The Boom Reality Of Uncle He’s Globally Synchronized L

Top Chinese leadership is taking further shape. With Xi Jinping’s continuing consolidation of power going on right this minute, most of the changes aren’t really changes, at least not internally. To the West, and to the mainstream, what the Chinese are doing seems odd, if not more than a little off. Unlike in the West, however, there is a determined purpose that is in many ways right out in the open.

Many here had been expecting that outgoing PBOC Governor Zhou Xiaochuan would be replaced by Liu He. Called Uncle He by many close to him, it has been said that Liu was a close friend of Xi’s since the two were boys. In 2013, just after Xi took power during the 18th Communist Party Congress, Uncle He was made deputy director of China’s crucial National Development and Reform Commission (NDRC), the government’s top economic central planning agency.

Last fall, at the 19th Party Congress, Liu skipped several steps in further rise through the Communist ranks. He was placed as a member of the Communist politburo, one of only twenty-five on China’s second most powerful governing councils.

But control over the People’s Bank of China is now passed to Yi Gang, the central bank’s current deputy. Taking over for Zhou seemed the logical next progression in Liu’s accompanying of Xi Jinping’s spreading policies. In the West already, Yi’s ascent is taken as a good sign, the sort of continuity clueless Western commentary assumes is the highest quality. This is, it is already being written, the same as Jerome Powell taking over for Janet Yellen.

That’s not what’s happening, though. Yi Gang provides the PBOC with operational continuity. A new Communist official, however, takes over one step above him on the government org chart – Liu He.

While Yi is given the central bank, Uncle He is being made one of China’s four Vice-Premiers and being handed its most powerful domestic portfolio. He will immediately be made the Chair of China’s Financial Stability and Development Commission that among other tasks oversees the coordination between the PBOC and the country’s various financial regulators.