With bonds, stocks, and commodities collapsing amid a renewed wave of Chinese monetray conditions tightening, concerns over potential butterfly effects and potential 'black swans' are beginning to appear. However, as The South China Morning Post reports, the people of Shanghai have a solution for that...
Two deliverymen have been accused of stealing a black swan from a park in Shanghai and cooking and eating part of it, according to a TV report.
The Chinese and U.S. stock markets are going in opposite directions, as an intensifying crackdown against leverage has slammed the recently 'stable' Shanghai Composite over the past week, erasing all post-Trump gains.
The relatsionship between the two markets is the weakest since August 2008 - just before the collapse of Lehman unleashed chaos on the global financial system.
It all started in February, when we first reported that something unexpected had happened: for reasons that were at the time unknown, the global credit impulse had unexpectedly tumbled, turning negative, a move which we predicted would result in a steep slide in the "soft" economic data, end the "reflation" optimism and unleash a wave of dovishness from the Fed.
The Shanghai Composite Index, notorious for its wild swings over the past two years, has gone 85 trading days without a loss of more than 1% on a closing basis, the longest stretch since the market’s infancy in 1992.
The last 4 days have highlighted the unusual effect in Chinese stocks.. each time the Shanghai Composite dropped over 1% (red dotted line) it was miraculously lifted to ensure it closed with a loss less than 1%...
Following Sunday night's resumption of trade after a three-day weekend, which saw sharp moves lower in US yields, the dollar and the USDJPY after Friday's disappointing CPI and retail sales data and the weekend's North Korea jitters, the mood has stabilized in light trading with Asian stocks advancing, Europe mostly closed for Easter Monday and S&P futures fractionally lower at 2,325 in early New York trading.