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I chanced upon another example of how “the loaded word” can have a more
powerful effect in today’s interconnected high-speed world. The premiere
example of this in America today has to be the words “weapons of mass
destruction” used with “imminent threat” and “global terrorism”. Perhaps with the growing awareness, despite mainstream media’s
reluctance to admit their responsibility in not covering this honestly, the alert
public’s indignation about the July 2002 Secret memo leaked in the UK
confirming that Bush had decided to invade Iraq and “fix” intel around that policy
decision will necessitate the use of these loaded words “war crimes” and “intent
to deceive”. KwC Mistranslated Chinese Story Causes Trading Panic By Andrew Browne, The
Wall Street Journal,
carried in The Seattle Times
Business Section, Sunday, May 15, 2005 HONG KONG — Guan Xiangdong, a reporter
for the China News Service, is more at home writing about tourism than finance.
But she was on duty in Hong Kong
two Saturdays ago while financially savvy colleagues took the day off, and she
cobbled together a story on the impact of a possible appreciation of the
Chinese currency using bits and pieces of news and analysis gleaned from that
day's local newspapers. But four days later, her efforts ended up
roiling the world's trillion-dollar-a day foreign-exchange market and sparking
panic e-mails and phone calls among currency traders and fund managers from
Singapore to Stockholm as the U.S. dollar tumbled. The storm, caused by a bad translation of her report, ended
quickly as the misleading text disappeared from the Internet after a brief time
— but not before hefty damage had been done. How a reporter for an
obscure, semiofficial Chinese news service managed to spark such chaos — and
losses for traders caught by the market's gyrations — says as much about
editorial standards in China these days as it does about the jittery state of
currency markets at a time when the United States is piling pressure on Beijing
to appreciate its currency to help cut its huge trade surplus. From her computer
screen in the China News Service's modest Hong Kong newsroom, Guan's story,
written in Chinese characters, worked its way Wednesday afternoon onto the Web
site of the People's
Daily — the organ of
the Chinese Communist Party — in the form of an English translation so garbled
it hardly made sense. The mangled translation of the story stated boldly that
China was going to announce an appreciation after a meeting of U.S. and Chinese
economic officials this week. Still, when an
Internet search engine threw the translation onto a screen in the London
offices of Bloomberg's news agency, it was flashed around the
world. "It really freaked the
market," said Claudio Piron, Asia currency strategist for J.P. Morgan
Chase, who was on the firm's trading desk in Singapore when the story broke in
the late afternoon. Traders instantly
dumped U.S. dollars and bought any Asian currency they could lay their hands on,
mainly Japanese yen, Singapore dollars and Indian rupees. When Bloomberg and
rival news service Reuters started casting doubt on the report,
traders just as quickly tried to buy back the dollar. Some traders, says Mr.
Piron, "got caught the wrong way around." He added: "There were a lot of annoyed people." Guan said she is
flabbergasted at all the fuss. "I can't work out why it's got blown up
like this," she said. She
maintains that all she did was trawl through Hong Kong newspapers for views on
how an appreciation of the Chinese currency would play in the city — views that
she vaguely sourced to "observers," not the newspapers she was
drawing from. It turns out that her most important source was an editorial in
the left-wing Ta Kung Pao. What happened next was
hardly Guan's fault. The online People's Daily got hold of her piece and farmed
it out to a translator working from home. The translation stated that China had
decided to revalue the yuan by 1.26 percent within a month and 6.03 percent in
12 months. It turns out that the percentage figures Guan cited were simply forward market
rates that she had lifted from that day's newspapers. Over a one-month and
12-month period, speculators on the nondeliverable forward market were betting
that the yuan would rise by 1.26 percent and 6.03 percent. Also, the item on the People's Daily Web
site gave no source for the story and neglected to mention the article was
ripped off from the China News Service. The Bloomberg story
flashed across trading screens just as Asian currency traders were winding down
for the day and European markets were opening. In Stockholm, Frederic
Cho, who manages Chinese equities for brokerage firm Hagstromer & Qviberg,
used the office loudspeaker to announce the news to startled colleagues and
then started frantically searching for the People's Daily story on the Internet
and dialing journalists and finance-industry contacts in Asia. "It didn't make sense to me,"
he said. What central bank would telegraph a revaluation, with the exact
numbers, a week in advance? In Shanghai, Stephen
Green, chief China economist for Standard Chartered Bank, was similarly
puzzled. "My initial thought
was, 'This is very strange,' " he said. He got on the phone and started
calling Chinese regulators. Eventually, his research team dug up the English
translation and the original Chinese-language story, and figured out what was
going on. Immediately, he sent an
electronic note around the bank explaining there had been a mistranslation. There was a time when a story in the
People's Daily had the imprimatur of the Chinese government. Foreign
journalists would parse every phrase in search of nuances that could signal a
change of policy. No longer. The official Chinese media, under commercial
pressure to compete, often in real time, now struggles with basic accuracy. But
the outside world hasn't caught up with this change. After
all, reasoned J.P. Morgan's Piron, "The People's Daily is the mouthpiece
of the government." That logic helps
explain why about $2 billion, by Piron's reckoning, was traded in the space of
a few minutes after the Bloomberg story was issued. The widespread belief
is that an appreciation of the Chinese yuan would trigger a wider revaluation
of currencies around Asia, where central banks have been intervening massively
to keep their currencies cheap and their exports competitive. Bloomberg defended its
handling of the story. "If China's government newspaper runs a story
saying China is relaxing its currency peg, that is big news, and it's natural
that it should be on Bloomberg," said Judith Czelusniak, Bloomberg's
spokeswoman, who is based in New York. "We'd be remiss in not reporting
it," she said. When the People's Daily announced that its story was a poor
translation "we reported that immediately," she added. Reuters added to what
turned out to be a chain of confusion. At one point, it flashed the news that
Bloomberg was quoting the People's Daily as reporting a yuan appreciation. "When the markets
started moving, we covered that," says the regional editor in charge, Adam
Cox. Searching for a basis of the movement, he says his team heard from
currency-market traders that a Bloomberg report on China's yuan was responsible.
When his team found a copy of the story, he said publishing a Reuters version
attributed to Bloomberg was an easy decision. "There was no real
delay," he said. After yanking the
story, editors at the online edition of the People's Daily expressed regret,
albeit with some defensiveness. "We are very sorry that the translation
was not accurate — it is our mistake," said one editor, who declined to be
identified. But the editor also took a swipe at the China News Service. Its
reporter "put too many vague sentences in the story which eventually
caused our mistranslation," the editor said. When China previously adjusted its
currency exchange-rate system in 1994, the official Xinhua news agency
published 2,500 words on the subject. The story explained in laborious detail
how the system would be adjusted. The announcement was made on New Year's Day.
And for good measure, that day was a Saturday. The headline in a
Goldman Sachs research report late Wednesday on the day's bizarre events
reflected the wry mood among investment banks in the region. "Lost in translation" it said. Matt
Pottinger and Qiu Haixu in Beijing and James T. Areddy in Shanghai contributed
to this article.
http://seattletimes.nwsource.com/html/businesstechnology/2002275257_translation15.html |
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