Category: Countries & Regions

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Yield Is The Last Refuge Of Scoundrels – Seeking Alpha

By David Merkel:

What’s that I see? We’re at a 50-year low for yields on low investment-grade-rated bonds. Surely the economy should be booming. What, like the Great Depression, we are in a liquidity trap? Seems that way…….

Baa Corporate Bond Yield WBAA

via Yield Is The Last Refuge Of Scoundrels – Seeking Alpha.

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Twin China PMI surveys show economy perking up | Reuters

By Lucy Hornby

“The return of the PMI above 50 suggests economic momentum has indeed picked up. It indicates the effect of policy easing may have been stronger than the consensus expected,” Zhiwei Zhang of Nomura said in a comment emailed to Reuters. “We believe macro data will continue to surprise on the upside in coming months, as the government continues to ease policy through the period of leadership transition.”…….

via Twin China PMI surveys show economy perking up | Reuters.

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S&P 500 with Share Weighted Earnings | The Big Picture

Fusion’s Kevin Lane observes that share-weighted earnings for the S&P 500 are “very close to tilting back into the negative zone”.

….With a bit more than half the companies reporting, S&P 500 earnings YoY (on a share-weighted basis) are only up 3.3 %.

via S&P 500 Index with Share Weighted Earnings Average | The Big Picture.

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The “Make Believe” NYSE Opening | The Big Picture

Good observation from Barry Ritholz about window dressing:

I was trying to figure out why the NYSE would open when not at full operating capacity……… Mutual funds are closing out their year on October 31st. I suspect they are desperate to get one last positive mark on the books before the new year begins.

via The “Make Believe” NYSE Opening | The Big Picture.

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Australia: Terms of trade down 4.2%

Westpac reports Australia’s terms of trade (for goods) weakened for the fourth consecutive quarter, down 4.2% in Q3 and 14.7% over the last four quarters.

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Global QE

Observation made by Philip Lowe, RBA Deputy Governor:

Since mid 2008, four of the world’s major central banks – the Federal Reserve, the ECB, the Bank of Japan and the Bank of England – have all expanded their balance sheets very significantly, and further increases have been announced in a couple of cases. In total, the assets of these four central banks have already increased by the equivalent of around $US5 trillion, or around 15 per cent of the combined GDP of the relevant economies. We have not seen this type of planned simultaneous very large expansion of central bank balance sheets before. So in that sense, it is very unusual, and its implications are not yet fully understood……

via RBA: Australia and the World.

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Hurricane Sandy [time lapse animation]

The power of nature.

[gigya src=’http://www.reuters.com/resources_v2/flash/video_embed.swf?videoId=238739605&edition=BETAUS’ type=’application/x-shockwave-flash’ allowfullscreen=’true’ allowScriptAccess=’always’ width=’460′ height=’259′ wmode=’transparent’]

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Dirty money cost China $3.8 trillion | Reuters

By Stella Dawson

China has lost $3.79 trillion over the past decade in money smuggled out of the country, a massive amount that could weaken its economy and create instability, according to a new report. And the outflow — much of it from corruption, crime or tax evasion — is accelerating. China lost $472 billion in 2011, equivalent to 8.3 percent of its gross domestic product…..

via Dirty money cost China $3.8 trillion 2000-2011: report | Reuters.

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Unsaving the U.S. economy | MacroScope

Gabriel Burin writes that the U.S. savings rate sank last month to its lowest since November.

“Households were only able to boost consumption in the third quarter by dipping into their savings,” said Paul Dales, senior U.S. economist at Capital Economics, after the Commerce Department release. “Faced with the prospect of major tax hikes in the New Year, however, they will soon become more cautious”……..

via Unsaving the U.S. economy | MacroScope.

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Chinese TV Host Says Regime Nearly Bankrupt | Epoch Times

A sobering assessment of China’s economy reported by Matthew Robertson:

Larry Lang, chair professor of Finance at the Chinese University of Hong Kong, said in a lecture that he didn’t think was being recorded that the Chinese regime is in a serious economic crisis — on the brink of bankruptcy.

The youtube audio requires translation:

Robertson summarizes Lang’s assessment into five key points:

  1. The regime’s debt sits at about 36 trillion yuan (US$5.68 trillion).
  2. The real inflation rate is 16 percent, not 6.2 percent as claimed.
  3. There is serious excess capacity in the economy, and private consumption is only 30 percent of economic activity.
  4. Published GDP of 9 percent is also fabricated. According to Lang, GDP has contracted 10 percent.
  5. Taxes are too high. Last year, direct and indirect taxes on businesses amounted to 70 percent of earnings…..

via Chinese TV Host Says Regime Nearly Bankrupt | Business & Economy | China | Epoch Times.

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