This conbined with the fall in iron, oil and copper imports suggests that China was stock piling commodities and has discontinued the practice. Unless western production and economic “growth” can make up for the slack caused by China’s discontinuation of stockpiling, commodities will likely continue to get hit hard in the short term and this may lead to a [...]
I find it interesting that this story gets very little play in the media and is buried on bloomberg and non-existent on CNBC but the story about positive reported improvements in Chinese manufacturing and Retail sales is everywere. The picture that is painted is that either (1) Chinese statistics regarding their recovery are heavily doctored [...]
This is interesting. This is the first protectionist move that the Obama administration has made with respect to China. I wonder if it is being done as a one off to appease the Steal Workers Union or as a broader policy. We will need to watch what if anything the Chinese do in response. The biggest [...]
This is clear evidence that the Chinese were stock piling oil, copper and iron ore. I believe this was done in large part to generate the perception of economic activity. Otherwise, this information is wildly inconsistent with the most recent Chinese reports of manufacturing activity and retail sales.
http://www.marketwatch.com/story/china-imports-of-crude-iron-ore-fall-from-record-2009-09-11
I ran across this article in the New York Times regarding Chinese corporate accounting practices. With a market that is trading at roughly 32 times earnings it is troubling to think that the earnings which command such a high multiple are not what they appear to be.
http://dealbook.blogs.nytimes.com/2009/08/17/another-view-shanghai-ed-profits/
Guangshen Railway announced its results a few weeks ago for the first six months of 2009: “tonnage of freight transported by the Company amounted to 26.5406 million tonnes (2008 interim: 34.5508 million tonnes).” – a 23% decline. This is difficult to mesh with government reports of robust growth.
http://www.marketwatch.com/story/guangshen-railway-announces-2009-interim-results-2009-08-26?newsid=969283042&dist=bigchartssymb%3DGSH&sid=16860
This article is a few weeks old but I think it illustrates where a good bit of the Chinese lending is ending up. It appears that many of the loans are being made to Chinese state owned corporations and instead of creating additional capacity managers are plugging funds into the housing market and the stock [...]
I think this article really illustrates the loonacy of Chinese economic statistics.
Factory production up:
“Output at the nation’s factories gained 12.3 percent from a year earlier, the most since August 2008, the statistics bureau said in Beijing today. Local-currency new loans were 410.4 billion yuan ($60 billion), up from 355.9 billion yuan in July, the central [...]
Here, Hugh Hendry chief investment officer and Partner at Eclectica Fund walks about in Guanzhou China and observes the empty buildings as evidence of easy lending and excess capacity.
http://www.youtube.com/watch?v=ektMQGbW3wk
Jim Chanos, who is in the attached post has been shorting Chinese infrastructure plays on the basis that China is building out additional capacity for a world dominated by US consumption that no longer exists.
http://www.cnbc.com/id/15840232?video=1246874316&play=1