It isn’t going to make the New York Times best sellers list.

But the biggest book of the year, for investors, could well turn out to be a modest volume that hit bookshelves in late March, published by a niche Beijing imprint, Central Party Literature Press.

“Excerpts of Xi Jinping’s Speeches on Finance Work” probably doesn’t read like “The Big Short” (full disclosure: Haven’t read it), but the state-published compilation of financial directives from the CCP strongman has already caused waves in financial markets.

On March 28, the South China Morning Post reported that the book contains never-before-public statements from Xi seemingly urging the People’s Bank of China — the country’s powerful central bank — to boost purchases of Chinese government bonds.

"The People’s Bank of China must gradually increase the trading of treasury bonds in its open market operations,” Xi told officials during a central financial work conference on October 30.

For the uninitiated, that sounds like technocratic gobbledygook. But basically “open market operations” is how central bankers describe buying and selling financial assets, usually government bonds, in financial markets.

But Xi’s comments, appearing as China grapples with its worst economic challenges in decades, were seen as a remarkable hint that the the party may be considering the kind of money-printing policies — known as quantitative easing or QE — it has long avoided, as it struggles to revive its deeply dysfunctional economy.

This matters, for a couple reasons.

For one thing, it’s a sign of just how badly China’s economy is faring. While official GDP and employment figures — often looked upon skeptically by outside analysts — don’t appear too bad, there are other indications of entrenched problems.

After a massive real estate bust, demand for credit — the fuel for market economies — has collapsed. Consumer confidence is slumping. The country has slipped into deflation for months at a time. Government spending appears to be the main source of economic activity, but it requires large amounts of borrowing.

In recent decades, governments in similar straits have used central bank money-printing programs as part of a program to escape from such economic pickles.

The Bank of Japan pioneered them in the early 2000s, in the aftermath of a real estate and banking crisis that led to a recession. They weren’t especially successful at restarting growth, but the Bank of Japan doubled down on quantitative easing during the early 2010s.

The U.S. Federal Reserve also pursued quantitative easing for most of the decade that followed the financial crisis of 2008 and ensuing recession. It then restarted QE when Covid delivered another major jolt to the economy in 2020.

But beyond the economic issues, Chinese QE could also be a major development for markets, and an opportunity for traders.

That’s because, at least recently, when central banks have embraced QE, they’ve also sometimes ignited powerful, years-long stock market rallies.

A QE turning point?

Between the end of 2012 and the middle of 2015, Japan’s Nikkei 225 rose 100%, as the BoJ doubled down on monetary easing, which it called “quantitative and qualitative easing.” Similarly, in the US, between the end of 2008 and the 2014 — when the Fed paused quantitative easing — the S&P 500 doubled in a years-long romp.

If China goes that way, this may turn out to have been the moment for global traders to dangle their well-pedicured toes back into Chinese markets. It’s been a long time since they’ve been tempted to do so.

For years, a string of issues has made China almost un-investable for global money. The Trump trade war. Saber-rattling over Taiwan. The government’s ham-fisted crackdown on its most innovative tech companies. COVID-19, and China’s growth-crushing lockdowns. Its housing bust. Its wobbly financial sector. And a government seemingly less interested in growth than its predecessors.

They’ve all combined to drive a flood of foreign capital out of the country.

It could be hard to coax it back, even as the party puts on its version of a charm offensive.

To be clear, we don’t know how close Beijing is to unleashing a Chinese version of QE, or if it will go that route at all.

For the record, the central bank has repeatedly protested that, even if it were to boost its activity in the bond markets, it wouldn’t amount to QE, rather it would simply be “liquidity management.” Hmmmm.

Still, there have been additional hints that it is in the cards. Last month, the People’s Republic’s powerful finance ministry publicly supported the idea of the central bank buying more government bonds. And late last month, the central bank itself came out to support the idea of trading more government securities, adding further support to the notion that QE could be on its way.

And for what it’s worth, the markets are acting like they see quantitative easing coming down the pike. Chinese government bond prices have risen, interest rates have fallen, the currency has declined — which you would expect if traders thought China’s central bank was going to print a lot more of them — and Chinese stocks have begun to rally.

In fact, Hong Kong’s Hang Seng index which was down as much as 12% earlier this year, has suddenly gotten a spring in its step, and has overtaken the S&P 500 in terms of year-to-date gains.

That obviously isn’t going to fix China’s issues. But given the headaches the country’s leaders face over the economy, it could be a start, and something they’d like to see continue.