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China Flips Off Geithner (Again) As Trade Surplus Beats Expectations And Surges To Second Highest In Two Years

Tyler Durden's picture




 

China just metaphorically flipped off the US, and the G-20, by not only beating trade expectations, but trouncing them, with a net positive trade surplus of $27.1 billion, compared to estimates of $25 billion. This was the second highest number since January 2009, and lower only to July's $28.7 billion. The main reason for the surge in exports was the trade balance with the EU, which at $14.5 billion is the highest since October 2008. In other words, Europe's strong currency is already impacting the continent's economic output, as end users opt to import stuff from China, instead of having it produced domestically, and not to mention stockpiling inventory in hopes that pricing power will allow prices to go up (instead of just squeezing margins even more). Ultimately, Europe is the one that is now getting hit by a double whammy of the CNY-USD peg (as the CNY is now at very low levels to the euro), as well as the recent surge in the EURUSD, due to the Fed's policies. Therefore, Europe has to continue battling not one monetary regime, but two, as its net trade balance with both the US and China are getting worse by the month. As for the all important Chinese trade balance with the US, it came flat with September, both at $18 billion, even though both imports and exports declined proportionally. Elsewhere, and possibly in anticipation of increasing inflation dangers and overheating, but still unwilling to depeg from the USD, Bloomberg reports that China has ordered some banks to raise reserve ratios by another 50 bps. This will be the second such move in under a month - last time it was another 50 bps move to 17.5%. Of course, this is no different than putting a cork in the proverbial dam.

Below are China's total gross and net monthly imports and exports.

Trade balance by country:

Note the surge in the trade balance with Europe:

More importantly for Chuck Schumer, there is no improvement whatsoever in the China-US trade balance, which was identical to September.

And lastly, the trade balance of China with the rest of the world.

 

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Wed, 11/10/2010 - 01:12 | 714981 Ras Bongo
Ras Bongo's picture

LOL: EU going to hell in a handbasket... British humor style.

http://www.youtube.com/watch?v=NOzR3UAyXao&feature=player_embedded

Wed, 11/10/2010 - 09:22 | 715860 Ein Stein
Ein Stein's picture

November 10, 2010

Chinese EMP Attack Prompts US Missile Strike After Cruise Ship Crippled

By: Sorcha Faal, and as reported to her Western Subscribers


A new report circulating in the Kremlin today prepared for Prime Minister Putin by Director Anatoly Perminov of the Russian Federal Space Agency states that an Arkon-1 military satellite monitoring the western coastal regions of North America detected an "EMP anomalous event" occurring on November 8th at 0600 Pacific Standard Time (-8 hours GMT) that bore the "direct signature" of a YJ-62 subsonic anti-ship missile fired from a Chinese People's Liberation Navy Type 041 submarine (NATO code name Yuan-Class) [photo 2nd left] known to be patrolling approximately 200 kilometers off United States coast.

Nearly 11 hours after this EMP "event", this report further says, Arkon-1 then detected a BGM-109 (Tomahawk) subsonic cruise missile launched from a US Navy Ohio-Class submarine operating off the coast of California [photo bottom left] on a "training mission" from its home port located at US Navy's Kitsap Base in Washington State and was enroute to the largest American Naval Base on the US west coast in San Diego, California.  

Note: A Russian military intelligence (GRU) addendum to this report states that the "training mission" the Ohio-Class submarine was on is related to a new US law passed this year allowing for the first time in history for women to serve on US Navy subs and was an "operational exercise" testing female Naval Officers competence prior to their first "operational deployment".

The "immediate effect" of the Chinese Navy's firing of their EMP missile, this report continues, was the "catastrophic crippling" of the US based cruise ship Carnival Splendor [photo 3rd left] that stranded its nearly 4,500 passengers and crew in a "dead in the water" boat and prompting the Americans to send the US Navy's Ronald Reagan aircraft carrier, warplanes, and supply aircraft to protect it from further attack after all of its electronic systems were destroyed.

An electromagnetic pulse (EMP) such as was used upon the Carnival Splendor is a burst of electromagnetic radiation that causes rapidly changing electric fields (or magnetic fields) that when coupling with electrical/electronic systems produces damaging current and voltage surges destroying all non-hardened electrical systems.

The US Naval Surface Warfare Center (NSWC) had previously warned that American ships were vulnerable to such attacks with EMP Assessment Group Leader of Blaise Corbett stating that "the consequences of failing to take appropriate precautions to protect fleet mission critical systems can ultimately prove catastrophic to the Navy's mission."

The purpose of this Chinese EMP upon an American ship, this report says, was twofold: 1.) A test of the EMP weapon itself that in a war against the Americans and would be used against their Naval Fleet and Marine Forces operating out of California and the west coast of the US, and 2.) A test of the response time for American retaliatory measures against any Chinese warship attacking the US and/or its interests in the Pacific.

The GRU further states that the timing of this attack was timed even more crucially due to China's testing of America's response time during a period when their President, as Commander In Chief of all US Military Forces, was out of the country, as Obama was as he was in India at the time.

The Americans response time of nearly 11 hours between the EMP attack on the Carnival Splendor and the US retaliatory strike, the GRU states, "virtually assured" that the Chinese submarine responsible for the attack escaped, but which they further point out may have been intended by the Americans so as not to escalate this crisis.

To the geo-political reason(s) for a Communist Chinese attack upon the Americans just days before the crucially important G-20 Summit in South Korea, which both President's Hu and Obama will be attending, this report says was due to the United States, in essence, declaring total economic war upon the rest of the world by its printing of nearly $1 Trillion US Dollars in order to monetize its staggering debt and that China warned:

"If the United States can increase the volume of dollars and it can transmit inflation to other countries to lessen the pressure of debt, then it will bring about a catastrophic influence on the world."

Typical of the United States propaganda media organs in telling their citizens about the true events relating to this crisis, it as if they have put themselves in total Cold War mode reminiscent of the 1940's to the late 1980's when they, likewise, failed to inform them of the many incidents or US Soldier deaths related to that conflict.

Most dangerous about the American people not being informed of the true and tragic state of our world today is their not being able to prepare for the much larger conflicts to come, especially in light of China's Communists vowing that they won't go down without a fight.  A fight, mind you, that now appears not only a sure thing, but imminent.

© November 10, 2010 EU and US all rights reserved. Permission to use this report in its entirety is granted under the condition it is linked back to its original source at WhatDoesItMean.Com.

[Ed. Note: Western governments and their intelligence services actively campaign against the information found in these reports so as not to alarm their citizens about the many catastrophic Earth changes and events to come, a stance that the Sisters of Sorcha Faal strongly disagrees with in believing that it is every human beings right to know the truth.  Due to our missions conflicts with that of those governments, the responses of their 'agents' against us has been a longstanding misinformation/misdirection campaign designed to discredit and which is addressed in the report

Wed, 11/10/2010 - 10:04 | 715930 Yardfarmer
Yardfarmer's picture

the unsubstantiated, sensational, and otherwise generally suspect reports of the Sisters of Sorcha Fall, the creation of internet fraudster David Booth have long been regarded as a laughingstock

Wed, 11/10/2010 - 11:02 | 716142 LowProfile
LowProfile's picture

So...  Where are the reports of dead electronic devices from the cruise ship passengers?

Wed, 11/10/2010 - 01:19 | 714989 Mr Lennon Hendrix
Mr Lennon Hendrix's picture
The harder they come, the harder they fall.  China is going for a tko on undesputed heavyweight champion of the world, the U...S...A!

 

lesner vs velasquez:

http://www.youtube.com/watch?v=9Fq8PPvP3OQ&feature=related

Wed, 11/10/2010 - 03:13 | 715102 MarketTruth
MarketTruth's picture

President Obama meets the President of China over VERY serious issues... (SNL skit)

www.youtube.com/watch?v=gCh90AVh9J4

Wed, 11/10/2010 - 01:54 | 715022 Itsalie
Itsalie's picture

The chart with the trade balance of China versus all the countries tells the true story: the whole Asian region and Australia are responsible for the EU+US+Non-Asian trade deficit. On the surface, nothing has really changed since the 1980s, except as more US+EU manufacturing are moved to Asia, the Chinese and Indians have taken over the lowest paying assembly-line and call-centre jobs used to be done by the Taiwanese, Koreans, and people in Asean, while this latter group have taken over the higher-paying jobs from the US+EU (eg design, production of precision intermediate parts etc). In reality, US+EU job losses in recent years have been to Korea+Taiwan+Japan, and these losses have been far more painful for the US+EU because they are generally better paying jobs for the middle class. For most industries, the lower-paying, lower-value assembly line jobs were lost in the 1970-1990s. There are obvious implications for the future of US and EU, not least of which is that currency war is the wrong battle. Cost-sensitive jobs (reliant on exchange rates) were the assembly-line jobs lost 2 or 3 decades ago. Preserving the remaining ones require reforming education, R&D and scientific and industrial policies rather than quick-fix currency adjustments. Unfortunately for America and increasingly for EU, their politicians, intellectuals and mainstream media are too focused on the next election or too ignorant to realize this, yet again.

Wed, 11/10/2010 - 02:07 | 715039 nufio
nufio's picture

i think this post summarises the curernt state of the world!

Wed, 11/10/2010 - 06:59 | 715769 Ricky Bobby
Ricky Bobby's picture

+10

Wed, 11/10/2010 - 01:59 | 715031 NOTW777
NOTW777's picture

missile back

Wed, 11/10/2010 - 02:06 | 715037 huckman
huckman's picture

What % import tax would create a zero trade deficit?

Wed, 11/10/2010 - 02:23 | 715054 qussl3
qussl3's picture

A tariff in isolation will not be effective as companies would just move production to other low cost labor pools, Indonesia, Vietnam ....etc

An alternative like requiring by law that goods sold in the States must have a 50% US production component paired with a 6mth accumulation of inventories before that to tide over short term shortages would probably do more to move jobs back here.

Wed, 11/10/2010 - 03:51 | 715074 sub Z
sub Z's picture

lulz... An import tax would make things worse. What you do is drop the corporate/business tax in the US altogether. End of story.

On a side note, a Cadillac is $350k in Shenzhen but there's a whole lot of domestically made Fords, Buicks, and Hummers. Evidence of the old glazzies.

Wed, 11/10/2010 - 09:16 | 715849 cowdiddly
cowdiddly's picture

Ah yes, and make up the difference by raising the  40-45% total taxes that the   110million working taxpayers are already paying to support 330million people.

Ok, lunch break is over. back to chopping that cotton, BOY

In 1969 according to an old Value Line Investment survey I have, corporate taxes were 50%. Today, according to the same book its 38% with a million loopholes and tax breaks. The extra money is moved offshore, paying 40% of profits to the 1% bonus pool and the rest spend on buying our representatives.And ya wonder why the middle class is disappearing. Sorry as far as standard of living I will take 1969 hands down. Period.  

Thu, 11/11/2010 - 05:56 | 718882 sub Z
sub Z's picture

You are on the chopping block, along with me and everyone else. Businesses hire people, they can give the government more of that money, which will just waste it, or hire more workers. The worker is the one who always loses. Two years ago we spent 34 days supporting government, this year 231 and that was months ago.

GDP is not coming from the consumer. That means it must come from business investment, government spending, or net exports. Debt reduction might also be accomplished by various forms of default and bankruptcies (involves significant costs for consumers, including tax liabilities on forgiven debt, legal fees, and lower credit scores).

The government has no fiduciary responsibility. Government spending does not work it creates bigger debt. Maybe if they quit wasting our tax dollars, taxes wouldn't be so high. In addition there is a permanent loss as a result of missed opportunity and a failure to stimulate growth. Workers again lose, and lose on their retirement. Their kids who would be looking for jobs but cannot find one lose, maybe stuck with huge education expenses on top of it. And then we all have to pay more for all the government foolishness.

If the government wants to increase its tax revenue, it should lower taxes on everyone, remove taxes on businesses altogether (people pay tax, it is a double tax, this is a global market our competitors don't, this takes care of the loopholes, etc.), which will increase business investment, and get people working. Taxes will not come from the unemployed. Business creates wealth, government takes it away. Everything the government runs is bankrupt. All the government meddling is making things worse.

The Fed wants to inflate everything instead of increasing the demand. At the same time China and other countries are sucking down commodities. Inflation acts as another tax, also benefits the rich. So more people are unemployed and the cost of living increases. If they want to see deflation then put everyone out of work and no one will be able to buy all the expensive stuff.

Wed, 11/10/2010 - 02:23 | 715055 Problem Is
Problem Is's picture

"More importantly for Chuck Schumer..."

Why?

Does Schmucky Schumer Take Campaign Bribes From China?
Why not? In 2004 The Schmuck-ster showed up at the Lipstick Building with his grubby little hand out...

Gave a rousing speech to the owners and employees of Bernard Madoff Investment Securities...

And then took mucho bribes...

All in a days work for NY's principle SCHMUCK...

Wed, 11/10/2010 - 02:30 | 715062 sub Z
sub Z's picture

Can you hear that giant sucking sound?

Wed, 11/10/2010 - 02:50 | 715078 HarryWanger
HarryWanger's picture

We will probably rally on this tomorrow. You know the mantra, China strong so the world must be doing great. If they're exporting so much, we must be buying it so our consumer must not be dead. At least that's how the market and CNBC will interpret it tomorrow.

Wed, 11/10/2010 - 02:59 | 715087 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Whatever you say Harry.

Wed, 11/10/2010 - 03:04 | 715090 qussl3
qussl3's picture

You are likely right.

We are in the all news is good news zone, regardless of how its even clearer today that no matter how much you trash the dollar or attempt to make the banks whole, nothing is being done to address what is really killing the American middle class.

And seeing that the bulk of final consumption resides in the American and European markets, China/Asia decoupling is bunk.

I'd be very long popcorn and hangover meds.

Wed, 11/10/2010 - 03:17 | 715114 skippy
skippy's picture

I like chinese, they only come up to your knees.

 

http://www.youtube.com/watch?v=WY-8TwBymfY&feature=related

Wed, 11/10/2010 - 03:18 | 715118 skippy
skippy's picture

BTW I like when Marla moralises tooo!

Wed, 11/10/2010 - 05:02 | 715437 A Man without Q...
A Man without Qualities's picture

Part of the danger of European "austerity" measures is they end up benefiting Asian importers who cater for the lower end of the market.  Something similar happened in germany with the car scrappage scheme - offering €3,000 for an old car was far more attractive to owners of cheaper made vehicles, but not so great for owners of Mercedes, Audi etc.  The Chinese will keep cutting costs, as in a centrally planned economy, employment matters more than profits, and dumb Westerners will continue to buy the minority holdings of the Hong Kong holding company that somehow, through whatever circuitous route has a small stake in a Chinese hold co that sits above a Chinese operating business that is actually controlled by the state provided loans.

Wed, 11/10/2010 - 05:55 | 715555 johny2
johny2's picture

basically in todays world, this news is a sure sign of USA stocks being worth even more in dollars.

Wed, 11/10/2010 - 06:22 | 715630 It is a bargin ...
It is a bargin my friend's picture

Tyler...you must get the clips from David Roche on CNBC europe and post them up ....brilliant stuff

Wed, 11/10/2010 - 06:51 | 715765 Fanatic
Fanatic's picture

China increases their reserve ratios by half a percentage point

Wed, 11/10/2010 - 07:18 | 715776 TooBearish
TooBearish's picture

China just hiked reserve requirement 50BP - rally on!

Wed, 11/10/2010 - 08:05 | 715793 johny2
johny2's picture

as much as i would not wish anything bad happening to ordinary chinese people, i really look forward to the day when the USA defaults on their foreign held debts. most of the problems in USA today are result of low interest rates for such a long time. yes, its FEDs fault too, but without china they could never manage to do this alone.

Wed, 11/10/2010 - 08:48 | 715823 chinaguy
chinaguy's picture

China & the USA reached an agreement at the Conference in Japan over the past weekend. The "read between the lines" announcement was reported by Bloomberg. The bluster in the past couple of days is a smoke screen.

It will play out with the USA making no serious effort against China at the G20 & China making no serious effort against QE2.

meaning...China continues to do what it wishes & the dollar continues to weaken.

 

Wed, 11/10/2010 - 08:57 | 715831 Manipulism
Manipulism's picture

Michael Hudson rocks:

Michael Hudson: ‘US wants China to commit economic suicide just like Japan did’

http://www.youtube.com/watch?v=8P1fihT5B7o&feature=player_embedded

Wed, 11/10/2010 - 09:23 | 715861 Bob
Bob's picture

US $ becoming a "pariah currency" . . . the irony is that QE is only meant to cover up the massive crimes of US banks. 

I wish everybody here would take 10 minutes to watch this simple explanation.

 

Wed, 11/10/2010 - 09:36 | 715878 bigdumbnugly
bigdumbnugly's picture

ty for the link, M

Wed, 11/10/2010 - 09:18 | 715852 Minyan Vince
Minyan Vince's picture

anyone caught Carl Q this morning on cnbc squawk...he stated that one "blog" wrote that it was like China giving the USA the bird with their trade numbers...well done ZH

Wed, 11/10/2010 - 11:06 | 716160 Jim B
Jim B's picture

I don't think China is giving us the bird, we are giving ourselves the bird.  We don't manufacturer consumer goods any more!

WTF, you mean the LCD TV I just bought wasn't made in the USA.... LOL

Thu, 11/11/2010 - 10:42 | 719189 redrob25
redrob25's picture

http://www.google.com/#q=carnival+splendor&hl=en&biw=1010&bih=586&prmd=nivl&source=univ&tbs=nws:1&tbo=u&ei=pgDcTJ7PL4jAsAPEoZ3jBw&sa=X&oi=news_group&ct=title&resnum=1&ved=0CDIQqAIwAA&fp=15f99d0f02bb13ea

 

Carnival Splendor disabled on Monday. Missile launch on Monday. Report above (no idea whether legitimate) reports China shot an emp and disabled a cruise ship.

Has anyone any other links discussing these events and whether they are truly related?

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