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Let's talk markets for starters and I three little metrics three Adam.
Last week we saw the biggest two day slide in the Dow since November 2011.
We saw the biggest one -- sell off in ten year treasuries in a decade and now in Shanghai we just had.
5% decline in a single day the biggest decline in Shanghai since November 2010 the fear is that seems -- Read that -- spreading but the good news is if the world financial system collapse as you can talk that ring Maceda was wearing an engagement ring that rock that is they hold that up have you -- Yeah that's a gorgeous.
Here is the -- -- there to be blue in the just is going to be working double -- Years all right here's the bottom line where we're paying attention to we will look the high frequency traders there again out of the Dow right now they're going to cash you know -- sit on the sidelines for a little bit.
We have options contracts expiring at the end of this week there's all kinds of things in -- -- talk about China.
And what we saw last week in China that I've read one article -- talked about the fact there was this the -- moment in China have the Central Bank in China.
Actually not making credit easy so the question becomes how do you turn over -- short term debt in China we're not talking about the banks the banks are fine in China.
It's the shadow banking system which is the majority of credit that's behind you know the government there sells land to the developers to raise cash and and they build.
These cities that are uninhabited -- -- -- manufacturing slowdown in China but you also have credit crunch have almost a liquidity freeze.
In China and that's really upsetting.
Some of the investors and one of the reasons you talk about fear.
That that's out there and then you talk by the Shanghai can what did dad today 5% -- in a single day it fell overnight that down.
I value the money percent of -- and I -- China has the the foreign reserves if they had to bail out their banks as they've done by the way they did this in the late nineties there's a book that explains this and this is a recurring problem since China has become somewhat of -- modern economy.
But they're banking system essentially collapses.
The book is read capitalism so in the late ninety's they went through this and the question is will they go through it again they have the funds -- the bank.
The question is the shadow banking system right nobody knows who the partners are on either side of the and of course stranded -- stocks and I heard another worry just -- late last week that the the other worry now so with China banks and -- cash crunch.
Look at that due to bond prices around the world -- China holds over trillion dollars -- US -- here if it starts selling off.
US tragedies to raise dollar cash and look at whether he'll play -- coming up the banks.
Then bond prices get rattled even further have big tumble last week that there's a lot of concern about that there's -- beauty you know that.
It's just for those of us who don't have the Ph.D.s from Princeton who write the -- you know the formulas that I've currency traders are using.
The Federal Reserve everyone spooked about them possibly pulling back how could they possibly pull back -- slowdown in China.
You have to own Federal Reserve saying that GDP in the United States in 2013 is contracting.
From where they had originally thought 2.3 percent from what they said would be two point 8%.
There on metrics are telling you.
That by their own formulas it's not the time -- -- and you have even a member of the Fed saying hey we were premature -- -- I've done all that our -- -- developing this rally may not be at right thanks for being with us today got a Adam Shapiro will -- later in the day.
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