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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 | Link to Comment yochananmichael
yochananmichael's picture

Bush's fault

Sun, 09/23/2012 - 20:53 | Link to Comment 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 | Link to Comment old naughty
old naughty's picture

Bullish for Obummer...

Bailout by Euroland.

Sun, 09/23/2012 - 21:26 | Link to Comment whatsinaname
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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 | Link to Comment 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 | Link to Comment CPL
CPL's picture

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

Sun, 09/23/2012 - 20:52 | Link to Comment 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 | Link to Comment 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 | Link to Comment 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 | Link to Comment 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 | Link to Comment Snakeeyes
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Perfect timiing -- for a major crash.

Sun, 09/23/2012 - 21:35 | Link to Comment 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 | Link to Comment freeasabee1
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war is coming, creative destruction is the only solution at this point in the game.

Mon, 09/24/2012 - 02:45 | Link to Comment prains
prains's picture

gulagian conscription is not very creative

Sun, 09/23/2012 - 21:37 | Link to Comment 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 | Link to Comment 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 | Link to Comment 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 | Link to Comment gwar5
gwar5's picture

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




Sun, 09/23/2012 - 22:42 | Link to Comment Gene8696
Gene8696's picture

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

Sun, 09/23/2012 - 22:57 | Link to Comment 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 | Link to Comment 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 | Link to Comment 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 | Link to Comment Atomizer
Atomizer's picture

Destroy present infrastructure to build new GDP.

Mon, 09/24/2012 - 02:47 | Link to Comment elementary
elementary's picture

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

Mon, 09/24/2012 - 02:48 | Link to Comment elementary
elementary's picture

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

Mon, 09/24/2012 - 02:51 | Link to Comment 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 | Link to Comment bunnyswanson
bunnyswanson's picture

Not when you look at the big picture. - The Corporation (Full length)

Mon, 09/24/2012 - 03:49 | Link to Comment 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 | Link to Comment 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 | Link to Comment 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 | Link to Comment 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 | Link to Comment 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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