• Sprott Money
    05/06/2016 - 06:03
    The US, in its own decline, is showing this same self-destructive tendency. The worse things get, the greater the inclination of the citizenry to say, “Carry on, everything’s fine.”

The Global Trade Cycle Turns Lower

Tyler Durden's picture


It should come as no surprise - to anyone but the most whocouldanode crowd - but global trade volumes are slowing notably, and surprise surprise, Europe is leading the lag. Between the total lack of any sustainable trade advantage that the PIIGS suffer from (discussed here) and recent outlook cuts from FedEx and UPS (detailed here), it is not a shock that the following detailed charts of Import and Export volumes for China, US, Japan, and Europe are starting to drop notably. Just as we pointed out here, Europe remains the hub of around half of World Trade and as is clear, the myth of decoupling among the world's largest economies is smoke-and-mirrors as it is a lead-lag relationship that is now proven to be entirely un-decoupled as 'obviously' the import and export sides of the world's imbalanced economies show trade is falling in a hurry.



As Barclays notes:

The weakness of the euro area is particularly apparent in considering global trade, where the slump in euro area import demand is discernible. Additionally, there has in recent months been a leveling out in import volumes for the US and Japan, while Chinese imports (albeit a more volatile series) also weakened up to August. In turn this has led to weakness in exports at the global level, with Asian exports to Europe particularly adversely affected.


Source: Barclays

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Sun, 09/23/2012 - 20:41 | 2823115 yochananmichael
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Bush's fault

Sun, 09/23/2012 - 20:53 | 2823136 Colonel Klink
Colonel Klink's picture

That meme is old and tired.

Obummers, CONgress', and Teh Bernanks fault!!!

Fuck'em one and all until they start doing the right thing.  Don't hold your breath.

Sun, 09/23/2012 - 22:52 | 2823315 old naughty
old naughty's picture

Bullish for Obummer...

Bailout by Euroland.

Sun, 09/23/2012 - 21:26 | 2823197 whatsinaname
whatsinaname's picture

When the US Fed prints money through QE the USD weakens, when the BOJ does it the JPY weakens (or atleast in the past) but when the ECB prints money to buy bonds the Euro actually strengthens. What is the rationale ?

Sun, 09/23/2012 - 21:43 | 2823210 TWSceptic
TWSceptic's picture

If the ECB does nothing the eurozone could break apart, endangering the euro itself. Other countries are in different situation. However in the end money printing will always weaken currencies even the euro as is clearly shown in XAUEUR.

Sun, 09/23/2012 - 20:47 | 2823123 CPL
CPL's picture

Everyone is a friend in trade, until they are not.

Sun, 09/23/2012 - 20:52 | 2823133 Colonel Klink
Colonel Klink's picture

Can't wait for the crash bitches!  Let's get this thing over with...

Mon, 09/24/2012 - 03:12 | 2823562 e-recep
e-recep's picture

it would be nice if it happened soon, but no, things will rot to the core. this thing we have will go on for at least 7-10 years. like it or not.

Mon, 09/24/2012 - 04:23 | 2823601 Colonel Klink
Colonel Klink's picture

Yeah I fear a long slow grind more than a sudden crash.  Alas, I believe you may be correct.

Mon, 09/24/2012 - 06:46 | 2823674 Bobbyrib
Bobbyrib's picture

I doubt this will last 7-10 years. I am thinking 3-5 at the most. We will see who is right in the end. I just don't have that much faith in Bernanke to keep the Ponzi going for that long.

Sun, 09/23/2012 - 20:57 | 2823142 Snakeeyes
Snakeeyes's picture


Perfect timiing -- for a major crash.


Sun, 09/23/2012 - 21:35 | 2823178 kevinearick
kevinearick's picture

You mean america is not the center of the elite capital universe. then who is bernanke working for, and more importantly, who exactly are the admirals driving oil working for, and if the us navy is commited to oil...why did it give china a leg up on gold, the next reserve currency, and all of apple's technology, not that china stands a chance im hell of advancing the ball. who is in china, thinking economies of scale at this point, naked, and can't they come up with a better sh-show than the proxy island fight?

And whp were the atlantic fleet admirals working for in the 60s and 70s, when the us dollar was sent into a tailspin? Look at the events that guided devaluation since wilson and his buddies started implementing this new world order.

Jackson and grant may have been a-s, but at least they called out a few spades in their time.

Sun, 09/23/2012 - 21:29 | 2823200 freeasabee1
freeasabee1's picture

war is coming, creative destruction is the only solution at this point in the game.

Mon, 09/24/2012 - 02:45 | 2823532 prains
prains's picture

gulagian conscription is not very creative

Sun, 09/23/2012 - 21:37 | 2823220 RiskAverseAlertBlog
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Hyperinflationary shutdown of the physical economy marches on. Or, if you prefer, Wiemar goes global.

Sun, 09/23/2012 - 21:50 | 2823241 chump666
chump666's picture

liquidation trade looks like forming (panic based correction i.e everything sells but USD bid, USTs bid), could swap into a war/geopolitical trade at any-point (oil/gold/USD bid everything sells and this time including USTs)

CB's could be front running the war trade. hence the unlimited QE's.

Looking very messy end of Sept, Oct could be a wipeout since we didn't get in Sept


Sun, 09/23/2012 - 22:18 | 2823272 Freebird
Freebird's picture

Don't know, but sold other fiat for usd back end of week - something stinks. The "au contraire" play. Let's see.

Sun, 09/23/2012 - 22:36 | 2823296 gwar5
gwar5's picture

Global necronomy turning it's toes up... Again?




Sun, 09/23/2012 - 22:42 | 2823306 Gene8696
Gene8696's picture

Nice report.. Will not be news till Nov 6th.

Sun, 09/23/2012 - 22:57 | 2823323 Yellowhoard
Yellowhoard's picture

Very bullish!

Buy! Buy!Buy!

If the world gets any more fucked up, we're all gonna be rich!

Sun, 09/23/2012 - 23:23 | 2823375 chump666
chump666's picture

Bets on China will occupy the islands:

* DJ Japan Govt Fujimura: 3 Chinese Boats in Japanese Territorial Waters around Senkaku

Sun, 09/23/2012 - 23:33 | 2823386 q99x2
q99x2's picture

No problem the ECB is trucking in another 2 tril plus to keep the fires burning throughout the winter.

Mon, 09/24/2012 - 00:00 | 2823424 Atomizer
Atomizer's picture

Destroy present infrastructure to build new GDP.

Mon, 09/24/2012 - 02:47 | 2823535 elementary
elementary's picture

My exports have been greatly diminished . . . just ask my husband!

Mon, 09/24/2012 - 02:48 | 2823536 elementary
elementary's picture

My exports have been greatly diminished . . . just ask my husband!

Mon, 09/24/2012 - 02:51 | 2823540 gdogus erectus
gdogus erectus's picture

Not to be a dick since I've only been waiting for this fucking collapse now since 2007 but does anyone else think that this data looks like noise?

Mon, 09/24/2012 - 04:28 | 2823604 bunnyswanson
bunnyswanson's picture

Not when you look at the big picture.


http://www.youtube.com/watch?v=nmXgedNKgjI - The Corporation (Full length)

Mon, 09/24/2012 - 03:49 | 2823593 Expositor
Expositor's picture

But yet the BDI has gone parabolic!?! What would drive the prices up so fast when trade is falling flat. I can't remember if this happened for Iraq or Afganistan but I think I might smell a war conspiracy.

Mon, 09/24/2012 - 10:14 | 2824125 1eyedman
1eyedman's picture

moth-balling of ships?  high insurance costs being passed along?  seasonality?  instead of using US navy ships, theyve decided to haul the troops via cargo carriers?


Mon, 09/24/2012 - 04:25 | 2823602 Vegetius
Vegetius's picture
Over the Wine-Dark Sea. 

- Homer

This is where we all are, trapped in "The Odyssey” with the Sirens calling us onto the rocks.

Mon, 09/24/2012 - 05:09 | 2823626 ak_khanna
ak_khanna's picture

All the efforts of politicians, government, central banks etc are focused on saving banks instead of targeting job creation which is the only way economy can recover. 
Jobs can be created by initiating the following :

Replace the top management of the too big to fail banks, put the existing ones in prison and charge them with fraud and misrepresentation. Break the banks into smaller ones so that they are no longer a risk to the whole financial system. Implement the Glass Stegall Act.

Use the reclaimed billions of dollars from the arrested bankers and use them to improve the infrastructure of the country. This would create jobs instantly and the improved infrastructure would give the confidence to the small businessman to hire more people.

Tax the richest 5% of the population heavily as they no longer create jobs in the country but outsource the jobs to the low cost developing nations. Stop completely the funding of election candidates by corporates and rich individuals so that their influence on politicians to make rules beneficial to themselves is clipped.

Stopping speculation and derivatives in commodity markets would reduce their prices substantially which would be beneficial to the majority of the population. This would lead to a better standard of living for the middle class families and they would go out and spend helping the revival of the economy.

But in the real world we can keep on dreaming.


Mon, 09/24/2012 - 06:59 | 2823687 Grand Supercycle
Grand Supercycle's picture


Due to recent central bank intervention and short covering spikes, these daily charts are extremely overextended and significant correction expected very soon:




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