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monetary policy exit mechanism

Just 20 mins ago, I read a news subtitles under CCTV, which said england will think about monetary policy exit mechanism, it confused me, because I just read a report from reuters.com which said england add £ 50,000,000,000 to support “Quantitative easing program” .

Actually , I read a chinese report from cfi.net.cn which said The Central Bank Of China is talking about the monetary policy exit mechanism. The report said  somebody think there are a obvious sign of economy recover, and finical crisis nealy ended.

I very trust CCTV, but these information shown different way , it really confused me. But from my eyes, there are more important problem then about will england add or reduce money from the market. This problem is Efficiency Of Monetray Policy . I read many report said in england or USA, The bank do not hope give factory loan , do not hope give people loan to support house and custom , but these bank had accept many many money from country and people to pass “THEIR CRISIS” . But the result is these bank take money from people , but not return money to people , The multiplier effect of monetary stopped, at the same time, these bank distribution of high salary to their staff in the “PEOPLE’S CRISIS” . Now the controler just take people’s money to support self-service , but many many people lost job and living the street .  If these bank can not support the goal to help factories and woker, why we give money to them? From Greed to Fear, it just only 8 months. I believe the bank system should not only pay attention to owner’s profilt, but also the bank system should pay attention the “Social Responsibility”. If these bank can not support social responsibility, the center bank should build another way to support the facorties.

OK, In china, also I think the most important problem is employment ,we should let demographic dividend be a good thing, not a burden, many people born after 1949, from 40,000,000 to 1,300,000,000 , just a short time! The first baby borned in 1949 will retirement in this year , and in a short time, china will have many many old people…..

China can not only depanded export or depanded Houst to support today and feature, we must change our model of economy growth, we must let people can get house in 5 years , not 30 years, we must let young people become worker and customer, not unemployed youths . The money should been use build the jobs, not used to support house price.The focus of monetray policy should changed to increase the job , change the structure of economy, let university graduates become researcher and high-tech workers, not unemployed youths or nanny. The focus is not amount, The focus is efficiency! Do not waste valuable asset to build a “Asset bubbles” , we should let people easy to get house and easy to get job, let china become more civilization and more high-tech, realease the power of creative ability in china people, not help a littler people get more money, that is not the goal of reform.

Guan Zhou–the rent of office fell to the level in 2005

Guan Zhou , is the one of the leader area of china reform, the beneficiaries of Industrialization, he rent of office feel to the level in 2005 because financial crisis, the vacancy rate is keeping rise up.

In next year, there still have more than 570,000 SQ new office offer to the marker, it make some company begin move from old office to new office, because new office is more cheap and more beautiful.

It is not the Isolated incident in china, the rent of office in BEI JING is still fell too, and in japan, the rent of office of Tokyo is feel also.

At the same time, the price of residential rise up 30% in last months, it is very strange.

BYD, a new tiger

Today , the price of the leader of chinese electric cars company — BYD rise up 9.55% . BYD’s goal in electric cars area is become the biggest company before 2015 year and become the NO.1 in the global before 2025 , for this goal, BYD begin purchase some good company in china and build them as base of electric cars, last week, BYD purchase the “SAN XIANG” company in HU Nang, China, and then BYD will invest more than 3 billion YUAN to ensure the base will reach at least 30 billion yuan output value in 3 years. And, BYD is still increase the product capability in other base.

Although the fiest electric car–”F3DM” juse sale out 19  in HONG KONG and SHEN ZHEN, but BYD is really a new tiger , the goal of this year of BYD is sale out 400,000 cars, it seems it is very easy to reach.

China export: continued to decline

In the first half of this year, Chinese export is continued to decline, The amount of export of the first year is 521.53 billion U.S. dollars , which dropped 21.8% . This is the eighth months the amount of export keep decline.

Because the demand is still decline, some chinese company begin sale their goods to demostic customer,I saw a toy which can talk with baby, it suprised me, I did not saw this kind toy in chinese market before, many friends have the same view with me, it really a good news for chinese customer, CCTV reported the owner of this company said becuase the price of export is far away higher then demostic market and many demostic compamy have a strong capability to study and research, they do not sale it in demostic market before. About the price, some exporter face the competition, I heared many of then had to offer a lower price to foreign customers, it is really a hard work to find who have an order in the hand and also have money in the hand, Many chinese company select close the facotory in a short time, so the owner can keep money in the hand and keep the chance for the future.

Face the tough competition, chinese government taken some measures to help these company, some of them found it is more easy to get loan, In chinese eyes, we  did not take trade protection to solved the problem,the imports still keep 424.6 billion .U.S dollars , and china begin took the initiative in international organizations to face the trade protection measures , not select trade protection too.  Last weeks, China has asked the World Trade Organisation to probe a U.S. ban on Chinese poultry imports and has filed complaints about EU anti-dumping measures against Chinese fasteners. I read a review of a england reported said: china begin to participate in the institutions which controled by Western.

The above chart(China Customs) is the imports and exports data from 2007-10 to 2008-10,we can found the amount of the trade had a big reduce since the beginest month of the decline.

Chinese shares drop down 5 percent today

Today, chinese SHANG HAI stock marker drop down 5 percent , in afternoon, there are even a 7% drop down happened. At the end , SHANG HAI Index closed at 3266  which eat the rise up in last week, this is the most drop down in last 8 months.

Before today, a new share listed in SHEN ZHEN GEM, which been   pushed to 7 tims of the price of IPO, but today when a huge share –”Chinese Architecture” listed , it’s price drop down the price of IPO, this is chinese market,  a hot and a cold market at the same time.

Today, PE of Shang HAI is 28 and PE of SHEN ZHEN is more than 40, the price is really too high, because it is far away from the AVG of the global market, although the number of china gdp looks good, but Overcapacity is really a problem need to solved, if the economy of global can not rise again, Overcapacity will begin a big problem for china.

In a short time, chinese shares rise more than 100% , the drop down is a revise for the trend of the first half of year. Investor or Speculation? It seems select Speculation maybe a good choice for short term.

On the other hand, if stock market drop down , maybe somebody which like Speculation will begin speculate house market, it is not a good news for chinese people.

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China’s futures market,somebody happy and somebody sad

Yesterday evening, LME copper (three months) create the record of the year, closed at $4600 , the records in the history is $8940 in last June.  Today, ShangHai copper (3 months : 0911 ) open at 44600 YUAN  and closed at 44830 YUAN, the voloum is 833,398 . With the good data of economy published ,  there are still an atmosphere of optimism, but although the volume is keep in a high level, but   it seems there are somebody are selling , somebody get the profit from the current trend .

At the same time, Soybean future market got a cold, the Department of Agriculture in  U.S.  said soybean crop growing good, There are some report said some fund is still sale out their own Soybean future shares, In china , the first auction of soybean is failed, nobody hope buy soybean in current price , 0 voloum .

In China’s futures market somebody happy and somebody sad , but the current trend is decided by the amount of funding, not a strong basic economy, I think keep a mind of it is very important .

After several failures, china government bonds issued success

Yesterday, China’s 15th government bond finally started trade.  The bond is fixed-rate bonds with a period of 3 years and 2.22% nominal interest rate. Before it, there are three consecutive times failure of the issuance of treasury bonds.

MR market.china is worry about the inflation, he is also doubted with the policy concerns of the central bank of china, this cause the yield of the short-term government bonds rapid rise,just look the picture of the right ,it is the INDEX OF CHINA BOND.  Also, this caused three consecutive failed bonds issue. And, China’s Ministry of Finance was forced to postpone the four local debt issuance.

I think we should pay attention to the signal of the failure of the bond issue, which indicates that the MR market’s expected is reversing, and there are some problem in the loan structure of these banks. Now the amount of the loan is create and creating the record of  china , we must pay attention to the efficiency of these loan , is it to the factory and family? Or it just been used to invest house? just like chinese idiom said: overkill.

At the same time,China’s investment in government bond  of the United States broke the 800 billion U.S. dollars  now, continue to be the largest investor in the bond market of USA. At the same time, the “bond king”  Bill Gross is still sale out their own bond of USA, Gross managed the size of 161 billion U.S. dollars of funds,the holders of government bonds from 28% (March) , reduced to 24% (June) , Holders of mortgage debt assets  from 61% (May) to 54% (June) , it is the lowest level over the past two years. At the same time, Japan, Russia and many other countries are selling their U.S. Treasury bonds. At the same time, we are still buy and buy, more and more.

Gross warned investors care of the risk with dollar-denominated assets earlier in a television interview, now every American currently has 40,000 U.S debt, Chinese investors are very worried that our depreciation of the investment in USA. And many chinese people is worry about Clinton’s action, she is still tell the world and China’s neighboring areas , china is a threat , some observers of china said, business just is business, if we just use business profit to face the pressure of Clinton, if we just help USA but ignore the voice of ” china threat” theory. we will failed.

China must guard against asset bubbles

Last CCTV reported,the price of an apartment in Bei Jing increased by 60% in few months, from 13500 YUAN /square meters to more than 20000 YUAN/square meters, it means 2950 U.S. dollars / square meters, or let’s say 275 U.S. dollars / square feet. In many better community area, it is normal for 30000 YUAN /square meters, or 4412 U.S. dollars / square meter , or 410 U.S. dollars / square feet, I know many villa saled in in Los Angeles, their price is 218 U.S. dollars /  square feet to 300 U.S. dollars / square feet, I feel very surprised !!And China’s housing is not property rights.  We know in BeiJing , many middle-class income is 500 U.S. dollars / month, it means a middle-class family muse save all money to paid the loan of house all them life!

At present,  many factory have not enough order ,and there are still many many migrant workers lost their job in city, the price of real estate is continuning rising, but the price of rental is still drop down. Such a background , the land prices and housing prices climbed crazy, it is new record in china history.  some senior official in some province said their salary can not support an apartment, some economists say if use their salary they will own a toilet in BeiJing.  Now the price of real estate is far away with people’s actual purchasing power.People had save all money for an apartment, and their don’t dare to spend money on other consumer goods. CCTV said yesterday, some business owners to closeing  factory, investing house, I think it is a big mistake. 30 years, these factory and works is the wealth of  chain reform, if them disapear in the bubble burst, that is the biggest loss for chinese people.

As we all know, Japan’s land and housing prices have been very expensive, but before 1990, suddenly, the house price just keep 20% of one year before, sub-loan crisis in USA, the crisis in the  Southeast Asia(1997) , the house price is keep a high level, but when the asset bubble burst , it dragged down the financial system and real economy . The central bank is not the ultimate, the people are. The price of asset can not be divorced from the actual bearing capacity of the people for a long-term,otherwise the reaction will play bad.

In this crisis, china should adjust the structure of economic,we must support medium-sized company, because them solved the most of employment problem. And these company is sensitive for the signal of price, interest rate. China should use more money to support high teconology company, and promote the real domestic demand , not number of GDP, it seems there are some part of money is wasted, CCTV reported yesterday a company get 27,500,000,000 loan from bank, we really need so high a price of house?loose monetary policy requires a risk assessment mechanism to enhance efficiency in the use of funds, and should be solving the employment and enterprise development, otherwise it is difficult and dangerous in long-term eyes. I said China’s gdp growth rate in the first half of the year, not bad, but we need the gdp growth is a long-term growth and people must get the profit from the growth, the budget of people is more important than gdp number.

The implementation of the policy can not be selectively implemented,cctv yesterday reported that some enterprises are long-term accumulation of land, there are a law bind this kind of business action , but no any one execution it, the problem is not only the execution power.

I born in china, I living in china, I loving china, I concerning the situation.

We should strengthen the monitoring of trends H1N1

16,July, WHO said “Changes in reporting requirements for pandemic (H1N1) 2009 virus infection”
The reason is “The 2009 influenza pandemic has spread internationally with unprecedented speed”, so “The increasing number of cases in many countries with sustained community transmission is making it extremely difficult, if not impossible, for countries to try and confirm them through laboratory testing”.
I think maybe this is a reality-based decision , But I think there still have some bug in WHO system , as we all know, last time when H1N1 virus– Spanish Influenza outbreak in 1918~1919,  there are more than 10 million people infected with the Spanish H1N1 Influenza in the worldwide, and it causeed 25,000,000 ~ 40,000,000 dead , at this time, the world’s population is about 17 million people.
OK, that’s what we known , but, some other fact is not get enough attention today, that is before  Spanish H1N1 Influenza outbreak in 1918, this virus had hidden in human being and pig more than 2 years! In this period , the virus fishish the process of gene evolution.
So , if we said now we are too busy to watching every case about H1N1 medical case of illness, maybe it is right , but under such circumstances, we need have another emergency model , what we need to do is not only change the ways of report.
I strongly recommended WHO build a Inspection Team to walking around the world to collection the trend of H1N1 in serious outbreak region and these area where have human dead case caused by H1N1, and the team need watching the region where big biological dead caused by H1N1.And the member of WHO should build a research team to promote the study of virology.

By the way, I read a news from England Medical Officer Liam Donaldson,he said to BBS, “Between 30 to 35% of people could come down with the virus this winter” , I think about “unprecedented speed” problem , some countries do too little , specify USA.

The picture is 1918 , Spanish nurses and dead man.We do not hope these things happen again, H1N1 caused by Human activity,we  should do more things for it

Perhaps China is lossing Australia, but Australia is also lossing of China

Some employees of Riotinto China recently  were accused of espionage and bribery in China have been detained staff survey, Australian Prime Minister Kevin Rudd said: the interests of the Chinese in Australia will face a crisis, and even other country’s economic interests  now also at the critical juncture.

Many chinese these words is no help for solved the problem,and in many chinese eyes:

1:We appreciate his determination to protect their own interests, but if used to treat and control the threat of another country, another country will make the feeling of stigmatization, this does not solve the problem.

2: After the incident, we see the opposition, the ministers and the Prime Minister published a number of hard-line speech, which insulted China’s surprising words. Australia immediately met with separatists in China, Australians will be an economic issue being politicized.

3: Australia considers that the ethnic Chinese-funded Australian politics is against the law and contrary to morality, but Australia is for the protection of bribes to the Chinese people and the theft of confidential relations between the two countries and tear

In the eyes of the Chinese people, Australia have a double standard and unfair for china.Australia some time ago said that China is a threat to Australia, so the development of huge amounts of money to use military power, many Chinese people feel very surprised and have a sense of crisis, Australians apparently forgotten, the history of Australia’s allegiance to the United Kingdom have sent troops into China territory to become the aggressor, the history of China has never been a soldier stationed in the territory of Australia. In the eyes of the Chinese people in Australia to allow the Japanese enterprises to control the majority of the shares, but investors Riotinto companies are in violation of the agreement the Chinese people, making China’s aluminum loss in the Bank of China ……

China is to learning how to integrate into the world, but Australia now told us that power is the best language. young people in chaina is the accumulation of these lessons in silence. Perhaps Australia may be the victory of today’s threats, but this was not the good thing for both of the country. Chinese people have been good for Australia, many people talk about the cute Kangaroo and Koala, Chinese people have been good for  the Prime Minister Kevin Rudd, many people think that he has the style Confucian scholar, when Prime Minister Kevin Rudd to talk about the market is not god, the Government should for social equity and appropriate interventions on the market, many chinese people think he is right. But now, Chinese people are talking about more power and a threat from Australia, many people think that a leader should be based on facts rather than the pressure to action. Perhaps China is the loss of Australia, but Australia are also being lost in China.