Posts Tagged ‘Nasdaq’

LinkSwarm for July 14, 2023

Friday, July 14th, 2023

More Biden crime family news, Toast Tab burns diners, and a judge blocks the Biden regime censorship. It’s the Friday LinkSwarm!

  • Biden DOJ Indicts Whistleblower Prepared To Testify Against Biden Family.”

    Dr. Gal Luft, the “missing witness” from the Biden corruption investigation, told the NY Post last week that he was arrested in Cyprus to stop him from testifying in front of the House Oversight Committee that the Biden family received payments from individuals linked to Chinese military intelligence, and that they had an FBI mole who shared classified information with the Biden benefactors from the China-controlled energy company CEFC.

    “I told the DOJ that Hunter was associated with a very senior retired FBI official who had a distinct physical characteristic—he had one eye,” Luft said.

    That FBI official is widely believed to be former FBI Director Louis Freeh, who gave $100,000 to a trust for two of then-Vice President Joe Biden’s grandchildren in 2016 shortly before telling Hunter, “I would be delighted to do future work with you.”

    Now, Biden’s DOJ has charged Luft with failing to register under the Foreign Agents Act (FARA), as well as Iranian sanctions violations. He’s alleged to have conspired with others to act in China’s interest, including recruiting and paying a former high ranking U.S. government official to support policies beneficial to China.

    Democrats are turning the federal justice apparatus into banana republic keystone cops to hide their own crimes.

  • Speaking of Hunter: “How reckless Hunter Biden photographed himself driving at 172mph while behind the wheel of his Porsche en route to a days-long Vegas bender with prostitutes and pictured himself smoking CRACK while behind the wheel.” No doubt left-wingers will crow about how Hunter is “living his best life.” (Hat tip: Ed Driscoll at Instapundit.)
  • Federal judge blocks Biden’s censorship schemes. “Terry Doughty, a Louisiana federal judge, issued a preliminary injunction Tuesday blocking certain federal agencies and officials, including the FBI and the Department of Health and Human Services, from communicating with social-media platforms.” Good.
  • The U.S. Navy blocks Iran from hijacking two tankers.
  • Dispatches from The Biden Recession: “‘Something Just Snapped’: Consumers Panic Search ‘Pawn Shop Near Me.'”
  • Poland is sending Ukraine Mi-24 Hind helicopters. The Hind is getting pretty long in the tooth, but it was a tough beast in its day.
  • “I’m willing to make a bold prediction and say that by the end of October, Mr. Biden will withdraw his reelection bid, and California Gov. Gavin Newsom will be declared the Democrats’ most viable option for the presidency.” I think he’s wrong. I think they’ll try to have Newsom replace Biden at the convention.
  • Just another week in Baltimore: “30 People Shot, 2 Dead As Block Party In Baltimore Turns Into ‘War Zone.'”
  • CDC Altered Death Certificates to Remove ‘COVID Vaccine’ as Cause.”
  • Nigel Farage is being systematically unbanked.
  • Meta/Facebook’s new Twitter rip-off Threads is filled with “dark design patterns” created to thwart the user’s wishes. (That tip: Stephen Green at Instapundit.)
  • Black Georgia state rep defects from the Democrats to the Republicans over school choice.

    “When I decided to stand up on behalf of disadvantaged children in support of school choice, my Democrat colleagues didn’t stand by me,” [Georgia State House Rep. Mesha] Mainor explained of her decision in a statement to Fox News Digital. “They crucified me. When I decided to stand up in support of safe communities and refused to support efforts to defund the police, they didn’t back me. They abandoned me.”

    “For far too long, the Democrat Party has gotten away with using and abusing the black community,” she added. “For decades, the Democrat Party has received the support of more than 90% of the black community. And what do we have to show for it? I represent a solidly blue district in the city of Atlanta. This isn’t a political decision for me. It’s a moral one.”

  • Nasdaq rebalances.
  • The New York Times is doing such gangbusters business that they just laid off their entire sports department.
  • Garbage restaurant QR code menu app Toast Tab is now taking money directly out of your pockets for a “processing fee.” They’re a garbage company run by garbage people and I hope they go bankrupt.
  • For a mere $950,000, you own the home of the Butthole Surfers in Driftwood, Texas.
  • Happy Bastille Day! Here’s Jerry Pournelle’s timeless essay on the original event.
  • Hollywood Confused By New Movie That Depicts Child Sex Trafficking As Bad.”
  • Star Turn Doggy:

    (Hat tip: Ace of Spades HQ.)

  • Scenes From China’s Slow-Motion Collapse

    Tuesday, July 26th, 2022

    Remember the bank runs in China story after all those bank accounts in Hunan were frozen? I’ve been looking for signs of wider contagion amidst the Chinese banking sector, and mostly haven’t seen it. But I have seen a lot of other cracks appear in China’s overall economic system, so here’s a roundup.

  • One reaction to the frozen accounts: “Chinese Bank Run Turns Violent After Angry Crowd Storms Bank of China Branch Over Frozen Deposits.”

    A large crowd of angry Chinese bank depositors faced off with police Sunday in the city of Zhengzhou, and many were injured as they were taken away, amid the freezing of their deposits by some rural-based banks.

    The banks froze millions of dollars worth of deposits in April, telling customers they were upgrading their internal systems. The banks have not issued any communication on the matter since, depositors said.

    According to Chinese media the frozen deposits across the various local banks could be worth up to $1.5 billion and authorities are investigating the three banks.

    On Sunday, about 1,000 people gathered outside the Zhengzhou branch of China’s central bank on Sunday to demand action; they held up banners and chanted slogans on the wide steps of the entrance to a branch of China’s central bank in the city of Zhengzhou in Henan province, about 620 kilometers (380 miles) southwest of Beijing.

  • China’s communist government reacted to the protests with their usual tact and understanding:

  • Also, it looks like the province suddenly had an outbreak of Flu Manchu, forcing protestors to stay at home. What are the odds?
  • But it looks like some of them will finally get some money back:

    (Plus more on the property slump.)

  • The official line on the Hunan account freeze: “Henan police said in a statement on July 10 that further investigations showed that, since 2011, a criminal group led by a suspect named Lu Yi had gradually taken control of several rural banks, through companies including the Henan New Wealth Group, to illegally transfer out funds. The police said they had arrested more suspects and seized more assets involved in the case.” I have no doubt the aforementioned were probably guilty, but I bet a whole lot more bank officials, regulators, and CCP officials (to the extent that those are separate groups and not mostly-overlapping Venn circles) were in on the scheme, plus a whole bunch more in dozens of other schemes that siphoned off depositor money into various pockets and a host of entirely different schemes. As I’ve said before, it’s smoke and mirrors all the way down.
  • Another thing driving unrest: “Rotten tail buildings,” that is residential buildings on which all construction is stopped, but for which those with mortgages for individual units are still expected to pay for:
    

  • The Result? Disgruntled homebuyers are refusing to pay their mortgages.

    A rapidly increasing number of “disgruntled Chinese homebuyers” are refusing to pay mortgages for unfinished construction projects, exacerbating the country’s real estate woes and stoking fears that the crisis will spread to the wider financial system as countless mortgages default.

    According to researcher China Real Estate Information, homebuyers have stopped mortgage payments on at least 100 projects in more than 50 cities as of Wednesday, up from 58 projects on Tuesday and only 28 on Monday, according to Jefferies Financial Group Inc. analysts including Shujin Chen.

    And that was over a week ago.

    According to Citi analysts, average selling prices of properties in nearby projects in 2022 were on average 15% lower than purchase costs in the past three years. Meanwhile, it’s only getting worse as China’s home prices fell for a ninth month in May, with June figures set for release Friday.

    The crisis engulfing Chinese developers is reaching a new phase, with a debt selloff expanding to firms once deemed safe from the cash crunch, including investment-grade names such as Country Garden Holdings, the largest builder by sales.

    The payment refusals, which come at a time when China’s economy is set to post what may be a negative GDP print due to the latest economic shutdown over Xi’s catastrophic zero covid policies, underscore how the storm engulfing China’s property sector is now affecting hundreds of thousands of average citizens, posing a threat to social stability ahead of a Communist Party Congress later this year. Chinese banks already grappling with challenges from liquidity stress among developers now also have to brace for homebuyer defaults.

    As a result of the unprecedented push for a debt jubilee, shares of China’s banks extended their recent decline Thursday, with the CSI 300 Banks Index falling as much as 3.3% before closing down 2.2%. A Bloomberg Intelligence index of Chinese developer stocks slid as much as 2.7%, even though Chinese lenders were quick to try and dispel fears that the movement could crash the economy: according to Bank of Communications, its outstanding balance of overdue mortgage loans linked to housing projects with risks of delayed delivery is 99.8 million yuan, accounting for 0.0067% of its domestic housing mortgage balance. The bank added that its housing mortgage loan quality is stable and risks are controllable, the Shanghai-based lender says in an exchange filing. At the same time, Postal Savings Bank of China says its overdue mortgage loans linked to halted housing projects is 127m yuan, and risks are controllable. Of course, it’s not like Chinese banks would ever lie, now is it?

  • There are some signs that the cracks are spreading.

    The Great Debt Jubilee is picking up speed: China’s homebuyer mortgage boycott, which prompted Beijing to scramble to avoid a potentially devastating crash in what is the world’s biggest asset is spreading, and according to Bloomberg, some suppliers to Chinese real estate developers are now also refusing to repay bank loans because of unpaid bills owed to them, a sign that the loan boycott that started with homebuyers is starting to spread.

    In a jarring case study of what happens when a ponzi scheme goes into reverse, hundreds of contractors to the property industry complained that they can no longer afford to pay their own bills because developers including China Evergrande Group still owe them money, Caixin reported, citing a statement it received from a supplier Tuesday.

    Similar to homebuyers who have taken a stand and refuse to pay for properties that remain uncompleted, one group of small businesses and suppliers circulated a letter online saying they will stop repaying debts after Evergrande’s cash crisis left them out of pocket.

    “We decided to stop paying all loans and arrears, and advise our peers to decline any requests to be paid on credit or commercial bill,” the group said in the letter dated July 15, which was sent to the developer’s Hubei office. “Evergrande should be held responsible for any consequence that follows because of the chain reaction of the supply-chain crisis.”

    As Bloomberg oh so perceptively puts it, “the payments protest is the latest sign of how a movement by homebuyers to boycott mortgages on unfinished homes in China is spreading to affect other sectors in the economy.”

    Yes it is, and it’s also why Beijing should be freaking out (if it isn’t), because what is taking place in China is far worse than what took place in March 2020 when the global credit machinery ground to a halt, only back then it’s because there was no other option, now it’s a voluntary development and not even fears of reprisals from China’s ruthless, authoritarian, Lebron-beloved dictatorship is stopping millions of people from calling for a systemic boycott, one which can topple China’s entire $60 trillion financial system in moments.

    Probably an overstatement, just because it takes a whole lot to overcome the inertia of the average Chinese citizen just wanting to keep their head down and not be the nail that sticks up.

  • Speaking of Evergrande, the rats there continue to flee the sinking ship.

    Embattled Chinese real estate giant Evergrande is expected to deliver a preliminary restructuring plan this week, following the exit of two bosses.

    The firm says its chief executive and finance head have resigned, after an internal probe found that they misused around $2bn (£1.7bn) in loans.

    Chinese businessmen misusing funds? Try to contain your shock.

    Evergrande has more than $300bn in liabilities and defaulted on its debts late last year.

    The crisis has spooked traders who fear contagion in China’s property sector.

    On Friday, Evergrande said it found that chief executive Xia Haijun and chief financial officer Pan Darong were involved in diverting 13.4bn yuan ($2bn; £1.7bn) in loans secured by its property services unit to the wider group.

    The firm said in a filing to the Hong Kong Stock Exchange that Mr Xia and Mr Pan had resigned because of their “involvement in the arrangement of the pledges”.

    Getting caught trying to cook the books even after it’s hit the fan. Classic Chinese management.

  • “Some big-name Chinese stocks including Alibaba Group Holding Ltd. and Baidu Inc. face the prospect of getting kicked off the New York Stock Exchange and Nasdaq if they refuse to let U.S. regulators see their financial audits.”

    The U.S. Securities and Exchange Commission has started the process, compelled by a 2020 law, and investors have started to pay attention. So has China, which moved to potentially clear a big hurdle that stymied U.S. regulators for years.

    1. Why does the U.S. want access to audits?

    The 2002 Sarbanes-Oxley Act, enacted in the wake of the Enron Corp. accounting scandal, required that all public companies have their audits inspected by the U.S. Public Company Accounting Oversight Board. According to the SEC, more than 50 jurisdictions work with the board to allow the required inspections, while two historically have not: China and Hong Kong. The long-simmering issue morphed into a political one as tensions between Washington and Beijing ratcheted up during the administration of President Donald Trump. The Chinese chain Luckin Coffee Inc., which was listed on Nasdaq, was found to have intentionally fabricated a chunk of its 2019 revenue. The following year, in a rare bipartisan move, Congress moved to force action.

    2. Where does it stand?

    As required by the law, known as the Holding Foreign Companies Accountable Act or HFCAA, the SEC in March started publishing its “provisional list” of companies identified as running afoul of the requirements. While the move had long been telegraphed, the first batch of names fueled a sharp decline in U.S. shares of companies based in China and Hong Kong as it dashed hopes for some kind of compromise. In all, the PCAOB has said it’s blocked from reviewing the audits of more than 200 of those businesses. The companies say Chinese national security law prohibits them from turning over audit papers to U.S. regulators. SEC Chair Gary Gensler said in late March that the Chinese authorities faced “a hard set of choices.” Days later, China announced it would modify a 2009 rule that restricted the sharing of financial data by offshore-listed firms, potentially clearing one obstacle.

    3. What is China changing?

    The China Securities Regulatory Commission said the requirement that on-site inspections should be mainly conducted by Chinese regulatory agencies or rely on their inspection results would be removed. It said it would provide assistance for cooperation with foreign regulators. The CSRC said it’s rare in practice that companies need to provide documents containing confidential and sensitive information. However, if required during the auditing process, they must obtain approvals in accordance with related laws and regulations.

    4. What’s the broader issue?

    Critics say Chinese companies enjoy the trading privileges of a market economy — including access to U.S. stock exchanges — while receiving government support and operating in an opaque system. In addition to inspecting audits, the HFCAA requires foreign companies to disclose if they’re controlled by a government. The SEC is also demanding that investors receive more information about the structure and risks associated with shell companies — known as variable interest entities, or VIEs — that Chinese companies use to list shares in New York. Since July 2021, the SEC has refused to greenlight new listings. Gensler has said more than 250 companies already trading will face similar requirements.

    5. How soon could Chinese companies be delisted?

    Nothing is going to happen this year or even in 2023, which explains why markets initially took the possibility in their stride. Under the HFCAA, a company would be delisted only after three consecutive years of non-compliance with audit inspections. It could return by certifying that it had retained a registered public accounting firm approved by the SEC.

    6. How many companies will be affected?

    There’s not much discretion. If a company from China or Hong Kong trades in the U.S. and files an annual report, it will soon find itself on the SEC’s list simply because those have been identified as non-compliant jurisdictions. In the March interview, Gensler pointed out that the law focuses on non-compliant countries, rather than specific companies.

  • Up to 10,000+ rich Chinese are looking for a way to flee the country.
  • For that and other reasons, Beijing is looking to impose more controls to prevent capital flight.
  • What would a “China is screwed” roundup be like without a Peter Zeihan video?

    “Demographically they’re in collapse…China’s not even going to survive this decade. They don’t even have the numbers to try…China doesn’t have the naval capacity to secure markets and resources….Xi Jinping has enacted a cult of personality that is tighter than anything that has existed through Chinese history. It’s gotten so tight that no one wants to bring him information about anything…This is how countries die.” Plus: China doesn’t know how to store grain.

  • Some more Zeihanian deglobalization thoughts from Stephen S. Roach.

    The widely acclaimed globalization of the post-Cold War era is now running in reverse. A protracted slowdown in global trade has been reinforced by persistent pandemic-related supply-chain disruptions, ongoing pressures of the US-China trade war, and efforts to align cross-border economic ties with geostrategic alliances (“friend-shoring”). These developments tighten the noose on China, arguably the country that has been the greatest beneficiary of modern globalization.

    Of the many metrics of globalization, including financial, information, and labor flows, the cross-border exchange of goods and services is most closely tied to economic growth. Largely for that reason, the slowdown in global trade, which commenced in the aftermath of the 2008-09 global financial crisis and intensified in the COVID-19 era, points to a sea change in globalization. While global exports went from 19% of world GDP in 1990 to a peak of 31% in 2008, in the thirteen years that followed (2009-21), global exports have averaged just 28.7% of world GDP. Had world exports expanded on a 6.4% trajectory – halfway between the blistering 9.4% pace of 1990-2008 and the subdued post-2008 rate of 3.3% – the export share of global GDP would have soared to 46% by 2021, far above the actual share of 29%.

    China’s gains from the globalization of trade have been extraordinary. In the decade prior to China’s 2001 accession to the World Trade Organization, Chinese exports averaged just 2% of total world exports. By 2008, that share had risen nearly fourfold, to 7.5%. China had timed its WTO membership bid perfectly, just when the global trade cycle was on a major upswing. While the financial crisis took a brief toll on Chinese export momentum, the interruption was short-lived. By 2021, Chinese exports had surged to 12.7% of world exports, well above the pre-2008 peak.

    China is unlikely to maintain this performance. Overall growth of global trade is slowing, and China’s slice of the trade pie is under mounting pressure.

    The ongoing trade war with the United States is especially problematic. During the first phase of China’s export-led growth surge in the aftermath of WTO accession, the US was consistently China’s largest source of external demand. Largely due to former US President Donald Trump’s tariffs, that is no longer the case. By 2020, US imports of Chinese goods and services had fallen 19% below the peak levels of 2018. Despite rebounding sharply on the heels of the US economy’s post-pandemic snapback, in 2021, US imports from China remained 5% below the 2018 peak. Partial tariff rollbacks for selected consumer products, which President Joe Biden’s administration is apparently considering as an anti-inflation gambit, are unlikely to jump-start bilateral trade.

    At the same time, enduring pandemic-related supply-chain disruptions are likely to take a sharp toll on China and the rest of the world.Over the six months ending in April, a “global supply chain pressures index” constructed by researchers at the Federal Reserve Bank of New York averaged 3.6, well above the 2.3 reading in the first 21 months following the February 2020 onset of pandemic-related lockdowns, and sharply higher than the “zero” reading associated with the absence of supply-chain disruptions.

    This is a big deal for a world connected by supply chains. Global value chains accounted for more than 70% of the cumulative growth in overall global trade from 1993 to 2013, and China has enjoyed an outsize share of this GVC-enabled expansion. As supply-chain disruptions persist, exacerbated by China’s zero-COVID policies, pressures on Chinese and global economic activity are likely to remain intense.

    Mounting geostrategic tensions are the wild card in deglobalization, especially their implications for China. “Friend-shoring” in effect turns Ricardo’s efficiency calculus of cross-border trade into an assessment of the security benefits that come from strategic alliances with like-minded countries. China’s new unlimited partnership with Russia looms especially relevant in this regard. With China edging closer to crossing the line by providing support to Russian military efforts in Ukraine, the US has recently moved to impose sanctions on five more Chinese companies through its so-called Entity List.

  • You’ve heard about the ghost cities. Did you hear about the failed ghost developments that were built as weird, cheap imitations of western structures?

  • Is Xi Jinping in danger from a coup?

  • No doubt I’ve missed many other examples of cracks in China’s economic edifice. Feel free to share them in the comments below.