This page has been archived and commenting is disabled.

China's Economy Continues To Crumble As Key Data Is Worst In 15 Years

Tyler Durden's picture




 

When China transitioned to a new currency regime midway through last month, the PBoC triggered a veritable meltdown in emerging markets. 

Make no mistake, part of the carnage was due to the fact that by devaluing the yuan, Beijing was effectively robbing the world of export competitiveness at a very precarious time. Fears that a weaker yuan would put upward pressure on regional REERs while further dampening onshore demand exacerbated an already tenuous situation across EMs, and in at least one case, forced the abandonment of a currency peg. 

Having said that, the yuan devaluation was perhaps more significant for what it telegraphed about China’s economy. That is, the yuan had appreciated by some 15% in REER terms in the space of just 12 months, and the fact that Beijing hadn’t gone the nuclear devaluation route (i.e. had “merely” resorted to multiple policy rate cuts) was seen by some as an indication that perhaps the economic situation wasn’t as bad as many people feared. The devaluation effectively crushed that theory and indeed, there are some indications that behind the scenes, China is targeting a devaluation on the order of some 20% which would have the effect of adding back 20 percentage points of export growth on the way to - hopefully- resuscitating output. 

On Sunday, we got still more evidence to suggest that China’s economy isn’t growing at anywhere near the clip the official figures suggest as industrial production came in light of expectations and FAI rose at the slowest pace since 2000. Here’s WSJ:

The data released Sunday pointed to continued weakness across large swaths of the world’s second-largest economy, heaping more pressure on the government to seek to further stimulate activity.

 

“This is very disappointing data,” said ANZ economist Li-Gang Liu.“It’s very difficult to see Premier Li Keqiang getting his 7% growth target this year.”

 

China’s industrial production grew 6.1% year-over-year in August, according to the National Bureau of Statistics. While this was marginally faster than July’s 6.0% level, it compared with an already very low reading in August of 2014 and fell well below a median 6.6% forecast by 12 economists in a Wall Street Journal survey.

 

Fixed-asset investment in nonrural areas of China rose 10.9% in the January-August period compared with the year-earlier period. This was also below expectation and slower than the 11.2% increase recorded in the January-July period.

 


Amusingly, even the NBS was cautious about the outlook going forward:

The statistics bureau warned of continued headwinds. “The foundation for the recovery is not solid,” it said on its website. “External and internal demand for industrial products remains weak and industrial production still faces relatively big downward pressure.”

And here’s a bit more color from Bloomberg:

“The economy is showing no sign of recovery," said Ding Shuang, chief China economist at Standard Chartered Plc in Hong Kong. “From the perspective of monetary policy, the government has done what it can, but demand from the real economy needs to pick up to really make use of that.”

 

The weakening economic figures underscore the challenge the government faces in meeting its growth target of 7 percent this year, as exports decline and producer price deflation deepens.

 

Investment in real estate development rose 3.5 percent in the first eight months of the year, down 0.8 percentage point from the January to July period. That reading was less than a tenth of the pace during the same period five years earlier.

 

 

Of course none of this should come as a surprise. Comparing China's headline GDP prints to individual data points betrays the extent to which Beijing is quite clearly fabricating the numbers. Here, courtesy of RBS, is a chart which vividly demonstrates the disconnect:

And here's a look at FAI components:

As Alberto Gallo notes, "investment cannot go on forever without demand" and indeed, excess capacity in China is one of the main reasons why the global economy is careening headlong into the deflationary doldrums. 

As for what happens when China eventually goes through an inevitable capital stock "adjustment," well, let's just say that if Daiwa turns out to be correct, our projections will look generous by comparison...

 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Sun, 09/13/2015 - 09:56 | 6541827 CaptainAmerika
Sun, 09/13/2015 - 10:01 | 6541834 realmoney2015
realmoney2015's picture

Yes, China is a factor in the coming collapse. But let's remember who is the real culprit: The Fed!

We cannot let them put the blame on China, Russia, Greece, Europe, ISIS, or any other scapegoat that the bankers create.

The Federal Reserve was started in 1913, the same year as the IRS. Since then the dollar has lost over 97% of its value. The Federal Reserve is not a government agency, it is privately owned by globalist bankers. Remember who the enemy is through all of this.

I started making candles with silver coins (https://www.etsy.com/shop/ScentSavers?ref=hdr_shop_menu) to help educate people on sound money. They are priced at $19.13 to recognize the year that America cmpletely sold out to the bankers.

We all have the same enemy. Don't let them divide us on other minor issues. Ending the Federal Reserve is the main issue of our time. Until that happens, our downward spiral will continue.

Sun, 09/13/2015 - 10:04 | 6541839 order66
order66's picture

You're using ZH to try and sell candles? Are you fucking serious?

Sun, 09/13/2015 - 10:20 | 6541871 negative rates
negative rates's picture

Ooohhh yeah, that number feels good. lets try it again tomorrow, shall we?

Sun, 09/13/2015 - 10:25 | 6541883 realmoney2015
realmoney2015's picture

Order66,

I'm using candles to spread silver to people who would otherwise not look into real money. Silver has been used as money for thousands of years. It is real money.

I also use candles to expose the Federal Reserve and the theft that they have committed over the last century.

I figured pople here at ZH, who for the most part understand the Fed and silver, could use them to help educate their loved ones.

Sun, 09/13/2015 - 10:52 | 6541957 Mr Poopra
Mr Poopra's picture

This is actually kind of cool.  Good luck.

Sun, 09/13/2015 - 10:24 | 6541877 realmoney2015
realmoney2015's picture

I wonder who the Fed will blame next for destroying our economy???

Sun, 09/13/2015 - 10:31 | 6541895 KnuckleDragger-X
KnuckleDragger-X's picture

The FED doesn't blame anybody, they've got other people to do that for them.....

Sun, 09/13/2015 - 10:35 | 6541910 realmoney2015
realmoney2015's picture

Haha. Very true! The fed hiode behinds many layers, including the governemnt and the media!

Sun, 09/13/2015 - 10:23 | 6541878 i_call_you_my_base
i_call_you_my_base's picture

Better off trying to sell crocheted gun cozies on etsy here.

Sun, 09/13/2015 - 11:35 | 6542096 orez65
orez65's picture

"Ending the Federal Reserve is the main issue of our time. "

I can't understand why anyone would down vote your post.

The root cause of all of our economic problems is the Federal Reserve.

The FR counterfeits capital.

The FR makes believe that we have enough capital for endles war, subsidies and inefficiency.

The financial monster that the Federal Government has created can only be killed by cutting out its heart: The Federal Reserve.

Sun, 09/13/2015 - 10:03 | 6541838 AlaricBalth
AlaricBalth's picture

Fixed asset investments grew at the slowest since 2000.
How many ghost towns does China need???

Sun, 09/13/2015 - 10:21 | 6541874 MSimon
MSimon's picture

How many ghost towns does China need???

 

Moar!!!!!!!!!!!!!!!!!!!!!!!!!

Sun, 09/13/2015 - 10:55 | 6541971 new game
new game's picture

all of these resources brought fwd has to have consequesces, right?

mankind, the rappper and pillager of mother earth, right?

the day of reckoning comes closer, tic tock...

Sun, 09/13/2015 - 10:02 | 6541836 Abitdodgie
Abitdodgie's picture

Its China's fault , they have a death star , no wait thats Putin , they throw babies out of --- oh never mind it's just china's fault look what they have done to Amerika's economy.

Sun, 09/13/2015 - 10:14 | 6541859 realmoney2015
realmoney2015's picture

Exactly. The Fed is really turning up the blame game. We all know it is the Fed that has screwed America and it's economy!

Sun, 09/13/2015 - 10:07 | 6541846 I AM SULLY
I AM SULLY's picture

The Chinese economy is collapsing, the US economy is collapsing ... NEWS FLASH!!! - THE WHOLE WORLD ECONOMY IS COLLAPSING!

Best Case Scenario: cascading systemic failure, social unrest, pretty much anarchy in every major nation.

Worst Case Scenario: World War 3, which becomes nuclear rather quickly

(brace for impact)

Sun, 09/13/2015 - 10:16 | 6541864 realmoney2015
realmoney2015's picture

I agree with your statement. However, I want to clear something up. Anarchy just means no rulers or ruling class. That doesn't sound so bad to me anyway!

Sun, 09/13/2015 - 10:24 | 6541880 MSimon
MSimon's picture

Anarchy just means no rulers or ruling class. That doesn't sound so bad to me anyway!

 

It is what comes next that you should worry about. The guy calling for law (he is it) and order (to his tastes).

Sun, 09/13/2015 - 10:33 | 6541902 I AM SULLY
I AM SULLY's picture

BINGO!

Sun, 09/13/2015 - 10:40 | 6541924 Save_America1st
Save_America1st's picture

http://wolfstreet.com/2015/09/11/whiff-of-rate-hike-panic-corporations-s...

Corporations in Rate-Hike Panic, Sell Bonds like there’s No Tomorrow, Investors Blissfully Eager

 

Telecom operator Frontier Communications came out of the “shadow calendar” with a $6.6 billion three-part bond offering to fund its acquisition of Verizon’s wireline operations in Florida, Texas, and California. The roadshow was supposed to start on September 10, and pricing was supposed to take place on September 15 or 16, S&P Capital IQ’s LCD reported on Wednesday.

But yesterday, Frontier accelerated pricing of the bonds and moved it forward to today (September 11). Why the sudden panicky hurry?

On September 16-17 is the FOMC meeting. The fateful one. The Fed might decide to kick off the cycle of monetary tightening by raising interest rates from nearly nothing to practically nothing. It doesn’t sound like a big deal, but the cacophony about it has reached a deafening level. With this move, the Fed would kill the Wall Street illusion of ZIRP Infinity, just like it killed the illusion of QE Infinity. And for our over-indebted corporate heroes, such as Frontier Communications, it is a big deal....

Sun, 09/13/2015 - 11:25 | 6542046 Conax
Conax's picture

Don't fret, you can rest assured my Shogunate will always be reasonable, equitable and just.  Anyone claiming otherwise will be impaled on a stake in front of the Ministry of Obeisance.

Let us all praise the Conaxian Shogunate. On pain of death!

Ooh Raaah

Ooh Raaah

Ooh Raaah!

 

 

(I didn't get an 'Ooh Raaah' out of some of you..)

Sun, 09/13/2015 - 12:38 | 6542314 tarabel
tarabel's picture

 

 

But I'm a deaf-mute, Your Magnificence.

Sun, 09/13/2015 - 13:34 | 6542522 Conax
Conax's picture

Your slight shall be overlooked this time, due to Our magnanimous  reasonableness.

Don't let it blossom into insolence.

Sun, 09/13/2015 - 10:34 | 6541905 KnuckleDragger-X
KnuckleDragger-X's picture

At this point it doesn't really matter, except how far civilization falls down. Pick a point, 100, 500, a 1000 years and humanity is quite capable of going there......

Sun, 09/13/2015 - 10:09 | 6541848 nmewn
nmewn's picture

"Of course none of this should come as a surprise. Comparing China's headline GDP prints to individual data points betrays the extent to which Beijing is quite clearly fabricating the numbers."

Clearly this is all the evidence rational, thoughtful people need to usher in the renminbi-yuan as the new reserve currency and promote Vice Minister of Public Security Meng Qingfeng to world treasurer and Keynesian light giver of the human race!!!

Siiigh ;-)

Sun, 09/13/2015 - 10:44 | 6541936 Oldballplayer
Oldballplayer's picture

If these are the made up numbers, I would hate to consider the real ones.

Sun, 09/13/2015 - 10:53 | 6541967 nmewn
nmewn's picture

Right...fake demand & ghost cities for everyone!!!...lol.

Sun, 09/13/2015 - 10:10 | 6541850 buzzsaw99
buzzsaw99's picture

if the pboc buys enough worthless equities everything will be fine. /s

Sun, 09/13/2015 - 10:11 | 6541852 wmbz
wmbz's picture

“The economy is showing no sign of recovery," said Ding Shuang

 

This is very, very good news... The stawk market should love it!

QE forever now, for certain. No rate increase, bail-ins, bail-outs, helicopter drops... Pump, pump, pump.

Champagne corks popping, happy days are here again!

Sun, 09/13/2015 - 10:13 | 6541858 buzzsaw99
buzzsaw99's picture

Brawndo the Thirst Mutilator had come to replace water virtually everywhere. Water, the basic component of all life, was deemed a threat to Brawndo’s profit margin. The solution came during the budget crisis of 2330 when the Brawdo Corporation simply bought the FDA, and the FCC, enabling them to say, do, and sell anything they wanted. [/Idiocracy]

Sun, 09/13/2015 - 10:25 | 6541882 Oldballplayer
Oldballplayer's picture

I heard it has electrolytes.

Sun, 09/13/2015 - 10:34 | 6541907 buzzsaw99
buzzsaw99's picture

it's what plants crave!

Sun, 09/13/2015 - 10:14 | 6541860 Talleyrand
Talleyrand's picture

And this data was released by the National Bureau of Statistics.

 

That's gotta' be some really meaningful shit.

 

Sun, 09/13/2015 - 10:26 | 6541887 MSimon
MSimon's picture

That's gotta' be some really meaningful shit.

 

It is worse than you could possibly think. Even worse than you can imagine.

Sun, 09/13/2015 - 10:17 | 6541868 khnum
khnum's picture

China is still producing its still buying the same or more as it was the problem for places like Canada and Australia is that prices for energy and commodity prices have tanked as have currencies against the US dollar....none of that is Chinas fault

Sun, 09/13/2015 - 10:34 | 6541908 Montani Semper ...
Montani Semper Liberi's picture

China is buying stills?

Sun, 09/13/2015 - 10:48 | 6541946 khnum
khnum's picture

Steel is down about 4 percent and a few other industries are slightly down,its not production that is the problem its debt for example there are companies not making a profit that are purely working to pay off the banks and when things slow down they borrow more.A viscious circle.We have had the stock market bubble burst the next will be building and construction a 1.7 trillion dollar bubble that has built 70 billion square feet and over 100 huge projects most of which are extremely under utilised.

Sun, 09/13/2015 - 11:36 | 6542098 CloseToTheEdge
CloseToTheEdge's picture

in memory of the badass rat...

 

Sun, 12/11/2011 - 23:17 | 1969080 slewie the pi-rat

i had a wooden whistle,

but it wooden whistle

so i got a steel whistle...

...and it steel wooden whistle!

Sun, 09/13/2015 - 11:47 | 6542129 MSimon
MSimon's picture

I believe China has about 50% of the world's steel making capacity.

 

They have no problem with production. They just pile it up. And when it rusts they just make steel out of high quality ore (rust). What could possible go wrong? It is much higher tech than coolies digging holes and filling them.

Sun, 09/13/2015 - 12:35 | 6542298 tarabel
tarabel's picture

 

 

I'm  not sure I follow the argument that solid or increasing commodity demand fromn China has led to a collapse in commodity prices that is not its fault.

Sun, 09/13/2015 - 10:18 | 6541869 q99x2
q99x2's picture

Let me print money and Q99X2 will become the world's leading economic power.

Sun, 09/13/2015 - 10:26 | 6541885 Amish Hacker
Amish Hacker's picture

Same problem. You have to get people to believe in it enough to accept it as payment.

Sun, 09/13/2015 - 10:21 | 6541873 magnetosphere
magnetosphere's picture

ahh the wonders of 35% compound annual growth.  $1 becomes $1 trillion in a single lifetime.  lulz

Sun, 09/13/2015 - 10:31 | 6541897 Pure Evil
Pure Evil's picture

All the while that $1 Trillion will still only buy $1 worth of goods and services.

Sun, 09/13/2015 - 10:29 | 6541891 Ban KKiller
Ban KKiller's picture

Chinese manufactured "stuff" is crap. Who needs their cheaply made junk? Already have enough, ha-ha. 

Independece freaks out those in power. They want you to be slaves to their power sources, food, housing, etc. Oh...and their monetary systems. 

Buying gold paint and painting bricks. Gonna bury them for the future. 

Meanwhile the local coin dealer says he can't sell right now.....gee, really? 

Sun, 09/13/2015 - 10:32 | 6541901 Pure Evil
Pure Evil's picture

Oh he'll sell as long as its at or above what he paid for it plus premium.

Sun, 09/13/2015 - 11:14 | 6542016 itstippy
itstippy's picture

"Chinese manufactured 'stuff' is crap. Who needs their cheaply made junk?"

China can manufacture "stuff" at any quality level Western consumers will buy.  If Apple Corporation insists on rigorous quality controls when manufacturing their iShit, Foxconn's Chinese facilities produce high-quality iShit (at least from a manufacturing perspective).  China builds nuclear weapons, has an advanced space program, designs and builds supersonic fighter jets.  They can build high-quality high-tech "stuff" when called upon to do so.

I agree fully that the vast majority of Chinese manufactured stuff is crap.  Western consumers demand cheap crap.  My fucking toaster is six months old and now it only toasts one side of the bread.  Made in China.  Twenty bucks.  Go buy a new one.  It's aggravating as Hell.  I can't FIND any quality "stuff" any more unless I pay an ungodly premium for some fucking high-end label.  So it's either a $20 toaster that lasts 6 months, or a $200 toaster that says "Subzero" on it and is really worth about $50.  There are no quality middle-class middle-priced goods on the shelves.

American consumers got into brawls over the chance to buy $2 waffle makers at Wal-Mart.  Who in the Hell would want a $2 waffle maker?    Imagine the sticky frustrating half-cooked half-burnt mess you'd get the first time you tried to use it.  But hey, it was only $2!  

Sun, 09/13/2015 - 12:32 | 6542282 tarabel
tarabel's picture

 

 

I buy abandoned properties and renovate them. Not quite a flipper, more sedate in my approach, but one of the great advantages of this is that people just walk away from all their stuff.

Furniture. Clothes. Appliances. Motor homes sitting in the driveway (my yard looks like a used RV lot, let me tell ya).

Anyhow, I get my pick of all that nice made-in-America stuff that they leave behind when they pack up the Chink crap for the move. Got three different chrome steel toasters from the days when stuff was built to last forever. Steel body blenders. You name it. Oddly enough, though, no waffle irons. You say Walmart has them on sale for $2?  Hmmmm.

Nah, I'll live with pancakes.

Sun, 09/13/2015 - 10:35 | 6541899 JustObserving
JustObserving's picture

Everybody lies about economic growth. Everyone is above average as in Lake Wobegon.

There was no real growth in the land of the free either.  Inflation was adjusted lower to create a fake growth

The Chapwood Index for 2014 was 9.7% and official CPI in the land of the free was only 0.8%.  So the Nominal GDP of 5.6% for 2014 becomes real GDP of -4.1%.

The revised real GDP for years 2011 to 2013 worked out to -6.2%, -6.5%, -6.5% respectively.

What is the Chapwood Index?

"The Chapwood Index reflects the true cost-of-living increase in America. Updated and released twice a year, it reports the unadjusted actual cost and price fluctuation of the top 500 items on which Americans spend their after-tax dollars in the 50 largest cities in the nation."

http://www.zerohedge.com/news/2015-05-29/inaccurate-statistics-and-threa...

Sun, 09/13/2015 - 10:33 | 6541903 Pesky Varmint
Pesky Varmint's picture

Since China fabricates numbers does this mean the real numbers

are even worse than this print?

Sun, 09/13/2015 - 11:51 | 6542144 MSimon
MSimon's picture

The quality of their fabricated numbers matches the quality of the Chinese fabricated stuff you get at the dollar store.

Sun, 09/13/2015 - 10:35 | 6541909 Deadratsplat
Deadratsplat's picture

Nothing to see here folks, keep moving, keep shopping, keep voting, keep your passion in fantasy football, nothing to see here...

Sun, 09/13/2015 - 10:40 | 6541918 ISEEIT
ISEEIT's picture

China's 'issues' must be due to a lack of regulation??

Perhaps a lack of 'social justice'?

Nah..'Climate change'..

Right?

Sun, 09/13/2015 - 10:45 | 6541938 Oldballplayer
Oldballplayer's picture

Shemitah, bitchez.

Sun, 09/13/2015 - 10:57 | 6541976 indygo55
indygo55's picture

I’m going to the local “Shemitah Fest” in my town. There is a band called “Georgy Porgy and the Shemitah Five” playing Apocalyptic Rock with a catchy yet doomy melody. There are Shemitah Burgers and the classic Pulled Smoked Smeatah Sandwich. They broil it on Fire and Brimstone. Don’t know what the Shmeat in the sandwich is but I’m sure it’s got delicious with a deluge of gloom and doom sauce. Can’t wait till the T-Shirts are out. See ya next year, ummm I mean, next Shemitah.

 

Sarc off/

Sun, 09/13/2015 - 11:53 | 6542154 MSimon
MSimon's picture

T-Shirts?

 

Shemitah shmatas.

 

 

Sun, 09/13/2015 - 10:47 | 6541943 daedon
daedon's picture

America has 50,000 abandoned factories and 30,000 bridges in critical need of repairs and a third world GDP when you subtract Military and forced health insurance, but US economy is just doing great.

1 million new engineers every year, 10,000 new businesses every day, many micro-high-tech. High speed rail systems, infrastructure, universities at a rate the world has never seen, oooooooo, the Chinese economy is in a bubble.  Wipe out all the funny money and the Chinese still have more hard assets than the rest of the world combined.

The Chinese economy is crumbling, ya ya ya and America is spreading Freedom and Democracy all across the globe.

The US federal government is militarizing all law enforcement because it knows very well what is coming.

Hey, maybe it's time for a name change at Zerohedge, how about Operation Zero-Mockingbird ?

Sun, 09/13/2015 - 11:01 | 6541978 MATA HAIRY
MATA HAIRY's picture

 

 

 

Jack Sprat could eat no fat; his wife could eat no lean...

And so between them both, you see,

 They licked the platter clean

yes, ZH sees only doom, but the mainstream press sees only sunshine....

yes, ZH exaggerates, but the mainstream media does as well...and sooner or later, the wheel goes round and round...and the bottom will come...but strangely enough it will be a huge surprise to those who adhere to the mainstream viewpoint...

 

Both viewpoints are necessary for understanding, grasshopper...

Sun, 09/13/2015 - 12:17 | 6542229 tarabel
tarabel's picture

 

 

Remind me again.

How many Chinese stocks remain suspended from trading?

Sun, 09/13/2015 - 13:15 | 6542459 daedon
daedon's picture

Don't confuse the casino with the economy.

"They had gambled and speculated on Wall Street until so many watered stocks and bonds had been manufactured on speculation,that numberless speculators, big and small, sprang up all over the country and stocks, bonds, and credits were pyramided and re-pyramided, and re-re-pyramided."

Banking and Currency and the Money Trust By Charles A. Lindbergh (1913)

Sun, 09/13/2015 - 11:32 | 6542083 Element
Element's picture

And remember that the worst of the data from the stawk collapse is still 3 to 6 months away.

Sun, 09/13/2015 - 12:23 | 6542254 RickM
RickM's picture

Tyler, pardon my ignorance, but can you post a glossary of acronyms that you use, e.g., FAI, REER, etc., so I can better understand what you write? Thanks!

Sun, 09/13/2015 - 12:30 | 6542279 honestann
honestann's picture

The Chinese economy is shrinking now.
The USSA economy is shrinking faster.
The EU economy is shrinking faster.

Sun, 09/13/2015 - 12:53 | 6542383 tarabel
tarabel's picture

 

 

Don't know about Europe but doubt that US is shrinking faster than China. Regardless, however, my guess is that Chinese shrinkage is accelerating quickly while American shrinkage is happening on a relatively fixed basis.

Neither compares to shrinkage in Chinese extraction colonies, where shrinkage would be classified as green shoots.

Sun, 09/13/2015 - 13:34 | 6542540 honestann
honestann's picture

I don't believe so, but it is possible China is already shrinking faster than the USSA.  And the reason for that is precisely what you said; the downward acceleration in China is currently worse.  I expect that will continue for a while, but at some point the acceleration of the downward spiral of the USSA may well catch up to China.

Look out below, wherever you go!

Sun, 09/13/2015 - 16:26 | 6543128 tarabel
tarabel's picture

 

 

Yes, hard hats all around.

Sun, 09/13/2015 - 12:48 | 6542360 tarabel
tarabel's picture

 

 

While the propaganda machines roll on in every country, the only thing they can purchase is a little time. To put this another way, wildly excessive claims by government "statisticians" that are not grounded in observable reality gradually lose creedence if they do not start to reconnect to the actual conditions on offer.

What do we see out of official Chiense statistics? We see a gradual inching together of reality and the claims being offered. But it is not the reality that is moving but rather an adjustment of the claims being made. First it was 7.5%. Then it was 7%, guaranteed. Now there are hints that 7% is "unlikely".

Oh yeah it's unlikely, all right.

What's next?

Probably an announcement that China's move towards domestic consumption means that 4 or 5 percent growth is equal to, or better than, 7 percent growth in its previous export model. To be followed by tacit hints that 5% is "unlikely" but 4% you can count on.

And so it goes. Heil Xi. Heil Obama. To heil with all of them.

Sun, 09/13/2015 - 15:32 | 6542876 bid the soldier...
bid the soldiers shoot's picture

So we're still pretending that once QE hits the banks, it is halted from going into the economy, are we.

And there's every reason to believe that a large increase in M3, without any increase in what backs a currency, should strengthen the value of that currency and not weaken it.

 

***********************************************

 First it was 7.5%. Then it was 7%, guaranteed. Now there are hints that 7% is "unlikely".

Do you think, tarabel, the the percentage miss In China will be worse than the 3rd Q 2009 here, which went from 3.5% on the first estimate down to 2.2% for the final number?

Sun, 09/13/2015 - 16:24 | 6543118 tarabel
tarabel's picture

 

 

I really have no idea, but I think both instances validate my observation.

Rather than provide accurate information so that individuals can decide what is best for them personally, bureaucrats look at a top down world where everyone is supposed to do what the authorities designate as most desirable.

This country was founded on the idea that everyone does what is best for themselves and this adds up to a gross sum that is known as a GNP.  Now we live in a world where the government sets objectives to which individuals are encouraged, coerced, forced, or otherwise persuaded to lend their efforts towards that top-down goal.

Sun, 09/13/2015 - 19:07 | 6543819 bid the soldier...
bid the soldiers shoot's picture

my bad

I thought you were being more critical of China (fudging numbers since Nixon) than you were of the US (invented fudged numbers.)

Sun, 09/13/2015 - 12:54 | 6542379 bankonzhongguo
bankonzhongguo's picture

The only outfit that is maybe more capricious than the entire Chinese political economy is the Fed and the BLS.

The HUGE difference between China collapsing and the rest of the world economy is that China can instantly access its 800 million left behind population interior space for more debt, more government demand, more economic development.

The US, Japan and the EU have nowhere to grow to. Ukraine? Mexico? Syria?

China will never be a white knight beacon of personal economic freedom (but neither will this BIS/FED dominated "market"), but between the non-coastal areas, linkage with Russia and the entire Africa garden, those spaces plus all their new machines and a million new engineers graduating university annually should tell you how far the rat hole the US has fallen.

Congratulations!

500 billionaires have most of the money and power in the West.

Now what?

Sun, 09/13/2015 - 14:56 | 6542788 bid the soldier...
bid the soldiers shoot's picture

I smell Newton's Third Law.

The PBOC, like the Fed, is telling a story which is equal to, but opposite from, the Fed's tale of the Absolute Awesomeness of the American Economy.

The PBOC is bewailing the condition of China's economy, knowing full well it can not but upset Wall Street.

Why would China want to do that?  

South China Sea?

Do NOT follow this link or you will be banned from the site!