We have gotten so large to throwing large numbers around in the US thanks to the various Fed facilities that the significance of the Chinese move may not be as obvious as it would otherwise be. $586 billion is a massive number for an economy the size of China’s. Recall our first stimulus package here […]
Read more...The dreary forecast comes from Eric Fishwick, chief economist at CLSA, an Asia-focused private equity firm. His reports in particular contends that the Chinese cannot possibly meet its growth projections for next year. One does not cross the officialdom in China casually. That suggests that either 1) CLSA is quite confident they won’t be making […]
Read more...As Dani Rodrik, who saw this item first, said, “Why do I think this is really bad news?” Remarkably, the article suggests that XIe might not attend the November 15 summit in Washington to discuss the future of the world financial order. This would be particularly noteworthy given China’s strong desire to push for a […]
Read more...We managed to miss this story on China’s diesel imports sent to us by reader Michael. When oil prices rose so rapidly early in the year, many pointed to robust growth in demand from China, and expected that level of growth to continue. Skeptics like your contrarian blogger pointed out other factors could be at […]
Read more...Brad Setser and Nouriel Roubini have collaborated in research and publishing on currencies but since are working independently. Roubini issues a grim outlook for China (“Roubini Foresees Chinese Hard Landing“). A cornerstone of Roubini’s analysis was that China was export-dependent and exports are falling fast: Note that China is an economy is structurally dependent on […]
Read more...Sorry to be brief today, but these excepts from our local Dr. Doom stand on their own (although I know some will take issue with the proportion of the economy he deems to be export dependent): Let us consider now in detail the evidence that China may be on its way to a hard landing… […]
Read more...Note that Credit Suisse has lowered its price projections to $60 for 2009. The main reason for the lower price expectation is much worse than consensus forecasts for GDP growth, and with it, increases in oil and gas demand, from China. Click to enlarge (hat tip reader Michael):
Read more...Despite China’s seeming economic might, it was only a few years ago that the hidden losses in among its banks were a frequent subject of discussion in the Western press. Indeed, in 2006, Ernst & Young hastily withdrew a detailed report that estimated that bad debt losses among Chinese banks were well above prevailing assumptions, […]
Read more...We featured reports earlier this year on plant closings in China, and the suffering in manufacturing areas is becoming more acute as the global downturn cuts into Chinese exports. Reader Michael sent us this report on China’s toymakers, but it also stresses that China may be more vulnerable to a global financial shock than advanced […]
Read more...Ed Harrison sent us a link to his latest post, and it’s a doozy. Most of us in the US who are financially-minded have been sufficiently caught up with the three ring circus of market turmoil, seemingly-a-new-trick-every-day Fed and Treasury interventions, and continuing financial firm implosions that we haven’t looked up much to see what […]
Read more...We have seen reports on various China-focused blogs and even in the US media that China is increasingly chafing over the US dominance in financial affairs, and is particularly unhappy about the role of the dollar. Consider this quote from an August New York Times article: Victor Shih, a specialist in Chinese central banking at […]
Read more...A wide range of commentators, including your humble blogger, have worried about the clearly untenable system known as global imbalances, or more formally, Bretton Woods 2. That was the tacit arrangement under which the US ran significant current account deficits which were financed by large purchases of Treasuries and more recently, Agency securities by foreign […]
Read more...Many investors assume that energy use is a relentless upward march as populations grow and consumers acquire more gadgets. But oil consumption has contracted meaningfully in the past, most notably in the first oil shock, when demand fell from roughly 67 million barrels per day to 59. And recall that the oil price shock was […]
Read more...China’s third quarter growth slowed to 9%, a faster deceleration than most experts forecast. Conventional wisdom has held that China’s expansion would fall as low as 8%, which would feel like a recession internally. However, with growth having already falle to 9% before the credit crisis hit the worst of its latest acute phase, and […]
Read more...One of the trades that looked like a no-brainer was betting on continued appreciation of the Chinese renminbi. In fact, so strong was the confidence in this outlook that China suffered from large-scale hot currency inflows (as recounted ably by Brad Setser) despite the official obstacles. A top investment bank in China is now forecasting […]
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