The correction is doing its work. The feds tried to stop it with trillions in loans, guarantees, and ‘stimulus’ spending. They failed. Over the last three weeks we have had confirmation after confirmation – the recovery ain’t happening. Unemployment is getting worse. Prices are falling – even the price of labor. The banks don’t lend and the people don’t spend.
July 8th, 2010 | Bill Bonner | 0 comments | ContinuedAll Posts Tagged With: "china"
Coming of Age
Now, back to the business of business. And yesterday on Wall Street, business was good! The Dow rallied by nearly three percent and so did the S&P 500. For one day at least, investors decided to price stocks for a recovery instead of a recession. The very positive retail sales figures helped.
July 8th, 2010 | Dan Denning | 4 comments | Continued
Independent from What?
Obviously, that kind of boom can’t go on forever. And when it came to an end in 2007 it changed the financial picture for governments as well as households and businesses. Tax revenues went down. Expenses went up. And so did the bailouts and boondoggles that they call ‘stimulus’ spending.
July 7th, 2010 | Bill Bonner | 0 comments | Continued
The Platypus Exception
What we both agree on is that no one knows what will happen. Your editor believes that the Austrian theory of the business cycle has both explanatory and predictive power when it comes to figuring out what has to happen at the end of a leveraged asset boom. But it is true – from meat pies to the platypus (both reptile AND mammal!) and in many other ways-Australia is exceptional.
July 7th, 2010 | Dan Denning | 87 comments | Continued
A Rhyme of the Times
Perhaps we are just overly curmudgeonly about the whole idea of spreading the wealth around. Still, it seems like a fraud has been foisted upon the Australian public…that everyone is entitled to benefit from the risk-taking of others without taking any risk at all…because the resources “belong” to all Australians.
July 2nd, 2010 | Dan Denning | 14 comments | Continued
Consume Now, Pay Later
One is that debt is no longer productive in boosting living standards. When it was, households were happy to borrow and so were businesses. But each addition dollar of new debt taken on in the economy is producing less and less real growth. Indeed, each additional dollar taken on is going, at least part of it, to service previously borrowed money.
July 1st, 2010 | Dan Denning | 2 comments | Continued
G20, Airlines and Transport
But don’t worry, boys, sometimes failure is the best you can hope for. And come to think of it…defeat is not so bad. Think how much better off the Chinese would have been if Mao’s long march had ended in the total collapse of his army. And suppose George W. Bush hadn’t been such a total failure? People might not have elected Barack Obama.
June 29th, 2010 | Bill Bonner | 0 comments | Continued
Surprise, Surprise
The surprise at the beginning of the day yesterday was China’s announcement that it would end the dollar peg. The surprise at the end of the day was that it didn’t make any difference. The news got investors all antsy…they spent the day preparing to drive prices higher. But at the end of the day the Dow finished lower – by 8 points.
June 23rd, 2010 | Bill Bonner | 5 comments | Continued
Currency Games
A stronger local currency might mean China is changing gears in its economic growth plan. That is, rather than relying on export-driven GDP growth, it will shift toward more domestic demand (people spending money). According to the Financial Times, consumption as a percentage of GDP in China has actually fallen from 45% to 35%. In other words, Chinese economic growth has become even more export reliant.
June 21st, 2010 | Dan Denning | 1 comment | Continued
Is China Undervalued Right Now?
During the past few years, China has become an increasingly compelling destination for investment capital. But with the recent weakness in the Chinese stock market – and serious cracks showing in the façade of China’s economy – does it make sense to invest in China right now?
June 15th, 2010 | Chris Mayer | 23 comments | Continued
Getting Better?
It was no big deal except that the there’s supposed to be a recovery. And May was important. Because the major stimulus efforts are coming to an end. Economists wanted to see how the economy would hold up without the government holding it up.
June 15th, 2010 | Bill Bonner | 3 comments | Continued
All Quiet on the Fronts
One thing to keep your eye on is the G-20 finance ministers in Busan, South Korea this weekend. They will get together and agree to do nothing urgent. The one thing they will definitely NOT be doing is raising interest rates. They are too creeped out about a sovereign debt crisis in Europe leading to another liquidity crisis, according to Bloomberg.
June 4th, 2010 | Dan Denning | 11 comments | Continued
There Are More Millionaires in China Than France
Whether he said it or not, millions of Chinese took it to heart. They got richer, faster than any people ever had…
June 1st, 2010 | Bill Bonner | 0 comments | Continued
Insights about China and Nicaragua
In the next 1,618 words, I’ll share few insights about both China and Nicaragua. These insights share no particular connection to one another…
May 28th, 2010 | Chris Mayer | 2 comments | Continued
Live from China
We are massively underweight Australia, which is perceived as an economy that is geared to China on the commodity side…
May 20th, 2010 | Dan Denning | 5 comments | Continued
