China eases monetary policy to start the New Year and stimulate growth

China kicked off the New Year by easing

its monetary policy the People's Bank of

China lowered the amount that banks have

to keep and reserve the reserves they

hold at the central bank the widely

expected cut will go into effect

starting Monday joining us is this hours

panel dan gelt route from you're the

founder of gelt routing company as well

as Yahoo Finance's Dan Roberts let's

start with you mr. Gil true Dan we

expected this it's 1/2 a percent for the

major banks will this be enough I think

it's gonna inject what about 180 billion

dollars of easy money into the Chinese

economy I don't I don't know if China

has much of a choice in in needing to do

this look the facts are this China has

20% of the world's population they have

basically 1.4 billion people they got to

do something with them keep them happy

enough that's what I say so that things

stay stable one of the ways to do that

is to make money available to them so

that they can put it into their

businesses and keep their economy moving

internally we already know that China is

a huge exporter of goods right people

are going to China to have things made

and then it gets pushed out to the rest

of the world

this move is signaling that China is

focusing in on we need to start

stimulating things internally

potentially some infrastructure type

projects would probably be helpful but

let's make no mistake about it China is

feeling the pressure of the world

economy up against them and President

Trump has made it infinitely clear that

China is the target for the entire world

well I'm feeling the pressure of its own

economy right its own slowing economic

growth now Dan does this help Chinese

people or does it really just help the

big Chinese banks because allowing that

reserve to be lower you know we talk

about the infusion of capital but really

you wonder if it will just allow Chinese

banks to play more with money that had

to be in their reserves previously right

I mean talk about it what is it 800

in terms of instant infusion into the

economy but I don't know whether the

average Chinese citizen sees that money

but it certainly helps the big Chinese

banks which they need it because of the

slowing economic growth so it's not just

the US right I mean it's it's the global

picture but it's also China as a really

problematic economy over the last year I

mean I remember just two years ago we

were talking about China cutting down on

you know tightening capital controls and

talking about how Chinese companies were

feeling crimped by that now this is a

little bit China waving a little bit of

a white flag in the sense of well we

need to do something because having

needs I haven't really slowed it down

even though they talked about slowing it

down over the past year they've already

been putting some more liquidity into

the system this isn't the first time

they've done it what's interesting is

that the timing of it before the signing

of the trade agreement we also by the

way kata is one we also got a

manufacturing number from China today

which showed that their manufacturing is

still expanding even if not quite as

much as so if you're an investor and

you're trying to figure out the

investments because we're having guests

come on the programs they look emerging

markets and what we heard just last hour

but emerging markets are gonna be tied

more to China than perhaps we are as we

decouple from China if that's the case

one of the things that's going on in the

Chinese economy that doesn't get a lot

of attention is the population is now

aging out to the point where they're not

going to be able to sustain the kind of

growth that they enjoyed when they were

coming up over the last 20 years what

does that mean for me if I'm about to

make an investment choice based on that

economy growing and being tied to other

you know whether it's India or Vietnam

well and its economy it's still growing

I mean let's say it's a Korea still

grundy wrote this long different yes

exactly right so look it just I would

just answer in terms of the big tech

names I would still feel very bullish on

you know $0.10 Alibaba JD comm those

companies I don't think are necessarily

going anywhere I think this is a

short-term play by the Chinese that's

the bottom line you start putting that

money quote-unquote out into the market

ultimately if the economy doesn't do so

well we saw that here in 2008 you run

into a big problem

hey investors Zack Guzman here are you

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