China asks local lenders not to lend to U.S.

aw hell

Hey OP. Link not working for me and I want to email this.

It's big. Huge. Telling.

heres where I found it



[link to www.tickerforum.org]

[link to www.marketwatch.com]

It's all over for Bushmerika now.

Ticker Forums are the shit

GAME OVER, arrest should start soon.



Life can be wonderful without credit, other countries do it so can we.

The Chinese government OWNS the U.S. government. But they don't have the reach the U.S. does yet, so it would still be unwise for them to jump ship.

But, they might not have a choice. IMO they would prefer to keep the status quo for a few more years or a decade or so.

void all Chinese bonds

imo this is serious...it could start snowball effect


you cant keep buying worthless forever..it has to stop

God is writing our headlines!

All it takes is money, lots of money, to maipulate the market. Could they be pulling strings to strangle the USA?

edit: "worthless debt"

we are so....fugged!

This is huge.

please PIN.....

DOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOMED.

keep bumping until a mod wakes up and pins this.

awwwww fucking hell things are unraveling so fast msm can't keep up. I have just spent the past 2 hrs flicking all thru the cable news channels I have and it's all repeats of McSame saying he won't debate, Obama saying he will and not much on Bush's speech. Usually when the Prez says a line or two they are all over it for a couple of hours at least. the Prez's eyes seemed very dead and his face didn't move much and it was scary to just see his lips moving and nothing else. Oh well it's been a long day. Maybe I am imagining things *shakes head from side to side*

US financial crisis impact could worsen: Chinese PM
25 Sep, 2008, 0253 hrs IST, AGENCIES

UNITED NATIONS: Cash-flush China weighed in on the US financial crisis Wednesday, with Premier Wen Jiabao warning that its international impact could become "more serious" and stressing the need for concerted efforts to contain the turmoil.

He indicated that China, the world's biggest holder of foreign reserves and second biggest holder of US treasury bills, was ready to help in an international bid to defuse the turmoil that has rocked financial markets across the globe.

"The ongoing financial volatility, in particular, has affected many countries and its impact is likely to become more serious," Wen told the UN General Assembly.

"To tackle the challenge, we must all make concerted efforts," Wen told the UN meeting at the tail end of his address, which touched on various issues, including a pledge to push ahead with reforms to fuel growth in the world's most populous nations.

US President George W. Bush, who is also attending the UN General Assembly, had telephoned Chinese President Hu Jintao on Monday to brief him about the financial turmoil and his administration's bid to stage a 700 billion dollar Wall Street bailout to stem the crisis.

Hu told Bush that China welcomed Washington's efforts to stabilize the US financial markets and hoped they succeed, according to Beijing's state media.

But as Wen spoke Wednesday at the United Nations, the Bush administration remained locked in a dispute with the US Congress over the massive bailout package aimed at buying distressed mortgages and mortgage-related securities from financial institutions.

Financial markets, including in China, have been volatile since the US crisis peaked this month, triggered by the bankruptcy of Lehman Brothers and a Federal Reserve rescue of insurance and financial giant AIG last week.

Wen hinted that China would help in any international bid to defuse financial contagion arising from the US crisis, saying this was not the time for "hostility" or "prejudice."

"So long as people of all countries, especially their leaders, can do away with hostility, estrangement and prejudice, treat each other with sincerity and an open mind, and forge ahead hand in hand, mankind will overcome all difficulties and embrace a brighter and better future," he said.

"China, as a responsible major developing country, is ready to work with other members of the international community to strengthen cooperation, share opportunities, meet challenges and contribute to the harmonious and sustainable development of the world," he said.

China has emerged as the world's largest and fastest growing holder of foreign exchange reserves, which totaled 1.8 trillion dollars as of June 2008, according to its central bank.

It has invested a large share of its reserves in US securities, which include Treasury debt, US agency debt, US corporate debt and US equities.

A Congressional Research Service report in January said China may be holding nearly 700 billion dollars in US securities as of June 2006, making it the second largest foreign holder of American securities after Japan.

Wen said given the global nature of issues threatening the world, including environmental problems, terrorism, diseases, natural disasters and financial troubles, "no county can expect to stay away from the difficulties or handle the problems all by itself."

[link to economictimes.indiatimes.com]

LOL.

Wen vs. Bush.

I feel sorry for our country. We never had a chance.

[link to economictimes.indiatimes.com]

Then they better get ready for the factory production orders to stop arriving from the US mainland. When everything stops so will the Chinese production machine.

GUYS THIS IS IT.

THIS IS THE BIGGEST STORY OF THE WEEK.

BIGGER THAN ALL THE PROPOSED BAILOUTS....

Pin this puppy! Unpin the "PETA Urges Ben & Jerry's To Use Human Milk" thread!

I'd say this is a wee bit more important :)

this is major news

Sad thing is, they are paying us to buy from them at this rate. It makes more sense for them just to keep it all to themselves now.


Mike

well heres an interesting snippet from the TF

this "Bam_Man" thinks China "made the phone call"
which could explain the motive for the bailout begging by Hanky and henry


see below :



"This Bam_Man guy makes an interesting observation:

Mish's Global Economic Trend Analysis

Bam_Man
Wednesday, September 24, 2008
4:34:06 PM

Most still seem totally baffled as to why this "bailout" is being rammed down the throat of the American people.

As far as the US Treasury and Federal Reserve is concerned, there are 16 VERY good reasons why this "bailout" MUST go through ASAP. They are:

BNP Paribas Securities Corp.
Bank of America Securities LLC
Barclays Capital Inc.
Cantor Fitzgerald & Co.
Citigroup Global Markets Inc.
Credit Suisse Securities (USA) LLC
Daiwa Securities America Inc.
Deutsche Bank Securities Inc.
Goldman, Sachs & Co.
RBS Greenwich Capital
HSBC Securities (USA) Inc.
J. P. Morgan Securities Inc.
Merrill Lynch Government Securities Inc.
Mizuho Securities USA Inc.
Morgan Stanley & Co. Incorporated
UBS Securities LLC.

These are the primary dealers in US Treasury securities. Between them, THEY PURCHASE THE VAST MAJORITY OF US GOVERNMENT SECURITIES SOLD AT AUCTION and then re-sell them to their foreign and domestic customers.

When they have a problem (like hopelessly impaired balance sheets), the US Treasury has a problem. The impaired balance sheets of many of the primary dealers is starting to hinder their ability to participate in Treasury auctions. This could lead to failed Treasury auctions in the very near future.

Anyone who is still puzzled as to the nature of the Wall St/Washington relationship needs look no further than this. This is the crux of the problem and the reason why the Treasury Department is forcing this bailout on the American people.



MethodMan
Wednesday, September 24, 2008
4:50:07 PM

@bam_man: good analysis. That's why I say if we really, really want to end this charade you have the power, at your fingertips, and it's so simple: just don't fund it. Don't buy treasuries.

Treasuries will be needed by the trillions to fund the bailout, and you buy them, you're supporting it, directly. Not only that, you are also voting for debt that future generations must service.

Now, the government can then choose to print. But that will end the game, permanently for them.




Bam_Man
Wednesday, September 24, 2008
4:58:56 PM

@MethodMan:

The amount of Treasuries purchased by individuals through the 'Treasury Direct' program is literally a drop in the bucket.

The primary dealers do the Treasury's 'heavy lifting' when it comes to financing.

Can you imagine Paulson sitting in front of a Congressional committee saying "We have to bail out the primary dealers at taxpayer expense so they can continue to participate fully in Treasury auctions"?

Not likely. Instead we get vague references to some sort of impending financial Armegeddon. Much more persuasive I think.


They are doing just what you suggested



MethodMan
Wednesday, September 24, 2008
5:07:37 PM

@Bam_Man: what I mean is through 401k/pension allocations. Banks have (had) this money to play with because they have retirement fund depositors. If BANKS had the same amount of customer outcry about "supporting the bailout with treasuries using my deposits" their tune would change very fast. If foreign banks see US buyers leaving, well, you have your auction failure and then some.

Bam_Man
Wednesday, September 24, 2008
5:29:16 PM

The whole point of this $700 billion 'gift' to the primary dealers is to keep the US Treasury bubble from bursting.

Even at today's ridiculous artificially low Treasury yields, the interest on the Federal Debt is over $400 billion per year.

This year's budget deficit was around $400 Billion. With next year's budget deficit expected to approach or maybe exceed $1 TRILLION, they will need to have the primary dealers be able to absorb an ADDITIONAL $600-$700 Billion.

Do you think they plucked that $700 Billion figure out of thin air?

Paulson's plan is to give the primary dealers $700 billion of balance sheet relief with the understanding that they replace DOLLAR FOR DOLLAR the toxic mortgage securities they offload to the Taxpayer with newly issued US Treasuries.

Makes getting through next year's "challenging Treasury calendar" a heck of a lot easier.

No Tin Foil required here. It is simply a matter of financing the Gubbermint.

Bam_Man
Wednesday, September 24, 2008
6:17:04 PM

@GoldmanSachs-

Jim Willie makes for entertaining reading, but he is W-A-Y out there.

This whole thing is about lining up financing for next year's HUMUNGOUS Federal Budget Deficit in advance.

The $700 Billion "gift" allows the primary dealers to handle $600-$700 Billlion more in expected 2009 Treasury issuance than they were able to do this year. They were able to handle $400+ Billion this year, so with $700 Billion of "help", they should be able to absorb the $1 Trillion next year.

This how you go about financing (or at least try to) a $1 trillion budget deficit without printing.

The real reason for this "bailout" is not that complicated and does not require any Tin Foil at all.

Can you imagine Paulson and Bernanke telling a Congressional Committee that we expect the economy to completely tank next year and that the budget deficit is going to approach or exceed $1 Trillion? And by the way we need you to help the Primary Dealers out with $700 Billion in balance sheet relief at taxpayer expense so that they can help us finance it.

No. They can't do that. So this is what we get. Vague references to "financial meltdown". It's not like they are out-and-out lying. Failed Treasury auctions will not produce pleasant consequences for anyone in the US.


Bam_Man
Wednesday, September 24, 2008
6:34:05 PM

My point is that this "bailout" is not part of some Wall Street conspiracy to loot the US Treasury and taxpayer. Sorry to spoil everybody's fun.

Rather, it is how the Treasury gets prepared to finance next year's gigantic budget deficit without printing.

I have said before that I am sure that the Chinese have already made "the phone call". The one where they say "You start printing and we start selling." This approach keeps them in the game.

The taxpayer gets benefits from this as well. Assuming the primary dealers get the $700 Billion in balance sheet relief and are able to absorb the $1 Trillion in new issuance next year, the taxpayer avoids a tax increase and interest rates stay low.




Bam_Man
Wednesday, September 24, 2008
6:58:48 PM

@sumdumguy asked:

"Why do we need primary dealers? Why not sell Treasuries directly at an open auction?"

Primary dealers insure that there is ALWAYS a COMPETITIVE bid for Treasuries and they distribute the Treasuries they buy to their customers throughout the world.

They serve as the Treasury Department's distribution network and insure that there is ALWAYS a RELIABLE and DEEP market for US Treasuries.

When it comes to meeting the funding needs of the US Treasury, they are INDISPENSABLE.

That is why this "bailout" must/will become law.


Bam_Man
Wednesday, September 24, 2008
7:06:07 PM

@BlindSight-

If I am correct in my assumptions, then this really is not a "bailout". The Treasury is helping its distribution network to get ready to handle a whopper of a budget deficit next year.

It is not a giveaway. The Treasury (and therefore the taxpayer) stands to get real benefits from this deal. Those would be NO NEW TAXES and a continuation of very low interest rates. Both these things are essential for there to be any chance for an economic recovery next year.

The thing that is giving people fits is that it looks worse than it really is.

Paulson and Bernanke get low marks for salesmanship.


Goldman Sachs
Wednesday, September 24, 2008
7:08:59 PM

@Bam_man

What if there is a boycott by foreign purchasers of treasuries (SCO, and perhaps Germany) such that the primary dealers are unable to finance treasury auctions? I mean, we need a net influx of $2 billion a day of foreign cash just to stay afloat already, right?

MethodMan
Wednesday, September 24, 2008
7:11:34 PM

"Failed Treasury auctions will not produce pleasant consequences for anyone in the US"

I would like to tell that to my credit card company when they fail to "buy" my credit line request of ten million dollars. Oh, shucks, you mean I will have to live within my means?

Funding this is refunding the credit bubble and malinvestment when it should have deflated. Doing this scheme, we push even more debt out against our nation's future prosperity. We set ourselves for an uncertain, even harder fall, when it could just be moderately painful now.



Bam_Man
Wednesday, September 24, 2008
7:16:33 PM

@GoldmanSachs:

If that were to ever happen (and it could) the primary dealers would be stuck with the US Treasuries. It is true that foreign appetite for Treasuries is not infinite.

In that case, this "bailout" would amount to yet another swap facility. The primary dealers would have essentially swapped their toxic MBS/CDO's for Treasuries. Not so bad for them.

Paulson and Bernanke are covering all the bases here. They are not evil or stupid. They are just lousy salesmen.

The Protocols of Zion in Modern English

A one page summary

[link to fourwinds10.com]