China says "You're not in trouble, it's only $430 billion"

[Kubes.SG]

The thing about China is that it is IMPOSSIBLE to know the truth about what is actually happening to the economy.  If you run some Govt Linked Company or GLC in China, there is no question that you must fudge the numbers so they match what you were told to deliver.  This is important as if you miss your numbers you either get imprisoned or executed.

No doubt the China's Central Bank head wishes he was married to the President and must look frustratingly at the lack of pressure in Singapore to perform, and for disasters to be covered up.  The poor bastard has done a running.  Maybe he is hanging out in an HDB flat in Yishan?

China: Rumors of the Central Bank Chief's Defection
August 30, 2010 | 1406 GMT

Rumors have circulated in China that People’s Bank of China (PBC) Gov. Zhou Xiaochuan may have left the country. The rumors appear to have started following reports on Aug. 28 which cited Ming Pao, a Hong Kong-based news agency, saying that because of an approximately $430 billion loss on U.S. Treasury bonds, the Chinese government may punish some individuals within the PBC, including Zhou. Although Ming Pao on Aug. 30 published a report on its website indicating that the prior report was fabricated by a mainland news site that had attributed the false information to Ming Pao, rumors of Zhou’s defection have spread around China intensively, and Zhou’s name has been blocked from Internet search engines in China.

STRATFOR has received no confirmation of the rumor, and reports by state-run Chinese media appeared to send strong indications that Zhou is in no trouble at the moment. However, the release of this rumor and its dispersion throughout the public is significant, particularly as the Communist Party of China (CPC) is preparing for a leadership transition in 2012.

Chinese state-run media and official government websites have run several high-profile reports about Zhou, which should be seen as an attempt to refute the rumors. The PBC website published two articles on its homepage reporting on Zhou’s meeting with visiting Japanese Financial Services Minister Shozaburo Jimi during the third China-Japan high-level economic dialogue as well as a meeting with an Italian delegation. Xinhua news agency reported that Zhou told the PBC Party Committee Enlargement meeting on Aug. 30 it should “continue to implement justice and strengthen legislative work in the financial system.” Prior to this news, Zhou appeared at the 2nd annual conference of the heads of the Chinese, Japanese and Korean central banks held on Aug. 3, and his most recent public appearance was Aug. 10 for China’s Financial System Anti-corruption Construction Exhibition.

Zhou is known to have lofty political ambitions and is believed to be a close ally to former Chinese President Jiang Zemin, as well as a core figure for Jiang’s “Shanghai Gang.” There has been no shortage of rumors about Zhou’s possible dismissal in the past five years, as he is believed to be associated with several high-level financial scandals. For example, Zhou was rumored to be under “shuanggui,” a form of house arrest administered by the CPC, during the massive crackdown of Shanghai Party Secretary Chen Liangyu in 2006, which was perceived in the country as a crackdown of the Shanghai Gang and part of President Hu Jintao’s effort to consolidate power ahead of the 2007 power transition. There was also a rumor that he might have been detained following the investigation and arrest of Wang Yi, the vice governor of the China Development Bank, along with several other officials in the financial circle. Currently, several financial scandals are still under investigation, and it is likely that Zhou, as PBC governor and one of the most powerful economic players in the country, could be associated with some cases. Therefore, whether or not the rumor is true at this time, the leaking of this news is very likely to be associated with a power struggle within the Communist Party’s economic hierarchy.

 

[TheWrathOfGrapes]

This is important as if you miss your numbers you either get imprisoned or executed.

Maybe he is hanging out in an HDB flat in Yishan?

Such an efficient system they have in China, don't you think? All policies and business plans are implemented and executed.  Maybe you should introduce this system to Australia?

And where is Yishan? The PBoC governor must be hiding in some mountain range next to Huangshan?

http://en.wikipedia.org/wiki/Mount_Huang

And yes $430 billion is indeed small change when you have foreign reserves of $2,422 billion and won't cause any trouble at all.  Seriously Kubes, you must eventually learn how not to see the tree for the forest. Look at the big picture. BTW, Australia's external debt is ONLY $920 billion.

[ZR]

What's all these compared to the US 200 trillion plus USD deficit.
If you are to book those responsible, probably could fill  them
up in a whole prison.
Everyone seems to be dancing and skirting around this issue.
Uncle Sam will as always have the last say and dictate and
command. They are one up over the rest as usual.
Ask Max Keiser and Stacy Herbert for more details.

[impossible]

This is nonsense. If this man has left the country is can't be because of losses on US Treasury holdings. They have rallied strongly for years and China has tons.

More like he has just gone on holiday.

[unless]

of course he hedged a portion of the portfolio..and the loss is in the hedge

[Tereerer]

Another disinformation campaign that was quickly latched on by the ever predictable Cube. Here's what happened:

China denies central bank chief fled over bond loss reports
    
    BEIJING, Aug 31, 2010 (AFP) - China on Tuesday denied rumours that the country’s central bank governor Zhou Xiaochuan had fled after the bank posted huge bond losses, a report said.
    Several Chinese websites reported Monday that the People’s Bank of China had incurred a 430-billion-dollar loss on bonds from US mortgage giants Fannie Mae and Freddie Mac and that Beijing might punish some people including Zhou.
    The websites cited the Ming Pao Daily as their source, but the Hong Kong newspaper denied publishing any such articles, Dow Jones Newswires reported.     The reports fuelled rumours among Chinese Internet users that Zhou had left the country.
    “They say that Governor Zhou has fled...,” said central bank deputy governor Hu Xiaolian. “But in actual fact Zhou was chairing a PBOC meeting.”
    Chinese shares were down 0.44 percent in afternoon trade.
    “Usually market volatility is in response to economic news, data or analysis. People will speculate on such factors. But to speculate on this sort of thing is extremely abnormal,” Hu said.
    The central bank was at pains to prove Zhou was at work, issuing two statements Monday with photos of the PBOC governor meeting with a Japanese official and a former Italian official.
    The Ming Pao Daily said its “editorial department clarifies that it hasn’t made any such report, and it strongly condemns the act of using Ming Pao’s name to spread false information.”
    The newspaper said it had reported the incident to the Hong Kong police and mainland authorities.
    The central bank declined to comment on the report when contacted by AFP.
  

[well they]

well they would say that, wouldn't they?

[Yes, but]

well they would say that, wouldn't they?

Sure, they will say what is best for them, but there is proof that the Chinese authorities and Ming Pao were correct and that the initial story was false.

This is a perfect example of media manipulation. Circulating a false story is almost as damning as circulating one that is true. The initial story, true or not, is already in the public consciousness. We were quick to believe it because it satisfied our existing prejudice. Once it's proven false, we are equally quick to justify the media's error, and our own error in believing it, by our opinions that it could very likely have happened even though it actually didn't.

This is the way Fox News operates.   

[absolutely]

This is the way Fox News operates.   

Ditto Kubes.

[Stinko]

This is the way Fox News operates.   

The expressions on the faces of the people of Fox News
reveal it all. They are of the one-track close-minded type
only concerned with their own narrow agenda and interests.


Ditto Kubes.

[wazzziz]

I am watching this right now.   There is a lot of hot rumours going around and its not to be taken lightly.  I have one friend who is really clued up on the situation up there in China.  I will be seeing him on Friday and will get the scoop.  It is a bit scary when you hear stuff like this.

[to wazziz]

Do you know anyone who is not clued up or in the know?

Personally when I meet friends we talk about things like football and girls, you know like normal people. Meeting you must be a blast.

[NorthKorea]

I heard that In North Korea the central bank governor receives regular beatings. If he could go on the run im sure he would, but it isn't as easy as that.

[wazzziz]

Do you know anyone who is not clued up or in the know?

Personally when I meet friends we talk about things like football and girls, you know like normal people. Meeting you must be a blast.

My life outside of home ?  Yes I do hang out with a lot of my contacts - networking is the way things work out here.

When we go out for a beer, we dont talk about finance all night long, some talk about girls, golf, country clubs, sentosa (the playground of the biggest names in finance and the richest people in asia) cars (who doesnt like to talk about cars). Sentosa is usually the hottest topic.

But yes often the conversation does turn to money, property, shares, EM's, global funds etc you name it.  As a rule, the more beer that we drink, the less we tallk about the serious stuff.  If you have ever had a karaoke night out with property agents, you will know what I mean.

Now back to the thread subject matter - if things in China are looking shaky then we may feel some effect here perhaps a slight softening of the market but hey look, lets not get too carried away until we get the facts.  I havent caught up with the boys yet, but I shall get the full story from them.  I am talking here about guys who work up there and live there half of the year and wheel & deal in all sorts of stuff. I have one buddy called The Hedgehog and well known in the financial industry..he loves football, girls, fast cars and what he doesnt know about hedge funds just aint worth knowing.

Just now personally I am watching what is happening in North America.  One of my friends gets back from NY this weekend as well come to think of it..

[Treasure Chest!]

You write some stupid stuff, but this is a gold mine!

You meet "contacts" for beers and "networking" and "Sentosa is usually the hottest topic", because it's "the playground of the biggest names in finance and the richest people in asia."

I am glad you will get "the facts" and "the full story" from "the boys" because they "wheel & deal in all sorts of stuff".  We're all on the edge of our seats about what secrets "The Hedgehog" will reveal, and of course your mate arriving from New York about "the situation in North America."

Seriously, are you working out a sitcome character here?  You're someone's comedy creation, right?  A goofy self-important persona with no job who says airy things like "we may feel some effect here perhaps a slight softening of the market"...am I correct?