It’s not just that there was an obvious and intense change in sentiment, as that is quite common among and within markets. It is more so that this repetition is a little too familiar. In January, the mainstream was taken aback as the world looked headed for a very dark place, all “unexpected” of course. Just a few months later, [...]
The focus on China and the Chinese economy is not just related to its size but more so the fact that it is the pivot point for the whole global system. In pure economic terms, as “end demand” from the developed world economies slows, the Chinese economy either absorbs that reduction (through its own internal “stimulus”) or passes it on [...]
You can always tell what kind of monthly variation any economic account provides from the commentary by which it is described. And there are, apparently, only two options: upward variations mean stimulus is working; downward variation just means that there will be more stimulus. Even by this crude cipher, you can still discern the state of the economic world since [...]
The world cheered this morning’s trade estimates from China, as both exports and imports rebounded from a dismal start to the year. Exports rose 11.5% in March after falling 25% in February; imports fell “only” 7.6% after declining 13.8% the month before. Despite the difficulties with data calculations around the Lunar New Year, economists were quick with their usual glowing [...]
China’s official reported reserves rose in March for the first time in five months. Though reserves had fallen to barely $3.2 trillion in February, that was down just $28.6 billion from January, being already hailed as a success and a step in the right direction since that was less than a third of the shocking decline in January (-$99.5 billion). [...]
A few weeks back, on March 18, the Japanese government bond market was hit with a “buying panic” of some noteworthy proportion. Yields all across the curve dropped, which takes some doing since yields were already at that point mostly negative. Common sense forces any sane person to wonder if sanity itself remains relevant to global finance: That raises the [...]
The “first” part of the TIC data update for January was relatively straightforward, especially since the scale of the net transaction adjustments in both December and January really did match what happened in January (crossing into February). The Treasury Department’s estimate for foreign holdings of US dollar assets were nothing short of remarkable in all the ways that were expected [...]
By April last year, it had become clear that conditions in China were heading into dangerous territory. Even though most mainstream attention was fixed on the then-still growing stock bubble, there was so much that was wrong almost everywhere else. The economy would not stop slowing, and indeed still has not. The financial system was worse, so much so that [...]
The PBOC’s balance sheet was relatively quiet in February, with no large moves on either side of its ledger. In fact, these minor shifts appeared to be more so adjustments than the more extreme efforts the central bank had become used to undertaking. The heavy lifting was accomplished in January at least as far was what is visible, leaving February’s [...]
Industrial production for the combined January/February period in China fell to just 5.4%, matching the lowest growth rate of the past fourteen years. Only the January/February 2002 IP rate was lower, but that was a single data point giving way to the rising financialization of the late eurodollar period. In 2016, these decelerations are commonplace, determined, and have no end [...]
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