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rffrydr
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rffrydr
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 Posted: Fri Nov 07, 2008 9:23 am Post subject: |
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This'll be a proud feather in my cap: 
| Quote: | Rumble in the jungle
Published: November 7 2008 09:18 | Last updated: November 7 2008 11:52
Turning around the runaway economic juggernaut of China, common wisdom had it, would be like turning around a super tanker. Actually, it transpires it is somewhat easier. China went from five years of 10 per cent-plus annual growth to 9 per cent in the third quarter. The latest Purchasing Managers’ Index presages a steep decline to 5.5 per cent in the current quarter, Credit Suisse reckons. And the following quarter does not look much better, putting China on course for a level of deceleration last seen almost two decades ago.
A slew of data due next week will offer the first official read. Recent rhetoric from government officials about the impact of the weaker-than-expected global economy suggests the numbers could be ugly. With the fiscal flexibility many other cash-strapped governments can only envy, the Chinese authorities are taking action: Beijing is turning on the spigots and cranking up public spending.
There are two risks now. A quarter or two of sub 7 per cent growth, before the effects of government spending kicks in, could upset the social stability on which China’s political structure depends. China’s export growth is falling, but import growth is falling faster still, ratcheting up the trade surplus. Protectionist pressure overseas could rise. Meantime, the spectre of deflation hovers as food and commodity prices fall. In a worst case scenario both overseas and domestic buyers would be in short supply. Bankruptcies and bad loans would proliferate.
Second is the possibility that external shocks disguise a bigger structural change, in which case China’s days of double-digit growth are history. The late paramount leader Deng Xiaoping threw open China’s doors in 1978, proclaiming “to get rich is glorious”. Reforms of the state-owned sector, an influx of foreign investment and, latterly, entry to the World Trade Organisation saw China do just that. Sure, there is more to come. But absent the big catalysts, double-digit cyclical upswings become a tougher ask. |
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HenryTo
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rffrydr
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| Posted: Sun Oct 19, 2008 10:11 pm Post subject: |
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Rings the bell at 9% growth. GM sales were telling in a car-loving evironment. Not great but good enough if they can peg it there for another six months.
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rffrydr
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rffrydr
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| Posted: Sun Sep 07, 2008 7:15 am Post subject: |
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The chinese have a saying: "extemes become their opposite."
| Quote: | At present, China's non-ferrous metal industry has a momentum of a slowdown growth after years of rapid growth. The reasons for the slower growth in the industry are as follows. Firstly, China's non-ferrous metal production and consumption accounts for about 30% of the global total, meaning that per capita consumption in China has surpassed the global average level. Secondly, cost continues to rise, and corporate profitability is declining after earlier rises, which gradually dampens the corporate enthusiasm for sustained fast growth in capacity expansion. Thirdly, extensive economic growth has led to a tight supply of resources and energy in China and China has continuously rolled out regulatory and control policies, which will help the industry change the growth mode with focus on capacity expansion, and step onto the path of sustained development.
It is forecast that China's output of non-ferrous metals will grow at a rate of around 10% in the period 2008-2010, even lower than 10%, and meanwhile growth rate of consumption will slow down accordingly. |
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rffrydr
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rffrydr
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| Posted: Mon Sep 01, 2008 8:26 am Post subject: |
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After the (shocking if not for the Olympics) manufacturing stats policy starts to backpedal:
http://www.ft.com/cms/s/0/35becba0-77bc-11dd-be24-0000779fd18c.html
This could have perverse conseqences with FDI. Now we'll see whether the long-promised chinese consumer having "stood-up" can stand up.
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rffrydr
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rffrydr
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rffrydr
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| Posted: Mon Jun 30, 2008 2:25 pm Post subject: |
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...And, disguised in an inflationary veil, shows the consumer--of refrigerators:
| Quote: | Chinese shoppers
Sunday Jun 29 2008 13:15
Where are all the Chinese shoppers? Official numbers suggest domestic consumption is in fine fettle - retail sales grew by 22 per cent in the year to April - but cracks are appearing in discretionary spending.
Car sales have been falling month on month since April, according to CSM Worldwide, an automotive consultancy. Growth in domestic passenger traffic on flights is also decelerating; Air China, the flagship carrier, saw traffic slump nearly 11 per cent in the year to May. And port volume growth at the key terminals of Shanghai and Shenzhen has fallen to 11 per cent and 8 per cent respectively, according to Citigroup (NYSE:C) . That is half the levels of a year ago. Some caution is necessary. Car sales in particular are a volatile series and drivers could well be forgiven for deferring purchases at a time when refiners are keeping petrol pumps empty rather than sell the stuff at a loss (as a result of subsidies). Last month's earthquake and the snowstorms earlier this year are distorting factors - aircraft were diverted to join the rescue effort in Sichuan, for example.
Nonetheless, markers of ailing consumer sentiment point to three factors. First, inflation and currency appreciation are flattering official data - hence the 28 per cent year-on-year rise in May exports versus the more muted growth in numbers of containers passing through the ports. Second, Beijing's bias towards tighter monetary policy, in words if not in action, is starting to bite. Discretionary spending data are weaker in parts and household bank deposits are rebounding. Third, there is a bigger structural shift under way. Rural household incomes have been rising since 2000 and last year rose by 10 per cent, according to Macquarie. Discretionary spending at this level is more likely to mean a fridge rather than a smart new motor. China's shoppers are far from down and out. But there is more fatigue than headline numbers suggest. |
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rffrydr
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HenryTo
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| Posted: Sat Dec 01, 2007 8:17 pm Post subject: |
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Thanks for posting that. As an aside, I found the following paragraph interesting as well. For now, this surely suggests that EM currencies (in general) have nowhere to go, but up, especially against the Euro and the Pound Sterling (yes, I'm biased):
| Quote: | | The difficulty of measuring PPP is one reason why some economists prefer to compare the sizes of economies using market exchange rates. After all, it is argued, countries trade with each other at market rates, so these provide the best basis for comparison. Measured this way, world growth over the past five years has been a still more modest 3.4%. Far from being the fastest pace for decades, that is slower than in the 1980s (see left-hand chart). So has the global boom been a mirage? A closer look at the numbers shows that this cannot be right. Measured at market exchange rates, emerging economies' share of global output last year was less than in 1980 (see right-hand chart), even though they have been growing more than twice as fast as the rich economies. The increase in their share of global energy consumption, from 43% in 1980 to 55% in 2006, also confirms that their weight in the world economy has surely risen. |
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