What’s going on in China? It’s a question that is on everyone’s mind. While most attention is focused on the unfolding human tragedy of the COVID-19 pandemic, the potential for it to be compounded by any economic fallout makes for even more urgency. The sad truth is that China was in rough shape heading into the coronavirus. How rough, though? [...]
While China’s coronavirus outbreak dominates Western media attention, the Chinese economy has been off for its Golden Week New Year celebrations. Unfortunate timing, to say the least. While global markets have been digesting the latest developments, domestic markets in China have been closed. Nobody really knows how they will reopen on Monday. As a consequence, the People’s Bank of China [...]
So much of the growth scare scenario relies upon China’s willingness to end it. By count of conventional Economics, there cannot be a case where a country like China just sits back and lets the economy fall into (further) decay. The argument will always devolve into some form of debate as to economic potential, but surely in a place like [...]
October 2017 continues to show up as the most crucial month across a wide range of global economic data. In the mainstream telling, it should have been a very good thing, a hugely positive inflection. That was the time of true inflation hysteria around the globe, though it was always presented as a rationally-determined base case rather than the unsupported [...]
I do get a big kick out of the way Communists over in China announce how they are dealing with their enormous problems especially as they may be getting worse. Each month, for example, the country's National Bureau of Statistics (NBS) will publish figures on retail sales or industrial production at record lows but in the opening paragraphs the text [...]
Another dovish example to be put on the growing pile of good things? The People’s Bank of China (PBOC) earlier today trimmed one of its many policy rates. The 7-day reverse repo rate will be reduced from 2.55% to 2.50%, a 5 bps cut practically pointless in functional terms widely interpreted instead for its purported “meaning.” Like the Fed, the [...]
The Federal Reserve wasn’t the only major central bank conducting open market operations (OMO’s) this week. On the other side of the Pacific, the People’s Bank of China (PBOC) had been, too. Big ones. And in both places, nobody really seems to know what to make of them even though they are actually connected to the same offshore dollar problem. [...]
Because the prevailing theory behind the global slowdown is “trade wars”, most if not all attention is focused on China. While the correct target, everyone is coming it at from the wrong direction. The world awaits a crash in Chinese exports engineered by US tariffs. It’s not happening, at least according to China’s official statistics. The reported numbers aren’t good [...]
It seems as if we’ve found one of those interim periods that often accompany times of uncertainty. Markets, stocks as well as bonds, are in a wait-and-see mode. Either the next shoe drops, as is feared, or the grand response works, as is widely hoped. Which way are the risks perhaps rebalancing? The global downturn that developed late last year [...]
Officials in China seem to be taking a page out of Mario Draghi’s playbook. Before Europe was pushed to the bring of recession, the President of Europe’s central bank would downplay any weakness in the European economy. In 2018 especially, Draghi frequently referred to 2017 as if it was something special. No cause for concern, he reassured, any softening was [...]
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