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China M1 Hits Bottom, Digs

MacroAndCheese's picture




 

A graph is worth a thousand words.  Here's three grand worth.

This graph charts China's M1, released last night:

China M1

 

 

 

 

 

 

 

 

 

 

 

M1 has hit the lowest level in more than a decade.

Think it doesn't affect stocks?  Guess again:

China M1, Shanghai Stocks

This is a close-up of China M1 with Shanghai stocks.

Oh well, China will stimulate, right?

China CPI

Not if China's CPI has anything to say about it.

The last time they stimulated their CPI was close to 2%.

It's 4.5% now, and blipping up.

All charts courtesy Bloomberg.

 

 

 

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Fri, 02/10/2012 - 11:49 | 2145935 Schmuck Raker
Schmuck Raker's picture

Soft patch.

Fri, 02/10/2012 - 11:03 | 2145737 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

The US wanted them to tighten, so they tightened.  What's the big deal?  China saw inflation ragin' like a New Year's dragon and they didn't let the winged beast leave its cave.

Fri, 02/10/2012 - 11:01 | 2145732 CreativeDestructor
CreativeDestructor's picture

World food prices were up in jan. blame that on Chinese new year. Sell side economists are so corrupt.

Fri, 02/10/2012 - 11:01 | 2145731 CreativeDestructor
CreativeDestructor's picture

World food prices were up in jan. blame that on Chinese new year. Sell side economists are so corrupt.

Fri, 02/10/2012 - 11:00 | 2145730 11b40
11b40's picture

I have no idea what the total numbers are, nor the impact in other industries, but in the basic home furnishings business, literally thousands of Chinese factories have closed and many more are barely hanging on. 

There is no de-coupling for China (nor any other nation, really), as their worldwide customer base struggles and de-leverages.  Their empty cities are giving way to empty factories.  Only government efforts there, as well as here, have managed to keep this ball of wax from melting down.

In addition, worker demands have driven wages up, capital is harder to come by, and the factory owners are vary aware of their slipping competitive advantages as measured against other 'low-cost' producing countries.  In a recent conversation, the owner of a glass factory told me they had at most 7 years, and maybe only 4 or 5, before their price advantages evaporate.

Chinese leadership has a very good grasp of the perils they face in maintaining control of a vast population facing food inflation.  Our confrontational attitude in the M.E., as we sheild our "friend" Israel, may be giving both the Chinese and the Russian governments the cover they need to whip up Nationalistic fervor to rally around their flags.  While we try to employ stealth as we fight an economic war with our reserve currency status as a weapon, don't be fooled into believing others don't recognize it for what it is...and they are fighting back.

Stay tuned, and stay alert.  Siesmic shifts are coming.

Fri, 02/10/2012 - 10:59 | 2145719 CreativeDestructor
CreativeDestructor's picture

M2 was their hope, that one is even worse. And china loans? It was barely enough to roll over. Gig is up..

Fri, 02/10/2012 - 11:00 | 2145707 Winston Smith 2009
Winston Smith 2009's picture

Chinese Electricity Consumption Fell Massively In January, And The Chinese New Year Doesn't Explain It

http://articles.businessinsider.com/2012-02-07/markets/31033020_1_indust...

"According to the China Securities Journal, China's electricity consumption in January fell by 7.5%. We estimate this may be the first decline since 2002 (excluding the financial crisis period in 2008-09), indicating industrial production may have slowed sharply in January."

Fri, 02/10/2012 - 10:51 | 2145684 falak pema
falak pema's picture

The Missouri breaks of galloping inflation; where are Brando and Nicholson on this?

Hard landing or soft killing?

Fri, 02/10/2012 - 10:45 | 2145654 Firing Pin
Firing Pin's picture

An hour after I look at these charts I'm hungry for more...

Don't worry China, Ben and the ECB will print enough for everyone.

Fri, 02/10/2012 - 10:41 | 2145633 vote_libertaria...
vote_libertarian_party's picture

Wow.  Crazy M1 value.

Maybe all those factories have literally switched to slavery thus no need for money.

Yikes!

buy buy buy

Fri, 02/10/2012 - 10:38 | 2145622 kaiserhoff
kaiserhoff's picture

China is NOT coming to the rescue???

But what about the Lone Ranger?  He still has silver bullets, right?  Right??

Fri, 02/10/2012 - 11:00 | 2145727 pupton
pupton's picture

Your comment got me to wondering, will this affect China's ability or desire to buy United States debt?  How will Obama fund his generous socialism without China to pay for it?  Will The Bernank just print away?

Fri, 02/10/2012 - 11:17 | 2145781 Joe Davola
Joe Davola's picture

Saudi Arabia said they want nukes if Iran tests one, no doubt we will lend/lease the nukes and the anti-missile defense for a tidy sum.

Fri, 02/10/2012 - 10:41 | 2145634 WALLST8MY8BALL
WALLST8MY8BALL's picture

The Lone Ranger had a horse named Silver. Silver bullets kill wherewolves. Silver coins could kill JPM.......

Fri, 02/10/2012 - 10:48 | 2145665 Firing Pin
Firing Pin's picture

Nothing kills JPM. Haven't you seen John Carpenter's "The Thing"?  It was based on JPM...true story. JPM runs the SLV (ingenious way to keep real silver out of everyone's hands). But the charade is coming to an end...Comex prices won't matter soon. Silver may be blinking $65 on the screen but dealers will be charging $150.

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