China “Terrifies” Investors With Crackdown: “If You Don’t Do What They Ask, There Will Be Blood”

We’ve spent quite a bit of time over the last five months documenting China’s epic ‘kill the chicken to scare the monkey’ campaign.
In the wake of a dramatic unwind in the half dozen or so backdoor margin lending channels that helped to pump some CNY1.5 trillion into Chinese equities during the first half of the year, Beijing embarked on an epic quest to shore up the market. Initially, authorities attempted to stabilize things by pumping hundreds of billions of yuan into the market via CSF. When that became too expensive, the Politburo simply started arresting people.
The witch hunt (and that’s exactly what it is) spread quickly to a number of high profile brokerage houses and before you knew it, China was arresting members of the plunge protection team.
Money managers were so terrified by late September that at least one market participant told a friend to ‘look after his wife’ in the event he didn’t come home after being ‘summoned’ by Chinese investigators.

This post was published at Zero Hedge on 12/04/2015.