Something Brewing in South Korea?

The won looks weak, with a possible major bearish breakdown in play. It only looks good versus the yen.

East Asian Currency Meltdown

I measure a 1000 point move from the top to bottom of the triangle (counting the 1997 peak down to 2007 low). If the whole triangle, the target would push out towards 2500. The former seems "insane" enough for me.

Singapore dollar also looks in trouble if USDSGP can break out of that pattern.

Snack Empire

Still holding this one.

Currency Checkup

USDSGD Bounces Off Support

Singapore Record Three-Year Home Price Decline

Bloomberg: Singapore Home Prices Fall for Third Year Amid Government Curbs

Singapore home prices fell 3 percent in 2016, the third straight year of declines as the government held steadfast on property cooling measures.

...Prices fell for a 13th straight quarter, the longest streak since the data was first published in 1975.

iFeng: 新加坡房价连跌三年 创1975公布数据以来最长下跌纪录

Nasdaq Plans China Commodities Futures in Singapore

FT: Nasdaq plans China commodity futures trading in Singapore

Nasdaq is planning to give investors direct exposure to China’s freight, iron ore and crude oil markets, through offshore futures contracts traded in Singapore — joining other exchanges in a wider push into Asian derivatives trading.

Hanne Johansson, Nasdaq’s global head of commodity sales, said the exchange believes new products can help satisfy demand for offshore access to Chinese markets, in much the same way as offshore renminbi trading in Hong Kong and London does.

“We want to explore how we can actually bridge these two markets,” Mrs Johansson said, referring to mainland China and offshore derivatives trading venues.

iFeng: 商品牛市令人眼馋 外国人正准备撬开中国期货市场大门

Winter Is Coming: China's Real Estate Market Cools, Singapore's Economy Grinds to A Halt, Another Emergency Fed Meeting

iFeng: 全国楼市现降温信号 三线城市房价降幅最大

Sales in 90 percent of Chinese cities fell in the first week of April. In 28 key cities monitored, sales fell an average of 23.2 percent.

Average sales decline in first-tier cities: 27.4 percent. Beijing declined 30 percent. Shanghai fell 17.2 percent. Shenzhen decreased 31.1 percent and Guangzhou tumbled 37.8 percent.

The average decline in second-tier cities was 20.9 percent.

Third-tier city sales: down 35.1 percent.

Centaline reports similar, though less severe data and blames it on March being a peak month for activity:

On the same day, the statistics released by Centaline Property Research Center also shows that the market turnover has dropped slightly, early April 54 City 97600 total contracted residential units, a 112,800 units in March down 13.5%. Among them, the first-tier cities fell more obvious, a decrease of 18%. Shanghai, Shenzhen, Beijing and other cities have different degrees of decline.

For the property market turnover decline, Centaline Dawei, chief analyst believes that the key cities in March and daily room rates climbed to a new high, and rose to the most in history. "The market shot up after the somewhat lower in April, but still high. Which, by the attention of the market in Shanghai and Shenzhen, after harsh New Deal, appeared last week, markets dropped significantly." He said.

The data is weekly and deserves a grain of salt as always, but it is surprising for the third-tier to be cooling more than top cities. First-tier cities implemented strict buying restrictions and have extremely difficult comparisons due to sales spikes in March; third-tier cities are still easing yet having no luck.

On to Singapore. Bloomberg: Singapore Adopts 2008 Crisis Policy as Growth Grinds to Halt

The Monetary Authority of Singapore moved to a neutral policy of zero percent appreciation in the local dollar, it said in a statement on Thursday. The currency slid the most in five months after the announcement, which came as a surprise to 12 of 18 economists surveyed by Bloomberg, who had seen no change in policy.

The article comes with a familiar chart of the global economic slowdown.

The last time the MAS shifted its currency policy to zero appreciation was in October 2008, when the economy was in a recession. Thursday’s move was the bank’s second unexpected decision in less than 16 months, following an emergency policy change in January last year to combat the threat of deflation.

The Federal Reserve is sending out smoke signals whether it wants to or not. ZH: The Fed Just Held An Emergency Meeting To Discuss Capital Markets

We do know, however, that it is a very busy week for unexpected, emergency meeting for the Fed, because according to the Fed's board meeting website, today at 3pm the Fed held yet another previously unscheduled "meeting under expedited procedures", only instead of discussing rates this time, the Fed talked about institutions, infrastructure and financial markets.

China May Use Offshore Banking to Secure South China Seas

China considers killing two birds with one stone, turning Yongxing Island (Woody Island) into an offshore financial center. Aside from the economic benefits, it would secure China's political claim on the South China Sea.

21st CBH: 南海岛礁能成为百慕大式离岸注册地吗?

Two of the country this year, the South China Sea once again become the focus of the parties. NPC press conference, spokesman Fu Ying was asked three times to the South China Sea. There are also proposals for motions involving the South China Sea. Two of the most notable of the CPPCC National Committee, deputy director of the Foreign Affairs Committee, submitted Han Fangming "Yongxing Island will build a Bermuda registered offshore" proposal.

Registered offshore, through low-tax policy or tax-free, loose financial regulation and open management program, set up to attract foreign companies registered offshore companies. Proposal suggested that the central and Hainan through policy and legal support, allowing the Xisha Yongxing Island, the development of offshore financial services, and thus promote the development of the South China Sea and the central economic zone in the South China Sea strategic layout.

I believe that, and regardless of the specific content of proposals, one on its own logic - the economic development of the island as a means of distribution of the South China Sea should be able to provide new ideas for breaking the increasing complexity of the South China Sea game.

In fact, economic development has become the main means to safeguard the sovereignty of the South China Sea. From the initial joint development of South China Sea oil and fishery resources initiatives, to the exploration of deepwater oil and gas fields, economic instruments are to highlight its significance. The difference is that the role of fisheries and oil and gas development is mainly reflected in the sovereign sea waters especially controversial declaration, and the development of offshore financial sector would help to strengthen the management of the actual controlled islands.

Although China has already realized over the Paracel Islands and administrative development, its economic function has often been watered down. A real problem is that China's legitimate military and civilian deployment in these reefs, likely to cause unnecessary tension in neighboring countries, and become some of the United States, Japan and other countries outside the South China Sea issue of multilateral excuse. In this context, clearly some of the reefs controlled economic development function, can also be regarded as reducing misjudgment, an effective means of reducing external intervention.

I doubt outside parties will be mollified by China securing its interests, but it undoubtedly strengthens China's claims.

There are drawbacks though. Foreign investors will be wary of China's claim on the islands and China's legal system is unable to deal with offshore banking at this time:

Security Capital is also an important factor. The vast majority of offshore centers away from geopolitical disputes, and maintaining political stability through effective government. In contrast, the South China Sea tensions in the South China Sea islands and reefs will hinder the development of the financial industry has brought. This is why a lot of people are not optimistic about Yongxing Island Offshore Financial reasons development. Of course, this view underestimates the Chinese South China Sea as a "real master" determination to maintain peace and stability on the South China Sea. However, for Yongxing Island as an international financial capital registration, we also need to make some effort to highlight Yongxing Island demilitarization of use and so on.

In addition, the legal system, now known global offshore centers use the Law Department. This system was considered for a higher degree of financial innovation tolerance, and ease of integration with Western multinationals legal system. And China, as in civil law countries, the ability to "compatible" an offshore centers?

In short, the Yongxing Island, the reality limited by a variety of conditions, even if the island's offshore area can be entered substantive stage of development, it is difficult to attract transnational capital in the short term. However, we could have based on their own business, and then through a series of innovative laws, the financial system, reducing barriers on legal convergence.

Of course, both can develop from the Yongxing Island offshore financial business, the South China Sea policies are ultimately in order to safeguard China's sovereignty and territorial integrity. Under this theme, we might open my mind, bold innovation, and explore more effective path of development and rehabilitation of the South China Sea.

PBOC Chief Economist: Exclusion from TPP Could Cost 2.2% of GDP

iFeng: 央行首席经济学家：不加入“大TPP” 会因此损失2.2%的GDP

Simulation results show that, with China's accession ("big TPP") compared to the scenario of China not joining, China will lose 2.2 percent of GDP. TPP is assumed that the transitional period of four years, the average annual opportunity cost in this stage of slightly more than 0.5 percent of GDP. If China does not join a number of other countries will also result in the loss of opportunity cost. For example, South Korea, Japan and other countries with close trade China will bear the equivalent of 1.5 percent of GDP and 0.6% of the GDP of the opportunity cost, while the European Union, Singapore, Vietnam and other countries and regions will benefit because the Chinese do not join.

...If the 16 potential member states have joined the Trans-Pacific Partnership Agreement, the Agreement (the "big TPP") implementation will boost GDP by most member states, which benefit from Korea's GDP accumulated 2.2%, Vietnam 2.1%, China 2.0 %, Japan 1.3%, Australia 1.2%, US 0.3%. Instead of "big TPP" countries will suffer some negative impact, which will also involve non "big TPP" countries in the corresponding free trade negotiations. On the industry level, the main beneficiaries of TPP, including Vietnam, Thailand and China's textile and garment industry, Australia's food processing industry, as well as China and South Korea's electronics industry. Japan and South Korea in the agricultural sector, the United States and Australia textile, garment industry will suffer a greater negative impact.

Related: The Logic of Strategy: Yuan Devaluation and the Road to Trade War

The ultimate containment strategy for the U.S. and regional partners (who all have access to U.S. markets) then, is an economic strategy. Yes, these nations will suffer slower growth, but they will retain their sovereignty.

U.S. May Scuttle Free Trade Deal And Send Ships To South China Sea

The failure of the TPP may mark the high water mark in this era of globalization. The next step will be an anti-China economic policies designed to cut China's military expansion. Community and identity have supplanted economics in most domestic Western politics. Sovereignty will rise above economics in international relations, as laid out in The Rise of China vs. the Logic of Strategy.

U.S. Military Proposes Challenge to China Sea Claims

The U.S. military is considering using aircraft and Navy ships to directly contest Chinese territorial claims to a chain of rapidly expanding artificial islands, U.S. officials said, in a move that would raise the stakes in a regional showdown over who controls disputed waters in the South China Sea.

Senate Democrats gang up to delay fast-track trade bill

U.S. Senate Democrats delivered a major blow to President Barack Obama's trade agenda on Tuesday, blocking debate on a bill that would have smoothed the path for a Pacific trade pact.

...The failure to garner the necessary votes came after pro-trade Democrats, including Senator Ron Wyden of Oregon, insisted that fast track be bundled together with three other trade bills, including one that would impose import duties on countries that manipulate their currencies for unfair trade advantage.

Who's that?

Social Mood in Singapore

Singapore’s Foreigner Problem

The abuse is often so vicious that in his 2012 national day rally speech, Prime Minister Lee Hsien Loong noted the proliferation of posts “tormenting and berating” foreigners, adding: “Very few people stand up to say this is wrong, shameful, we repudiate that. I think that is no good.”

In the latest high-profile incident, British banker Anton Casey lost his job and was forced to flee the island last month with his wife — a former Miss Singapore Universe — and son. The hapless Casey received death threats after making sneering comments on Facebook mocking the “poor people” using public transport, though his comments probably had more to do with social class — a subject rarely discussed in Singapore — than with race per se.

The previous month saw a major backlash on social media after Indian and Bangladeshi workers rioted in Singapore’s Little India district, leading Lee to again warn against “hateful or xenophobic comments, especially online.”

Yet the worst abuse is usually reserved for low-paid construction and service sector workers from China, India, Bangladesh and the Philippines. Mainland Chinese are known as “PRCs” — from the People’s Republic of China — and are often ridiculed for their poor English and perceived lack of social graces by the ethnic Chinese who make up around 75 percent of Singaporeans. Chinese bus drivers who staged an illegal strike in 2012 cited this discrimination as one of the reasons for their unhappiness.

Online forums are full of vicious comments about “PRC scum,” “foreign trash,” Filipino “cockroaches” and so on. An event held by Singaporeans in Sydney to celebrate the city-state’s national day last year attracted attention when locals and other foreigners were apparently refused entry. Summing up the siege mentality of many Singaporeans, one of the attendees wrote on a local blog afterwards that: “Everyone of us were on the same page. There were no PRCs, India Indians, Bangla or Pinoys [Filipinos] to annoy us.”

Singaporeans protest immigration; U.S. government ignores social mood at its own peril

The U.S. government is headed for disaster as it continues to pursue peak social mood policies during negative social mood. In Singapore, the largest protest since independence opposes increased immigration.

Singapore protest at population policy biggest since independence

One sign, apparently directed at Singapore Prime Minister Lee Hsien Loong, read: "Ah Loong sweetheart, 6.9 (million) is a kinky number, but quality, not quantity," referring to his comment that the country's population could reach 6.9 million by 2030. A speaker at the rally, Kumaran Pillay, said he wanted his country to be led by "a man with vision" and did not want Singaporeans' lives to be controlled by "number Nazis".

Another speaker, Sem Teo, a banking executive, said: "Singaporeans should stop being afraid and speak up for change."

Rally participant Tan Jee Say, an ex-civil servant now in opposition who ran for president in 2011, said: "The prime minister has failed us. Make way for a new prime minister."

In contrast, the U.S. is committed to a quantity over quality policy, combined with a possible new minimum wage hike, that will guarantee a massive increase in unemployment and resulting social dysfunction.

A former visa officer in the United States lays out the case against amnesty in Legalizing illegal immigrants a bad idea

It's not just 11 million people. A substantial percentage of illegal immigrants are here alone, and once they get green cards, they will be able to petition for their wives and children to join them in the U.S. And if they become U.S. citizens, they will also be able to petition for their siblings and parents. Those migrants, in turn, can petition for their relatives and so on. Not all of the immigration preference categories are immediate, but within 10 to 15 years, legalizing 11 million migrants could result in possibly 30 million new arrivals.

I have seen estimates of 20 million illegal aliens or higher, which translates into potentially 60 million or more new arrivals.

Jobs Americans won't do? Proponents of an amnesty for illegal immigrants often claim illegal immigrants do tough, low-paying jobs that Americans and legal immigrants won't do. This notion is flawed now but will be demonstrably false after an amnesty. Illegal immigrants are currently limited to working for employers who pay in cash and don't ask questions, but with an amnesty, they'll be competing for jobs in the mainstream labor market with less educated Americans, who are already struggling with wage stagnation and a tight labor market.

Strain on social services. Legalizing millions of mostly poor people, many of whom have no job security or health insurance, will put a strain on already strapped social services agencies. A study by the Center for Immigration Studies estimated that 57 percent of immigrant households (legal and illegal) used at least one welfare program in 2009. Illegal immigrants aren't eligible for most benefits, but once this group has legal status, they'll be eligible for the full range of benefits

If President Obama has his way and gets a $9 minimum wage, the U.S. could easily be looking at permanent 10% or higher unemployment, with a spike into the 20% range. The current plan is to simultaneously legalize people currently earning black market wages and then price them out of the market by hiking the minimum wage, pushing them into welfare at higher numbers.

Anti-immigration protests are coming to the United States, but the question is, will they happen before or after an amnesty?

American democracy + multiculturalism + negative social mood = recipe for major conflict

SPIEGEL: During your career, you have kept your distance from Western style democracy. Are you still convinced that an authoritarian system is the future for Asia?

Mr. Lee: Why should I be against democracy? The British came here, never gave me democracy, except when they were about to leave. But I cannot run my system based on their rules. I have to amend it to fit my people's position. In multiracial societies, you don't vote in accordance with your economic interests and social interests, you vote in accordance with race and religion. Supposing I'd run their system here, Malays would vote for Muslims, Indians would vote for Indians, Chinese would vote for Chinese. I would have a constant clash in my Parliament which cannot be resolved because the Chinese majority would always overrule them. So I found a formula that changes that...

"It's Stupid to be Afraid"

Yuan reform continues...

China, Singapore Sign Currency Swap Pact

Singapore has become the latest addition to the list of countries to sign currency swap agreements with China. China's central bank and Monetary Authority of Singapore recently signed a three-year swap agreement valued at 150 billion yuan.

How Singapore advertises

In-Flight Advertising On Singapore Airlines

On long-haul flights, one can watch ads before the on-demand movies (you can actually skip the ads if you want). One of the ads is for Silversea which is a luxury condos company aimed at expats. The ad shows a video of the place with gorgeous Westerners doing some shopping, sunbathing, and having a good time. And the caption reads: “No capital gains tax; no currency controls; no restriction on foreign ownership; no inheritance tax; no withholding tax for sale of properties; no value added tax”. That’s all. Nothing is said about the place itself. Clearly, businesses in Singapore know what a difference the island-state’s tax system can make to foreigners desiring to invest their money. This is global tax competition at work for you. Actually, one should rather call it “institutional competition.” This is the way Singapore Inc. establishes its name and reputation.

H/T Marginal Revolution.