Free Homes, Money: Second-Tier Cities Fighting for Talent

iFeng: 二线城市发起人才争夺战 给钱给房给户口还不够
Recently, the provincial capital of Henan Province, Zhengzhou, "on the further deepening of the implementation of the reform of the household registration system," the proposed migrant workers in the city to participate in urban social insurance for two years, I and immediate family members can be settled in Zhengzhou City Center, College graduates, skilled workers, graduates of vocational colleges, returned overseas students and migrant workers into the town of rural demobilized soldiers settled restrictions.

In addition to Zhengzhou, after that, including Chengdu, Wuhan, Xi'an, Changsha, including the second-tier core cities, including the introduction of a generous talent policy, these second-tier cities like the agreement is like, focused on the "talent battle."

...Wuhan, "settled in the New Deal" is in the implementation of May 22, to stay in Wuhan entrepreneurial employment of college students, graduated within 3 years without the need to buy a house can apply for settled status, masters and PhD graduates can be directly settled; a month later put forward "support million College students stay in China employment. "

Changsha will be released on June 29, "Talent New Deal 22", the next five years will invest more than 10 billion yuan of funds to attract reserves of 1 million talent; to settle down and work doctorate, master, undergraduate, two years each year, Ranging from rental and living subsidies.

Chengdu on July 2 proposed "Rong bleaching plan", the implementation of "first settled after employment", the implementation of full-time undergraduate and above graduates with graduation certificate settled system; on all types of urgent need to pay talent "Rongcheng talent green card" and so on.

Within a few months, there are including Jinan, Nanjing, Hangzhou, Zhengzhou, Qingdao, Xiamen, Tianjin, Chongqing and other second-tier cities, also joined the "talent battle."


Dollar Analog Goes to the Wall

The dollar analog is approaching uncharted territory. The DXY has seldom fallen 5-months in a row outside of a bear market. The line in the sand is the support level for the 28-month trading range: 92.62 is the closing low and 91.88 the intraday low.

A breakdown would have major implications for the yuan, since it would greatly alleviate, if not eliminate, depreciation pressure.


The Decline of the University

From the Socionomics Institute:

Overgrown Ivory Towers

There’s a sense of growing unease in academia: University infrastructure is taking a hit.

“U.S. universities have been putting precious money toward financial aid, academic programs and gleaming buildings that might attract new students—neglecting aging electrical systems and leaky roofs. As a result, schools are staring down a deferred maintenance backlog that has topped $40 billion.” (WSJ)

To add insult to injury, many schools are beginning to miss annual enrollment goals, which have declined each school year since 2011. Meanwhile the annual earnings differential between a high-school graduate vs. a college graduate has been shrinking since 2000. In other words, the cost of college attendance ($1.3 trillion in collective student loan debt) is rising as the financial benefits of a degree are falling.

In his prescient study — published long before the recent spate of coverage regarding higher education’s potential demise — socionomist Alan Hall forecast a massive shift in society’s positive attitude toward higher education and the eventual collapse of the credit-fueled, government-supported education bubble. Hall’s analysis goes beyond linear economics to reveal what’s really behind the problems in universities today.

Learn more

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Poland Moves to End Communist Judicial System

Good luck finding an mainstream article that explains why Poland is reforming its judiciary. Almost every article is a one-sided condemnation of the Polish ruling party, labeling the move as an authoritarian power grab. What is the media trying to hide?

USAToday: Poland steps away from democracy, EU in judiciary reforms
However, many Poles support the current powers and actually say these reforms are a divorce from old communist judicial systems.

Tomasz Sakiewicz, the editor-in-chief of right-wing newspaper Gazeta Polska and a supporter of drastic judicial reforms, says these changes aren’t about controlling the judiciary.

“We want to change it, to reform because it comes from communist times,” he says. “It’s completely broken by corruption — a mafia system.”

Sakiewicz says most Poles think the courts need reform. An opinion poll in May found 63 percent of Polish citizens think the judiciary needs to make some serious changes.
The Poles are in the process of decommunization, following in Hungary's path.

Communism (progressivism) is the ruling ideology in the West though. Even the capitalists are against them.

FT: The EU has a moral obligation to act against Poland

WaPo is aghast: This is what the gradual erosion of rule of law looks like in Poland
During the 2015 campaign for parliamentary seats, PiS argued that failing to purge the judiciary of former communists and collaborators is a caricature of justice — and that the court system is precisely where communism remains entrenched.

PiS says it plans to “end Poland’s post-communist era” by transforming the court system. Poland’s court system is a complex four-level hierarchy with regional, district, appellate and the highest court. The Constitutional Tribunal stands separate from this hierarchy, evaluating the government’s legislation.
Poland's government is implementing a policy favored by the majority of the public. It is reforming an undemocratic institution filled with communist ideologues, replacing it with a more democratic system.

There is no real moral argument to be made. If Poland was progressive and reforming a judiciary stuffed with orthodox Catholics, the world media would be cheering the democratic reform, Poland stepping out of its past and into the present. Since it is communists on the losing end, and Catholics on the winning side, it is painted as authoritarianism.

All of this is taking place within the context of deteriorating social mood. The EU's response is to push Poland (and likely all of Eastern Europe) out of the union.

Guardian: Poland may be stripped of EU voting rights over judicial independence
The EU is on the brink of taking the nuclear option of stripping Poland of its voting rights in Brussels in response to plans by its rightwing government to “abolish” the independence of the country’s judiciary.

Frans Timmermans, the first vice-president of the European commission, accused Warsaw of seeking to put judges under full political control as he warned that the EU was “very close” to triggering article 7, a never-before-used sanction in the treaties that allows a member state’s voting rights in the council of ministers to be suspended.

Poland’s ruling rightwing Law and Justice party (PiS) has been in almost constant conflict with the European commission since it was elected. In recent weeks the Polish government has proposed a series of reforms that would give ministers power over the appointment of judges and members of the country’s supreme court.
The EU is still heading for a breakup.


One in Three Bavarians Want Independence

The Local.de: One in three Bavarians want independence from Germany, poll shows
While many stereotypes that foreigners hold of Germany - such as Lederhosen and Oktoberfest - actually come exclusively from Bavaria - local residents will note that the southern, alpine state often feels a world away from the rest of the country.

The state with its own dialect and cultural traditions even has its own independence movement party - the Bavarian Party - albeit less influential than separatist groups in places like Spain or Scotland.

But a new survey looks to bolster the Bavarian Party’s hopes for a true Free State of Bavaria (the state’s official title). A YouGov poll with Bild tabloid, published online on Sunday, showed that one-third of Bavarian respondents agreed that “my state should be independent from Germany”.

Turkey Still Stirring Up Trouble

ZH: Germany Warns Its Citizens: They Risk Arrest If Traveling To Turkey
Foreign Minister Sigmar Gabriel said Germany had revised its travel advice in the wake of the recent arrests of several human rights activists, including German national Peter Steudtner.

Steudtner “was no Turkey expert – he never wrote about Turkey, he had no contacts in the political establishment … and never appeared as a critic,” Gabriel told reporters.

He added that this meant that any German national travelling to Turkey could suffer the same fate.
ZH: Greek President Blasts Erdogan After Turkish Harassment: "Provocations Are Sign Of Weakness, Come & Get It!"
While Pavlopoulos’ helicopter was heading to islet Panagia, pilots received warning calls and threats from the Turkish armed forces. The Turks claimed the Greeks that they were flying in Turkish Flight Information Region. The Greek delegation ignored the Turkish warnings and the President landed safe in Panagia.

A day earlier, the Turkish armed forces called the Greek helicopters nearing the island of Rhodes to leave the area as “they were flying in a demilitarized zone” where such flights are forbidden. The Greek pilots did not respond to the callings from the Turkish side.

A little later, the Turkish side called on the pilots of Shinook to leave the area as they were flying inside “the Turkish FIR.” On board were President Pavlopoulos, Defense Minister Panos Kammenos as well as the military leadership of the country.

In one incident, the military helicopters transporting Pavlopoulos suffered radio interference from Turkey.

Wednesday morning, a pair of Turkish F4 fighter jets entered the Athens Flight Information Region at 10 a.m. between Lesvos and Lemnos and flew over the Fournoi islets at 8,900 feet.


China Ramps Up Central Planning

Bloomberg: Xi's Risk-Off Push Ripples Through China as Transition Nears
On Tuesday, Bloomberg reported that the banking regulator had told lenders to lower interest rates on wealth-management products, a popular vehicle for domestic savers, after yields in the $4 trillion industry jumped in past months. Officials also extended their campaign against risky overseas acquisitions, with conglomerate Dalian Wanda Group Co. coming under scrutiny after a deals spree.

...Some Chinese lenders received an order from the China Banking Regulatory Commission earlier this month to lower their rates on WMPs, according to people familiar with the matter. The requirement applies to on-balance sheet WMPs, which account for only about a fifth of the total market, according to one of the people, who asked not to be identified as the matter isn’t public.

...An editorial in the Communist Party’s People Daily newspaper on Monday pointed to the seriousness of the campaign, warning of potential "gray rhinos" -- a variation on the black swan events popularized during the global financial crisis, with the difference that the danger from a charging rhino is more immediate and the animals are less rare.


NBS Spins June Home Price Rise: At Least the YoY Number Declined

China's NBS had to spin the 0.67 percent national increase in home prices in June by showing the year-on-year increase for May 2017 was higher than June 2017. June's one-month rise was only slightly behind May's 0.74 percent increase.

Buying restrictions in the top-tier are working: the total price increase for the four an Xiamen was 0.06 percent of the national total. The seven second-tier "hot" cities from 2016 only accounted for 3.6 percent of the total.

New home prices in Harbin rose 1.6 percent, Chongqing 1.5 percent, Xiangyang 1.9 percent, Beihai 2.1 percent.

Existing home prices climbed 0.59 percent nationally. The top tier cities saw net prices declines, while the hot second-tier cities only accounted for 6 percent of the national increase. Beijing saw the largest decline, 1.2 percent.

NBS: 2017年6月份70个大中城市住宅销售价格变动情况

American Mood Sours

BI: Americans are less happy than they were 10 years ago — and money alone can't fix it
Americans were first asked that question in 2006, and in 2007 the US had the third-highest happiness results of 23 OECD countries. Today, that response is at its lowest point yet, ranking 19th of 34 OECD countries.

"America's crisis is, in short, a social crisis, not an economic crisis,"economist and Columbia University professor Jeffrey D. Sach wrote in a chapter of the report called "Restoring American Happiness."

Sachs mentions that while per capita GDP — an indicator used to gauge the economic health of a country — is rising, happiness is falling.

"The United States can and should raise happiness by addressing America's multi-faceted social crisis—rising inequality, corruption, isolation, and distrust—rather than focusing exclusively or even mainly on economic growth, especially since the concrete proposals along these lines would exacerbate rather than ameliorate the deepening social crisis," he wrote.
The scale of crisis is far greater than any time at least since the 1930s. Correcting these problems requires a decline in social mood because people don't reform until mood turns negative. Rising mood will increase the very problems that need to be fixed because diversity and immigration increase isolation, distrust, corruption and inequality. Social mood is in a bear market and the low lies in the future.

Chinext Falls 5.1pc on Regulatory Fears

China is deleveraging and trying to tighten. The Fed will start shrinking its balance sheet by December, maybe September. The ECB might start tapering. Japan is the ever-present fireworks factory in search of a match.


Fixed Asset Investment Rises 8.8pc in June

Fixed asset investment growth was 8.8 percent in June, enough to keep the YTD growth rate steady at 8.6 percent. Private fixed asset investment increased 7.2 percent YTD and 8.3 percent in June.

NBS: 2017年1-6月份全国固定资产投资(不含农户)增长8.6%
NBS: 2017年1-6月份民间固定资产投资增长7.2%

China Real Estate Investment Below Trend in June

Real estate investment ticked up from 7.4 percent to 7.9 percent growth in June, but this still slowed the YTD total growth rate to 8.5 percent.

Home sales (in yuan and area) and land sales both ticked up.

NBS: 2017年1-6月份全国房地产开发投资和销售情况

Chinext Plunges to New Bear Market Low

Price as of Monday morning.
CBBC: China reports 6.9% second-quarter GDP growth on year, topping expectations


Chinese Cities to Link Residential Land Supply With Population

iFeng: 楼市调控思路重大变化:“人地挂钩”加快一二线供地
Centaline real estate chief market analyst Zhang Dawei said that the past few years on the big cities are proposed to strictly control the border, reduce land supply, but now is to adapt to changes in population movements, increase the supply of land in large cities, "This idea is a major change in property market regulation."
What's the big idea? Linking land supply to population changes.
In the past for a long time, China's implementation of "control the size of large cities, and actively develop medium-sized cities and small cities," the small and medium-sized urbanization strategy, land supply to the three or four lines of cities tilt, and the population to the metropolitan area gathered trend divergence. As a result of this supply and demand mismatch, part of a second-tier urban land supply is insufficient, housing prices bubble serious, and three or four lines of urban land supply serious surplus, land waste, efficiency is very serious.

Therefore, the implementation of "people to hook" in order to communicate with the population of the situation and the actual needs of the match.

Held in December last year, the central economic work conference clearly to implement the people linked to the policy, according to the distribution of population distribution of land use indicators. To implement the responsibility of the local government, the real estate prices rose the pressure of the city to a reasonable increase in land supply, increase the proportion of residential land, make up the city idle and inefficient use.

Chinext Slides as Credit Growth Slows

And herein lies the rub: as we said one month ago, "fundamentally a ponzi scheme, this works without a glitch during rising markets but falling prices especially among small and mid-cap companies, have eroded the value of that collateral, raising the specter of forced liquidation - where lenders, often Chinese brokerages, make borrowers sell the pledged shares. Selling the stock adds more pressures on share prices, triggering a downward spiral."

But wait, there's more: while most Chinese companies pledged "only" their own shares to get loans, a handful of companies also used shares of the acquired companies as pledged collateral.

This is precisely what HNA Group did, which now faces not only growing regulatory scrutiny from Beijing that threatens to spook bond investors and raise HNA’s financing costs, but also send its shares plunging as holders are forced to liquidate even as most of the shares pledged to fund its buying spree are already declining, accelerating its demise. And, in an scenario that can only be dubbed as a "reverse rollup from hell" - on steroids and margin - one that would make even Valeant blush and snicker, if the value of its collateral, i.e. stock price, falls enough, HNA will soon be forced to sell its holdings to repay debt, thereby resulting in the disintegration of the company.
ZH: "A Reverse Rollup From Hell": China's "Boldest Dealmaker" Faces Margin Call Disintegration


Mortgages Down, Short-Term Corporate and Household Lending Up in June

Corporate borrowing (SOEs?) offset the drop in household borrowing in June. Mortgages fell to 31 percent of total lending, down from 41 percent in June 2016. July will be interesting. Last year, mortgage lending was more than 100 percent of total bank lending in July.
ZH: China Creates A Quarter Trillion In New Loans But Analysts Are Worried: "It's Not Enough"
Looking at the breakdown, corporate loans rebounded to CNY695bn from CNY609bn a year ago, with long-term corporate loans coming in at CNY578bn (year ago: CNY411bn) and short-term loans rising to CNY274bn (year ago: CNY198bn). Household loans remained strong in June, registering CNY738bn, compared with CNY712bn a year ago, of which short-term household loans rose to CNY261bn (year ago: CNY138bn). We note long-term household loans (mostly mortgage loans) slowed to CNY483bn, from CNY564bn a year ago. We continue to expect long-term household loans to soften given the PBoC's further guidance to commercial banks to raise mortgage rates and lower loan-to-value ratios recently.

M2 Slows Slightly in June, TSF Jumps

Headlines focused on the 12-month M2 growth rate of 9.4 percent, made possible by the June increase of 1.87 percent being below the June 2016 increase of 1.97 percent. The 3-month annualized M2 growth of 8.2 percent looks much slower, well below the year-ago 12.7 percent.
The increase in M2 wasn't offset by a rise in reserves. China's FX reserves account for 12.7 percent of M2.
Total social financing hit a new rolling 12-month high of 19.1 trillion yuan.

Reuters: China's June new yuan loans rise to 1.54 trln yuan, above f'cast
Chinese banks extended 1.54 trillion yuan ($226.9 billion) in net new yuan loans in June, well above analysts' expectations.

Analysts polled by Reuters had predicted new yuan loans of 1.2 trillion yuan, up from 1.11 trillion in May.
Reuters: China June total social financing rises to 1.78 trln yuan
iFeng: 中国6月末M2余额同比增9.4% 再创历史新低


Chinese Cities Boosting Land Supply: To Stabilize Home Prices or Raise Money?

Last time housing turned down, land sales collapsed. Top-tier cities want to boost land sales this time around, under the guise of stabilizing prices. But are they more interested in boosting revenues in case land sales collapse again? Also consider cities such as Beijing are limiting population growth and even relocating population into the surrounding province.

iFeng: 中国大城市开启大规模供地计划 有利于平抑房价
Shanghai, Beijing, Shenzhen, Fuzhou and other large cities in China recently developed a large-scale land supply plan. In the real estate regulation from the "subtraction" to "add" in the process, the Chinese city will open a new round of large-scale supply to the times?

Shanghai plans to supply 5500 hectares of residential land during the period of "13th Five-Year Plan" (2016 - 2020), which will provide about 1.7 million units of housing, according to the "Shanghai Housing Development" "Twelve Five" period increased by about 60%.

Beijing also significantly raised the supply plan for residential land in the next few years. Beijing officials last month revealed that Beijing will build 1.5 million new homes in the next five years. This is in line with the five-year land supply plan released earlier in Beijing. In this plan, Beijing plans to supply residential land in the next five years, 6,000 hectares.

Shenzhen City, Shenzhen City, the recent housing construction plan in 2017 annual implementation plan, Shenzhen this year will arrange the supply of commercial housing 168 hectares of land, plans to build new construction of 80,000 sets of commercial housing, construction area of ​​7.2 million square meters. Last year, Shenzhen new commodity housing sales of about 40,000 units.

Fuzhou this year to determine the residential land supply plan compared to last year more than doubled, two years after the plan also continued to increase the trend; Guangzhou City 2017 construction land supply plan shows that this year, Guangzhou new residential land of about 5.7 square kilometers, year on year An increase of 19.1%.
Furthermore, some of the cities limited land sales to support home prices in the past:
Large cities, especially Beijing, Shanghai and other large cities to increase the supply of land is undoubtedly conducive to stabilize housing prices. But most of these cities are scarce land resources, lack of capacity for the city. For example, in recent years, Beijing has gradually reduced the supply of land, for many years failed to complete the annual land for the plan. In 2016, the actual supply of residential land in Beijing fell to 469 hectares, less than 40% of the planned completion.
Another possibility: these cities are planning more redevelopment, pushing residents out into the hinterlands to make way for commercial development.


China Connecting West with Singapore

iFeng: 中国西部启动建设一条向南出海纵向大动脉(图)
"South to the channel" has a broad market prospects. From Chongqing Yangtze River shipping to the sea is 2400 km, transport time more than 14 days, if the Chongqing railway to the North Bay port is about 1450 km, reduced distance of 950 km distance, transport time is only 2 days, greatly saving distance and time cost. If you go south from Lanzhou to Singapore, than the east of the sea time to save about 5 days, land and sea transport distance by about half.

The western part of the western region is mostly east-west channel, the "south channel" from the North Bay and Nanning to the north by Guiyang, Chongqing, Chengdu, connected Lanzhou and Xi'an, will form the western region of China's first north-south vertical Big arteries, but also to the northwest of China more than a large channel to the sea. At the same time, the "south channel" in the sea and nine ASEAN countries connected to the land and the Indochina Peninsula in seven countries connected to these countries and China to build traffic corridors also help to promote economic corridor construction.

Chinese CPI and PPI Fall in June

The third consecutive month of PPI deflation, an annualized rate of 3.6 percent deflation.
NBS: 2017年6月份工业生产者出厂价格同比上涨5.5%

As has been the case in the recent past, the only thing keeping Chinese consumer prices from sub-1 percent inflation or even outright deflation is the Spring Festival price spike.
NBS: 2017年6月份居民消费价格同比上涨1.5%


Super Volcano Fears Reflect Current Mood

The earthquake, which was the eighth largest ever recorded in Montana and largest in 34 years, comes just weeks after a flurry of smaller earthquakes hit the region. The swarm of activity began June 12, and by the end of the month nearly 900 earthquakes had been recorded near the Yellowstone supervolcano, along the western edge of the park.

Though the heightened seismic activity has stoked fears of a possible supervolcano eruption, Jacob Lowenstern of the USGS told Newsweek that it is not without precedent.

“The swarm in 2010 on the Madison Plateau lasted at least three weeks. In 1985, there was one that lasted several months,” he said. “Yellowstone has had dozens of these sorts of earthquake swarms in the last 150 years it's been visited. The last volcanic eruption within the caldera was 70,000 years ago. For magma to reach the surface, a new vent needs to be created, which requires a lot of intense geological activity.”
One reason why the supervolanco story keeps popping up is trust in scientists and science is falling. At peak social mood, people believe science and scientsits have all the answers. As peak mood fades, people take a reasonable view of science. During periods of negative mood, trust in science is replaced with superstition.

Scientists haven't done themselves any favors with their global warming data manipulation and in the case of seismology, giving spectacularly ill-time advice.

Science: Seven-year legal saga ends as Italian official is cleared of manslaughter in earthquake trial
Investigations of Bertolaso’s role in the prequake reassurances began following the release of a police phone tap in January 2012, while the scientists’ trial was taking place. In the phone call, made to a local Civil Protection official the day before the experts met, Bertolaso said he was sending the scientists to L’Aquila to carry out “a media operation” in order to “shut up any imbecile,” most likely a reference to Gioacchino Giuliani, a technician at the nearby Gran Sasso physics laboratory who had reportedly raised a series of alarms about impending strong quakes in the weeks beforehand.

Bertolaso’s trial only got the go-ahead in October of last year, after the prosecutor in the original trial twice requested that the case against him be dropped. Following opposition to those requests by three relatives of the deceased and their lawyers, hearings got underway in March and concluded on Friday, only 6 days before the trial would have been timed out. (Italy’s “period of limitation” dictates that a verdict much be reached within 7.5 years of the event, in this case the earthquake.)

During Bertolaso’s trial, there was much discussion of the idea that lots of smaller tremors are a good thing because they discharge energy and therefore reduce the chances of a major quake taking place. Considered by many seismologists to be false, it was this idea that witnesses in the original trial said victims found particularly reassuring and that persuaded them to stay indoors. De Bernardinis relayed the notion to the public in a now infamous interview he gave just ahead of the scientists’ meeting on 31 March 2009—which is why he was convicted for manslaughter.
As for climate change: Study Finds Temperature Adjustments Account For ‘Nearly All Of The Warming’ In Climate Data
The peer-reviewed study tried to validate current surface temperature datasets managed by NASA, NOAA and the UK’s Met Office, all of which make adjustments to raw thermometer readings. Skeptics of man-made global warming have criticized the adjustments.

Climate scientists often apply adjustments to surface temperature thermometers to account for “biases” in the data. The new study doesn’t question the adjustments themselves but notes nearly all of them increase the warming trend.

Basically, “cyclical pattern in the earlier reported data has very nearly been ‘adjusted’ out” of temperature readings taken from weather stations, buoys, ships and other sources.

...“Nearly all of the warming they are now showing are in the adjustments,” Meteorologist Joe D’Aleo, a study co-author, told The Daily Caller News Foundation in an interview. “Each dataset pushed down the 1940s warming and pushed up the current warming.”

New Shanghai Housing Development: Rental Only

A Shanghai housing development being offered for rent instead of sale made headlines as Chinese wonder if it signals a change in the market.

iFeng: 楼市出现只租不售现象 房子会越来越便宜吗?
The two pieces were in Zhangjiang and Jiading, the use of a column marked "rental room", which means that developers must be self-holding after 70 years.

For such a notice, in fact, indicates that the first-tier cities are accelerating the development of the rental market. This is undoubtedly for living in the front line of ordinary people is a big positive. The future of the property market is not only a second line and three or four line differentiation, it is within the city of differentiation, what people rent, what people buy a house, the pattern will be more and more clear.

FX Reserves Tick Higher in June

FT: China forex reserves climb for fifth straight month


Once Hot Hefei Home Prices Down 50pc

Home prices in Hefei are down 15 to 20 percent, with some individual properties down as much as 50 percent.

In the second half of last year, especially after October 2, Hefei launched the "history of the most stringent purchase order", the real estate market quickly by the hot state of hot and cold into the cold, the price continued to fall, the volume shrinking. According to real estate intermediary, the current Hefei housing prices generally fell 15% to 20%, individual residential prices actually showed a 50% straight down, the price was cut.
Financial speculation was rampant and now gone. Some investors didn't even care about speculating on the home price, they used the property as a way of taking money from the bank:
Wang Tao said that they did many batches of business last year, including a "real estate group" is from Zhejiang over, four individuals to form a team. Behind a few companies to sponsor some of their funds, used to pay real estate first payment, earned money and then split into proportion. At that time, they suddenly had 20 sets, so that intermediaries to help calculate the down payment, can figure out how much money they can get from the bank. They don't care about the quality of the house, they just want to find a house with large floorspace, so that you can borrow more money from the bank, this kind of "financial speculation" is barely legal.

This type of "real estate group" mostly do not need their own money, if done well, but also more sets out some money. He remembered very clearly, there is a "financial speculators" through this way, after some operation after more than 200,000 cash.
iFeng: 这个城市去年房价涨幅全球第一 今年却几近腰斩


Second-tier Cities Offer Free Rent, Hukous and Money to Graduates

Second-tier cities are fighting to attract graduates. Changsha offers an annual rental subsidy of 15,000, 10,000 and 6,000 yuan for graduate, masters and undergraduate degree holders. Graduate and masters students also receive 60,000 and 30,000 yuan subsidies for a home purchase. Fuzhou, Chengdu, Nanjing, Hangzhou and Wuxi are other cities offering benefits. The latter three have subsidies worth as much as 100 million yuan for companies.

iFeng: 动真格了!二线城市"开价抢人",送钱、送户口,还送房住!


When the Road Ends: Trump Moves Forward on Trade Agenda

ZH: Trump "Overrules" Cabinet, Prepares To Unleash Global Trade War
In a plan pushed by Commerce Secretary Wilbur Ross, and backed by chief strategist Steve Bannon (not present at the meeting), trade policy director Peter Navarro and senior policy adviser Stephen Miller, the United States would impose tariffs on China and other big exporters of steel. Neither Mike Pence nor Jared Kushner weighed in either way.

Everyone else in the room, more than 75% of those present, were adamantly opposed, arguing it was bad economics and bad global politics. At one point, Trump was told his almost entire cabinet thought this was a bad idea. But everyone left the room believing the country is headed toward a major trade confrontation.
How many economic models are stress tested for politics?

From 2014: The Logic of Strategy: Yuan Devaluation and the Road to Trade War
The protectionists are ever so slowly gaining the upper hand thanks in part to negative social mood. 2008-2009 will probably mark the peak moment for Wall Street and the Treasury Department, even though there is as yet no sign of it in Washington. Changes can be seen in the form of issues such as immigration, which has turned the grassroots of the conservative movement against the Chamber of Commerce and large corporations (due to an attack initiated by the latter against the former). This has pushed the Overton window of acceptable debate among conservatives who can now take shots at big business. There is also the growing libertarian faction pulled together by Ron Paul that supports his son, Rand Paul, that consistently attacks the Federal Reserve and Wall Street. Put it together and it is not hard to envision an anti-Wall Street, pro-manufacturing political consensus emerging. This will cut across party lines, with manufacturing unions pulling in Democratic support if there are specific bills to vote on.
There are many potential paths, but the world has been adhering to the general path predicted by a major negative wave of social mood.


Zhengzhou: Sunac Slashes Prices 20pc, Demands 100pc Cash

Caijing: 调控下房企求生样本:融创郑州降价20% 要求全款购房
June 24, Zhengzhou Sunac as a new opening of a lake. In the surrounding high-level housing prices average price of 13,000 yuan / square meters above the market, like the lake one high-level average price of 10,000 yuan / square meter, down 20%. But Sunac made an all cash purchase prerequisite. Reporters on June 27 repeatedly call the sales office were no answer.

Informed sources, the recent financial development of two real estate promotions. In addition to the above as Lake One, there are Tianjin Rongyuan. Reporters call the project sales office was informed that last year opened in September to sell a group with 28,000 yuan / square meter decoration, and now only sold rough 24,000-25,000 / square meter.

...Not only Zhengzhou, June 25, Shijiazhuang a low-key opening of a project, hardcover high-level about 15,000 yuan / square meter, houses 15,500 yuan / square meter, lower than the expected price of about 15%. It is understood that the project surrounding the rough price of the project, the basic in the 16,000 -2 million / square meter range. Beijing surrounding Yanjiao, there are housing prices have been reduced by five or six thousand yuan / square meter, the decline is about 20% -30%.
The article speculates that the cuts stem from cash flow problems at Sunac, along with the desire to quickly move property in markets with slackening demand.

Li Keqiang Says Foreign Profits Can Leave Anytime

Rebutting the April news of multinationals being asked to stop capital outflows, LI Keqiang said companies are free to take profits out of China. Though perhaps the key word in that sentence is profits.

iFeng: 李克强保证外企利润自由进出 一条不成文规定早已松动
Speaking at the World Economic Forum's 2017 New Champions' Annual Meeting (also known as "Summer Davos"), Chinese Premier Li Keqiang said: "We encourage foreign-funded enterprises to stay in China to invest in China, Of the profits in China to reinvest, will create more lucrative profits, of course, I also assure you that all foreign - funded enterprises as long as the profits made in China, you can freely in accordance with your wishes free access, there will be no restrictions.
Turning to Chinese firms, the article says capital controls are easing:
The lawyer told the first financial reporter, starting from April last year, every month have a certain amount of foreign exchange restrictions, this is an unwritten rule.

And now, they told the first financial reporter, this situation has begun to improve.

Zhan Xiaoning, director of the United Nations Development Program (UNCTAD), told the first financial reporter that China's policy environment for foreign investment is now in an important transitional period. One is from the traditional foreign management system to the new negative list based on the open foreign investment management system transition; the second is from preferential policies to investment facilitation-oriented transition. The overall direction of China's investment environment is to be further liberalized and facilitated.

He said that the "foreign investment industry guidance catalog" in the ban and restrictions on the continuous decline in industry, the service sector and the original restrictions on foreign investment in some manufacturing industries to increase the intensity of foreign investment. At the same time, the investment environment is optimized and facilitated. The establishment of foreign-funded enterprises outside the negative list from the approval system to the filing system, foreign-funded enterprises unified registration of capital system and the promotion of fair competition within the domestic and foreign enterprises, have further improved the foreign environment. Which are conducive to the growth of foreign capital inflows.

Facing the future, Zhan Xiaoning told the first financial journalists that the rapid growth of China's foreign investment reflects the objective needs of Chinese enterprises to become international and participate in international competition. With the "one way" and the international production capacity to promote cooperation, China's foreign investment is expected to remain at a high level.
And back to Li:
Li Keqiang said that these years, in the face of economic downward pressure, we did not take the "flood irrigation" type of strong stimulus, nor follow the excessive dependence on investment, consumption of resources, the traditional way of development, but through reform and innovation, Economic growth from the past too much rely on investment, export-led, to rely more on consumer-driven, service industry and domestic demand support. Last year, the contribution of consumption to economic growth rose to 64.6%, becoming the main force of economic growth; the proportion of added value of services increased to 51.6%, accounting for half of the country; the difference between current account and gross domestic product fell to 1.8 %, Domestic demand has become a ringing pillar.

Behind the above changes, highlighting China's economic structure and quality of the change and enhance the economic growth has also maintained a stronger stability and sustainability.

Li Keqiang said that China will continue to maintain a healthy monetary policy in the future, and to promote production and other structural reforms.


FRED on Chinese Economic Data

FRED: China's Economic Data: An Accurate Reflection, or Just Smoke and Mirrors?

As soon as economists start altering data, even something as simple as seasonality, they are deviating from reality. Some Chinese data points are more suspect, such as GDP, but then all GDP is somewhat suspect given the major revisions that take place.

The more skeptical you are of Chinese data, the more it makes a case against economic planning and the field of economics. If its all fabricated numbers and they're achieving real growth, then why even keep statistics? It brings to mind this paper on Hong Kong: GOVERNMENT WITHOUT STATISTICS: POLICY-MAKING IN HONG KONG 1925-85, WITH SPECIAL REFERENCE TO ECONOMIC AND FINANCIAL MANAGEMENT.

Also: Freedom Works: The Case of Hong Kong
The laissez-faire attitude of the Hong Kong government on economic matters was cemented by Sir John Cowperthwaite, the colony’s financial secretary from 1961 to 1971, whom Welsh called a “political economist in the tradition of Gladstone or John Stuart Mill” and the personification of “unreconstructed Manchester-school free traders.” Cowperthwaite had almost complete control of Hong Kong government finances and used it to implement his policy of “positive nonintervention.” Friedman gave Cowperthwaite a great deal of the credit for Hong Kong’s success, citing approvingly Cowperthwaite’s refusal to collect most economic statistics on the grounds that “[i]f I let them compute those statistics, they’ll want to use them for planning.”
The most important data point is debt. How much of Chinese economic growth is tied to an expansion of credit? How much will survive a downturn in the credit cycle?

HK Microcaps Plummet

Bloomberg: Hong Kong Small Cap Stock Plunge Wipes Out $6.1 Billion in Value
A string of Hong Kong stocks suddenly plunged Tuesday, with traders pointing to links between some of the companies and a brokerage that’s under regulatory investigation.

Seventeen firms tumbled by more than 40 percent at the close, losing a combined HK$47.8 billion ($6.1 billion) in market value. China Jicheng Holdings Ltd., an umbrella maker, and GreaterChina Professional Services Ltd. sank more 90 percent. Lerado Financial Group Co., whose shares were halted by Hong Kong’s securities regulator this month, has previously disclosed an investment in China Jicheng and an underwriter role on a GreaterChina share placement in 2015.

...The S&P/HKEX GEM Index sank 9.6 percent, its biggest retreat since August 2015, and closed at its lowest level on record. The gauge has lost more than 90 percent since 2000.


Mistress Dispelling in China

China’s Mistress-Dispellers
A week after his first visit, Yu went back to the store. He had heard that Wang had recently purchased property nearby, and he let drop that he was looking to buy an apartment in the neighborhood. She offered to take him on a tour and introduce him to agents with properties to sell. In the course of several weeks, Yu and Wang started getting meals together, and eventually Yu invited her to Shanghai for a weekend sightseeing trip. She demurred at first but later accepted, on the condition that she could bring a girlfriend along.

Using his client’s money, Yu put the pair up at a hotel, showed them the city, and took them to sample its culinary specialties. On Shanghai’s famous river promenade, Yu took pictures of the two women and then got the friend to take several of him and Wang with their arms around each other. Once the weekend was over, these pictures found their way to Wang’s boyfriend. “A picture speaks louder than a thousand words, and, in a jealous man’s imagination, it can speak ten thousand,” Yu told me. The man ended the relationship, and returned to his wife, appreciative, if nothing else, of her loyalty. The mission had taken around four months in all.

Beijing Subway Pushes Smartpass

Caixin: Beijing Subway Wants to Go Cardless
Beijing’s subway authorities are trying to get more people to use their smartphones to pay for metro fares amid the explosion in China’s digital payments market.

As far back as 2013, subway stations across the capital were equipped with the technology to accept mobile phone payments, but only 1 million commuters — a fraction of the passengers who take the metro every day — have used the service so far.

One reason for the feature’s low popularity is that it requires mobile phones to have a special SIM card with embedded NFC (near-field communication) technology.

Since last year, more phone makers have been adding an NFC component to their handsets. Now, there are more than 160 phone models that can be used for card-free payments and don’t require the user to buy a special SIM card.


Scholar Says Current Regulatory Framework Can't Stop Local Debt Buildup

An increasingly visible evidence of renewed signs of local government debt indicates that the relevant documents in recent years and the debt management framework established by the new budget law are still inadequate. If the capital budget process and the comprehensive financial commitment control system are not introduced as soon as possible, the trend of debt expansion and financial risk spread will be difficult to be effectively curbed.

Objective analysis, China's existing debt management framework is not sufficient.

Since the audit conducted a comprehensive audit of government debt in 2013, the government's senior management in the face of debt control, the continuous introduction of dozens of related documents. The new budgets that were implemented in 2015 also rarely set out many of the terms of debt management. Today, despite the basic framework is ready, senior management debt determination and efforts remain unabated, the relevant policy documents continue to be frequently introduced is proof.

Who Gets Dongbei Steel?

EO: 东北特钢关键一周:破产可能性不大,谁会最终接盘?
Northeast special steel time is running out.

July 10, is the Northeast Special Steel Group and the bankruptcy administrator to Dalian Intermediate People's Court to apply for a second extension of the draft deadline for submission of reorganization plan.

According to Article 79 of the Bankruptcy Law, the debtor or the manager shall submit the draft of the reorganization plan to the people 's court and the creditors' meeting within six months from the date when the people 's court determines the debtor' s reorganization. If the prescribed period expires, the people 's court may adjudicate for a period of three months if the debtor or the manager requests and has justifiable reasons. Where the debtor or the administrator fails to submit the draft plan for reorganization, the people 's court shall decide to terminate the reorganization procedure and declare the debtor bankrupt.

On July 10, it was the law that allowed the final deadline for the reorganization of the Northeast Special Steel.

From October 10, 2016 to July 10, 2017, a total of 273 days, which is the process of the Northeast special steel reorganization cycle. During this period, around the reorganization, the parties to the Northeast Special Steel and strategic investors and many creditors negotiations stalemate.

Inside the Northeast Special Steel, on the strategic investors, that is, the reorganization of the acquisition of who is who, has been rumors constantly.

On 21 June, an unnamed person from the subsidiary of the Northeast Special Steel Company told the Economic Observer that since the end of last year, the Anshan Iron and Steel Group and the Northeast Special Steel have been in constant contact with each other during this period. Anshan Iron and Steel can pick up the rumors of the Northeast Special Steel.

The company where the people, during this period with a total of two positive contact with Anshan Iron and Steel, respectively, the Northeast Iron and Steel Company of the assets of the assessment and audit. The person reported to the Economic Observer, in addition to Anshan Iron and Steel, there is no other intention to investors at the level of the subsidiary had a similar contact.

Top or Not? Chinese Media Discuss Housing

The PBoC second quarter depositor survey is being cited as evidence the buying restrictions aren't dampening demand. (Coverage of survey here.)
iFeng: 史上最严调控浇灭买房人的热情?央妈给出意外答案

A separate article says the turn in first- and second-tier cities is clear.
"As the current market trading volume in the overall low level, can basically determine the June market transactions compared to May basically flat, narrow range." Yan Yue Jin that the recent part of the city for the control policy began to "patch ", Which will be the corresponding urban housing transactions in different directions, varying degrees of impact.

"The country has more than 36 cities 'limited sales', is becoming the current local market regulation and control of new ideas, has also become the round from March to start the national multi-city regulation and control of new features. There are more cities in the future will be implemented" Zhang Dawei told reporters, "inventory data has been a 21-month low, is expected in 2017 the real estate market is difficult to optimistic in the whole year, especially in the third quarter of the year," Zhang Dawei told reporters that the new control measures, a certain period of time limit transfer, can effectively reduce speculation. The traditional off - season will appear more obvious cooling performance.
iFeng: 一二线城市楼市量价双跌“拐点”初现

Some developers are back to using stealth price increases via charges for decorating and furnishing a new apartment.
However, in some places the limit is not true price. Recently reported that there have been some developers in Guangzhou through the "double contract" to circumvent the government limit policy, making house prices down, not only significantly increased the proportion of buyers down payment, but also makes the net sign price and the actual sales price Far away, leading to distortion of official data on primary housing prices.

The so-called "double contract" is two contracts, one is required to sign the purchase contract, the other is the decoration contract, the amount of the two contracts together is the total purchase price, and decoration contract amount can not be loan, The down payment in the purchase contract is paid together. This practice in 2013 that round of property market regulation in the more, then the local government introduced a regulatory policy to put an end to this phenomenon.

At present, Beijing, Shanghai, Nanjing and other cities limit the price effect is obvious, the market has cooled. As a result of strict regulatory policy, housing sales are more formal, there is no "double contract" phenomenon, so the net sign price can more accurately reflect the actual transaction price. However, in some second-tier cities and three or four lines of the city, "double contract" phenomenon is not uncommon, in addition to bundled with the construction or fine decoration, even more simply net sign a price, the actual sales is another price.
iFeng: 二三线城市双合同致房价明降暗升 地方监管应动真格

SOEs Inflating Profits

SCMP: Audit report reveals China’s economic fault lines
An official audit report published on Friday said that 18 of the 20 state-owned firms that were audited have in recent years inflated their revenues by more than 200 billion yuan (US$29 billion) and boosted their profits by 20 billion yuan with faked business and manipulated books.

The companies audited include China National Petroleum Corporation, China State Shipbuilding Corporation and Sinochem Group.
Much of China’s spectacular growth has been fuelled by lending.

Lu Zhengwei, chief economist from Industrial Bank, said that although the fake profits only accounted for a small proportion of total takings at the country’s state-owned entities – less than 2 per cent – it showed the problems they had deleveraging.


Beijing Has Mortgage Lending Standard: 25pc Total Lending

Mortgages only accounted for 28 percent of new lending in May, a new all-time low. Banks have a minimum standard of 25 percent. Since mortgages are 28 percent through May, they'll have to fall to 21 percent for the rest of the year. The lending standard could also crush credit growth rates.
At the end of May, individual housing loans increased by 90.76 billion yuan compared with the beginning of the year . The proportion of newly added loans was 28% , which was lower than that in the first quarter of 2017 (37.6%) and 2016 (47%), down 9.3 and 18.7 percentage points, trending towards a reasonable ratio.
According to the report, Beijing banks have a target for mortgage lending: 25 percent of new lending. Since the ratio is 28 percent at the end of May, it requires a decline to 21 percent in the rest of 2017.

From January 2017 onwards, the People's Bank of Operations in the MPA assessment to further highlight the credit policy-oriented effect assessment, in accordance with the macro-prudential requirements, to join the individual purchase loan growth factor, the Beijing area of ​​all banks strict control of individual purchase loans Accounting for the proportion of all new loans, and the annual control target is determined to be about 25% of the reasonable level.

From the implementation of the situation, the first quarter of 2017 new personal purchase loans accounted for 36.1% of all new loans fell sharply from the fourth quarter of 2016 proportion of 67.4%, down about 31 percentage points. Especially as the main bank in Beijing, the main bank more obvious: ICBC Beijing Branch fell to 24%, Construction Bank Beijing Branch fell to 29%, Bank of China Beijing Branch fell to 15%, Agricultural Bank of China branch in Beijing fell to 35% , China Merchants Bank Beijing branch fell to 23%.

From these two words can be found, the Beijing area for the new mortgage accounted for the minimum standard control at 25%.

According to the May data, the current Beijing new mortgage accounted for 28%, if you want to reach 25% level, what will happen next?

According to the previous year lending of 605.9 billion yuan, and a 10% new loans growth rate, we estimate that in 2017 Beijing new loans may reach about 660 billion. 25% of that is 165 billion, that is, Beijing's new mortgage size to control the level of 165 billion or so.

The first five months, Beijing banks have issued 90.7 billion housing loans, then that is, the next 7 months left 165 billion -90.7 billion = 74.3 billion or so the amount of loans.

Just to say, if the remaining 7 months to 2016 all new loans for the base calculation, according to 10% growth rate, then all the loans may also be issued about 340 billion.

In this case, 74 billion (74.3 billion) accounted for only 21.7% of the 340 billion, that is, if the future to achieve 25% of the new housing loans accounted for the target, the remaining 7 months, the proportion of mortgages in total lending can not exceed 21%.

To know that the 25% threshold can be said to be a minimum standard, if more than expected, then the future does not rule out the individual months of the new mortgage accounted for less than 15%, or even lower.
Beijing lending was 324 billion in the first five months. Plus 340 billion for the rest of the year comes to 664 billion. However, what if banks can't offset the decline in mortgage lending? We'll find out very soon if there are other borrowers prepared to step in to the gap created by the slowdown in mortgage lending.

iFeng: 楼市传来大消息:房贷数据创新低 房价受影响大


China Chooses Deflation, For Now

Bloomberg: China's Banking Regulator Seeks Details of Wanda, Fosun, HNA Loans
The China Banking Regulatory Commission asked some banks to provide information on overseas loans made to Dalian Wanda Group Co., Anbang Insurance Group Co., HNA Group Co., Fosun International Inc. and the owner of Italian soccer team AC Milan, according to people familiar with the matter.

The inquiries, which come a week after reports of an investigation into Anbang’s chairman, are likely to put a further chill on China’s outbound takeovers after tighter capital controls cut deal activity this year by 56 percent from the same period in 2016. By targeting some of the country’s most powerful tycoons, Xi Jinping’s government may be sending a signal of its commitment to cleaning up the financial system before a key Communist Party leadership reshuffle later this year.

“We are now in an environment where preventing financial risks is lifted as the top priority, so I think the regulators are trying to gauge the total exposure,” said Wei Hou, a Hong Kong-based analyst at Sanford C. Bernstein. “Regulators must have seen some red flags.”

...Shares of billionaire Guo Guangchang’s Fosun and related companies tumbled in Hong Kong, mirroring a similar rout at units of Wanda. Fosun International fell as much as 9.6 percent, while Shanghai Fosun Pharmaceutical Group Co.’s dropped as much as 7.8 percent.

Wanda Film Holding Co. tumbled as much as 10 percent in Shenzhen, its biggest loss since January 2016, before its shares were suspended from trading. Wanda Properties International Co.’s 2024 notes plunged as much as 10.7 cents on the dollar to 101 cents in morning trading in Hong Kong, the biggest drop on record, according to Bloomberg-compiled data.

“I don’t think it’s the right time to invest or buy into these companies,” said Alex Wong, a director of asset management at Ample Capital Ltd. in Hong Kong. “Sometimes this kind of event can accelerate very quickly.”
The ChiNext fell 1.44 percent on the day, all of it in afternoon trading following the news.


Will China Run out of Reserve? What's Your DXY Target?

CFR: China Isn’t Going to Run Out of Reserves Anytime Soon
At the same time, I think the evidence continues to mount that the scale of outflows is significantly a function of expectations—so the best way to limit outflows is simply to hold the exchange rate stable for an extended period of time (technical note: China has an ongoing current account surplus, so stable reserves imply ongoing outflows at a modest pace).
China merely provides the fundamental backdrop. This is entirely a story about the U.S. dollar. If the U.S. dollar declines, then China dodges a bullet. Global credit growth will revive, global economic growth will follow, the U.S. dollar will decline. If instead credit growth remains tight, global economic growth will disappoint, and the U.S. dollar will rally.

23.1pc of Depositors Plan to Buy Home in Next 3 Months, New High

The PBoC Q@ surveys are out. Depositor sentiment declined slightly from Q1. The number the press locked onto was 23.1 percent of depositors saying they plan to buy a house in the next three months. It was the highest total ever recorded.

The question asked was: do you have any big spending plans in the next 3 months? Respondents could choose more than one. Travel was tops at 33.6 percent, education 26.2 percent, healthcare 23.6, big consumer item 23.3, house 23.1, entertainment 18.3, insurance 14.6.

iFeng: 央行:23.1%居民准备未来3个月买房 比例创新高
PBoC Depositor Survey: 2017 年第二季度城镇储户问卷调查报告 (pdf)

The banker survey shows bankers more confident about the macro economy, but the only time they were less pleased with monetary policy was in 2011.

Banker Survey: 2017年第二季度银行家问卷调查报告 (pdf)

Entrepreneur confidence is at its highest level since the first quarter of 2014. The foreign and domestic orders index crossed 50 percent, the first time in at least 3 years. The last time these were well above 50 percent was in 2011.
Entrepreneur survey: 2017年第二季度企业家问卷调查报告 (pdf)


MSCI Adds China to EM Index at 0.7pc

Marketwatch: MSCI to add 222 China A shares in emerging-markets index
The move, which was widely anticipated, could trigger an inflow of as much as $210 billion into China’s equities over the next five years, according to Goldman Sachs.

“This is a significant and highly symbolic recognition of China’s importance to the global economy, and a big vote of confidence in the Chinese growth story from MSCI and its clients,” said Danny Dolan, managing director of China Post Global, in emailed comments.

Even so, the immediate impact on the Chinese stock market from portfolio rebalancing following MSCI’s announcement is likely to be muted, according to Capital Economics.

“What’s more, a steady increase in the inclusion of A-shares in the MSCI Emerging Markets Index will probably only happen if China continues to liberalize her financial markets, including granting greater access to foreign investors and addressing fears over capital controls,” said John Higgins, an economist at Capital Economics, in a note.

Housing Bubble Fallout: Fake Divorces Turn Real

iFeng: 一次假离婚,相当于增加10年收入!有人这样做,结果悲剧了
Reporters learned from the Beijing Municipal Civil Affairs Bureau, 2014 to 2016, three years of marriage remained stable, are about 170,000 pairs. However, in the case of a generally stable number of marriages, the number of divorces increased year by year, reaching 97,600 in 2016, up 73% from 2014. At the same time, in 2016 Beijing recruits the number of 22,607 pairs, up 131% over 2014.
As you might guess, couple that had a "fake divorce" sometimes ended up with a real divorce. There are 3839 cases in the courts involving "fake divorces."
Huge interest in the temptation to leave a divorce to buy a house seems to be a "smart" choice. But economics has a common sense, the proceeds are proportional to the risk, the other side of the high-yield divorce is high risk. Each microblogging (micro-signal: nbdnews) to "fake marriage" as the key word in the Chinese referee document network search found that the relevant litigation ruling reached 3839.

In many cases of divorce due to fake divorce, the most tragic is undoubtedly due to false divorce finally fake into a real, wealth and two empty.

According to the information Times reported that in order to avoid bank credit policy and property purchase policy, Guangzhou, a man Chen Liang and married seven years wife Liu Fang "fake divorce", also signed a "net income" divorce agreement. Guess his wife fake play really do not want to be remarried to be sued.

August 2015, Chen Liang and Liu Fang ready to jointly buy a room in Guangzhou Nansha and pay the deposit and the first payment, but Liu Fang told Chen Liang, because Chen Liang personal credit records caused by his name can not be signed in the purchase contract The To this end, Liu Fang asked to "fake divorce" approach to circumvent the purchase policy to buy the room. The next month, the two divorce procedures, and in the Civil Affairs Bureau signed a divorce agreement. The same month on the 30th, Liu Fang and developers signed a contract to buy the room.

After Liu Fang explicitly refused to remarry, and refused to return all belong to Chen Liang's share of the property. Two of the "divorce agreement" this agreement: Foshan, a room and a room owned by Guangzhou Liu Fang, Chen Liang voluntarily give up belong to the property under the name of Liu Fang; daughter by Liu Fang to carry support, Chen Liang monthly maintenance fee 1500 yuan.
The courts response to fake divorces that turn real: tough shit.
In September 2016, Chen Liang sued the court Liu Fang, asked the court to revoke the "divorce agreement" to change the custody of her daughter, and confirmed that the two suites in Foshan and Guangzhou jointly owned by both sides.

The court of first instance that, according to the marriage law, divorce procedures only for both men and women can voluntarily, no need to review whether the feelings of the two sides rupture, do not consider the reasons for divorce between the two sides, so Chen Liang Liu Fang for divorce registration date has been dismissed The Chen Liang advocated the "divorce agreement" there is fraud, the court held that Chen Liang, Liu Fang has reached a consensus on whether the divorce, and the civil affairs department audit, even if Chen Liang is due to avoid the purchase policy and divorce registration, Is the two sides agreed to divorce to avoid policy, so there is no fraud. Chen Liang said the two sides had agreed to buy a house after the remarriage, but now Liu Fang does not agree to remarry, that she is not voluntary consent to remarry, so even if the two sides have agreed to remarry, the agreement because of the voluntary and invalid. And the issue of child support and property division, Chen Liang failed to prove that the two sides had other agreement on the issue or with other conditions.

Accordingly, the first instance ruling dismissed all of Chen Liang's claim. Chen Liang appeal, the second instance dismissed the appeal to maintain the original verdict.

"Marriage Law" clearly stipulates that both men and women voluntarily divorced, allowed to divorce. As long as the legal requirements of the divorce conditions, the implementation of the relevant procedures, with legal effect. In other words, even if the parties exist false divorce, divorce registration has also been effective, unless it can prove that "divorce agreement" is not its true meaning that.

Fujian Linhui law firm director Lin Minhui lawyers said that whether it is true divorce or false divorce, as long as the two sides in the divorce process is true and voluntary, without any side of the coercion, coercion, divorce is effective and irrevocable.


Streaming Video of Lujiazui Forum

Coverage of speeches and updated news.

Scroll down to see Zhou Xiaochuan's speech, broken into various posts.

2017年陆家嘴论坛 周小川释放什么信号?

Teapot Refiners Start Price War on Refined Products

Looks like Chinese crude inventory could be coming down amid a price war between the oil giants and teapot refiners.

iFeng: 罕见的成品油价格战 中石油和中石化这对巨头怎么了?
Oil products analyst Hu Huichun said to China News Network, resulting in the current price of melee situation, the main reason is more and more refining enterprises to obtain the right to use crude oil imports, making gasoline and diesel production increased significantly. At the same time, private refineries lose the right to export refined oil, resulting in oversupply, its refined oil inventories can only be digested in the country.

In the past, local refineries imported crude oil use rights and crude oil import rights are restricted, in order to use imported crude oil, subject to the oil, petrochemical and other large central enterprises. Beginning of last year, the state gradually release the relevant restrictions. As of March this year, the country a total of 18 local oil refining enterprises have been the right to import crude oil, began a large number of imported crude oil processing.

From the customs data released, China's crude oil imports rebounded sharply in May, the average daily imports of 37.2 million tons, becoming the world's largest oil importer. Another data show that last year the national refining refining capacity of the total capacity of about 30% of the total oil refining capacity.

China University of Petroleum Professor Dong Xiucheng that, compared to private enterprises, PetroChina Sinopec's organizational structure is complex, the gas station itself without adjustment of the right price, the market reflects the low sensitivity, can not be as private enterprises as the rapid adjustment of prices, the lack of price The advantages of attracting customer capacity correspondingly weakened, so its sales will be affected by private enterprises. Sinopec's quarterly report shows that retail sales fell to a three-year low in the first quarter of this year.

IHS Markit senior oil researcher Yan Kefeng also told Reuters, "teapot refinery" (referring to private refineries) overcapacity is eroding Sinopec, PetroChina two giants of the market share.

Faced with the impact of private refineries, PetroChina, Sinopec chose to join the price war. Dong Xiucheng that "two barrels of oil" through the price war, the market share to rise and the inventory can be effectively consumed, oil prices will return to normal prices.


Chinese Home Prices Still Rising in May, Top Cities Show Signs of Exhaustion

Chinese new home prices climbed 0.74 percent nationally in May. Smaller cities saw the largest increases, such as 3.4 percent in Bengbu. The count of cities with rising prices dropped by two as the market is clearly plateauing. Price follows volume.

Top-tier plus Xiamen accounted for only 1 percent of the increase. They're down to 10 percent of the 9.5 percent yoy national price increase.
The seven hot tier-two cities I track declined in May, and they only account for 16 percent of the national increase yoy.

Measures such as the converted housing regulations and changes to school admission policies in Beijing did bite into existing home prices. Nationally, existing home prices rose 0.57 percent in May, 7.8 percent yoy.
The top-tier and Xiamen saw an average price decrease. Combined with the seven tier-two cities, these 12 accounted for only 4 percent of the national existing home price increase in May.

NBS: 2017年5月份70个大中城市住宅销售价格变动情况


Analysts See Mortgage Slowdown, Rate Hikes Due to Lack of Capital

iFeng: 银行真没钱了 北京首套房贷已基准利率为主优惠绝迹
Hai Tong Securities macro bond analyst Jiang Chao believes that mortgage interest rates soared mainly because the "bank without rice pot." According to the study, "in 2016, the bank can be in the financial markets through the same industry deposit at 2.8% interest rate, so the 4.9% loan interest rate, even if the mortgage interest rate hit 8 fold is also profitable to the first quarter of this year Interbank deposit rate rose to 4.5%, so the bank mortgage interest rates began to play 9 fold, 95 fold to make up for the cost rise. But in April and May after the bank's interbank deposits are made, the banks themselves have no money, then how to issue mortgages?"

Jiang Chao believes that the rise in lending rates, loans to shrink, means that the impact of financial leverage will be transferred from the financial market to the real economy. "Credit contraction is the biggest risk in the second half of the year." In the first half of 17 years, although the economy appears to see signs of falling, but only slow slowdown, because the financial leverage is only in the financial market, mainly for the currency and bond interest rates rise Commercial banks are still expanding, lending rates and loan payments remain stable, but with the shrinking distribution of interbank orders, which means that commercial banks began to shrink, lending rates rose sharply, and the payment of loans began to shrink, which means that The impact of financial deleveraging will be transferred from financial markets to the real economy, and credit contraction will be the biggest risk of the economy in the second half of the year.

A publicly traded bank insider told reporters that the bank mortgage interest rates rise, not only because of the national real estate macro-control factors, may be because "the banks really have no money." "Banks are still more likely to lend to buyers because mortgages are among the lowest risk classes in bank loans, with low default rates and bad debts, which are fundamentally high quality assets."

The above-mentioned joint-stock bankers believe that the situation of financial deleveraging, interbank deposit, outsourcing business are in recovery, plus the central bank MPA assessment, the major banks are tightening. "Mortgage rose the fastest, roughly the financial business and interbank deposit business done better bank."


Socionomics Alert: Republican Confidence Converging With Democrats

Republicans and Democrats flipped positions in consumer confidence surveys following the presidential election. Independents drove the overall rise.

Now Republican and Independent confidence is starting to crack.

ZH: Republicans Crack - UMich Confidence Slumps To Lowest Since Trump Elected
While this break corresponds with James Comey's testimony, only a few consumers spontaneously referred to him or his testimony when asked to explain their views.

Importantly, the decline was observed across all political parties, but the loss in confidence among self-identified Republicans since June 8th was larger than among Democrats (9.2 vs. 6.8 Index-points), with Independents showing the greatest falloff (11.5 Index-points).

The size of the partisan difference between Democrats and Republicans in the Expectations Index, however, was largely unchanged (55.6 Index-points prior to June 8th, and 51.2 after).

The recent erosion of confidence was due to more negative perceptions of the proposed economic policies among Democrats and the reduced likelihood of passage of these policies among Republicans. Fortunately, a strong job market, improved household income and wealth have provided a financial buffer against rising uncertainties.

Nonetheless, consumers have become less optimistic about the future course of the domestic economy. Even with the expected bounce back in spending in the current quarter, personal consumption is expected to advance by 2.3% for all of 2017.

How To Find A Good Chinese Company

Find the ones that stick to their core business.

Caixin: Steel-Maker Shagang Changes Tack With Internet Acquisitions
Chinese steel-maker Jiangsu Shagang Group has made a significant $3.8 billion deal to buy two internet data firms, including the owner of Global Switch, as the firm seeks to explore new industries amid ongoing overcapacity within the steel sector.

Shenzhen-listed Shagang, which supplies specialized products to infrastructure and vehicle builders, said it planned to acquire Jiangsu Qingfeng Investment Management Co. Ltd. and Beijing Daily Tech Co. Ltd. for a combined 25.8 billion yuan ($3.8 billion).
High debt levels are hardening the political and culture forces that prevent companies from failing. I associate this type of complete business shift with OTC penny stocks in the U.S.

At least in this case it sounds like they have some experience:
Shagang’s move to open up a new revenue channel in data is also a result of the emerging boom in online steel trading platforms. There are about 300 such platforms in China, with one of the largest being Ouyeel, of which Shagang is a shareholder.

The Meddle Kingdom

The Economist: Australia battles Chinese political influence
China is Australia’s biggest trading partner and its second-biggest source of immigrants (after India). Almost 160,000 Chinese students study in Australia; rich Chinese also see the country as a haven for investment. All this, argues Rory Medcalf of the National Security College in Canberra, gives China’s authorities a natural desire to influence Australian policy and in particular to weaken its ties with America.
I can't tell you when you will win, but if you want to win political office in the future, stake out the most extreme nationalist position on issues of trade, security and immigration today.


China Housing Cooldown: This Time It's Different

According to CASS data:
The median price of the above cities (Beijing, Shanghai, Guangzhuo) in May were 61685 yuan per square meter, 54458 yuan, 22,273 yuan, respectively, compared with April decreased by 3.2%, 0.4%, 0.5%. Another first-tier cities in Shenzhen, the median price of 50423 yuan per square meter, up 0.5%.
According to this table, Beijing prices are down 4.09 percent, nearby Langfang's average price fell 8.54 percent. The table also shows year-on-year prices are still upwards of 50 percent in many areas.
Media prices declines are also ugly in surrounding cities:
Some cities in the surrounding areas prices are also declining. In May Tianjin, Shijiazhuang, Foshan, Langfang median home prices were down 4.2%, 0.48%, 9.1%, 8.4%.
This next chart is a plot of home price changes since the start of the year (X-axis) against sales area (Y-axis). The first tier cities are all in the bottom except Guangzhou, while both Shenzhen and Guangzhou prices are down YTD. Many of the "hot" second-tier cities are in the bottom left quadrant: falling sales and falling prices. Other second-tier cities are in the upper right. Sanya is the outlier city with sales growth of almost 100 percen sales and prices down more than 10 percent; Nanchang has soaring prices, but flat sales. The chart is from China Index Academy and Tianfeng Securities Research Institute.
From the current indications, 2017, the mortgage market and then 2016-like surge in the probability of almost zero.

"At present, the national financial and real estate industry regulation, interest rate difference and market demand are playing with each other.As a whole, this year the total amount of bank lending compared to last year, the increase will be shrink."

Supervision of the year, the market year. Last year, the property market hot, loose credit environment is the main reason. And now mortgage interest rates raised, resulting in increased purchase costs, or will become the development of the property market this year, a key factor in the development.

In fact, because the central bank to tighten liquidity, the bank to obtain capital costs are rising, if you continue to maintain mortgage discount, the bank will be unprofitable. So, if the central bank does not relax monetary policy, the future will be more and more cities to raise mortgage rates. The property market or facing a new era, is the real estate speculators "warm boiled frog." If you this time, but also hope that the next two years, housing prices rose, and accordingly investment, is likely to fall into the trap of liquidity crunch.
Is this time really different? Maybe for developers. Maybe.
This time is not the same, will developers have a bad second half?

Yiju Property Research Institute has developed a quarterly report to build a China real estate financial environment index. Which includes nine sub-indicators, can generally reflect the real estate industry is facing the monetary policy and the degree of tightness of the capital side.

The real estate financial environment index in China in the first quarter of 2016, is a loose section, then down, the first quarter of 2017 has dropped to normal range, Yi Ju Real Estate Research Institute Vice President Yang Hongxu Is expected to slide in the second half of the tight interval.
The chart of this index from E-house (Yiju) runs from loose (red) to tight (blue). Q1 was normal.
This next chart compares a financial conditions index (green) with sales growth in the top 30 cities (red).
Evergreen real estate Yang Hongxu that the past two rounds of short cycle of experience, the financial environment indicators are not bottomed out, the sales growth will not rebound, or will not be achieved by the negative positive. The past two rounds of sales growth continued for five quarters. This round is expected to last longer may be longer.
Buying restriction could kill the market until 2021:
"In fact, the sale is the property market 'to the lever' policy, so that buyers must be for their own purpose for the allocation of funds, or in accordance with the 4-5 year trading cycle, is unlikely to attract highly leveraged high-cost funds to enter." Central Plains real estate chief analyst Zhang Dawei said bluntly.

Even if the sale of new homes in the restricted cities, may be the first to 2021 before it can be listed on the transaction. A number of industry insiders believe that the sale of a clear blow to speculative investment demand, reduce the investment properties of the real estate market, affecting the real estate speculators the possibility of short-term profit. "For the leveraged investors, the risk is growing."
The article concludes with a reference to a leaked document from Vanke which definitively says the golden era of real estate is over.

Vanke said the same thing in 2015.

The restrictions are far tighter this time and China's debt levels all the larger though, so maybe this time really is different. We'll know in the second-half when the real pain starts hitting. Will governments hold the line or ease at the first sign of major trouble?

iFeng: 楼市爆大消息!这次不一样了 这些人受益最大