So now we're finding out that "80,000 tonnes of aluminum and 20,000 tonnes of copper" of that was posted as collateral in China is missing.
God only knows how many billions of yuan's worth of loans and financial instruments were using this imaginary stuff as collateral, but then again, God only knows a lot of things about China's economic "miracle."
It's extraordinary that anyone is surprised by any of this. Back in 2007, no less than current First Vice Premiere of China, Li Keqiang, admitted to the US ambassador to China that ALL Chinese data, outside of electricity consumption, railroad cargo, and bank lending was for "reference only."
Put another way, one of the top-level Chinese politicians admitted in private that China's economic data is a total fiction.
Fraud is endemic in China's economy. Whether you're talking about dogs disguised as lions in zoos, China accounting for over 85% of fake goods seized in the EU, rat meat being sold as lamb, 400 BILLION counterfeit cigarettes being produced (including one manufacturer who went so far as to disguise his operation as a military base), large multinationals like Caterpillar being swindled by Chinese frauds, or the over 10,000 Chinese officials who have fled China taking over $100 billion with them, China has got it all.
All of these stories are public. Anyone could find them. Which is why it's extraordinary that anyone would be surprised that Chinese firms are also lying about the copper and aluminum they claim to own.
To its credit, China's government has made an effort to crack down on fraud, but when cooking the books is endemic to the point that your educators coin the term "GDPism" to describe the fudging numbers to meet requirements, there's only so much a number of high profile arrests can do.
At the end of the day, China's economy and financial system are a black box. No one really knows what's real and what's not. This makes it all but impossible to accurately assess what's going on there.
Adding to the confusion is the fact that China's Government is heavily invested in maintaining the illusion that China is a powerhouse. So every data point (even the formerly accurate electricity consumption) is massaged.
After all, if a multi-billion dollar company like Caterpillar, with its army of consultants, lawyers, and bankers can be tricked into acquiring a Chinese scam, what chance does an individual investors have?
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