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CEBM Warns China Exports And Imports To Decelerate In Q3 And Onward

Tyler Durden's picture




 

As if one needed additional fears about the Chinese bubble popping, with overnight reports that various Chinese provinces are rising minimum wages to quell social unrest, following last night's surprising decline in the China PMI, here comes CEBM with a very scary outlook on China trade in general, and exports in particular. Well, if nothing else it will sure help the US push its world's worst trade deficit a little higher now that it will have much less to import. From the report: "Our CEBM China export leading indicator has already peaked, indicating that China’s exports are likely to peak soon. Our export model suggests that China’s exports may decelerate from 3Q due to weakening domestic and foreign demand." And here are some bad news for Obama's plan to double US exports in the next 5 years: "As the government has unofficially adopted normalization strategy away from the stimulus we are likely to see property, infrastructure, and manufacturing investments lose steam in the second half. The deceleration of FAI may put downward pressure on China’s imports." Have no fear - with its record budget spending, NASA will soon discover intelligent and wealth life on Mars, which will be more than glad to import all of America's financial innovation and three other things we export.

Full report.

 

CEBM China Daily 2010-07-01-Macro

 

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Thu, 07/01/2010 - 11:33 | 446582 Max Hunter
Max Hunter's picture

'And here are some bad news for Obama's plan to double US exports in the next 5 years'

That might happen.. After we drop 70% first.. The double off that number.

"The other 3 things we export". LMAO.. The sad part is how accurate that statement is..

Thu, 07/01/2010 - 11:36 | 446590 Jeff Lebowski
Jeff Lebowski's picture

I would recommend you panic.

Thu, 07/01/2010 - 11:49 | 446651 Ragnarok
Ragnarok's picture

TD, Swiss at it again?

Thu, 07/01/2010 - 11:37 | 446601 I need more asshats
I need more asshats's picture

Is it time to send in the liquidation companies to buy up the manufacturing equipment in China?

Thu, 07/01/2010 - 11:41 | 446614 tmosley
tmosley's picture

With what?  I don't think they are going to want your dollars for very much longer (or Euro, for that matter).

Thu, 07/01/2010 - 13:12 | 446866 I need more asshats
I need more asshats's picture

t,
when you travel abroad for business or pleasure you have to convert your currency to local.

Thu, 07/01/2010 - 11:38 | 446604 strannick
strannick's picture

Yes. Americans Chief Exports.... 'Financial Innovation', Cotton,  and I dont know the other two

Thu, 07/01/2010 - 11:41 | 446613 duo
duo's picture

Used CRT (TVs and Monitors) and used paper/cardboard.

If it wasn't for those items, all of the containers going back to China would be empty.

Oh, don't forget coal.

Thu, 07/01/2010 - 11:46 | 446640 PierreLegrand
PierreLegrand's picture

heh...+1,000

Is it ok to panic now?

What would be fantastic is if there was one article written describing how this all unravels. All the great articles from ZH, Shadow Stats, Market Ticker and others assume a level of knowledge that just isn't there for most people, myself included. One article that would show how producing funny money broke this then broke that etc all the way to collapse in a logical order. Does anyone know of such an article or series?

 

Thu, 07/01/2010 - 14:00 | 446997 traderjoe
traderjoe's picture

I'm new here, but it seems there is general consensus that an economic collapse is inevitable due to the obscene levels of debt, gross inefficiencies and inequities in the economy, and the sheer physics of not being able to pay for all of the debt and the fact that the debt/derivatives/etc. are essentially all inter-connected. 

But, that's where the consensus ends, largely because it is impossible to predict how the Gov's will respond. War? Regional conflict? Nuclear QE? Police state? Martial law? Confiscation of property? How long will deflation last until we get hyper-inflation? When will the sheeple realize their dollars aren't back by the fictitious gold in Fort Knox? ZH'ers seem to intuitively understand it will get ugly (PM's, food, guns, ammo), but who knows in what form? That's just my impression so far...hope I haven't over-spoken.

Thu, 07/01/2010 - 13:05 | 446856 fiddler_on_the_roof
fiddler_on_the_roof's picture

How pessimistic and wrong.

American strength : Grains, Meat, Fruits, Software, Networking Eqpt, Financial Market, Armaments, Aeroplanes, etc.

 

Thu, 07/01/2010 - 15:19 | 447182 Anarchist
Anarchist's picture

Hate to tell you but there are plenty of suppliers who can provide the same goods at lower costs. With the Euro drop, jet aircraft can be sold far below what Boeing can supply. Most food we sell overseas has some form of farm subsidy attached to it. Other than the most sophisticated weapons systems, which we won't sell to people who actually have money, the advantage of American exporters is pretty weak.

Thu, 07/01/2010 - 11:46 | 446624 Mako
Mako's picture

This is not what the decoupler theory Schiff sold me.

http://stockcharts.com/def/servlet/SC.pnf?chart=$SSEC,PHTAWANRBO[PA][D][F1!3!!!2!20]&pref=G

Thu, 07/01/2010 - 12:39 | 446787 Cognitive Dissonance
Cognitive Dissonance's picture

Lot's of veteran ZH first birthdays to celebrate as a community.

Happy ZH Birthday Mako. I found this photo of you taken just this morning.

Thu, 07/01/2010 - 11:45 | 446632 newstreet
newstreet's picture

Did the SNB just come in to the market?

Thu, 07/01/2010 - 11:45 | 446635 luigi
luigi's picture

I hope everybody here has the possibilty to grow some vegetables in the backyard...

Thu, 07/01/2010 - 12:52 | 446822 Strom
Strom's picture

Definitely expanding my garden. Especially because I work in CRE.

Thu, 07/01/2010 - 11:47 | 446645 Oh regional Indian
Oh regional Indian's picture

Priceless. Price Less.

What I find really rankles me is the fact that India, struggling straggler on the bumpy road to westernization, does not even figure in discussions.

It fancies itself on the world stage, new buddy buddy with America and especially with America+War on Terror.

Such a lightweight existence for a sixth of the world's population.

The clear end-game for this reality is all manufacturing activity shifting to war mode, nothing else can explain the last 15 years.

It's getting very interesting, very fast.

ORI

http://aadivaahan.wordpress.com

Thu, 07/01/2010 - 11:49 | 446652 Amish Hacker
Amish Hacker's picture

The real ruh-roh here is that as China's export income declines, they will have less incentive and fewer dollars to buy US Treasuries, the supply of which appears infinite. 

Thu, 07/01/2010 - 12:03 | 446679 Bam_Man
Bam_Man's picture

That is why they have a $3T QE 2.0 waiting in the wings.

It's strictly a question of how much lower the stock market will be allowed to go before they pull the pin.

Thu, 07/01/2010 - 12:05 | 446682 walküre
walküre's picture

and if it doesn't happen?

Thu, 07/01/2010 - 12:07 | 446690 Bam_Man
Bam_Man's picture

What do you mean by "it"?

Thu, 07/01/2010 - 12:13 | 446711 walküre
walküre's picture

the QE event.

everyone seems so assured that it WILL happen.

what if it doesn't? game over?

Thu, 07/01/2010 - 12:18 | 446723 Mako
Mako's picture

It's game over either way.  

Thu, 07/01/2010 - 12:24 | 446746 taraxias
taraxias's picture

I love makoisms. Short, succinct and right to the point.

Thu, 07/01/2010 - 12:37 | 446779 Bam_Man
Bam_Man's picture

We will get at least one, possibly two more rounds of QE out of Bernanke.

He will start to have misgivings when it's time for QE 4.0 and will be replaced before QE5.0 is announced.

The printing will continue until "sufficient" inflation is produced.

Thu, 07/01/2010 - 12:49 | 446795 Mako
Mako's picture

Here I will simplify it, pick one.

1.) Do nothing or stay on present course if you will.

2.) Increase government spending and the Fed buying supposed assets.

3.) Decrease government spending and the Fed not buy supposed assets.

All the choices above get you to the same point.... ie collapse.

"The printing will continue until "sufficient" inflation is produced."

That is the lie they told you and you believed.   There is no Wizard of Oz. 

Thu, 07/01/2010 - 12:14 | 446713 bigdumbnugly
bigdumbnugly's picture

by "it" i'm sure he means QE2, but the questionable word of his is "if."

rest assured, walkure, it "will."  no choice really.  and you know geitner has always leaned that way.

Thu, 07/01/2010 - 12:16 | 446719 walküre
walküre's picture

Mr. Geithner and Mr. Summers may not keep their jobs.

The Europeans have decided to go the austerity route, at least officially. How much of that will translate into policy has to be seen.

Is possible that the Europeans are now leading the way and the Americans will follow that lead as opposed the other way around which was the failed policy of bailouts and stimulus and QE 1.0.

Thu, 07/01/2010 - 12:27 | 446753 taraxias
taraxias's picture

I don't think you are listening. Mako is trying to explain it you.

The Europeans are leading the way to a deflationary depression.

The US is leading the way to a hyperinflationary depression.

The key word here is "depression". Choose your poison.

Thu, 07/01/2010 - 12:45 | 446803 Oh regional Indian
Oh regional Indian's picture

Brilliant synopsis taraxias.

Simple, eh?

The path is clear. It's actually a track!

No going back!

Forward! Upward!

To infinity and beyooooond!

Go figure!

 

ORI

http://aadivaahan.wordpress.com

 

 

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