Evans-Pritchard

China Delivers "Surprisingly" Great Economic Data Across The Board, Yuan Yawns

Following more dismal data from the US, hope for global growth remains in China and they did not disappoint. Despite slumping macro data, a major slowdown in real estate, and the nation's deleveraging efforts in the last three months, GDP beat, Retail Sales beat, Industrial Production surged, and even fixed asset investment was above expectations. The Yuan hasn't moved.

Weekend Reading: Stuck In The Middle - Again

Just as was witnessed following “The Great Depression,” the bursting of the next asset bubble will likely once again drive participants away from the market for an entire generation, or longer. The problem for individual investors is the “trap” that is currently being laid between the appearance of strong market dynamics against the backdrop of weak economic and market fundamentals. Ignoring the last two to chase the former has historically not worked out well.

China Injects Economy With A Quarter Trillion In Debt In One Month, But The Full Story Is Much Scarier

"From a growth rate perspective, the speed of credit expansion is alarming. The current pace of credit growth in China is realistically in a range between 19% and 20%, well above the reported official TSF growth of 12.4% and new loan growth of 13.0% in September. Relative to GDP, China’s credit-to-GDP ratio currently in a range from 260% to 275% of GDP as of September 2016" - Barclays

"It’s A Lot More Negative Than People Think" - China Beige Book Issues Stark Warning About The Economy

“I’d find it earth-shatteringly surprising if we don’t have a significant problem between now and China’s leadership change” in the fall of 2017 when the 19th Party Congress convenes, said Leland Miller, China Beige Book’s president. “This is not a stable economy. It’s one that twists and turns and happens to end up at the same spot. There are real problems below the surface.”

Weekend Reading: A Market In Stasis

The market hangs in a virtual stasis. Over the past couple of months, we have continued to drift from one economic report, or Central Bank meeting, to the next. The bulls and the bears have met at the crossroad.

Weak Chinese Trade Data Confirms Global Slowdown, Imports Tumble

While central banks continue to "print" liquidity, now at a pace of nearly $200 billion per month, they are unable to print trade, perhaps the single best indicator of deteriorating global economic conditions. The latest confirmation came overnight from China, which reported another batch of disappointing trade data including imports which have now declined for 21 straight months, while exports have fallen for 12 of 13 months.