cloud computing market is expected to be worth 37.2 billion yuan (US$6 billion) in 2017 as demand for the service grows, the Chinese-language China Securities Journal reported on Friday. Some American tech companies are watching the largest and fastest I.T. market in

Oil rig dispute could see repeat of Sino-Vietnamese War: report

Breaking News today that a Chinese vessel as rammed and sunk a Vietnamese fishing boat. All countries in the South China Sea and East China Sea are using fishing boats in a game of cat-and-mouse to challenge each other on their respective areas. This time

China now runs 4 of the world’s 5 biggest banks

Stockswatch China has become a banking powerhouse. Four of the five largest banks in the world are Chinese, according to SNL Financial’s latest global bank rankings. It’s a big change from the past few years when only two Chinese banks made the top five. Beijing-based

France relents to China, Chinese police to help patrol Paris streets

Scared of losing the Chinese tourist dollar, France has relented to China and will allow Chinese police on the streets of Paris. More signs of the benefits of third-world immigration into the West to the point where cultural breakdown has occurred and law and order

People’s Bank of China will take down global gold price manipulation

Gold has been flowing East for a decade. When the West wakes up to the fact that their gold is gone, they will no longer have sound money with which to back a currency. The world has only been off a gold standard since 1971

China to lower reserve requirement ratio

From the China Daily… BEIJING – China will lower banks’ reserve requirement ratio (RRR) by 0.5 percentage points starting May 18, the country’s central bank announced Saturday. The cut, the second of its kind this year, will drop the RRR for the country’s large financial

Chinese Officials Falsify Data To Mask Slowdown, NYT Says

Is China tweaking its numbers on GDP? Probably. For twenty years Chinese GDP roughy came in right on the governments target. This would be an almost magical performance record considering economists in the West can predict absolutely nothing. For years, China most likely lowered GDP

Japan Learning the Hard Way, Destroying your Currency is Not an Economic Strategy

Japan will learn the hard way that destroying your currency is not an viable economic strategy. Shanghai Daily JAPAN posted a record 1.63 trillion yen (US$17.4 billion) trade deficit in January as rising exports trailed surging imports of crude oil and gas due to rising

Renminbi-yen trade growing strongly a year after launch

One year after the launch of direct trading between the renminbi and Japanese yen, the daily trading volume between the two currencies has reached 50-100 billion Japanese yen on the Shanghai market and 15 billion yen on the Tokyo market, a combined volume double that

China Market Update


Lack of cyber experts needs to be met with education reform: experts

Global Times

Tech experts revealed that China is not training anywhere near enough IT workers to deal with digital threats issues at the country’s largest cyber security event Tuesday.

“As of 2014, China has more than 700,000 cyber security talents working in key information system and infrastructure industries. By 2020, China will need about 1.4 million cyber security talents. In the last three years, we have recruited about 10,000 students pursuing cyber security, but we are hugely lagging behind demand,” Feng Huamin, vice president of the Beijing Electronic Science and Technology Institute, said at a plenary session during China Cybersecurity Week held in Wuhan, capital of Central China’s Hubei Province on Tuesday.

As China is launching a national push to train more cyber security talents, many top universities have started to offer cyberspace-related majors since 2015.

Vice Minister of Education Lin Huiqing said at a press conference in February that the number of new university majors involving cyber security, information countermeasures and confidential data management has surpassed 120 and other cyberspace-related majors have exceeded 4,800.

However, many cyber security experts at the Wuhan event pointed out that only a small proportion of China’s schools offer such courses and there is a lack of qualified instructors, calling for the country to quickly establish a systematic discipline on cyber security education and promote more practical training.

No systematic method

At the session, Feng said that China now needs more cyber security talents working in several sectors, including those working in Party and government systems; in key infrastructure and information systems; and in combating cybercrimes and cyber terrorism.

Statistics show that China has 3,115 teachers involved in information security education but only 7 percent of them are classed as high-level talents.

Feng pointed out that only 10 percent of the 1,200 Chinese technology and science universities offer related majors while over 100 leading universities do not. Besides, only 15 Chinese universities have established cyber security schools and there is no systematic method for cyber security education.

In June 2015, China’s State Council released a notice, demanding the quick establishment of a cyber security discipline and the cultivation of cyber security talents.

Moreover, Feng noted that a lack of practical training and high-quality instructors are also two highly important problems.

Ernest McDuffie, former director of the US National Initiative for Cybersecurity Education program, said at the Wuhan conference that he has not met many college students who have an interest in studying cyber security and the growth rate of global cyber security talents in 2015 was under their expectation.

Greater investment

Shen Changxiang, an academician at the Chinese Academy of Engineering, suggested China open classes to train minors and offer chances for special talents to study cyber security at college without taking the national college entrance examinations.

The Wuhan government has pledged to double the number of scholarships for cyber security majors and recruit top cyber security graduates from Chinese and overseas schools as well as the winners of cyber security contests. It will also open a class for minors and run special recruitment drives for “maverick geniuses.”

Moreover, the city government will establish a new evaluation system. Instead of taking exams, cyber security majors will be evaluated based on their performance and priority will be given to those with practical and entrepreneurship experience.

As for cultivating first-class instructors, the Wuhan government vowed to offer twice the salary and research funds to the best cyber security experts compare to those working in similar positions.

Specifically, they will also receive 2 million yuan ($299,823) in subsidies and up to 100 million yuan in funding if they have innovative technologies that have a significant impact on the economy.

Mengchow Kang, board member of the Information Security Certification, called for the standardization of cyber security workforce development.

With such a system, cyber security talents, no matter where they are working, could get recognized with an international qualification, said Kang.

In February, China launched its first special fund for cyber security with initial capital of 300 million yuan to realize the nation’s strategic goal of becoming a strong Internet power.

The fund, established by the China Internet Development Foundation, will be used to provide financial assistance to experts and teachers who specialize in cyber security.


China to Perform Space Brain-Machine Interaction Experiments on Tiangong-2


China launched its second space station, Tiangong-2, on Thursday, according
to state media reports, paving the way for a permanent space station that
the country plans to build around 2022.

The launch of the new satellite comes five years after the country launched
its first space station, Tiangong-1, in September 2011.

The space station Tiangong-2 is China’s first real space lab. A brain-computer
interaction test system, developed by Tianjin University, has been installed
in the lab and it is set to conduct a series of experiments in space, People’s
Daily reported.

According to Ming Dong, the leader of the research team in charge of the brain-
computer test system, the brain-computer interaction will eventually be the
highest form of human-machine communication.

The brain-computer interaction test system in Tiangong-2 boasts 64 national
patents. The research team has long been devoted to the research of brain-computer
interactions, previously developing two idiodynamic artificial neuron robotic
systems that can help with the rehabilitation of stroke patients,” the
publication wrote.

Regarding the use of such brain-computer interaction technology in space, the
leader of the research team suggested that it could also help Tiangong-2 astronauts
to more easily accomplish their assigned tasks. For example, the brain-computer
interaction can transmit the astronauts’ thoughts into operations, while at the
same time observing their neurological functions. Earlier in an interview with
Sputnik, Russian military expert, Vasiliy Kashin, said that Tiangong-2 will allow
Chinese astronauts to stay in orbit for 30 days, which is longer than ever before
in the history of the Chinese space program.

The Tiangong-2, whose name means “Heavenly Palace,” will be used to test space
technology and conduct medical and space experiments.

According to the military expert, in the future, a third module is planned for
launch, in which a crew of 3 people will be able to stay in orbit for up to 40 days.
The refueling technology of the orbiter is also planned to be developed in this module.
It should be noted that to date, China has managed to implement its program, in general
adhering to its originally established schedule without any unforeseen accidents.

Thus, it is hoped that with the advent of the private Chinese space station, China
will establish a permanent presence in space and will begin to experiment with
long-term human experiments required for flights to other planets.


Cyber security week kicks off

GOVERNMENT and industry officials urged consumers to join the war against online fraud and spam messages as the National Cyber Security Awareness Week kicked off yesterday.

The campaign, organized by six national regulators, including the Ministry of Public Security and the Ministry of Industry and Information Technology, is aimed at improving the national online security level and raise people’s awareness. Problems like online fraud, leakage of personal information and network hacking have become national issues.

“Every one has to attend the campaign. Otherwise, all of us will become victims,” said Zhou Hongyi, chairman of Qihoo 360, the country’s biggest online security company.

Domestic firms, including Tencent, Baidu and Qihoo 360, and overseas giants like Microsoft and Kaspersky attended an online security expo in Wuhan, Hubei Province, as part of the national campaign.

Microsoft yesterday announced it will establish a transparency center in Beijing, which would open parts of Microsoft source codes to government-backed organizations.


China Market Update


What the Chinese Are Reading


Dan Collins with Max Kesier- Will the Dollar Live to Die Another Day?

China Market Update


Forex reserves fall to lowest since 2011

What they China Daily is not saying? They are happy to report that China’s FX
reserves are dropping therefore letting releasing pressure on a Yuan upswing to
reduce China’s massive $250 billion trade surplus with the United States.

What they are also not saying is that all of this “capital flight” is a state-directed
program to have Chinese companies go global. Chinese state-owned firms are being
supported by the government to gobble up the global assets.

China Daily
CHINA’S foreign exchange reserves fell to the lowest since 2011 in August as the central bank intervened to support the yuan as it weakened to near-six year lows.

While the US$15.89 billion drop was in line with market expectations and was described by analysts as modest, it was the biggest fall since May and could signal fresh capital outflows from the economy as it starts to show signs of steadying.

China’s reserves fell to US$3.185 trillion in August — the lowest since December 2011 — from US$3.20 trillion at the end of July, central bank data showed yesterday.

China’s reserves, the largest in the world, fell by a record US$513 billion last year after Beijing devalued the yuan, sparking a flood of capital outflows that alarmed global financial markets.

But declines have slowed sharply in recent months as authorities tightened capital controls and cracked down on forex trading which is suspected to be speculation.

Traders believe the central bank has stepped in via state-run banks since mid-July to slow the pace of depreciation in the yuan, which has weakened 2.6 percent against the US dollar so far this year.

Analysts expect pressure on the yuan and reserves to continue as expectations of another US Federal Reserve interest rate hike this year support the dollar.

“With a Fed rate hike likely before the end of the year, the authorities will have their hands full with containing any wild spikes in USDCNY triggered by capital outflows, and can expect FX reserves to remain on a downward path through to the end of the year,” said Chester Liaw, an economist at Forecast Pte Ltd in Singapore.

China CFOs Are Swapping Dollars for the Yuan in Statements


Chinese companies in Hong Kong are abandoning a long-held practice of reporting earnings in dollars in favor of the yuan.

Want Want China Holdings Ltd. made the switch for the first time since its 2008 listing when reporting first-half earnings last month, while Hengan International Group Co. dropped the Hong Kong dollar figures it has used since at least 2001. China Resources Beer (Holdings) Co. said it moved to yuan-denominated reports to reduce the impact of currency moves.

While Capital Link International Holdings Ltd. says the growing international importance of the yuan means it no longer makes sense for the nation’s companies to report in a foreign currency, JPMorgan Chase & Co. says the weaker Chinese currency is triggering the move. The yuan will decline a further 1.3 percent to a six-year low by the end of the December, according to analysts’ median forecast in a Bloomberg survey.

“It’s flattering when the yuan is appreciating but it makes the numbers poor when the yuan is falling,” said Adrian Mowat, the chief Asian and emerging-market equity strategist at JPMorgan. Companies “recognize after recent yuan weakness that it makes the numbers less favorable in Hong Kong dollars.”

“The yuan has become enough of an international currency to no longer need to report in dollar or Hong Kong dollar terms,” said Uwe Parpart, Hong Kong-based chief strategist at investment bank Capital Link. “The yuan has become a respected currency.”

Pentagon Stunned As Thousands Of Chinese Troops Enter ISIS War


The Kremlin have announced that China are to send 5,000 of its most elite military forces into the Levant War Zone to help Russia in the fight against ISIS, which has left the Obama administration and the Pentagon “horrified”.

The “Siberian Tiger” Special Forces and “Night Tiger” Special Forces Units were given authorization to be deployed by China’s People’s Congress (NPC) on Sunday, after China passed its first anti-terrorism law allowing their army to take part in anti-terror missions abroad.

Whatdoesitmean.com reports:

Most critical to China in entering this war, this report continues, is the “grave” national security threat it faces from both the Islamic State (ISIS/ISIL/Daesh) and Turkey’s National Intelligence Organization (MIT)—and as, perhaps, best described by the noted award winning American military-intelligence journalist Seymour M. Hersh who in his latest article warned of this threat by stating:

Globalization of the yuan picks up momentum

The People’s Bank of China, in a report released last month, used the term “yuan internationalization” for the first time to describe its six years of efforts in promoting global use of the currency.

It was a sign that those efforts are coming of age and bearing positive results. The yuan today is the fifth-largest payment currency in the world, according to SWIFT data.

The central bank has so far signed currency swap deals with 32 countries and regions, and has appointed 16 banks across Asia, the Americas, Australia and Europe to act as clearing houses for the yuan.

The internationalization process began in 2009 when the central bank allowed cross-border trade settlements in yuan for the first time. It followed that by opening various quota-controlled channels for foreign capital to invest in domestic bond and stock markets.

In a report issued last month, the People’s Bank of China said it will launch a cross-border clearing mechanism called the China International Payment System this year. Though vaguely worded, the report suggested the bank will support foreign entities issuing yuan bonds onshore, will facilitate foreign institutions investing in the domestic interbank bond market, and will “study” the removal of quotas now placed on how much foreign central banks can invest in the interbank bond market.
The process of reform has been long and gradual as authorities try to balance the need for greater global engagement with concerns about shocks to long protected domestic sectors of the economy.

The Standard Chartered Bank has sketched a picture of how the transformation will play out in the near future.

“Within the next three years, China will achieve capital liberalization in a ‘managed’ way,” said Ding Shuang, China chief economist at StanChart. “By ‘managed.’ we mean well-grounded capital-account transactions will be free, and restrictions only on speculative short-term capital flows.”

He predicted few restrictions on foreign direct investment, equities investment and cross-border lending, but an overall quota on capital account transactions.

“Restrictions will be triggered only in cases of huge external impacts and crises to prevent excessive money flows,” Ding added.

StanChart said the volume of foreign trade settled in the yuan will rise to 50 percent in 2020 from 25 percent now. The value of yuan assets will be equal to between 4 percent and 5 percent of global central bank reserves by 2020, up from less than 1 percent now.

The value of domestic bonds held by foreign investors is expected to jump sixfold to about 5 trillion yuan (US$806 billion).

Two Con Men arrested claiming to be Soros protege and a 300 year old Qing Emperor

Two Shenzhen con men are charged with running a more than 40 million-yuan ($6 million) scam while claiming to be a protégé of business magnate George Soros and an immortal Qing Dynasty (1644-1911) emperor.

Zheng Xueju, the victim, was seeking to open a village-based bank in 2012 when she was first introduced to the con’s point man, surnamed Ma, the Shenzhen Intermediate People’s Court heard Wednesday.

Prosecutors said Ma claimed not only to have the necessary government and military connections, but also that he was a student of billionaire investor George Soros and had access to billions of dollars.

But things got royally messed up when the smooth-talking Ma introduced Zheng to his partner, Liu Qianzhen.

Liu told Zheng he was the Qing emperor Qianlong (1711-1799), crediting his more than 300 years of life to consuming an “elixir of immortality,” the court heard.

Liu said he was on board, but only needed a transfer of 2 million yuan to unlock his imperial assets.

Zheng agreed. In 2014, Ma successfully scammed Zheng with other investment and real estate scams, said prosecutors.

It only took two years and more than 40 million yuan for Zheng’s husband, Wang Liangbiao, to become suspicious. He began recording their conversations, which he later handed over to prosecutors as evidence.

Ma said he had spent the money on real estate, cars and “precious herbal essences,” prosecutors said.

The court has yet to reach a verdict.

Nandu Daily


Oil Prices to Spike as China Fills Strategic Reserve?

The Saudi Prince is coming to town just as China is about to stockpile its strategic
oil reserves .

China needs to fill its strategic stock, according to Wang Jun, deputy director of the China Center for International Economic Exchanges’ Department of Information.

“Our strategic crude oil inventory only covers about 30 days, which is low, compared to other countries’ 180-day stock

Global Times
Saudi prince visit eyes vast Chinese oil export market

China and Saudi Arabia are eyeing deeper energy cooperation as Saudi Arabia’s Deputy Crown Prince Mohammed bin Salman prepares to visit China.

Prince Mohammed is scheduled to visit China from Monday to Wednesday and will co-chair a high-level meeting between Saudi and Chinese officials led by Chinese Vice Premier Zhang Gaoli, China’s Ministry of Foreign Affairs announced last week.

During his visit, Prince Mohammed will meet Chinese officials on further strengthening economic ties with a number of deals, including the signing of memorandums of understanding on cooperation in the power sector and one on cooperation on oil storage, Saudi Arabia’s English-language newspaper Arab News reported on Thursday.

Deals expected to be signed during Prince Mohammed’s trip also include investments in Saudi Aramco, the country’s largest state-run oil producer, the Arab News said. Aramco is reportedly planning to go public, issuing about 5 percent of its shares as part of the kingdom’s economic reform plan.

Though other areas such as security cooperation are expected to be discussed, the main focus of the prince’s trip will be on further opening the Chinese market, as the country faces deteriorating global market conditions for its oil exports and as China moves to bolster its strategic inventory, experts noted.

Saudi Arabia, one of the world’s largest oil exporters, has been suffering from sluggish global demand, shrinking prices and rising competition from countries like Russia and Iran.

“At a difficult time like this, it is natural for Saudi Arabia to turn to China, the world’s second-largest oil importer,” said Lin Boqiang, director of the Center for Energy Economics Research at Xiamen University. “I expect a relatively good deal for both sides during the visit.”

The potential deal would guarantee Saudi Arabia more access to the huge and expanding Chinese market, while helping China secure a steady oil supply at lower prices, according to Lin.

China is already one of the largest importers of Saudi oil. In the first half of 2016, China imported about 1.07 million barrels of oil per day from Saudi Arabia, or 14 percent of China’s foreign oil supply, according to Bloomberg.

Strategic oil storage

The potential for growth in Chinese oil imports is promising, as China needs to fill its strategic stock, according to Wang Jun, deputy director of the China Center for International Economic Exchanges’ Department of Information.

“Our strategic crude oil inventory only covers about 30 days, which is low, compared to other countries’ 180-day stock. Furthermore, China’s oil storage infrastructure has improved significantly and can store much more oil now, so there is a huge potential,” Wang told the Global Times.

Crude oil deals with Saudi Arabia would also diversify the supply channels for Chinese oil imports, which is conducive to the country’s energy security, Lin noted.

Prince Mohammed, who is scheduled to return to China after a visit to Japan to attend the G20, will present his country’s economic reform plan, under which the Saudi government would spend $72 billion on projects aimed at diversifying the kingdom’s economy.

China Market Weekly Update

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China’s Postal Savings Bank Begins $8 Billion Hong Kong IPO Process

The Postal Savings Bank of China (PSBC) — the country’s largest unlisted commercial lender — has begun the process to file for an initial public offering on the Hong Kong stock exchange, Bloomberg reported Monday, citing people familiar with the matter. The IPO, which seeks to raise roughly $8 billion, is likely to take place in September.

If the bank’s IPO manages to hit its fund-raising target, it would be the world’s largest IPO since September 2014, when the Chinese e-commerce giant Alibaba debuted at a record $25 billion in New York.

However, given that the bank’s planned offering comes amid a global rout in bank shares and a 60 percent drop in share offerings in the Asia-Pacific region — both triggered by the uncertainty over, and in response to, the U.K.’s decision to leave the European Union — many have questioned the timing of the IPO.

Global Deflation Illusion Will End in Tears


According to the financial press, the greatest global economic threat is
deflation and a lack of global demand. Of course, the solution to that is
more printed money for bankers in the form of economic stimulus.
The reality, is quite the opposite. Oil prices are up 47% in 2016.
Health care premiums are expanding in the U.S. squeezing the life out
of the middle class. Higher eduction in the U.S. will cost you hundreds
of thousands of dollars. In China, home prices in China’s major cities
have doubled in the last three years. An iPhone 6 in Shanghai will run you
$1,000 USD. Product prices in the U.S. are being held reasonably low by a
stacked house of financial derivatives, credit, and low interest financing.
When the ponzi system busts foreigners are going to demand real money..
up-front for their labor.

All over the world, things are more expensive. We are awash in printed money
and it will end in tears.

Two guys leave the Apple Store this week with tens of thousands of dollars
in Apple products.


Bohai Steel Group ‘may receive bailout’

BOHAI Steel Group, the indebted state-owned conglomerate, may receive help from a local government bailout fund to restructure its debts, the online financial magazine Caixin said at the weekend.

Bohai Steel, which was created in 2010 through the combination of four manufacturers, holds liabilities of 192 billion yuan (US$28.9 billion) from 105 creditors, alongside assets of nearly 290 billion yuan, Caixin reported.

The Tianjin government plans to create a local asset manager to assist in the debt workout of Bohai Steel, alongside other troubled Tianjin enterprises, the magazine said.

Restructuring of the group represented the biggest since the global financial crisis, Standard & Poor’s analyst Christopher Lee told Reuters in March.

Bohai Steel creditors include the Tianjin branch of the Bank of Beijing Co Ltd and several trust companies.

Straight to Hell in Monetary Hand-basket- German Bank Imposes Negative Rates on Individual Depositors

Don’t look now but your savings are being confiscated by banks, your pensions
are going to pay to turn your country into an open-air refuge camp and you
get to play “avoid the rape game” by war veteran Jihadi’s. Just another day
in the New World Order Paradise.

By Amey Stone

A new line has been crossed in the global move to negative interest rate policy. Before banks only imposed negative rates on businesses and each other. Now a German bank is charging individual depositors with large balances a negative rate.

Bloomberg reports:

This week, a German cooperative savings bank in the Bavarian village of Gmund am Tegernsee — population 5,767 — said it’ll start charging retail customers to hold their cash. From September, for savings in excess of 100,000 euros ($111,710), the community’s Raiffeisen bank will take back 0.4 percent. That’s a direct pass through of the current level of the ECB’s negative deposit rate.
“With our business clients there’s been a negative rate for quite some time, so why should it be any different for private individuals with big balances?,” Josef Paul, a board member of the bank, said by phone on Thursday. “As it looks today, charges on deposits won’t be extended to customers with lower amounts” than 100,000 euros, he said.

Peter Boockvar of The Lindsey Group headlined his morning note, “The weapon of mass confiscation spreads to retail.” If this practice spreads, instead of stimulating growth, the policy would essentially a tax on savers. He opines further:

NIRP is the dumbest monetary initiative the world has ever seen. Bottom line, monetary policy is damaging global growth, not facilitating it and we are seeing more and more evidence of policy back firing.


China Market Weekly Update

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