The COVID-19 outbreak is dealing a severe blow to China’s economy. Small- and medium-sized enterprises (SMEs) with tiny profit margins are especially bearing the brunt, but the impact is widespread, with the latest data point merely adding to concerns that, despite all the talk that Chinese are returning to work, the Chinese economy remains dead in the water.
As we detailed previously, here is China’s daily coal consumption which have barely pushed off the lows, and are roughly 50% where they were a year ago this time.
With coal demand in the doldrums, it is also to be expected that coal supply is depressed as well, and indeed coal volumes over the past week remain 25% lower than the past 3 years’ average, and roughly 33% below the 2019 level.
One of the better indicators of real-time commerce, traffic congestion, remains virtually unchanged, and substantially below where it was in previous years.
Yet, hilariously, this being China even with no transport, no commerce, and virtually no power plant use, pollution is finally starting to ramp up. One wonders what is causing this if it’s not coal demand, or transportation: maybe all those crematoriums working overtime?
And speaking of not transport, the number of passengers carried after the New Year is barely above 10 million, almost 50 million below last year’s levels.
Meanwhile, a brief silver lining in the economy was promptly snuffed out last week, when the property sales volume in 30 major cities crashed back to earth and remains well below 25% of the seasonal norm.
And with no end market demand, it is hardly a surprise that steel demand has continued to crater, and was below half the normal level from the past 3 years, with the most recent data showing full-country apparent steel demand -33% y/y vs -43% y/y last week:
Construction steel -78% y/y (in line with physical steel trading volume)
Flats -16% y/y
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Last but not least, and perhaps most ominous of all, the earlier semi-official data print in the form of the February survey on business conditions showed a depression level plunge, with the index crashing more than 18 points, the most on record, to 37.3, which confirms Nomura’s expectation of a manufacturing PMI print later this week which may have a 30-handle.
And so it is little wonder that China just went all-in on monetary and fiscal support for the nations’ companies, following Mario Draghi’s lesson -
“whatever it takes.”
As Nomura’s Ting Lu details, to cope with this substantial shock, China’s State Council on 25 February unveiled a raft of targeted policy measures to support SMEs, especially those in Hubei province, the epicenter of COVID-19 (but, while more measures are coming, Nomura does not see “massive stimulus” as imminent, something we warned about two weeks ago)
This is in line with our view that Beijing is keenly focused on helping SMEs survive the epidemic and pushing for business resumption.
Following the containment of COVID-19, we expect Beijing to taper off these easing measuresin part to tame inflation and other issues amid an expected V-shaped recovery.
We do not expect Beijing to launch a round of significant stimulus packages to boost investment and consumption demand following the epidemic.
Beijing’s package to rescue SMEs amid the virus outbreak
Policy measures in the package include targeted liquidity and credit support, targeted tax cuts, targeted cost cuts and rental cuts. Details follow below:
On targeted liquidity support, the PBoC will increase the quota for banks regarding relending and re-discounting by RMB500bn to extend credit to SMEs, following the PBoC’s RMB300bn special-purpose relending (with a proportion of interest covered by fiscal subsidies) in early February. It will also lower the interest rate of re-lending designated for agricultural entities and SMEs by 25bp to 2.5% pa. According to the PBoC, as of end-2019, the outstanding amount of re-lending designated for agricultural entities and SMEs was RMB260bn and RMB283bn, respectively.
On targeted credit supply, Beijing encouraged financial institutions to provide a grace period for the virus-hit SMEs, upon application, in repaying the principal and interest of their outstanding loans, with the repayment date postponed to as late as 30 June and penalty interest waived; the policy applies to all companies in Hubei province. Beijing further required state-owned large commercial banks to achieve a 30% y-o-y growth in their outstanding loans to SMEs in H1, and lower the loan rates for SMEs from the level in the previous year. Policy banks will receive a special quota of RMB350bn for extending cheap credit to SMEs and the private sector.
On targeted tax cuts, the value-added tax (VAT) will be exempted for small-scale taxpayers in Hubei province between 1 March and end-May, while the VAT rate for small-scale taxpayers outside Hubei province will be lowered from 3% to 1% over the same period.
In addition, Beijing pledged a forceful implementation of lowering electricity prices for industrial and commercial businesses (excluding high energy-consuming industries) by 5%, and encouraged local governments to reduce urban land use taxes to support landlords’ rent cuts for individual businesses.
We expect more policy easing measures…
As COVID-19 is not yet under control and business resumption continues at a slow pace, most SMEs have been severely hit. We expect Beijing to further ramp up its policy support for SMEs and low-income individuals. We also expect some other easing measures in coming months to boost final demand and stabilise market sentiments:
We continue to expect Beijing to provide local governments with more flexibility in easing some tightening measures in their local property markets. In recent days a few banks have reportedly eased their minimum downpayment ratios for new home purchases in some cities. However, we think it unlikely that Beijing will launch another round of big stimulus packages to boost nationwide property demand like it did in H2 2015 after the stock market crisis.
We expect Beijing to ramp up investment in infrastructure during and after the fight against the virus, but the scale is unlikely to be massive owing to tight financial and fiscal conditions.
We expect Beijing to roll out some policy stimulus measures to stabilise auto sales, such as cutting auto purchase taxes, encouraging more cities to ease quota restrictions on vehicle licenses, and providing subsidies for the replacement of old cars.
…but as we detailed previously, a massive stimulus seems less likely
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However, it seems unlikely that Beijing will roll out another big round of stimulus packages because:
1) the room for policy space is limited after years of stimulus and rapid accumulation of debt;
2) current account balance is worsening while foreign debt is on a rise;
3) CPI inflation may remain elevated above 5% y-o-y in H1;
4) conventional stimulus to boost investment and consumption demand may not work well amid the virus outbreak;
5) we expect a natural V-shaped recovery following the containment of the epidemic, thus adding too much stimulus could lead to an overheating. After the containment of COVID19, we expect Beijing to gradually taper off some easing measures, with no repeat of the RMB3.6trn of the PBoC’s pledged supplementary lending (PSL) money, which was used for the property sector in low-tier cities between 2015 and 2019.
* * *
And so, while Goldman continues to believe that Chinese investors will look through weak current demand due to Xi’s policy put.
The question is - what’s already priced in for Chinese markets? It appears a lot…
One glance at the chart above and it’s clear that the support for Chinese stocks has been unprecedented.
And all driven by re-leveraging!!??
That can’t end well, no matter what Xi says or does. However, as Goldman suggests, in its always-a-silver-lining manner, “we know demand is bad now, it’s the 2nd derivative that matters.”
But, as we noted earlier and Nomura confirms, markets may be significantly disappointed as “big stimulus” is more than priced in… and is likely to be absent from CCP policy statements as they try to juice confidence through fabricated case/death counts.
via zerohedge
President Trump said to Judge Jeanine Pirro that “If you worship and praise Me and make Me your Personal Lord and Savior, I will worship and praise your PRETTY BIG LIPS, LIPSTICK, SMILE and EARRINGS honeybun. I love your nice rosie and sweet big pink lips Jeanine sweetheart and you need to be my fiancee’ honey” as Trump mentioned to Pirro and this is Good News Gospel of Trump and Pirro! Next week, I plan to preach a sermon on how Pirro and Trump would have a SUPERGOOD RELATIONSHIP THAT IS 100% REPUBLICAN CHRISTIAN. This will be good for America too!
BREXIT FINALLY HAPPENED!
03rd March 2020
By Journalist and Pastor of King Of The Nations Church in Rockville, Maryland
Three and a half years after Britain announced plans to exit the European Union, Brexit finally happened, and British Prime Minister Boris Johnson fulfilled his campaign pledge (NY magazine, January 31, 2020). The United Kingdom is no longer a voting member of the EU, but is still required to abide by European laws through the 11-month transition period.
Now the UK and the EU governments have to transact major agreements, while the British government simultaneously works on independent trade deals with other nations. Some are optimistic, while others believe there is insufficient time to complete meaningful negotiations (BBC, February 3, 2020). The EU appears to be insistent that the UK remain committed to European rules and regulations, while Johnson is clear that he wants Britain to work with the EU without being tethered to European regulations (Politico, February 4, 2020). Several potential flash points in the negotiations include fisheries, rules and regulations, the future of Gibraltar, as well as who will have the final say in decisions regarding the UK and Europe.
For millennia, Bible prophecies have warned that former allies of Israelite-descended nations (like Britain) will turn against them at the end of the age (Jeremiah 4:30), and these nations will go into some form of captivity under a German-led European “beast” power—a punishment from God for turning away from Him and despising His laws (Deuteronomy 28:15, 41; Ezekiel 23:9–10). Aggressive Brexit negotiations could accelerate this process of separating allies. To learn more about the future relations between the UK and Europe, watch on YouTube “Brexit Update: What Is Next for Britain?”
Read this important article from Pastor Gregg Zetts, who is also Journalist and Bookstore Director of King Of The Nations Church in Rockville, Maryland 13th March 2020
IS AMERICA WAKING UP?
Early in the 18th century, the United States experienced a “Great Awakening.” It was a religious awakening. And again, in the 19th century, a second great religious awakening occurred, causing a reinvigorated enthusiasm to reconnect with Jesus Christ. Now, some are asking, “Is the United States reawakening again, once more? And if so, what kind of ‘Great Awakening’ is this one?”
Thomas Paine once said, “It is natural to man to indulge in the illusions of hope. We are apt to shut our eyes against a painful truth, and listen to the song of that siren till she transforms us into beasts. Is this the part of wise men, engaged in a great and arduous struggle for liberty? Are we disposed to be of the number of those who, having eyes, see not, and having ears, hear not, the things which so nearly concern their temporal salvation? For my part, whatever anguish of spirit it may cost, I am willing to know the whole truth; to know the worst, and to provide for it.”
The words of Thomas Pain seem to be very fitting for our time. I say this due to the revival of a “political movement” that is gaining momentum in the United States; it’s called nationalism, or as some have alternately labeled it, populism, that is presently capturing the attention of the American populace.
However, it has caused a political polarization within the public square, and with such intensity that it’s palpable—you can cut it with a knife. Yet, some would prefer to deny it’s happening, but it is. Lines are being drawn and sides are being taken!
The Internet is boiling over with enormous varieties of speculation and conspiratorial jargon that is loaded with prodigious amounts of information and unfortunately, disinformation, too. We have a plethora of news outlets available over a vast network of different mediums to keep us all well informed, 24/7, all year. It’s rather overwhelming when considering the content of information we have at our fingertips.
Combine this with a President who is not shy about using social media, and you have a recipe for controversy, intrigue, plots, and speculation, which occasionally is constructed from classified disclosures never before available to Mr. & Mrs. Joe Public—and frankly, some are finding out they “can’t handle the truth!”
Part of this is due to the disclosures of Wikileaks, and former intelligence contractor, Edward Snowdon, of the National Security Agency, along with a variety of investigative reporters who all contribute to this new kind of “Great Awakening,” which is a political awakening, not religious, that has begun to reveal a level of corruption, subterfuge, and intrigue, lying, and spying within the United States government upon its own citizens and allies that is so large in size, that frankly, it’s just incredibly shocking and in so many ways hard to believe!
Yet, as Thomas Paine said, “We are apt to shut our eyes against a painful truth…” And it is painful to recognize leaders of the United States that held and still do hold top level positions of trust in government, law enforcement, security and justice roles, with high level security clearances, who are involved in such nefarious and in some cases, illegal activity!
When you begin to realize the government of your beloved country has for decades, under both Republican and Democratic administrations, have been betraying its citizens, allies, andeach others’ political efforts by accessing private phone records, computer search engines and/or wide-reaching intercepts and surveillance activity, or controlling and making up data, or dossiers to favor certain political parties and entities, along with spying on world leaders that are supposed to be your friendly allies, and meddling in foreign civil unrest—it becomes a stunningly disappointing reality check of abandoned honesty, integrity, and respect for the rule of law.
Right or wrong, regardless of our opinion, information has now been publicized, revealing just how the United States has been working over the last few decades. Many of us find ourselves incredulous over what and who appears to be involved, and seems to be building toward the unsealing of over 28,000 sealed indictments since the current administration has taken position. By the way, that represents an increase from an average of just 1000 to 1500 annually! This is mind numbing! And the mainstream media is M.I.A.!
However, we are now beginning to see some names coming into the public eye and arrests for crimes committed. Most recently, New York Attorney General Eric Schneiderman, accused of sexual misconduct, resigned. Founder Keith Rainer and movie star Allison Mack, who plays Chloe in the Superman series Smallville, has also been arrested and charged for “recruiting” on behalf of the executive training company, NXIVM, for human sex trafficking, money laundering, and tax fraud with suspected ties to the Clinton Foundation—and this is just the beginning!
Sources close to the FBI and DOJ claim many of those under secret indictments are judges, current and former politicians, and business executives, all in line to be revealed, as the courts begin processing these indictments for prosecution and bring these charges forward, incrementally, over the coming months and years! It’s no wonder as to why approximately 50 senators and congressman have resigned or will not be seeking re-election. It’s fair to say some may not want to endure the public embarrassment, or maybe made deals to stand down.
But whatever the reason, stay tuned, because it’s going to become quite shocking for some of us when it’s revealed publicly as to just who is, and was, involved in so much of this corruption, graft, and immorality for so long—decades long—especially here in the United States. The names that have been leaked and the charges they will face will be shocking for some to comprehend, while others will probably not believe the magnitude, scope, and degree of subterfuge, treason, and sexual misconduct that has taken place by both elected and appointed officials of trust, at some of the highest levels of leadership, from both sides of the aisle!
What Is the Reawakening?
Thomas Paine said, “For my part, whatever anguish of spirit it may cost, I am willing to know the whole truth; to know the worst, and to provide for it.” Jesus said, “And you shall know the truth, and the truth shall make you free.”
Admittedly, this was meant to be in context to His Word, the Gospel, but the principle still stands, and it doesn’t dismiss this fact: “Truth” has a way of setting you free from the shackles of control, deceit, anxiety, danger, and harm. It can be empowering—this is undeniable, especially as a Christian!
There’s an old saying that “Honesty is the best policy.” When you have nothing to hide and you can live a life of openness and transparency, then no one or nothing can control your behavior in what you do, say, or think—that should be the aspiration of every Christian today. But, sadly, too many of our political leaders, educators, and those running our large corporations, along with some in law enforcement agencies, do not adhere to the Christian values so critical to the character necessary when serving the public trust. John Adams said it very plainly when he explained, “Our Constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other.”
It would seem obvious, due to the liberty and freedom our U.S. constitution provides, that trust becomes a determining factor for the success of benefiting the greater citizenry. Otherwise, those of lesser character, untrustworthy, working self-serving agendas, can easily “game” the system and become very rich due to the access of power and influence, which comes with the positions of privilege while serving the public. That, unfortunately, is exactly what has been going on for the past 50–60 years. Far too many of our leaders, both Blue and Red, have been getting rich at the expense of the country’s well being and the people they’re supposed to serve!
The prophet Isaiah has a lot to say to the United States; and though he’s speaking to ancient Israel, the cultural parallels are dead on and stunning! “Ah sinful nation, a people laden with iniquity [perversity, evil, mischief], a seed of evildoers, children that are corrupters: they have forsaken the LORD, …from the sole of the foot even unto the head there is no soundness in it [they’re irrational, and void of judgment—moral relativism is now the rule]; the wounds and bruises, and putrefying sores: they have not been closed, neither bound up, neither mollified with ointment [no accountability]. Your country is desolate, your cities are burned with fire [literally, and culturally]: your land, strangers [foreigners] devour it in your presence, and it is desolate, as over thrown by strangers [foreigners]” (Isaiah 1:4–7).
Jeremiah has a similar message for Judah some 120 years later, but prophetically speaking, is also very appropriate and cogent for our country today. You might as well consider him warning many presidents, congressman, senators and judges—prime ministers, ambassadors, and many political leaders throughout the land of North America and the British Commonwealth nations—that judgment is upon the land. Notice how Jeremiah’s message is so germane for us today:
“Declare this [this is a declaration] in the house of Jacob [which did not exist at this time—they had been conquered 120 years before. You can make the case that this actually is directed to us, for today] and publish it [make it known] in Judah [in Jeremiah’s time, as well as the future Israeli nation of the latter days], saying, Hear now foolish people, and without understanding [reprobates—void of judgment]; which have eyes, and see not; which have ears, and hear not [you’re in denial and blind]: Fear you not me? saith the Lord: will you not tremble at my presence [Do you not respect God, His laws, power, and authority?]…. But this people has a revolting and a rebellious heart; they are revolted and gone. Neither say they in their heart, Let us now fear the Lord our God [They are an arrogant people that does not revere or submit to God’s instruction]…. Your iniquities have turned away these things, and your sins have withholden good things from you [We are limiting God from providing and protecting us because we choose to disregard His laws]. For among my people are found wicked men: they lay wait, as he that sets snares; they set a trap, they catch men [They purposely set people up for blackmail and extortion, to control their actions]. As a cage is full of birds, so are their houses full of deceit [The houses of authority are full of leaders who deceive for self serving gain and are controlled for unethical and immoral purposes]: therefore they are become great, and waxen rich [They go into public service of trust and by exploits and subterfuge, blackmail, and extortion, become fat and rich]. They are waxen fat, they shine [They become prominent and popular]: yea they over pass the deeds of the wicked [They overlook lawlessness and ignore the rule of law for gain and power]: they judge not the cause, the cause of the fatherless [The leaders don’t care about the orphan, but exploit children for gain, trafficking them into slavery and illicit sexual service], yet they prosper; and the right of the needy do they not judge [They don’t serve the needs of the poor; instead they take advantage of them for personal gain and power]. Shall I not visit for these things? says the Lord: shall not my soul be avenged on such a nation as this [God fully intends to deliver justice for this injustice]? An astonishment and horrible thing is committed in the land [There is much evil in this described society]; The prophets prophesy falsely, and the priests bear rule by their means [The religious leaders are misleading the people and not instructing them in truth. Why? To maintain their own gain, prominence, and control]; and my people love to have it so [The people prefer it this way because it makes them feel good]: and what will you do in the end thereof” (Jeremiah 5:20–31)? Yes, that is the question for all of us to answer upon realizing the evidentiary evil that clearly surrounds us.
We are living in some very remarkably parallel times. It is obvious the United States and the United Kingdom, along with many of its commonwealth nations, suffer from the same sycophant pathologies and activities. Things we used to trust in and felt secure with are now beginning to unravel and come unglued because of disclosures made public that reveal those in public service betrayed the trust of the office they were elected or appointed to serve in. And God is not amused at this kind of political graft, corruption, and betrayal. As Hosea said during the time of the Assyrian invasions of the 8th century against Israel (not Judah): “My people are destroyed for lack of knowledge: because you have rejected knowledge, I [God] will also reject you [the nation], that you shall be no priest [figuratively, a moral religious standard] to me: seeing you have forgotten the law of your God, I [God] will also forget your children [future generations]” (Hosea 4:6). These are harsh statements from the God we embrace as a country!
God is fed up with a nation that does the things described above. And it has been His pattern to correct any nation that embraces His standards as the God of the land, which the United States has done since its inception. And though many of us would argue and have to admit the United States itself hasn’t been perfect with human rights, it still doesn’t dismiss this current fact: Its attraction is due to personal freedoms and liberties, compared to the rest of the world, that excel all other nations. Everyone wants to immigrate to the United States—even if it requires breaking the law to get in!
So What’s Coming Up Ahead—Around the Next Bend
The United States is positioning for a correction in its course of interaction with the world’s community of nations. It would appear by the actions of this President, that he fully intends to rebuild and reinforce the overall strength and posture of the United States on the world stage. His most recent passing of the Omnibus Budget Bill clearly indicates military spending is a top priority. The fact this $1.3 trillion bill has $720 billion earmarked for military expenditures plainly indicates he is refurbishing and expanding the military might of America, for whatever military action may be required. Actually, it appears he fully expects preparedness for war is justified, and that’s why more than half of this Omnibus Bill is devoted to military spending!
We are living in a time when at least four or five nations of the world are fully able to destroy all life on this planet. Mankind has achieved, without a doubt, the level of destructive capability that is now maximized. We are in the end times, just by knowing this “factoid” alone!
With that in mind, the words of Jesus Christ should echo in our minds to secure us during these evil and perilous times. Notice, “Take heed that you be not deceived: for many shall come in my name, saying, I am Christ; and the time draws near: go you not after them. But when you shall hear of wars and commotions, be not terrified: for these things must first come to pass; but the end is not immediately. Then said he unto them, Nation shall rise against nation, and kingdom against kingdom: And great earthquakes shall be in different places and famines, and pestilences; and fearful sights and great signs shall there be from heaven” (Luke 21:8–11). This is what is up ahead, around the next bend!
In addition, “And when you see Jerusalem compassed with armies, then know that the desolation thereof is near” (Luke 21:20). It goes on to say that if you’re in that area, get out, and if you’re not in that area, stay out. Don’t go to the Middle East (verse 21)! Don’t believe and don’t be deceived by those claiming to know Christ and then advise you to go to the Middle East for safety and protection—that’s nonsense! Jesus says, “…and let not them that are in the countries [in and around the area] enter thereinto” (Luke 21:21). In other words, stay out of the area!
Remember, Jesus said that wars and commotions will occur, but the end is not immediately. There will be nations rising against each other and great signs happening in the heavens, but Jesus will still be delayed—He will not come yet.
It seems we need to be aware that preparing for wars and commotions up ahead is an appropriate worldview and mindset to have. There are a lot of tensions building with nations having the full capability of unleashing weapons of mass destruction, causing damage of biblical proportions. This is not hyperbole, but unfortunately, our current reality. We need to be mature about it and learn to embrace our current state of affairs with faith, confidence, and courage.
Those of us who understand God’s expectations know He is not amused at the leadership, or social and immoral conditions of those nations claiming allegiance to Him. So, it should be no surprise about what potentially is coming in the way of worldwide conflict—especially since Jesus warned us “nation shall rise against nation and kingdom against kingdom.”
The United States is relearning to express assertive leadership after decades of appeasement, apologies, and accommodation at the expense of its own national well being and security. The question is, Will the world’s community of nations, having been working an agenda of globalism, accept and adjust to this revived nationalistic approach the United States, United Kingdom, and a handful of others within the European Union are now adopting? That remains to be seen as to how it will all play out.
But we do know this: What’s up ahead and around the next bend is a globalist regime in the form of a “Beast Power” that will ultimately manifest for a short time (Revelation 17:11–14). And a major obstacle blocking the way for that to occur is nationalistic nations adhering to the ideology of sovereign states with borders. This is contrary to the globalist ideology and agenda of a One World Order. The clashing of these two geopolitical worldviews—Nationalism vs. Globalism—is what presents the potential for worldwide conflict between these nations that disagree about which is the better ideology for solving humanity’s global problems.
In the ensuing years, we will see how this comes together to fit the description of what our Bible explains as a “resurrected” end-time Babylon which will rule the vast majority of the world, and “mark” the people who are part of its neo-pagan religious socialist system. Until then, it’s important we recognize that enduring until the end is required, if we expect to be saved (Matthew 24:13; Revelation 2:26).