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China's Schrodinger Economy Continues To Contract And Expand At Same Time

Tyler Durden's picture


It's hard to know what the world wants but for sure those looking for massive stimulus-driving intervention by the PBoC will be sadly disappointed by the better-than-expected data out of China. With HSBC's China Flash Manufacturing PMI printing with a ninth month of contraction, at a five-month high, but with the Manufacturing Output index at a nine-month high, it would appear that goal-seeked Goldilocks struck again in the soft-landing being engineered across the Pacific. Converging up towards China's 'real' PMI data at the magic 50-mark, HSBC's Asia Economist suggests (via Markit) that "the earlier easing measures are starting to work." With input and output prices slowing, does this disinflationary move provide more room for easing - given that the headline PMI (which implies slowing demand) is still contractionary (as are critical segments like New Orders and Employment). Market reaction is flatline for now with AUD (and implicitly ES) managing a small bump that has now been retraced.



China Flash Manufacturing PMI Summary

and Production at 9 month highs, New orders still contracting, and Employment contracting at Q1 2009 levels...


If they build it - will anyone come?

Source: Markit Economics


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Mon, 07/23/2012 - 23:06 | 2644493 Vic Vinegar
Vic Vinegar's picture

Sure.  But long-term I'd rather have a Chinese wife than a cracka.

Tue, 07/24/2012 - 00:37 | 2644625 Muppet of the U...
Muppet of the Universe's picture

Is anyone remembering that China jacks up its economic data just like every other government?  Jim Rogers tells us China wins.  Yea they win the LONG game in gold.  But in the coming collapse and stimulous/debt bubble?  Everyone is fuhhhhhhhhh'cked.  I would take the numbers you see coming out of China and shoot several handles lower, and HSBC is prob closer to the truth than their government.  Why do I say this?  B/c they've already lied several times, and they have no reason to stop.

Tue, 07/24/2012 - 01:01 | 2644660 The They
The They's picture

China may win in the long run but the communist party... now THAT'S a different story.  If there's any continuity with the party that Mao founded, it's this: the communist party has always founded the prosperity it created on supressing consumption in order to stimulate production.  Now that trend MUST REVERSE.  In order for that to happen, the communist party bureaucracy must be whiped away.  Only once that happens can China truly become the next world superpower.

Tue, 07/24/2012 - 03:47 | 2644798 Vic Vinegar
Vic Vinegar's picture

Abso-fuking nonsense.  Navel-gaze on this or buy physical.

I guess there is way more physical out there than one imagines.   

Because if enough people actually stood for delivery, we wouldn't have to read this shit, no?

Maybe one day, spacemonkey.  Maybe one day.

Tue, 07/24/2012 - 04:00 | 2644801 Vic Vinegar
Vic Vinegar's picture

Once again junker, you prove commenting on ZH > stamp collecting.

While you have not offered anything of value yet, I'm busy worrying about how quickly that junk came down.

Yet I'm also compassionate enough to wonder if:

-you hold physical

-you wanna hear Katy Perry again (OK - here you go)

What's up?  Why are your panties in a bunch?  LOL

Tue, 07/24/2012 - 00:49 | 2644638 ACP
ACP's picture

What's long term nowadays? The bullshit is so thick and widespread nowadays I can't even think about what I'm going to do after I pinch my next loaf.

As for Schrodinger...the cat was simultaneously dead and alive, not just contracting and expanding, which is the perfect description of the Chinese economy. Look at the "remnants" of last Olympics. Holy shit.

Mon, 07/23/2012 - 23:06 | 2644494 sitenine
sitenine's picture

If they build it - will anyone come?

There are a billion of them.  So, eventually?

China has room to grow, and they are so very good at central planning.

Most of their numbers are lies, but they don't have to depend on those numbers internally.  Do they?  China is Chinese, so one thing we can be sure of is that they wont end like Europe.

Mon, 07/23/2012 - 23:14 | 2644507 Vic Vinegar
Vic Vinegar's picture

China is the new wild west.  I don't pretend to know how 'the elites' there think, but the business workers there are excited about things.  They are looking to make more money and do better for themselves.  They care not about: central banking, the loss of their liberty (they never had any - LOL), or making witty comments on the internet.  

It's an exciting time to be alive in China.  

Mon, 07/23/2012 - 23:31 | 2644538 barliman
barliman's picture


In may be an "interesting" time to be alive in China ... in line with the old Chinese proverb.

There are about one billion Chinese people who do NOT find this an exciting time to be alive in China.

They are the ones outside of the 'middle class' and the elites. They are not doing better. They are just being exploited.

Reality is SUCH a bitch, isn't it?


Mon, 07/23/2012 - 23:40 | 2644549 Vic Vinegar
Vic Vinegar's picture

Reality is SUCH a bitch, isn't it?

Not really.  I don't see much of a difference between a Chinese girl making toys today and my grandfather working in the iron ore mines.  Both took the best job they could.

Mon, 07/23/2012 - 23:13 | 2644509 JackT
JackT's picture

There are only so many ghost cities that can built.

Mon, 07/23/2012 - 23:15 | 2644515 Vic Vinegar
Vic Vinegar's picture

Lemme guess: you aren't living in China?

Mon, 07/23/2012 - 23:38 | 2644547 adr
adr's picture

Lemme guess: you aren't actually Chinese?

Tue, 07/24/2012 - 00:14 | 2644590 fiftybagger
fiftybagger's picture
Silver Update 7/23/12 Loco London

Tue, 07/24/2012 - 00:11 | 2644586 JackT
JackT's picture

Nope. Not in China. All I'm saying is that The Chinese govt can't feed it's people nor its pig stock with concrete. You will see what I mean once the US harvests come in and exports drop. China is playing the same game as everyone else, except they are stuck between a rock, a wall, and a hard place.

Tue, 07/24/2012 - 10:38 | 2645375 thefedisscam
thefedisscam's picture

Vast majority of American MORONS like you have NO clue how Chinese live, yet you think you know everything. What a pity.

Feel sorry for your guys!

Mon, 07/23/2012 - 23:14 | 2644512 chump666
chump666's picture

and...USD bids are in outta china again for the nth time

*USD/CNY floats to the top of the trading band after 2nd day of weak fix

Mon, 07/23/2012 - 23:17 | 2644517 FieldingMellish
FieldingMellish's picture

It's OK as long as they don't eat the cat (assuming its dead).

Tue, 07/24/2012 - 00:25 | 2644606 FieldingMellish
FieldingMellish's picture

No love for physics jokes?

Tue, 07/24/2012 - 00:54 | 2644654 Number 156
Number 156's picture

I'll bite.

Its Dead cat quantum entanglement. One detector registers a bounce, the other a thud. I can assure you that both cats are dead.

Mon, 07/23/2012 - 23:19 | 2644522 pleseus
pleseus's picture

Non QE ish.

Mon, 07/23/2012 - 23:21 | 2644524 Anusocracy
Anusocracy's picture

So China's economy is functioning like a leaky heart valve?

Mon, 07/23/2012 - 23:23 | 2644526 youngman
youngman's picture

They just put a 15.5 billion offer for Canada´s biggest oil company.......buying up those commodities..its better than treasuries..

Mon, 07/23/2012 - 23:38 | 2644548 JustObserving
JustObserving's picture

They are paying a nice 61% premium for the privilege.  They should be buying up some gold and silver miners - they are dirt cheap now.  

Tue, 07/24/2012 - 00:39 | 2644632 jonjon831983
jonjon831983's picture

NXY isn't Canada's biggest oil company.  Most of its production comes from outside of Canada.  Anyways, apparently it was run quite badly, their stock price has been getting nailed and production was getting lower past few quarters.  Good riddance.



Sry, using wiki:

Comes in 10th based on market cap (well from that list maybe scratch ENB+TRP, so 8th.


But yes, once again another way to dump USDs.

Tue, 07/24/2012 - 01:06 | 2644679 jimmyjames
jimmyjames's picture

But yes, once again another way to dump USDs.


Not necessarily-

Canada also runs a trade deficit with China-so maybe it's the CAD that's being thrown back at us instead of buying paper bonds-


China is one of Canada’s largest and fastest-growing trading partners in the world. In 2009, bilateral merchandise trade with China totalled $50.8 billion, consisting of $11.2 billion in Canadian exports to, and $39.6 billion in imports from, China.

Mon, 07/23/2012 - 23:26 | 2644529 barliman
barliman's picture


The Chinese have a very poor track record of central planning. They HAVE had a long run of capital expansion thanks to Western corporate investment, both direct (i.e. actual capital) and indirect (e.g. intellectual property - both provided and stolen) which has served as a basis for their expansion over the last thirty years.

Unfortunately, their capital expansion has been surpassed by the capital extraction by the elites.

Produce any numbers by anyone regarding China - absent the virtually impossible reform of their system by the Chinese elites, it won't make any difference.

China has been trapped on its current path for the past decade. Somewhere down the road is masive social and political upheaval accompanied by economic collapse.

Anyone think there will an upside when it happens?


Mon, 07/23/2012 - 23:34 | 2644543 Vic Vinegar
Vic Vinegar's picture

I greened you because it's a genuine comment.

But on a long enough timeline...they make things so money flows there.  I wouldn't be too concerned about hypothetical econcomic collapses.  

Tue, 07/24/2012 - 00:18 | 2644594 barliman
barliman's picture


Lots of poeple in lot of places over centuries have made things.

ALL of them have experienced econonomic collapses when there have been discontinuities created in the markets.

Either you have not studied anything in socioeconomics (the last two centuries of America's economic contractions and expansions would be a start) or you are intentionally engaging in misinformation.


Tue, 07/24/2012 - 01:43 | 2644706 Vic Vinegar
Vic Vinegar's picture

No I am not intentionally engaging in misinformation.

Rather I am intentionally engaging in...

...Katy Perry videos, as they seem to be superior to anything written per the comments section on this site in days.  Here is a good one, just for you.

Also, I am engaging in a suggestion that all space monkeys buy physical.

If you can one-up me - please do!

Tue, 07/24/2012 - 01:46 | 2644713 barliman
barliman's picture


Well, I like Katy Perry so I gave you an uptick for the concept and the link.

I don't know if this is a one up ... because it could be under your buy physical heading ...

Buy bulk quantitites of the foods you eat, at least a year's worth, and learn canning before you buy any precious metals.

It will cost less in the long run, you are going to need to eat if you are not dead, and, under many circumstances, it will be far more valauble than silver or gold.

There is virtually no down side risk to this investment strategy.


Tue, 07/24/2012 - 02:02 | 2644728 Vic Vinegar
Vic Vinegar's picture

Just wanted to take back my green.  Canned foods taste like shit.  

Not to mention there ain't cats out there with naked shorts on Chef Boyardee.  Yet for some reason they continue to crush the price of physical silver.  Why do you think that is?

Buy physical.  Or listen to this lunatic.  LOL 

Tue, 07/24/2012 - 04:28 | 2644816 Vic Vinegar
Vic Vinegar's picture

Wow.  Three junks to zero..I guess there are some passionate Chef Boyardee fans who read ZH.  

Buy physical and you don't have to put up with this bullshit any longer.  Seriously.

On the other hand, if you enjoy this nonsense...

Tue, 07/24/2012 - 02:23 | 2644754 CrazyCooter
CrazyCooter's picture

So, what happend to the old school "I love the smell of napalm in the morning" recruitment videos? A fucking break up so lets join? Seriously?

So, the armed forces are better off with emitionally unstable people, unprepared to do the job (i.e. kill people, blow shit up, or support those who kill people and blow shit up)?

If you are not sure you are "prepared" visit your library for this book:

I don't mean to be an ass, I am just saying this feel good music video bullshit join the millitary because I cut my hair crap is worthless. Hopefully, at least one tree huggin hippie, with long hair, a bad boy friend, and shitty self esteem, will spare their future (and that of the service who would be stuck with them), by doing the math on actually joining a force that exists, well, to kill people.

We need men (women), who love the smell of napalm to defend freedom.



P.S. Disclaimer: Read "War is a Racket" by Smedley Butler. Also, I am not MDB, but take my post with a bit of sarasm. It is, as I understand it, the most effective criticism. Thus was my intent.

P.S.S. For those true valor warriors out there, Dave Grossman is your google objective.

Tue, 07/24/2012 - 02:43 | 2644764 Vic Vinegar
Vic Vinegar's picture

Already read War is a Racket buddy.  I find you to be a good commenter but your thoughts worthless.

Your thoughts shared here are different than a spacemonkey's thoughts on Yahoo re: The Dark Knight Rises how?

Buy physcial.

Anyone who cares should be pushing that concept on sites outside of our comfort zone.  Until then, let the mental masturbation continue...

Mon, 07/23/2012 - 23:40 | 2644553 TheFourthStooge-ing
TheFourthStooge-ing's picture

barliman said:

China has been trapped on its current path for the past decade. Somewhere down the road is masive social and political upheaval accompanied by economic collapse.

Anyone think there will an upside when it happens?

Layoffs for AnAnonymous and his peers at the Ministry of Truth.

Tue, 07/24/2012 - 00:31 | 2644615 barliman
barliman's picture

AnAnonymous and his peers at the Ministry of Truth being 'terminated' by their bosses for 'message failure' would be more in line with precedent.

The 100 million plus deaths from starvation seem like too steep a price to pay.


Tue, 07/24/2012 - 00:59 | 2644671 YouAreBliss
YouAreBliss's picture

Ben says his 5 year plan beats theirs, so we win.

What's his 5yr plan?  Make China buy our T - Bills with huge negative real yields, until the dollar collapses.  

Mon, 07/23/2012 - 23:29 | 2644533 zorba THE GREEK
zorba THE GREEK's picture

China has its own currency and central bank like the UK and the U.S. and

Japan, so they can BS, print, lie, cheat, and steal from their people, just

like the UK, U.S. and Japan. They can kick the can for years before their

house of cards fall. Problem solved.


Mon, 07/23/2012 - 23:30 | 2644535 Duke of Con Dao
Duke of Con Dao's picture

stranger than fiction, Tyler, I actually wrote a produced libretto based on a month of Schrodinger's life

when he ran off with his mistress to the Austrian Alps where he finished his seminal work but

finally gave up and went back to his overbearing wife who looked like Krushchev. It had touches

of the Blue Angel... that said here's my current vid: 

YouTube - "Howard Roark, You Didn't Build That!" says President Obama

Mon, 07/23/2012 - 23:36 | 2644546 adr
adr's picture

What else do you expect, reality contracting but official numbers expanding. The goal is for reality to become irrelevant, replaced by government manufactured propaganda engineered to increase the value of paper held by the unproductive leech class.

Just like the miracle of US corporate revenues that continue to climb in an environment of declinin sales. Really?

A corporation can produce nothing, yet be valued more than half the goods producing sector alone. Business is built for the explicit purpose of an IPO, to generate income for underwriters and wealth for angel investors. The inventory held is a scam to create the illusion of growth. Masive multi-million dollar debts are created to manipulate reality to make a worthless corpoation look like a genious of enterprise. Blowing $250 million to make a lump of shit look like a diamond is peanuts when an IPO can generate bilions. Dollar one in real profit never needs to be made in order for the executives to cash out to the tune of millions.

This is capitalism? This is the production of goods to serve the demand of the consumer? The consumer doesn't even exist. He is told what to purchase, what to consume, and what to watch by the massive corproations because his choice has been removed. Tell me the alternative to the multibillion dollar copration is in the marketplace? Tell me how a single person with a dream can, in today's over regulated world, create a productive corporation to unseat a behemoth.

If you do become lucky enough to make some money, the lawyers will target you for extinction. You will be told, "You made your money, be happy. It's our turn now and you should have know better." New corporations that aren't on the IPO path, cherry picked by the investment banks have no chance. They on average last 3-4 years before they are destroyed by "market forces".

For example Skull Candy, and ShockDoctor were all garbage corporations making terrible products that found friends in high places. There was no real consumer demand for their products. However, they made perfect stock scams. They were given the IPO path and corporate retail boards forced buyers to purchase massive inventory loads to show huge revenue growth. In less than a year a company that had less than 20 units of inventory was given 1200 units taking up half a store gondola? It made no sense, until the IPO was filed.

The big box retail model isn't failing because of a lack of consumers. It is failing because the investment banks are moving on to scams that don't require the production of product inventory. Dotcom 2.0 allows for a corporation without revenue to be worth billions. If you are worth billions without even needing to sell a product to a consumer, what the hell do you need them for? It's Wall Street Utopia! We played this game before and it didn't turn out so well.

Tue, 07/24/2012 - 02:32 | 2644760 Vic Vinegar
Vic Vinegar's picture


Buy physical metals while you can.  And if you see your neighbor carrying something, help him with his load.

Mon, 07/23/2012 - 23:42 | 2644551 cinefex3d
cinefex3d's picture


Tue, 07/24/2012 - 00:08 | 2644578 Manthong
Manthong's picture

I think I found the cat.


Tue, 07/24/2012 - 17:10 | 2647136 Manthong
Manthong's picture


What's not to like about a Chinese cat duality presenting a bird to reality?

Tue, 07/24/2012 - 00:08 | 2644584 Atomizer
Atomizer's picture

China's empty cities are reported as GDP.

These cities are so smart, no one wishes to live there.


Tue, 07/24/2012 - 00:15 | 2644591 chump666
chump666's picture


Tue, 07/24/2012 - 00:14 | 2644587 FinalCollapse
FinalCollapse's picture

Cinefex said 'We are watching you, round eyes!'

Cinefex - Fuck Off

Tue, 07/24/2012 - 16:04 | 2646748 TheFourthStooge-ing
TheFourthStooge-ing's picture


Mon, 07/23/2012 - 23:55 | 2644567 silverdragon
silverdragon's picture


When you haven't been to a country, haven't worked in that country and know nothing about that country your comments are ridiculous to those that have.

I guess you get paid to do this, ask your trainer for more training.

Tue, 07/24/2012 - 00:38 | 2644631 barliman
barliman's picture


Well, other than the fact I have been there, have worked there and know a good deal about the country ...

Wait? What was your point exactly?

Oh, yeah, you don't like people hearing the truth.

But after 18 weeks and 3 days  ... YOU have the inside line, eh?


Tue, 07/24/2012 - 02:20 | 2644752 Vic Vinegar
Vic Vinegar's picture

Oh, yeah, you don't like people hearing the truth.

Doubt it.  

For all your wisdom and worldly travels - what is actionable about what you have to say?

Canned tuna doesn't cut it for me, dude.  Try harder.

Mon, 07/23/2012 - 23:57 | 2644570 Atomizer
Atomizer's picture

If You Build It, He Will Come - Field of China City Dreams -2010

Tue, 07/24/2012 - 00:06 | 2644581 RobotTrader
RobotTrader's picture

100% of China's purchase of U.S. Treasuries are still in a winning position after 35 years of buying, which is simply incredible.

Tue, 07/24/2012 - 00:35 | 2644624 Atomizer
Atomizer's picture

RobotTraders Treasury Flatulence Deodorizer


Tired of smelling the stench of someone else’s bad trading advice?  Our automotive PSA tape will stick to any 99% soggy rectum basement dweller. Application is as easy as throwing a quarter on the ground. Call today!

Tue, 07/24/2012 - 00:16 | 2644592 silverdragon
silverdragon's picture

For those business people deciding whether or not to invest in China don't take too much notice of those trolls who are paid to convince you otherwise.

The China economy is growing and there are more opportunities than anyone can invest in. Almost all the foreigners I know doing business here are growing their companies at incredible rates.

Tue, 07/24/2012 - 00:21 | 2644601 FinalCollapse
FinalCollapse's picture

SD - that's why the electricity usage is down 10% in Shandong and other heavily industralized regions? Really? Expanding at incredible rates?

Tue, 07/24/2012 - 00:43 | 2644640 barliman
barliman's picture


If they actually turned off some of the machines and lights the number would be down much further than 10%


Tue, 07/24/2012 - 02:34 | 2644761 Dr. Sandi
Dr. Sandi's picture

Good point.

They probably don't, though. Dad's not home.

Tue, 07/24/2012 - 00:44 | 2644641 El Tuco
El Tuco's picture

All I know is China will not be immune to the Global Economic problems that are plaguing the rest of the world. Eventually they too will have their day.....

Tue, 07/24/2012 - 00:54 | 2644659 Atomizer
Atomizer's picture

I'm just about ready to retire for the evening. Would you mind tucking me in & read the story about china's shipping exchange?

Shanghai Shipping Exchange President Talks Role in Shipping Market's Future

Tue, 07/24/2012 - 00:21 | 2644599 silverdragon
silverdragon's picture


the link to your post mentions Shenzhen, Guangzhou, Beijing and Shanghai. There are about 100 million people living there.

I understand you Trolls gotta eat but have some self respect, flip some burgers at MacDonalds instead.

Tue, 07/24/2012 - 00:38 | 2644629 Atomizer
Atomizer's picture

Its good to know that you & Robo are holding hands.

Tue, 07/24/2012 - 00:31 | 2644604 silverdragon
silverdragon's picture


Ask your head troll to post for you so that it is worth my time reply to your posts.

Tue, 07/24/2012 - 00:46 | 2644647 barliman
barliman's picture


LULz ...

First lesson, try using the 'Reply' link. It would increase your credibility by a factor of two.

It would still be virtually indistinguishable from zero ... but take what you can get.


Tue, 07/24/2012 - 00:28 | 2644614 silverdragon
silverdragon's picture


Are you quoting govt statictics?

Chinese stats are as honest as US stats.

Tue, 07/24/2012 - 10:53 | 2645431 thefedisscam
thefedisscam's picture

Well said!

Plus, the cash economy in China is much much more prevalent than it is in the U.S.. And ALL those cash economy is NOT in the government statistics! And they are huge.

Bottom line is Chinese have a lot of cold hard CASH!

Tue, 07/24/2012 - 00:38 | 2644627 silverdragon
silverdragon's picture


Are you typing while stoned?

Tue, 07/24/2012 - 01:00 | 2644657 barliman
barliman's picture


Far, far above the level of your simple function, there are people in your country  who know exactly what I am referring to ...

Above them are some who know why ...

Mind altering drugs are items from my past.

Does that help your ability to understand the present?

Or foresee the future?


Tue, 07/24/2012 - 01:54 | 2644720 Vic Vinegar
Vic Vinegar's picture

They say you learn something new every day.  

Today I learned that barliman's comments are bullshit.  

Not saying that today was as profound as the day I learned Santa Claus was bullshit.  But I still learned something new...and at least the cliche still holds!

Why don't you just get a Chinese broad, barli, tell us about how much is going on in the country and then STFU?  

Don't waste our time with this nonsense.  Thnx in advance.

Tue, 07/24/2012 - 00:45 | 2644642 YouAreBliss
YouAreBliss's picture

Just like zero point energy, the Chinese produce growth from empty Malls, apartment complexes, cities. 

The way they report economic numbers would make Barclay's blush.

As demand for their products implodes now in the EU, then the US they will break apart like the USSR.

As we soon learn, thanks Ben, you can't Command and Control real growth.

Tue, 07/24/2012 - 00:44 | 2644644 silverdragon
silverdragon's picture

Muppet of the U...

The stats are so dodgy in China because so many different entities are all manipulating them both up and down for their respective reasons. No one has any idea what the real stats are.

Bottom line, Rogers is correct, China wins and if you have the opportunity to invest in a company in one of the major cities preferably retail you will do well in the next decade. MacDonalds, Pizza Hut, Starbucks etc while admittedly all are evil, all are also doing well just as smaller retail operations are doing well.

Tue, 07/24/2012 - 00:46 | 2644649 ptolemy_newit
ptolemy_newit's picture

I live in China for 10 years now and support fortune 100 industries.

To design and build a car plant will take 32 months.  To house and feed 20 million people will take  5 to 10 years.  THEY ARE NOT GOUST CITIES!   They are proper long term planning for  1 + billion people urbanizing.    You think you can wait for the people to arrive before you start construction !!!!!!!!!!!! Idiots


Tue, 07/24/2012 - 01:16 | 2644680 Atomizer
Atomizer's picture



Let's take the city of Kangbashi for example..


  • What is the resident retention rate? 
  • What is the Rental Rates vs. Unit Capacities?
  • What is your delinquency rate vs. debt service coverage ratio?

Apply that ZH research paper to other new China cities built. Compare the rural population migration vs. new empty urban suites unoccupied.


Tue, 07/24/2012 - 07:01 | 2644903 StychoKiller
StychoKiller's picture

Apparently, you do not own your own home, because if you did, you would know that housing requires constant maintenance.  Simply standing vacant will lead to all kinds of issues, example:  wildlife moving in, and paying no rent!

Tue, 07/24/2012 - 00:56 | 2644662 silverdragon
silverdragon's picture

El Tuco,

China unlike almost all other countries trades with almost every country. Which when you make most things and need more of most things under the ground and grown above the ground means your international trade is going to keep on growing.

China has many years of growth left in it.

Tue, 07/24/2012 - 01:12 | 2644682 walküre
walküre's picture

$5/day slaves cannot support the global economy.

China's miracle growth economy was possible because of massive consumption in Europe and North America.

Some Chinese made it rich in the process. The vast majority of Chinese are piss poor, curb-side shitting desperate slobs working for the Triads.

The reality is that China is done. It's economy is exhausted and has made a few people pretty rich over a few years. Now consumption in Europe and in North America is way down. The Chinese are not consuming their own mass manufactured crap in the same magnitude as we have.

Those $5/day slaves aren't buyers of Mercedes, Audi or BMW either.

China has many years of growth left in it

Stop dishing out this nonsense propaganda. The Politbureau isn't paying you that much, are they?

Tue, 07/24/2012 - 01:50 | 2644715 barliman
barliman's picture


'Message failure' carries far more severe penalties in some Chinese jobs than we are used to in Western countries.


Tue, 07/24/2012 - 02:37 | 2644762 Dr. Sandi
Dr. Sandi's picture

An economy isn't exhausted until you run out of willing hands able to work.

The Chinese certainly know how to work. And they've got nearly 3 billion hands.

Tue, 07/24/2012 - 00:59 | 2644669 chump666
chump666's picture

Shanghai about to hit Dec 2011 lows, goes through that all bets are off...China 2012/2013 meltdown with oil inflation on-top.  The Fed prints, China will go to war with it's neighbors i.e India/Philippines/Japan for gas/oil offshore areas.


Tue, 07/24/2012 - 03:20 | 2644782 chump666
chump666's picture

or Hang Seng...just went neg.


US markets get payback next session for being stupid and rallying on dip buying. 

Tue, 07/24/2012 - 01:02 | 2644674 walküre
walküre's picture

Why are we being served a "Flash" PMI?

Nervous Nellies, they are.

Market sold off inexplicably over the weekend and today. Why? Business propaganda (aka media) spouts "Spain's problems" as the common theme?

Like Spain's problems weren't known last week? Give me a fucking break. DAX off close to 4% before some semblance of sanity returned. Someone cashed in, that's for sure. This will occur more frequently now and more vicious than we've seen over the last 2 years.

Try trading this bear market and find yourself mauled and experience the death by a thousand bites.

100% out. Get out now, folks. Do not look back. The fireworks are about to start.

Tue, 07/24/2012 - 01:04 | 2644675 TulsaTime
TulsaTime's picture

Nobody rides the +10% train for that long and lives to tell the tale.  China may think it has control, but so did everyone else.  Boom is not a good word for China anymore. 

Tue, 07/24/2012 - 01:04 | 2644676 TulsaTime
TulsaTime's picture

Nobody rides the +10% train for that long and lives to tell the tale.  China may think it has control, but so did everyone else.  Boom is not a good word for China anymore. 

Tue, 07/24/2012 - 01:19 | 2644690 silverdragon
silverdragon's picture

China is changing from an export to US and Europe model to exporting to and importing from almost every country in the world while similtaneously growing the economies in its second and third tier cities and linking its cities with what must be the most money spent in the shortest period of time on transportation infrastructure the world has seen.

It will be a while before the dust settle on all this growth though there has to be another decade of 5-10% growth.

Tue, 07/24/2012 - 01:21 | 2644691 gold_bug
gold_bug's picture

Remember Hugh Hendry's take on China.....

Tue, 07/24/2012 - 01:29 | 2644697 ptolemy_newit
ptolemy_newit's picture

Yes manufacturing is in a down cycle for 3 years SO WHAT!  Every engineer in my office carries an Iphone and drives car.  There homes are not investments.  And the weaker speculators will get crushed GOOD clean out the dead and let the strong grow stronger

The Mcdonalds and KFC are full every day.

The country people have more than 14000 in the bank what about the average America?

The cities are growing slowly and will fill during the 2016 explosion.  You think the whole world will fall down for ever


Tue, 07/24/2012 - 02:00 | 2644730 barliman
barliman's picture


The last time we had a global economy go into a severe depression ...

Wait, we have never before had a true global economy integrated to the degree we are currently seeing.

When the EU/euro collapses, HOW will China settle current account balances with their EU counterparties?

HOW will the rapid appreciation of the renminbi be addressed with regard to export prices to Europe?

The WHOLE World will not fall down for ever ............ but amazingly large portions of it will enter a New Dark Ages ... but only if no major global wars break out.



Tue, 07/24/2012 - 02:39 | 2644763 Dr. Sandi
Dr. Sandi's picture


Sometimes I think you're crazy, and sometimes what you have to say is so stark that it scares the shit out of me.


Tue, 07/24/2012 - 01:30 | 2644699 silverdragon
silverdragon's picture


"The vast majority of Chinese are piss poor, curb-side shitting desperate slobs working for the Triads."

That was funny, not sure its 100% true though.

Having been to a couple of hundred small, medium and large cities in China and having built from scratch many companies in different cities in China my view is a bit different to yours. Come over someday, take a look, you may be surprised.

Tue, 07/24/2012 - 01:52 | 2644719 ptolemy_newit
ptolemy_newit's picture


I really Like nei mongol, the future is huge!

2016 Great Transportation Expansion:

Russian government approved the construction of the US$65 billion Siberia-Alaska rail and tunnel across the Bering Strait.

A modern transport infrastructure is the real road to Russia's future.  By 2016 the plan is to construct 63,000 km of new roads and 8,600 km of railway route through Siberia to facilitate economic ties between China and Russia to the Canada and the US.

Also the current traffic intensity and capacity utilisation levels will require more than a third of the roads in Russia to reconstruction and modernize; and we are talking about a network of 1,145,000 km in total!

We are looking at $25-35bn of Government spending annually on road infrastructure alone for the next 3-5 years.  All told, Russia is hoping to raise $1 trillion for infrastructure investment over the next 10 years, with as much as 80% of the financing coming from private sources, (private toll roads).



Tue, 07/24/2012 - 01:59 | 2644729 ptolemy_newit
ptolemy_newit's picture

And another thing :)

Domestic economy, how many people under 40?  350 million Nice ladies (size 7) in dresses with matching shoes and hand bags waiting in line for a hair style.

These people are married with childeren double income! Saving their Money.

just look at the stats on PPP Purchasing power parity!

Tue, 07/24/2012 - 02:14 | 2644746 silverdragon
silverdragon's picture

I think I will just keep buying Silver, every time someone is posting and trying to negate people buying Silver their actions are instantly suspect.

Govt. trolls are out to protect the Dollar/Euro and bonds and stop us buying Silver and Gold as that will cause their ponzi to collapse.

Eat shit and die trolls.



Tue, 07/24/2012 - 02:54 | 2644774 LikeClockwork
LikeClockwork's picture

Pumping silver on zh? My, you are an original.

Tue, 07/24/2012 - 03:25 | 2644787 Vic Vinegar
Vic Vinegar's picture

OK - you settled it.  I come here for the lulz that cannot be had via stamp collecting.

Yeah he pumps investment that's actually going to hold value into the future.

Perhaps not original, but of greater value than anything you ever had to say, no?

Tue, 07/24/2012 - 02:42 | 2644766 Dr. Sandi
Dr. Sandi's picture

If you don't have a sliver of silver.

The reaper man will de-liver your liver.

Tue, 07/24/2012 - 04:08 | 2644807 orangegeek
orangegeek's picture

And in other news, all other communist countries are expanding just like communist China.  North Korea and Cuba are leading the way.

Tue, 07/24/2012 - 04:19 | 2644812 ebworthen
ebworthen's picture

Reminds me of one of those Chinese finger traps; the more you pull apart, the harder it is to escape.

Tue, 07/24/2012 - 04:53 | 2644829 ptolemy_newit
ptolemy_newit's picture

Hi Bariman,  the following from some smarter guy than I. 

The United States dollar is forming a BOTTOM of a 15 year cycle that looks allot like the bottom of 1995.  Longer term, this chart suggests a rally of much greater duration and strength than most analysts expect in today’s current low dollar climate.

?I would think that China will except low and slow payments on current accounts.  Very patiant and long term thinking people.

Expect that the great floods of 2013 and the regional conflicts (war some places) will support the growth of the surviving economies. 

America and China are going to be very close trading partners for a long time to come.  Japan and taiwan will need the labor power of the main land for the next 50 years.

Tue, 07/24/2012 - 08:47 | 2645086 silverdragon
silverdragon's picture

I keep buying physical silver and so does everyone I know and we buy in decent sized quantities a couple of mates have crossed the one tonne mark. With ten thousand physical uses and having been money throughout history it allows me to sleep at night.

In these uncertain times the only other better bet is building companies from scratch and growing them and selling them to get more silver. You have the maximum amount of control when you build and grow a company from scratch with maximum reward.

There are only two reasons not to buy silver, ignorance or because the person is a troll.

Tue, 07/24/2012 - 10:24 | 2645337 GlomarHabu
GlomarHabu's picture

If we look at the daily output of ZH we are entertained with dozens of charts a deluge of numbers.Why do we even read them?

These articles are read for reasons other than granite and granular evaluations of the world markets. It's mind pablum. You,me and all the contributors enjoy the congregation,making comments, and venting but  reading the articles isn't necessary, a point I have tangentially made in almost every post I make.

ZH looks at data available to all and reaches ZH conclusions. The fact that the data is all bogus, from private and public companies, from the governments of the world and from every source you can name is now ,or should be, a self evident truth. I mean didn't we just experience the shocking,yes shocking news of Libor? The cascade of crap coming our way regarding "factual data" is never ending. Just how many years worth of articles were written using bogus gumby numbers. GIGO is the term and it matters litttle if it is omission or commission that produces an article with a conclusion totally void of reality.

Yeah, it doesn't matter because we no longer have anything close to honesty in government or finance.



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