Things started getting very difficult with the internet about six months ago as the great firewall got tighter, but in the past few weeks internet access has been far more frustrating than it has ever been during my over six years living in Beijing. It takes me hours (literally) to post anything on my blog. [...]
Golfers prevented from making speculative profits on the RMB
Mar 27th, 2008
A while back on one of my earlier postings I wondered whether one of the first acts of Wang Qishan, the country’s new economic czar, might be the try to reduce capital inflows by more rigorously enforcing capital controls. I really didn’t think this kind of administrative response to a monetary problem would be likely [...]
China’s monetary trap
Mar 26th, 2008
Scattered throughout this blog are references about the way I view China’s currency regime, why I believe monetary policy is out of control, why I have insisted since 2003 that China’s trade surplus and foreign exchange reserves could only grow, and why I claim that the authorities are increasingly going to have to consider a [...]
Deconstructing Chinese inflation
Mar 25th, 2008
Like most people I have been looking at CPI inflation in China as a year-on-year number, which is the headline number most widely discussed and reproduced. The problem with this particular number, of course, is that it eliminates the sharp monthly fluctuations and smoothes out the data to such an extent that it is a [...]
Today’s China Daily quotes remarks made by a senior advisor to the PBoC on RMB stability and the need to fight hot money inflows, which he delivered at a conference held over the weekend (“Advisor: China needs stable yuan to fight hot money”). I thought his comments were very interesting: China needs a relatively [...]
How do you turn this thing off?
Mar 21st, 2008
According to Market News International Chinese foreign exchange reserves hit $1.6471 trillion at the end of February. This means that foreign exchange reserves rose by a surprising $57.3 billion over the month of February (actually I am lying – none of these numbers surprise me anymore). In January reserves were up officially by nearly [...]
Tax repeal rumor caused a rebound in Shanghai
Mar 20th, 2008
Yesterday I noted that there were lots of rumors in the market of a cut in the stamp duty as a way for the government to prop up share prices. In my posting I wrote: Earlier last week Minister of Finance Xie Xuren said public discussions about cutting the stamp duty had been noted [...]
Minimum reserves up. Stamp duty down?
Mar 19th, 2008
Yesterday I had to join some friends from New York for dinner, so I left my office earlier than usual. While I was away and after the market had closed the PBoC sneaked in another 0.5% hike in minimum reserve requirements – their second hike this year, after ten hikes last year (all except one [...]
In his press conference today for the conclusion of the annual session of the NPC, the country’s top legislative body, Premier Wen smiled bravely at the attendees and television cameras and said that the government is fully confident that they can control inflation this year, although he admitted that it would not be an easy [...]
Some numbers on Chinese demographics
Mar 13th, 2008
A friend of mine sent me the following table. It comes from a paper presented at the September 2007 International Conference on the CCP’s 17th Congress by Daniel Xu and Ning Ding (“Distortion of Population Growth and Pressure on Employment”) and shows the number of people, in millions, entering the job market in China every [...]
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