Chinese Plunge Protection Team Failing to Stem Stock Market Declines…(Brace For Impact!)

Thursday, July 30, 2015
By Paul Martin

by Bob Adelmann
TheNewAmerican.com
Thursday, 30 July 2015

In the last 30 minutes of trading on Wednesday, the Shanghai Composite Index jumped more than three percent, while the smaller Shenzhen Composite (equivalent to the U.S. Nasdaq index) leaped more than four percent. That this was the result of actions taken by China’s unofficial “plunge protection team” was obvious to Jacky Zhang, an analyst at BOC International: “Clearly it is government intervention again.”

China’s plunge protection team (PPT), equivalent to the U.S. stock market’s “Working Group on Financial Markets” set up under President Reagan following Black Monday in October 1987, has moved heaven and earth to keep its stock markets from collapsing. The team, made up of China’s Securities Finance Corporation and the China Securities Regulatory Commission, along with top officials from the country’s 21 largest brokerages and the Chinese central bank, has implemented an entire panoply of measures to stem the tide, including:

• Demanding that foreign banks wishing to continue doing business in China refrain from making any negative public comments about its stock market;

• Lending $42 billion to brokerage houses for them to use to buy stocks;

• Demanding that brokerage houses ante up some $20 billion of their own capital to purchase equities;

• Announcing new stimulus in the amount of $40 billion for infrastructure projects;

• Speeding up similar infrastructure spending already in the works;

• Allowing margin accounts already underwater to remain open despite sustaining margin calls;

• Demanding that the owners of China’s 300 largest corporations refrain from selling any of their stock for the next six months;

• Eliminating any new public offerings of stock;

• Cutting interest rates to new lows; and

• Allowing the yuan to continue to depreciate against world currencies in efforts to stimulate exports.

The Rest…HERE

Leave a Reply

Join the revolution in 2018. Revolution Radio is 100% volunteer ran. Any contributions are greatly appreciated. God bless!

Follow us on Twitter