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President Xi Knows a Crash Is Coming, and Is Trying To Protect China

Nov. 9, 2017 (EIRNS)—The biggest change in the Chinese government since the 19th Congress of the Chinese Communist Party, has been the creation of a super-financial regulatory agency, which outranks all existing regulatory agencies—and in fact outranks the ministries of the Chinese government as well. Today’s South China Morning Post (SCMP) calls it the Financial Stability and Development Committee under the State Council. It convened its first meeting this week under Ma Kai, whose position as Vice-Premier raises the Committee above cabinet level. But Ma is 71 and due to retire in March. SCMP and Bloomberg News believe that the man to succeed him will be Liu He, 65, Xi Jinping’s "trusted economic lieutenant," and intimately involved for Xi in relations with the U.S.A. Liu was just elected to the 25-member Politburo, "creating an opportunity for his election as Vice-Premier at the annual meeting of China’s legislature in March."

Much of the media links the formation of the new super-regulatory body with supposedly high levels of debt within China, and with lapses of its existing regulatory bodies in the recent period, but they are missing an important element.

The committee’s mandate is as follows, according to a Chinese government statement translated by Bloomberg News.

  • To deliberate major reform and development for the financial sector;

  • Coordinate financial reform, development and regulation, coordinate issues concerning monetary policy, coordinate the making of financial policies and related fiscal and industrial policies;

  • Analyze international and domestic financial situations, address international financial risks, conduct policy research on systemic risk prevention and treatment; and

  • Guide local financial reform, development and regulation.

Helga Zepp-LaRouche observes that Xi Jinping has noted repeatedly at international conferences that the causes of the 2008 financial meltdown have still not been rectified.