Wednesday, September 19, 2012

The China Turmoil

Ed Yadeni notes on crashing China:

China’s Communist leadership change isn’t going smoothly at the same time that the economy is slowing significantly. For example, electricity output during the three months through August rose only 1.4% y/y. Crude oil demand has flattened out around 9.5mbd over the past six months through August. Fred Smith, the head of FedEx, warned on Tuesday that China watchers may be “completely underestimating” that the export slowdown is more than offsetting attempts by the government to boost growth.

The recent widespread protests in China against Japan’s claims to some of the disputed islands in the South China Sea are already harming the economy. Japanese companies are temporarily closing their manufacturing facilities and retail outlets in China...

China’s Shanghai-Shenzhen 300 stock price index rallied late last week, but now seems to be resuming the downward trend of the past year...

This morning, Reuters reports that the mass protests could backfire on China’s Communist leaders. Ultra-nationalists are going bonkers that Beijing isn’t being tough enough on Japan. Many demonstrators held up portraits of Mao Zedong.

1 comment:

  1. War is the health of the state. You think the Communists can't see this crash coming? WWII was along time ago. This anti-Japanese hysteria is trumped up so the Communists can keep power. The big question is, how far will it go, or will it bleed over into Taiwan or Korea?