CHINA A50 - Asia led the recent Decline, it will againThe WMP - Chinese Wealth Management Product system is quite possibly the grandest Ponzi Scheme
within recorded history of the world.
Investors have adopted the belief - WMPs' are identical to a Bank Deposit, backed by the Bank that sells them.
China's CCP uses the WMPs as a funding mechanism for it's Agenda in Business - Funding Projects with the
Peoples Money... China holds $1.81 Trillion in Foreign Reserves, it could provide a level of Fractional assistance,
but it cannot.
The Capital or more accurately the WMP Ponzi is well over $12 Trillion in creation at this moment.
Evergrande... slammed the breaks on the effort, the loss of confidence placed a serious doubt in Chinese
Investors' minds as to whether or not their WMP "Deposit" is Safe.
Clearly, it is not as the CCP had to step in with guarantees, originally $20 Billion.
It has ballooned to $300 Billion.
As these projects were securitized and sold... Foreign Investors wanted in on the Pyramid.
Everyone from Wells to BoA to Crypto "Tethers" purchased these Instruments.
GSCO is only too happy to provide a market in the JUNK as is JPM and a great many other US
Firms.
The attendant effects of this disruptive failure to deliver on Loan Payments created a large
amount of Selling within US Markets as the Losses began to accumulate.
The A50 will provide us clear indications as to the next downturn for US Equities as well. ASIA
and the US does not diverge for very long when it comes to Capital Markets...
One to Watch - contagion risks.
Many of you are probably born after the 1987 Crush. I was at my Desk @ Drexel, it began in
Germany and ended up here in mere seconds, watched it LIVE.
Contagions can be quite nasty and arrive at any moment.
- HK
