Recent comments from the Chinese Ministry.....>

CHINA: Recent comments from the Chinese Ministry of Finance confirm CNY1tn worth

of special bonds are to be issued in "the near term," per BBG.

- The comments also point to fiscal loosening.

- This is not a shock. In early April a CCIEE economist noted that "growth of

only 4.5% would allow the creation of 10 million new jobs." Adding that

achieving "this level of annual expansion after what he referred to as a "small"

contraction in Q1 may require boosting the fiscal deficit ceiling to 3.5% of GDP

from 2.8% last year. The government should also issue about CNY1 trillion in

special government bonds, which do not figure in narrow deficit calculations and

which other advisors have said could be levered many times to boost lending in

the economy."