The relative calm in China may have finally broken, as the latest ebb in the negative credit trajectory may have reached another inflection. It is well-known and established that the Chinese economy is heading toward what was only a few years ago thought to be recessionary (when 7.5% GDP growth was believed an indication of severe distress), to which commentary [...]
Next to Japan’s “unexpected” re-acquaintance with recession, the most serious indication of global economic distress has to be oil prices. And where commentary turned to “explaining” Japanese recession as related to a small attempt at fiscal discipline rather than the more debilitating flirtation with intentional debasement, convention surrounding the precipitous plunge in crude is desperately trying to direct toward “supply.” [...]
Sovereign debt is the tangible pivot by which everything in Europe depends. That speaks not just to persistent fiscal imbalances that remain, years later, unresolved, but the unspeakable financial equivalent to a doomsday scenario. The damage to the European economy from the last financial panic is slowly being revealed (as with the unrequited and un-criticized promises of central banks), which [...]
China’s figures last week were not “helpful” to the “global growth” narrative, and now Japan and Europe have contributed their share of turning sentiment. It seems as if credit markets might actually be on to something with all this bearishness standing in stark contrast to stock markets that just don’t care about much except self-feeding participation and corporate indulgence. There [...]
The word “unexpectedly” has made its appearance in Japan with the latest quarterly GDP release. Economists had forecast between +2.2% and +2.5%, so -1.6% counts for an “outlier” to commentary. This result, following a quarter where GDP already fell 7.3%, is nothing short of atrocious and leaves no doubt the disastrous shape to which Japan has befallen. As I said [...]
With Europe reporting GDP, reactions have been somewhat varied. In some places, it was taken as not as bad as feared, while others were downright cheered by a lack of total collapse, as if that is now the standard for economic progress. Since GDP tends to be noisy in the short run, the major components, the economic base, continues to [...]
The largest calendar segments of the retail universe are back-to-school followed closely by Christmas. The peak month for back-to-school is August which is usually the third or fourth biggest month of the year in terms of raw retail sales; with October right behind as Christmas retailing ramps up. September, which falls in between back-to-school and Christmas (at least historically), was [...]
There was not much good news from China last night, particularly as there were no PMI releases to allow the media and economists to project uncorrelated optimism. Everything from industrial production to retail sales came in under “estimates”, with industrial production in October particularly worrisome as the second worst month (only better than August) since 2008 and the depths of [...]
WalMart finally broke its losing streak in same store comparable sales. Beating expectations, US comps rose 0.5% vs. the same 13 weeks in 2013. That must mean the consumer is resilient once more? While there is certainly no scale in the positive figure for Q3 (the 13 weeks ended October 31) the trend seems to be moving in the “right” [...]
The nature of liquidity under the eurodollar standard is to essentially link “markets” that outwardly seem to have little or no relation. You can see the synchronized ups and downs quite clearly but miss the ultimate connection, especially under the orthodox assumption of the world’s economies and their “natural” finance as mostly closed systems with only tenuous associations. If that [...]
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