The "up-to-the-minute Market Data" thread

Originally posted by nydsdan
Can I ask a really stupid question? Where does the IMF get this money from in order to issue bonds in such large denomination? Who controls IMF? Sure, member countries are supposedly working together - kinda like a financial UN or something, but who is at the head of the table, and who are they to create bonds?

That's not a stupid question by any means. The answer to it give you a good protective shield against ignorant claims concerning the world finances.
You can start from here . . .
imf.org...

I just found this news on their site,

IMF Injecting $283 Billion in SDRs into Global Economy, Boosting Reserves

So the billions injected will be over 300 after all,

With much of the world still mired in recession, the IMF took action to bolster its members’ reserves through an allocation of SDRs, or Special Drawing Rights.

The allocation, equivalent to $250 billion, was made on August 28 and will be followed by an additional, albeit much smaller, allocation of $33 billion on September 9. With the two allocations totaling roughly $283 billion, the outstanding stock of SDRs would increase nearly ten-fold to total about $316 billion.

Doesn't this will accelerate Inflation?

www.imf.org...

Originally posted by stander
China has the right to purchase SDR like Mongolia, Iceland, or any other nation affected by the global economic downturn. The SDR has been around since 1969 and it wasn't invented to replace USD as the reserve currency -- IMF is like a world bank that can loan large sum of money to entire nations, coz there is no private bank rich enough to handle this type of loans.

The People's Bank of China didn't purchase any bonds for an investment, coz IMF is not in this kind of business. According to the agreement, the bank purchased regular SDR notes.
www.imf.org...

The IMF has NEVER BEFORE sold bonds. This is a first. SDR (Special Drawing Rights) have been around to help emerging nations an economies since 1969, but IMF BONDS are a brand new creature.

From the link you provided:

the PBC agrees to purchase from the Fund promissory notes

Series A and Series B Notes are identical, except that only Series A Notes are eligible for early payment on demand under certain circumstances, as specified in paragraph 7 of the General Terms and Conditions.

the Fund may issue and the PBC shall purchase Notes during an initial period of one year commencing on the date the first Note is issued or
September 30, 2009, whichever is earlier (the “Availability Period”). Unless otherwise agreed between the PBC and the Fund, the Fund shall give the PBC at least five business days’ (Beijing) notice of its intention to issue Notes for purchase under this Agreement, including the amount of the Notes to be purchased

Notes shall be denominated in the special drawing right (SDR). Notes shall be issued in multiples of SDR 10 million. The purchase price for each Note shall be 100 percent of the principal amount thereof.

Except as otherwise provided in this paragraph 4 and in subparagraph 7(b)(ii) below, each Note shall have a maturity date that is three months from its issue date. The Fund may in its sole discretion elect to extend the maturity date of any Note or of any portion thereof by additional periods of three months after the initial maturity date, which extension the Fund shall automatically be deemed to have elected with respect to the maturity dates
then in effect for all Notes unless, at least five business days (Washington) before a maturity date, the Fund notifies a Permitted Holder in writing that the Fund does not elect to extend the maturity date of the particular Note or portion thereof; provided however that, in no event, shall the maturity date of any Note be extended to a date that is later than the fifth anniversary of the issue date of such Note.

So these are 3 month notes (bonds) that can be extended up to 5 yrs, with each bond worth 10 Million SDR

Stander, show me where the IMF has done this before & where any country has bought these "notes" before, please.

reply to post by marg6043

That's a drop in the bucket. It took $180 billion to bail out AIG alone.

reply to post by stander


Yes but that was in the US, this funds are to be going into the global economy, are they to multiply anyway?

Still the question of inflation even is addressed by the IMF in their site when responding to questions of how this billions output will be doing to economies that will be using them.

Yes I would say that China has a plan to accelerate *SOMETHING*

Hong Kong recalls gold reserves, touts high-security vault
In a challenge to London, Asian states invited to store bullion closer to home

HONG KONG (MarketWatch) -- Hong Kong is pulling all its physical gold holdings from depositories in London, transferring them to a high-security depository newly built at the city's airport, in a move that won praise from local traders Thursday.

more at link

So IMF Bonds, pulling all physical gold home...

this does not sound like good news to me

edit to fix tags

[edit on 9/3/09 by redhatty]

reply to post by redhatty
Good work Detective Red...

There's the Gold move CNBS has no clue on...either that or are lying AGAIN...as usual...

And more news out of China...

Markets hit by China commodity default

A report that Chinese state-owned companies will be allowed to walk away from loss-making commodity derivative trades provoked anger and dismay among investment bankers on Monday as they feared it may set a damaging precedent.

The State-owned Assets Supervision and Administration Commission, the regulator and nominal shareholder for state-owned enterprises (SOEs), told six foreign banks that SOEs reserved the right to default on contracts, Caijing magazine quoted an unnamed industry source as saying in an article published on Saturday.

While the details of the report could not be confirmed, it was Monday's hot topic in financial circles from Shanghai to Singapore as commodity marketers feared that companies holding underwater price hedges could simply renege on the deals, costing banks millions of dollars in profit.

The warning from SASAC follows a series of measures from Beijing this year to crack down on the sale of derivative products by foreign banks to Chinese enterprises, principally big consumers, who bought protection against higher prices last year only to watch the market collapse -- leaving them with losses.

While many companies including top airlines have come clean on the losses, some analysts fear another wave may follow.

more at link

and

China's SOEs May Terminate Commodities Contracts

China's state-owned enterprises may unilaterally terminate commodities contracts as they try to cut massive losses from financial derivatives, an industry source told Caijing on August 28.
According to the source, China's State-owned Assets Supervision and Administration Commission (SASAC) has sent notice to six foreign financial institutions informing them that several state-owned enterprise will reserve the right to default on commodities contracts signed with those institutions.
Keith Noyes, an official with the International Swaps and Derivatives Association, a trade organization, confirmed that he is aware of the matter, but provided no further comment.
Foreign brokerages usually work through their Hong Kong operations to sign over-the-counter derivative hedging contracts, according to an investment banker whose firm is involved in the business. Hong Kong and Singapore usually serve as venues for arbitration over such transactions.
Most investment banks may "just swallow" any losses arising from canceled contracts, the executive said, adding that any losses are usually made up for with compensating trades.
Investment banks "just earn less" from such transactions, he said.
But any such move would be a major blow to investment banks which service massive commodities hedging operations for Chinese SOEs on the international market, said the executive.
Chinese SOEs have suffered massive losses from hedging contracts since the onset of the global financial crisis. SASAC and the National Auditing Office has been investigating derivatives positions trading since the beginning of the year.
A source from a state-owned company told Caijing that most of Chinafs SOEs engaging in foreign exchange and international trade have participated in derivatives trading, involving capital topping 1 trillion yuan.

So let's make a list, Investing in something OTHER than the USD, Pulling in all physical gold from London, Allowing State owned companies to default on commodities contracts...

This is starting to look a bit fugly to me

And we still haven't even heard what the new ruling political party in Japan is going to do

reply to post by redhatty


You are a plethera of information today!!!

Looks like I was was right earlier when I said I smelt Fear...

reply to post by redhatty

I didn't read the whole agreement, but the "notes" are actually bonds. It looks like the IMF doesn't have enough funds to respond to many requests for an assistance. So they decided to borrow. I believe that the Chinese and IMF have come up with an instrument to create a special secondary market for the US Treasuries that China holds to liquidate them without undue losses. The biggest holders of US debt are likely to make this kind of purchase once again.

Originally posted by stander
reply to post by redhatty

 

I didn't read the whole agreement, but the "notes" are actually bonds. It looks like the IMF doesn't have enough funds to respond to many requests for an assistance. So they decided to borrow. I believe that the Chinese and IMF have come up with an instrument to create a special secondary market for the US Treasuries that China holds to liquidate them without undue losses. The biggest holders of US debt are likely to make this kind of purchase once again.

So...now even the IMF is begging... :shk:

I do fear a Train Wreck for real now...

reply to post by stander


I agree, I think the IMF Bonds are a vehicle for China to get rid of the US T's it no longer wants to hold. Ben hasn't been buying back enough of their 30 yr holdings, so they are finding another way to convert them.

That's a bit of de-coupling that we really don't want to see though.

KD comments on that today too

The Sort Of Decoupling You Don't Want

OMG, this is a perfect example of why the US is scroomed



Congressman Stark: "The more debt we owe, the wealthier we are".

WARNING: Language not suitable for most work environments and small children

Originally posted by warrenb
reply to post by marg6043

 

To me it seems like the markets are doing exactly what they did this past January to March, before tumbling below 6800...
[atsimg]http://files.abovetopsecret.com/images/member/db28d4536a4d.png[/atsimg]
finance.yahoo.com...

We could see the downward spiral very soon


[edit on 3-9-2009 by warrenb]

Thats very incorrect (not being mean), I can help you here.


www.sierrachart.com...


Thats all you need to know really - the 20 EMA and the 50 EMA now that we are above the 200 EMA.

Today, the development favors the extended linear regression as a tool to predict today close.

[atsimg]http://files.abovetopsecret.com/images/member/c952fb663353.jpg[/atsimg]

See what happens . . .

reply to post by redhatty


Money is debt, yep...

As for what China is up to - probably up to what the old wisdom says: Wars are won by those who have biggest reserves. They are building up their reserves of all that really matters.

They are using the existing system of exchange to acquire ores, oil, technology, influence while at the same time simulating consumers society onto which western economies are so hooked up.

China is simulating, simulating, simulating... And an amateurs' simulation like DJI or IMF cannot fool them.

All they have in mind is - war. Politics and economy are just prosthesis of war.

reply to post by DangerDeath


True, but remember the Chinese are a very patient people. They have had over 6000 yrs to plan strategies and learn from mistakes.

In this day and age, they have learned that you can defeat a nation without having a single shot fired, just crush them economically, or buy all their assets & debt & you in essence own them.

Old book, well written, I highly recommend Hegemon: China's Plan to Dominate Asia and the World

Read it & you will see that this almost exactly describes the play book China is using RIGHT NOW

reply to post by redhatty



whoa - I'm amazed that senators handlers let that happen. the puppet masters are losing their grips. that's disturbing in of itself

I do think that the interviewer should have been a little quieter and let the senator hang himself more in his own ignorance. But the insulting language of the senator is really enough to show how scared, freaked and out of control these people are right now.

thanks for posting this! He is really repugnant.

reply to post by redhatty


If China goes ahead on defaulting it will come out clean and free, still while screwing those around them, China have so much hold and foreign influenced specially in the US that nobody is going to touch them with sanctions.



Because let face it people they hold Americans bull by the balls because of debt.

Now will US do the same? default on all debts, that will hurt China a lot, even create a possible war.

I don't think so, the US will never dare to do that.

The FED had a good CMB auction today, right after the results were released, the DXY obtained an erection.

We know where the $$ came from to prop the USD up today, now don't we?

Even though the talking heads on CNBS are not mentioning China & it's gold recall from London, the traders see the news & are acting accordingly.

I'm thinking that the inverse 2x gold etfs, DZZ or DZG are a good investment today, possibly cashing out tomorrow or Monday

edit to correct spelling/syntax

[edit on 9/3/09 by redhatty]