Sunday, April 19, 2015

China Injects More Liquidity to Ailing Global Economy

The contraction in the global economy, lead by the periphery economies since the 2007-08 economic meltdown, continues without much public interest. This will change as the contraction spreads regardless of central bank liquidity injections.

The Chinese will be adding to global liquidity by cutting reserve requirement 100 basis points. This stimulus, regardless of headline hype, should follow a similar path of failure defined by the Fed's stimulus programs (QE1, QE2, QE3, and soon on).

Headline: China makes big cut in bank reserve requirement to fight slowdown

BEIJING (Reuters) - China's central bank on Sunday cut the amount of cash that banks must hold as reserves, the second industry-wide cut in two months, adding more liquidity to the world's second-biggest economy to help spur bank lending and combat slowing growth.



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