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Imf To Issue $150 Billion In Bond Debut

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http://www.bloomberg.com/apps/news?pid=206...id=aICtTde_qKVA

July 1 (Bloomberg) -- The International Monetary Fund’s board of directors plans to approve authorization to issue as much as $150 billion of bonds for the first time as it seeks new sources of funds, an IMF official said.

The board is scheduled to vote on the matter today, the official said on condition of anonymity. The bonds are part of a wider effort to seek new funding as the lender helps countries from Iceland to Pakistan combat the global financial crisis.

The securities, the culmination of months of talks between the fund and its members, will offer the largest emerging-market nations a new way of making IMF contributions while they seek greater say at the fund. China, Brazil and Russia have favored the bonds instead of regular contributions as they wrangle with other members over redistributing the IMF’s voting power.

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Who is going to buy these bonds?

Will the BoE be buying?

Read the article IRRO

China’s government has also said it will buy $50 billion in notes. Russia and Brazil in June month announced plans to each buy $20 billion of bonds from the IMF.

India has indicated it would contribute to an IMF bond program.

It's a BRICS power play.

Let's see in what ccy the debt is denominated.

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Read the article IRRO

I'm a man do you think I read instructions? :lol::lol:

The way China is allowing it's banks to go on a massive lending spree it might need the money in future.

Won't this just be sucking more money out of the global economy.

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I'm a man do you think I read instructions? :lol::lol:

The way China is allowing it's banks to go on a massive lending spree it might need the money in future.

Won't this just be sucking more money out of the global economy.

I don't know dude, but this just came out

China's Manufacturing Expands for Fourth Month on Stimulus, Bank Lending

http://www.bloomberg.com/apps/news?pid=206...id=aacBmb4Ckix4

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I don't know dude, but this just came out

China's Manufacturing Expands for Fourth Month on Stimulus, Bank Lending

http://www.bloomberg.com/apps/news?pid=206...id=aacBmb4Ckix4

Excellent, you see debt is wealth.

China gets lending and you see expansion.

Question is how will Chinese business/consumers manage to get the money in the future to repay the banks back?

Short term fix, once the lending binge is over what then?

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Excellent, you see debt is wealth.

China gets lending and you see expansion.

Question is how will Chinese business/consumers manage to get the money in the future to repay the banks back?

Short term fix, once the lending binge is over what then?

Well, some think the stimulus is actually working

In China, the stimulus plan and new loans of 5.84 trillion yuan in the first five months, almost triple lending a year earlier, are driving growth.

“China’s stimulus program is having a demonstrable effect on domestic spending, which has resulted in increased manufacturing activity,†said Jing Ulrich, Hong Kong-based chairwoman of China equities at JPMorgan Chase & Co.

Bank of America Merrill Lynch and JPMorgan raised this week their forecasts for second-quarter economic growth. The former expects 7.6 percent, compared with 7.2 percent previously. JPMorgan increased its forecast to 6.9 percent from 6 percent.

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If the lender of last resort is having to borrow I cant help thinking that the only thing propping the system up at this point is essentially Enron style accounting of a global scale......

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Well, some think the stimulus is actually working

http://www.asianews.it/index.php?l=en&...me=1&size=A

06/11/2009 16:23

CHINA

Beijing (AsiaNews/Agencies) – Investments in China increased by 40% in May. But experts believe that the weak signs of recovery are the result of heavy government investments that will amount to over 4 trillion Yuan (over 400 billion euro). Meanwhile the service industry is facing great difficulties.

Investment in urban areas in fixed assets such buildings and roads rose 40% compared to 2008 (up 6.8% in the first five months of 2009). The mainland's exports fell 26.4 %in May from a year earlier, while imports fell 25.2%. The General Administration of Customs said after seasonal adjustment, exports rose 0.2% per cent in May from April and imports rose 4.4 %.

Economists agree that the signs of recovery are the direct result of financial investments announced by the government amounting to 4 trillion Yuan (400 billion euro). Since the stimulus was announced in November, China has built 20,000 kilometres of rural roads, 445 kilometres of highway and 100,000 square meters of airport buildings. Some experts are optimistic and note that current orders for manufactured goods were made months ago, when fears for the global crisis were at their worst.

Instead others believe that the improving situation in the home market is only the result of these state investments, which they believe to be insufficient in really kick-starting a lasting economic recovery.

Feng Yuming, a Shanghai economist, observes that “External demand remains weak as the US and European economies are still contracting, so it'll be hard for China's exports to see a quick reboundâ€.

Banking expert Xing Zhiqiang comments to the South China Morning Post “The growth momentum of investment is really dramatic, and we expect that momentum to continue in the next two or three quartersâ€.

Now the crisis is hitting not only the manufacturing sector but also the service industry, affected by a drop in consumption, but also by delinquent payments, bad debts and even bankruptcy. In the first quarter of 2009 earnings across the sector was down 3.3%. In a letter published in February to central authorities the China Federation of Logistics and Purchasing, warned that “Clients are delaying payment. Some upstream clients have gone bankrupt or reneged on debt repayment; the risk of bad debts has increased. Many Chinese logistics firms have delayed or cancelled investment plansâ€.

http://news.bbc.co.uk/1/hi/business/7945477.stm

Foreign investment in China fell in January and February as overseas companies were hit by the global recession, official figures have shown.

The amount of direct investment from abroad was $13.3bn (£9.5bn) - a drop of 26.2% from the same period a year ago.

Holidays over China's Lunar New Year mean the combined January and February figures are seen as a better indicator of the economy than monthly data.

The number of newly-established firms fell 13%, the commerce ministry said.

Foreign investment - which rose by 23.6% in 2008 to $92.4bn - has been one of the factors driving the rapid growth of China's economy.

But analysts say the figure has been under pressure in recent months amid the financial crisis - with further drop-offs in investment expected to contribute to the slowing pace of growth in China.

Making up for the lack of foreign investment?

Can you trust the Communist party?

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Well, some think the stimulus is actually working

Some people also think if China follows the west in a deflationary spiral it will be game over.

Some other people also think the Chinese are not the most trust worthy when it comes to producing government statistics.

In the same way the West is bluffing the population into thinking they will run QE until we get hyperinflation thus scaring those with money to spend (and it is working to some degree) it is also possible that the Chinese are bluffing on this one as well. Their factory closure rate has been colossal and it is hard to see where all this money is going to. The Chinese housing bubble has imploded as well so they face the same problems as the West in many ways.

Several years ago on this site we were discussing the slashing of interest rates in the face of the debt bubble bursting and a very good analogy of this policy was used, "pushing string", i.e you can not force people to take on debt. Economic policy atm is helpless and the only way out, as I believe was discussed and devised at the G20 meeting back in March, was that propoganda was the only and most effective tool left. The theory being if they can convince enough people things are getting better they may be able to generate so traction in the economy which could at least stabilise things.

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Several years ago on this site we were discussing the slashing of interest rates in the face of the debt bubble bursting and a very good analogy of this policy was used, "pushing string", i.e you can not force people to take on debt. Economic policy atm is helpless and the only way out, as I believe was discussed and devised at the G20 meeting back in March, was that propoganda was the only and most effective tool left. The theory being if they can convince enough people things are getting better they may be able to generate so traction in the economy which could at least stabilise things.

Creating the new paradigm.

If enough people believe the market will work they could get traction. However this is exactly how a pyramid scheme operates.

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Well, some think the stimulus is actually working

Don't tell me that it's different in China ;) ... Commanded credit expansion is credit expansion everywhere. Consequences are the same everywhere, too. Namely, false economic incentives, moral hazard and massive malinvestments to be written off at some point in the future.

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http://www.asianews.it/index.php?l=en&...me=1&size=A

06/11/2009 16:23

CHINA

http://news.bbc.co.uk/1/hi/business/7945477.stm

Making up for the lack of foreign investment?

Can you trust the Communist party?

Exactly. That's why I don't get why a few gurus on this site are cheerleading Russia, China, India and Brazil. OK, let them join the band-wagon fully while they can to burn their reserves. Might it be a cunning plan by the West? In any case, they are part of the system and will suffer along with or without IMF bonds.

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Guest DissipatedYouthIsValuable
Who is going to buy these bonds?

Will the BoE be buying?

My unborn children to pay for a load of tossers newly bought BTL empires?

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