Reuters: "China banks told to halt lending to US banks"

[jordi_fanclub]

Source: Reuters

BEIJING, Sept 25 (Reuters) - Chinese regulators have told domestic banks to stop interbank lending to U.S. financial institutions to prevent possible losses during the financial crisis, the South China Morning Post reported on Thursday.

The Hong Kong newspaper cited unidentified industry sources as saying the instruction from the China Banking Regulatory Commission (CBRC) applied to interbank lending of all currencies to U.S. banks but not to banks from other countries.

Read more: http://www.reuters.com/article/companyNewsAndPR/idUSPEK16693720080925

---

The mess is compounding...

[Indiana_Dem]

1. oh shit. nt

[progressoid]

38. Yep. n/t

[lurky]

2. Yikes. I think the big shoe just dropped.

If the Chinese are shutting off the tap, then things are going to get ugly fast.
:( :(

[OKthatsIT]

16. nahhhhhh, only if they're planning another 9/11...

they wouldnt dare...would they?

[TrogL]

17. This is financial warfare - They've already won.

[BearSquirrel2]

25. We GAVE it to them ...

We GAVE it to them with all this outsourcing.

The Chinese have NOT taken over yet. They have a nice scam going on right now in callusion with US conservatives. If they shut off the tap, the scam will be over as our currency will crash as will a great deal of Chinese manufacturing.

[The Backlash Cometh]

34. You're right. We discussed this on DU many years ago, but

it was one of those "What If's" that no one takes seriously, but the liberal blogs.

[Beam Me Up]

37. I remember that. Hell, just before 9/11 there was a large

derivative bubble that looked like it was about to break. Then 9/11 happened and Wall Street was closed for several days -- not to mention the headquarters of the SEC was literally destroyed. All that news and the world of hurt the early * administration was in was wiped off the information map.

We've been watching this 'funny money' business for a long time, not to mention the looting of the treasury by the */Cheney cabal. Once we caught wind of PNAC it all began to make bloody sense. Shock doctrine spelled out for all to see. That is the point -- the POLICIES that have led to this crisis were not just bad or incompetent decisions. They were that but they were that in a much more sinister sense. The SECURITY (in any sense of the word) of this country has NEVER been a high priority of these people. That's why, back in 2003 (I believe it was) Al Gore CALLED FOR THE RESIGNATION OF ALMOST THE ENTIRE BUSH ADMINISTRATION ON NATIONAL SECURITY GROUNDS. This was at a speech at NYU sponsored by move-on. It was a stunning, historical speech coming from an x Vice President and past Presidential candidate -- AND it received NO coverage by the mainstream news.

In short, we've been watching this tidal wave form for a long time now. The American people have been kept under-informed and misinformed about this growing crisis by a complicit corporate media. NOW it is becoming clear that the rest of the world (especially Russia, China and their allies), aren't going to put up with our MASS CONSUMPTION of the world's resources and wealth to feed our Imperial war machine and our domestic over-consumption of resources any longer. Why should they??

This is what happens when you let FASCISTS (and that is what they are) take control of your government. If the American people don't put a stop to this, the rest of the world will HAVE to. And it isn't going to be pretty.

edit typo

[Delphinus]

30. Who is "they"?

And, don't you recall the rumor spreading about Al CIAda doing something in October?

[billyoc]

3. o/~ All by myselllllllllllllllfffff... o/~

[grasswire]

4. oboy

Isn't that where the money for the bailout was coming from?

I guess now they have to use the social security trust fund?

[EmilyAnne]

5. That is something I really want to know, too, oboy.

Was China going to loan the bailout money?

[tridim]

13. Sell off the war machine piece by piece

And cut the Pentagon budget in half

[annabanana]

6. This would be "bad", Venkman.

[Ghost Dog]

7. Asian Money Rates Surge as Bailout Doubt Tightens Cash Squeeze

Sept. 25 (Bloomberg) -- ... Benchmark three-month rates in Hong Kong and Singapore climbed past the levels when Lehman Brothers Holdings Inc. filed for bankruptcy and the U.S. government nationalized American International Group Ltd. earlier this month. Short-term rates on yen loans climbed to a two-month high and bill swap rates in Australia rose to the highest since August, suggesting more than $180 billion of cash injections by central banks have failed to unfreeze lending.

``The conditions are revealing a new level of breakdown in the global financial system that central banks appear powerless to fix,'' Greg Gibbs, director of foreign-exchange strategy at ABN Amro Bank NV in Sydney, wrote in a research note today. ``There's an element of end-quarter demand for liquidity intensifying the problem.''

...

The three-month U.S. dollar Libor yesterday jumped 26.5 basis points, or 0.265 percentage point, to 3.476 percent, the highest level since January, according to the British Bankers' Association said. The cost on similar yen loans reached a two- month high of 0.906 percent.

``Financial sector concerns will probably continue because the asset market, that is the housing market, is still falling,'' said Tomoko Fujii, head of Japan economics and strategy at Bank of America Corp. in Tokyo. ``It's not realistic to signal a complete waning of pressure anytime soon.''

...

Globally, banks have set aside $511 billion in losses tied to the collapse of the U.S. subprime mortgage market as Treasury Secretary Henry Paulson said the banking system is ``frozen to a large extent.''

Cash infusions by policy makers have ``not helped boost confidence between banks,'' ABN's Gibbs said. ``Every time the central banks provide a new crutch, the banks rely less on their own legs.''

/... http://www.bloomberg.com/apps/news?pid=20601080&sid=aKww9nMiO5fg&refer=asia

[amandabeech]

42. It sounds like Obama's call for a global approach to the problem was correct.

I despise some of the members of his economic team, but the U.S. can't do this by itself. U.S. financial institutions weren't the only ones buying all kids of exotic crap priced to perfection by computer models. The U.S. government should not be burdened by bailing out super sophisticated international investors from their bad decisions to buy what has always looking pretty dicey to me.

However, I expect that the Shrub/Darth action plan to alienate the rest of the world will make it very difficult for foreign governments to help out.

Perhaps the best we can imagine is some sort of short term prop-up followed by a global solution once the Obama team is in place and has its bearings.

If McCain gets into the White House, whether by legitimate, but unfortunate vote, hook or crook, I think that the rest of the world will snub its collective nose at us, at least unless they need the U.S. to throw some more low-value treasuries at them.

[OKthatsIT]

8. Well good....now we won't have any money for WARS and...

this outrageous paramilitary police state build up.

SCREW THE PENTAGON! GET RID OF THE FEDERAL RESERVE!

[Ghost Dog]

9. China Denies Report It's Banned Lending to U.S. Banks (Update1)

Sept. 25 (Bloomberg) -- China's banking regulator denied a media report that it had banned the nation's lenders from offering credit to U.S. financial institutions.

...

The banking regulator ``never, through any channel, announced or notified domestic banks to ban lending to U.S. financial institutions,'' China Banking Regulatory Commission spokesman Liao Min said in a statement on the commission's Web site today. The commission condemned the ``irresponsible'' report and reserves the right to take legal action, the statement said.

Chinese banks mostly avoided the more than $520 billion of writedowns and credit losses by global financial firms. They hold a combined $721 million of assets at risk related to Lehman Brothers Holdings Inc., which filed the biggest bankruptcy in history Sept. 15, according to Bloomberg calculations based on the most recent data released by Chinese lenders.

/... http://www.bloomberg.com/apps/news?pid=20601089&sid=aaxM3V9YhAwA&refer=china

[depakid]

14. It wouldn't have been in their best interest to halt interbank lending

which is why the first report didn't ring true.

[Mojorabbit]

18. Is their denial

believable? Surely they are moving to protect their assets.

[krkaufman]

19. Well, from China's perspective, given how much they've loaned US ...

... we're too big to be allowed to fail.

[cornermouse]

26. Do you really believe that?

I don't.

[krkaufman]

32. US "too big to fail" ... "do you really believe that?" ... No, not really.

Well, I do think we're too big to fail without significant global repercussions. The unfortunate thing is, given how we've alienated the rest of the world they are all probably willing to suffer whatever crises are necessary to see us fall from our perch.

[depakid]

20. Well, that wouldn't be the way to do it!

[Mojorabbit]

23. Do you have any ideas

how they would do it? It would be great to know or have some clues that might throw up a red flag. They probably would not announce it if they were choking off our credit but do it secretly. I figured from the article someone blabbed.

Then again we are valuable to them for a while longer as far as trade goes.

[Sonicmedusa]

10. Damn! That will mean we will have to put Americans to work

Making our OWN stuff again.

[LibertyorDeath]

11. Fucking Hell

Here comes the shit!

[Politicalboi]

12. Man McCain/Bush

Will do anything to cancel the debates.

[LooseWilly]

15. Funny...

Never thought having no retirement plan, no credit to buy any property, and no interest in getting loans to buy a new car would make me feel so free...

Ahh... embrace your inner third world nature people... we're headed that way...

[99th_Monkey]

21. LOL - you made me laugh therapeutically - thanx.

as long as they leave Social Security alone, I'll be ok, but it's not at all clear that they WILL leave it
alone.

Guess I'd best get my ass down to the Obama Campaign Headquarters and lend a hand pronto!!!

[Indenturedebtor]

22. The best days of my life have been spent in the third world

I'm ready. Just give me some dirt to sleep on and some cheap gritty food to eat and I'm solid :D

[KillCapitalism]

24. Oh shit, do you know what this means.

They'll have no other choice than to crank up the printing presses if China will no longer loan us the money to keep things running.

[City Lights]

27. Swell....

:mad:

Bush ruins absolutely everything he comes in contact with.

[Douglas Carpenter]

28. Kick and recommended!!!

[Odin2005]

29. SH*T!!! This is not good at all. n/t.

:scared:

[Ganja Ninja]

31. No more buying cheap Chinese crap.

Whatcha gonna do now Wal-Mart?

[The Backlash Cometh]

33. How do you like free market now? Ya bastids.

[LeftHander]

35. Duh...our "credit" is no good....

9 trillion in debt and counting, GDP is going to drop like stone....

I wouldn't loan US banks any money either until the get rid of the rotten heads at the top.

[GinaMaria]

40. surprise! Guess what? You are lending them the $

We're being saddled with $700B of additional debt. I always wondered what it looked like when Rome was burning.

[my2sense]

36. Dayum - without a single shot fired - we're so screwen

[GinaMaria]

39. so where will the $700B bailout come from? n/t

[Gin]

41. so.....does this help get the bill passed or what?

I am so suspicious of this whole thing that I think they are manipulating US tax payers to go along with the bailout...