China temporarily out of the Bitcoin game?

[pattu1]

http://money.cnn.com/2015/04/15/investing/china-stock-market-bubble/

Would explain a lot, especially since January...

When this money moves back into Bitcoin, we will have a serious bull run. 

[Torque]

I especially love this quote about the Friday selloff in equities:

"China. There's been plenty of talk about a bubble in Chinese stocks. Today government regulators took steps to try to crack down on so-called margin trading. They are also allowing more short-selling where people can bet that stocks will fall. That didn't go down well with investors who began to question if a market that is up over 75% since October can sustain this pace, especially as China's economy slows down."

So let me get this straight, if the Chinese gov't senses that there is a bubble forming in their stock market, they step in to actually restrict margin trading and INCREASE the ability to short-sell?  Wow, some free market they have there.  It's no wonder their stock market never goes anywhere, and their people can never be allowed the freedom to think for themselves and invest how they want.

I wonder if they have done this with the Chinese bitcoin exchanges as well?

[umairsaleem]

China stock market is firing now, nobody would care Bitcoin that is keep dropping.

well that is strange because i know they have still the biggest farm, and many other small-medium farm, and they are still mining like crazy

Not exactly, many people dropped out, that's the truth.

[BTC2DAMOON]

I'm here working in China and it's true.  I know people here that trade BTC like I do and they've moved most of their funds out of BTCChina and into Chinese mutual stock funds.  Their stocks are really hot now so it makes sense.  Once their stocks stop popping they will be back.

[Snorek]

I'm here working in China and it's true.  I know people here that trade BTC like I do and they've moved most of their funds out of BTCChina and into Chinese mutual stock funds.  Their stocks are really hot now so it makes sense.  Once their stocks stop popping they will be back.

I wonder if that change of heart Chinese people had happened because BTC price was down and they started to doubt Bitcoin. Or it is otherwise and stocks were so enticing that people abandon bitcoin for it?

[KimNam]

maybe temporarily or forever, nobody knows
no chinese trader (or speculator), i think there's no bitcoin's skyrocketing. And in other hand there's no quick dump too. Bitcoin market is like now, sideways and turn downwards.
Yes many of bitcoin traders dump BTC when alibaba IPO happen, i have some chinese friends did that and they never involved in bitcoin worlds anymore

[Amph]

I'm here working in China and it's true.  I know people here that trade BTC like I do and they've moved most of their funds out of BTCChina and into Chinese mutual stock funds.  Their stocks are really hot now so it makes sense.  Once their stocks stop popping they will be back.

besides that, the volume of cny is still huge, froo bitcoin(75%) and the global bitcoin volume is not reduced so much, but their slow exit, could be the reason for the dropping in price...

[Torque]

Yep, Chinese stock market bubble confirmed:

http://www.bloomberg.com/news/articles/2015-05-04/china-s-crazy-stock-market-charted

They're now experiencing the same dot-com tech mania the U.S. went through in 1999-2001.

And look at that margin buying!  For unknown/unproven Chinese tech IPOs??  Holy crap!  When that house of cards falls, it's going to get really ugly... and there's going to be a lot of bagholders.

[thezerg]

Those invests in the stock market and those who invests in Bitcoin are different people. There might be some who dumped their bitcoins to trade stocks instead. I believe these are the minority, at least in money terms.

indeed.


Those who invest in BTC usually don't have enough money to invest on Stock Markets or Forex.

Of course after each bubble things changes and some people cash out from BTC to invest in other stuff

LOL, because you guys said it, it MUST be true! 

Instead of just making unsubstantiated claims, you should consider money as a fluid that ebbs and flows into various containers: stocks, bonds, different countries, gold, land, bitcoin. 

It seems to me painfully obvious that the bull markets in the USA and China have depressed prices of other speculative commodities.  But I am not going to fall into your trap and speculate with absolutely no research on how big the effect might be.


 

[mrhelpful]

Didnt they say something similar back way in 2013 or several years back.

And they say something similar now is a bit weird to my eyes. The question is, how is china suppose to sell off their american debt? if our dollar value is reasonable being lowered every year.

I doubt they are completely out of the game. China has massive amount of people, and if they see some form of benefit they`d seize it.

[Torque]

This is getting hilarious

http://www.wsj.com/articles/chinas-stock-market-boom-wont-erase-bad-debts-1431426965

Proof from the article that the Chinese gov't has now gone full retard:

"Chinese companies have been active of late issuing fresh equity.  China Resources Land  and  Fosun International  this week are working on plans to raise more than $1 billion apiece. This is undeniably a good thing in a country with a leverage problem: The more equity raised, the more debt can be paid back.

 The government seems to support the market rally, with full-throated editorials in state media encouraging ordinary investors to take the plunge. So a school of thought has developed that the stock market—and the associated equity raising—is part of a concerted campaign by Beijing to reduce debt."

So now the Chinese retail investors get to bail out these domestic companies who are swimming in debt by speculating in them using leverage -- all sanctioned by their gov't -- how awesome.

The article finishes with this:

"Even if the most indebted companies succeed in deleveraging through raising equity, who really benefits? Should the sudden stock-market rally reverse as quickly as it has arrived, it will turn out that China’s deleveraging was laid on the shoulders of those ordinary savers who have rushed to buy shares."

[HI-TEC99]

This is getting hilarious

http://www.wsj.com/articles/chinas-stock-market-boom-wont-erase-bad-debts-1431426965

Proof from the article that the Chinese gov't has now gone full retard:

"Chinese companies have been active of late issuing fresh equity.  China Resources Land  and  Fosun International  this week are working on plans to raise more than $1 billion apiece. This is undeniably a good thing in a country with a leverage problem: The more equity raised, the more debt can be paid back.

 The government seems to support the market rally, with full-throated editorials in state media encouraging ordinary investors to take the plunge. So a school of thought has developed that the stock market—and the associated equity raising—is part of a concerted campaign by Beijing to reduce debt."

So now the Chinese retail investors get to bail out these domestic companies who are swimming in debt by speculating in them using leverage -- all sanctioned by their gov't -- how awesome.

The article finishes with this:

"Even if the most indebted companies succeed in deleveraging through raising equity, who really benefits? Should the sudden stock-market rally reverse as quickly as it has arrived, it will turn out that China’s deleveraging was laid on the shoulders of those ordinary savers who have rushed to buy shares."

I remember after the big crash in 2008 there were reports that large amounts of the bank's debts led in a big chain back to ordinary Japanese savers. Some of them lost massive amounts of money from their pension funds and the like. It appears that the ordinary Chinese savers might now be in danger of having the same thing done to them in the future.

[Torque]

http://qz.com/399664/behind-the-chinese-governments-brazen-bid-to-pump-up-its-stock-market/

Last paragraph:

"Of course, slashing debt and privatizing inefficient state behemoths are good things. But by hyping the market, the government is essentially urging its people to buy the stocks of companies with very weak—and in some cases possibly fraudulent—fundamentals. Last week’s selloff shows just how fragile China’s stock rally is. When the market finally reverses, it will be Chinese households who have ended up paying for the excesses of the state, once again."

[Torque]

Still climbing, which will make the subsequent fall even worse.  Their stock market will take years to completely deflate and bottom out.

http://www.bloomberg.com/news/articles/2015-06-08/the-6-5-trillion-china-rally-that-s-making-stock-market-history

Hopefully the smart ones will sell early (like now) and come back to Bitcoin.

[CyberSuzy]

I am surprised they laster this long

[mrhelpful]

Last time I checked they said the same thing a year, ago.

But I confirmed with my chinese friend it was just more a price play then anything thats over there. And people do it on a local level.

[leopard2]

soon the pendulum will swing back: when the stock bubble bursts, the money is not lost, money never vanishes in a fiat money system

it will just be CHANGE HANDS and from there, flow back into other investment vehicles, such as BTC

So when all that Chinese money flows out of stocks, it could flow into Bitcoin again, and this time it will reach higher highs, way above the $1200 we saw before

[fred930]

soon the pendulum will swing back: when the stock bubble bursts, the money is not lost, money never vanishes in a fiat money system

it will just be CHANGE HANDS and from there, flow back into other investment vehicles, such as BTC

So when all that Chinese money flows out of stocks, it could flow into Bitcoin again, and this time it will reach higher highs, way above the $1200 we saw before

I know the Chinese can buy vouchers to convert cash into bitcoins, but I thought direct bank transfers to exchanges were banned. How can really big money from China flow into bitcoin again through a voucher system? For example I doubt it's easy to buy $100k worth of vouchers there.

[Cluster2k]

A Chinese relative came home after visiting China last week.  She said many middle-upper class people she spoke with who had previously invested in property were now piling money into shares over there.  She mentioned two comments she heard:

"The share market is easy.  We're collecting red envelopes from the government"  (red envelopes being cash gifts)

"The government won't let the share market fall"

It's little wonder that Chinese investors and speculators would be fleeing bitcoin in favour of opportunities locally. 

Some investors she spoke with were thinking of financing a foreign project that guaranteed 17%pa income.  Very, very high by Western standards.  What did the Chinese investors think?  It's way too low, because they can get 40%pa financing local projects.  Think about that for a moment.  Many investors in China consider doubling your money within two years as a good return, and anything less as "poor".

[chmod755]

If CNN already calls it a bubble it may not last for too long, but it could be one of the reasons of why we're just floating near $200