This indicator is suggesting slower economy and lower stock prices
Lumber prices over the past 25 years have been a quality leading indicator for the future direction of the economy and the stock market, in both directions.
Back in March, the Power of the Pattern pointed out that Lumber was at the top of a 25-year channel (formed a bearish rising wedge), where 50% declines in Lumber often happen in the past…. [...]
JAMES KANTER, STEPHEN CASTLE and NIKI KITSANTONIS
March 11, 2013
The president of the European Commission on Monday called on E.U. leaders to stay the course on debt reduction and economic overhauls, as he sought to head off a rancorous debate on those issues when the leaders hold a summit meeting here this week.
“Steadfast implementation of reforms is beginning to deliver results in terms of current accounts and regaining competitiveness,” the commission [...]
The main news overnight was the Chinese February trade balance, which if the past several years were any indication, would have been a deficit in keeping with the cyclical economic weakness resulting from the Chinese Lunar New Year. Surprisingly, instead of a deficit, as SocGen explains Chinese exports came in massively above expectations in February, while imports were on the weak side. The strength of exports was bewildering, especially when [...]
globaleconomicanalysis.blogspot.com / By Mike “Mish” Shedlock / Friday, February 15, 2013 8:21 PM
Inquiring minds are looking at charts from the New York Times that show U.S. Trade in 2012 Outpaced Many Other Countries.
“In 2012, United States exports of goods rose 4.5 percent from 2011, a faster rate of growth than that of 10 other major countries but well below the growth rate of Chinese exports. American imports rose 3 percent, but the trade [...]
Wolf Richter www.testosteronepit.com www.amazon.com/author/wolfrichter
Japan’s Liberal Democratic Party went all out late last year to re-grab the power it had held for 50 years before getting booted out in 2009. Its platform: print and borrow with utter abandon to create asset bubbles and inflation, and to weaken the yen. It even threatened to wrest control over the printing press away from the Bank of Japan. That verbiage has been phenomenally successful: [...]
by Dan Denning, Daily Reckoning.com.au:
Well here we go. Let the countdown begin. China’s fourth quarter GDP numberscome out on Friday. We reckon most of the run up in the All Ords to 4751 has been in anticipation of good news. If form holds, stocks will trade down once the news is in.
As for the news itself, well, is it really news? That is, does a GDP figure really tell you anything useful? As we [...]
EDITOR’S NOTE – This is the first installment in “China’s Reach,” a project that will analyze China’s influence with its trading partners over three decades, and explore how that is changing business, politics and daily life.
(Excerpt) Read more at hosted.ap.org …
3 Things US Politicians Need To Know About China
Patrick Chovanec, An American Perspective From China |
This weekend, I was quoted in The Weekly Standard about what Mitt Romney and Paul Ryan need to know about what is happening in China. It begins by noting that Paul Ryan, Romney’s surprise VP pick, came out swinging the other day on President Obama’s handling of China:
“Free trade is a powerful tool for peace and prosperity, but our trading partners need to play by [...]
German industrial production declined 0.9 percent month-over-month (MoM) in June. Meanwhile, exports fell 1.9 percent MoM in June. This comes after yesterday’s decline in German factory orders and shows that Europe’s largest economy is slowing under the weight of the region’s debt crisis.
German industrial production declined in June, led by a drop in construction output.
Production fell 0.9 percent from May, when it gained a revised 1.7 percent, the Economy Ministry in Berlin said [...]
Simon Black on JUNE 1, 2012
June 1, 2012
New York City
This week saw yet another move from the Chinese government to internationalize its currency and eventually overtake the dollar.
The latest? Direct foreign exchange between the Chinese renminbi and the Japanese yen. In other words, when the two nations trade, they’ll no longer need to use the US dollar as an intermediate currency.
China is Japan’s largest trading partner… yet a massive 60% of their mutual trade right [...]
After some disappointing data out of China, talks of a Chinese hard landing are back full force.
But there’s one economic indicator that Chinese hard/soft/bumpy landing watchers should be looking at according to Societe General analyst Wei Yao.
Wei says import data, which is subject to less statistical adjustments and can be easily cross-checked with its trading partners, is a crucial indicator because China’s “import demand centers on investments“. And remember Chinese imports [...]
Flies ‘sting’ fruit then larva eat it from inside
Panic sparked by single fly in Auckland
Described as ‘world’s worst fruit pest’
An entire suburb in New Zealand has been put on ‘lockdown’ and the nation is on Red Alert after the capture of a feared invader.
Jitters spread throughout the country after the discovery of a single male Queensland fruit fly, described as the world’s worst fruit pest.
It was trapped in the Auckland [...]
“Another development that’s been happening in recent days is swaps are being made. China and Australia just recently completed a $31 billion swap of their currencies. To me that’s tantamount to barter. These countries have essentially pre-positioned their currencies, probably because they are worried about being cutoff from international transfers.”
“Jim Sinclair has pointed out what is taking place with the SWIFT system. I would just like to add that SWIFT [...]
by Adam, CM
History is replete with the carcasses of failed currencies destroyed through misguided intentional debasement by governments looking for an easy escape from piling up too much debt. James Rickards, author of the recent bestseller Currency Wars: The Making of the Next Global Crisis, sees history repeating itself today – and warns we are in the escalating stage of a global currency war of the grandest scale.
Whether it ends in hyperinflation, [...]
‘Something’ cannot be made from nothing, except for indebtedness.
The argument is that the euro is declining relative to the dollar and the Fed must respond. This does not conform to what is taking place, that the euro is fatally damaged. The only unknown is how many countries must default before the Germans exit and the euro ceases to exist.
LTRO does not create solvency or effect debts other than to shift [...]
How Jim O’Neill still has a job is beyond us. Not only is he the head of the worst performing vertical at Goldman Sachs, not only is he the creator of the Bloody Ridiculous Investment Concept (BRIC), but now this? Come on…
First, from Reuters: Goldman’s O’Neill: U.S. equities market could rise 20 percent in 2012 - dateDecember 27, 2011.
And then… from Bloomberg - S&P 500 May Rise 20% on U.S. Growth, Goldman’s O’Neill Says,November 16, 2010.
The Standard [...]
By Matthew Dalton
BRUSSELS — The European Union Thursday slashed its growth forecast for the 27-nation bloc in the coming year and said it can’t exclude the possibility of a deep, prolonged recession.
The European Commission, the EU’s executive arm, said in its semiannual forecast the economy is struggling with weak confidence, financial turmoil, government austerity packages and a slowdown in Europe’s main trading partners.
It said [...]
by Charles Hugh Smith from Of Two Minds
Why the Eurozone and the Euro Are Both Doomed
Papering over the structural imbalances in the Eurozone with endless bailouts will not resolve the fundamental asymmetries.
Beneath the endless announcements of Greece’s “rescue” lie fundamental asymmetries that doom the euro, the joint currency that has been the centerpiece of European unity since its introduction in 1999.
The key imbalance is between export powerhouse Germany, [...]
From Michael Krieger of KAM LP
All quotes below are taken from a Bernank paper written in 1999 titled “Japanese Monetary Policy: A Case of Self-Induced Paralysis?”
Although it is not essential to the arguments I want to make—-which concern what monetary policy should do now, not what it has done in the past—-I tend to agree with the conventional wisdom that attributes much of Japan’s [...]
Dollar Got Me Down: A Down Dollar Roadmap
All the talk about a dollar currency crisis is getting ahead of itself. Quoting Mises won’t make it happen overnight. It takes years, even decades for a reserve currency to dissipate. Instead of wholesale collapse, the most likely outcome is a steady decline in the dollar over an extended period of time. Of course there is [...]
Treasury Secretary Timothy Geithner said on Tuesday a strong dollar “will always be” in U.S. interests and that the Obama administration would not undercut the greenback to spur growth.
AP Timothy Geithner
“Our policy has been and will always be, as long, at least, as I’m in this job, that a strong dollar is in our interests as a country. And we will never embrace a strategy of [...]
by Charles Hugh Smith from Of Two Minds
Your Pick, Ben, But One Goes Off the Cliff
It’s one or the other, Ben: you either push the real economy over the edge or you push stocks and the risk trade off the cliff.
Now that you’ve pushed the dollar down, Ben, it’s your pick on what to push off the cliff: your beloved risk trade or the real economy. Here’s [...]
by Henry Blodget
When companies get into financial trouble, they usually fire current management, analyze and streamline their operations, and restructure their debts.
America is currently in financial trouble, but the only step in the turnaround process that we seem to be capable of taking is firing current management (see the recent midterm elections). After that, it’s just finger-pointing and bloviating [...]
Today at 8:30 am the US trade deficit for December will be revealed. The consensus is $40.5 billion. Yet the final number could come well worse of even the bleakest expectations. Citi’s Stephen Englander looks at export patterns by key trading partners and concludes “that the risk of a big negative surprise and a number beyond the pessimistic Citi forecast is not out of [...]
“Data form our trading partners shows robust exports to the US, and exports from the US show signs of fizzling.” – Steven Englander
The consensus expects a modest deterioration of the US trade deficit from $38.3bn to $40.5bn in the US trade data to be released on Friday. Citi economists expect the trade deficit to come in at $42bn. Some data suggests that the risk of a big [...]
Courtesy of Phil of Phil’s Stock World
Is it Wednesday already?
What a fun week we’ve been having. Â I had told Members when we were looking forward in the weekend post: Â ”Wednesday is a biggie with Mortgage Applications, Challenger Job Cuts, ADP Jobs Report, Productivity and Unit Labor Costs, ISM, Construction Spending, Oil Inventories, Auto Sales AND the Fed Beige Book, which I think may show optimism building [...]