Meanwhile Europe is growing a little, China exportations falls are confirmed.

Discussion in 'General Trading Discussion' started by WaveWage, Sep 8, 2015.

  1. WaveWage

    WaveWage Well-Known Member

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    It is done, it is published, China now announce it officially: China exportation has lowered once again. But it is less worst than expected by Bloomberg News who talked about 6.6%, it is rather a -5.5% progress on exportation that happened to China. Meanwhile, importations rather got a -13,8%, this basically means that importations slowed down further than the exportation did.


    China is accounting for 13% of world's GDP. Meanwhile its impact for markets has been clear the last week, it seems that the news aren't as bad for China as expected, hence why I expect a better way for now, even if I can't be sure.
    For reference, the trade surplus still grow of 20,1% compared to last year, China customs said.
     
  2. pwarbi

    pwarbi Senior Investor

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    Like you say it's not the massive drop that I think they was bracing themselves to expect, and while no negative is good, I think they'll take this with a sigh of relief, as they know, and was expecting it to be a lot worse.

    What does this tell the Chinese for the future? Well cautiously optimistic is probably about where they are now.
     
  3. Rainman

    Rainman Senior Investor

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    The worst isn't over yet. It's surprising though that China exports have dropped after the measures they took to prevent that. They devalued their currency so Chinese products can be even cheaper, didn't they? I suppose this isn't just about their stock market crash. I get the feeling that global economic slowdown is approaching or it already is here.
     
  4. Sunflogun

    Sunflogun Well-Known Member

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    I wish I could understand how the markets work better, that would mean a better investment. As for the European growth, still shy and fragile.
     
  5. WaveWage

    WaveWage Well-Known Member

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    [HR][/HR]
    Well, about the devaluation of the currency, experts said the real effects should start to happen between three or six months. But as you say, the devaluation of the currency should have helped somehow.
    But I have an hope as well as my theory on it: the current system on the China can't support furthermore exportation + manufacturing growth. They can probably grow even more because they have one billions of citizens so with the new recent cash flow, they can probably grow still for the upcoming years, but I doubt that the China system as it is done now can support more exportations, and this fall just show we hitted the limit of the current system for them.
     
  6. baudwalk

    baudwalk Senior Investor

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  7. Nox

    Nox Guest

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    All this craziness and uncertainty is just making me so uncomfortable. Take me back to 2006 :(

    Markets are rather bearish at the moment, any bit of bad news seems to result in an overreaction. The decline in imports is a huge red flag, as it further confirms the slowdown that everyone (but China) is talking about in the Chinese economy. That's obviously bad news for many of it's commodity based trading partners who've been able to gain off the back of their growth. There is still a fair amount of growth happening in the region, and the Chinese government seems to be doing everything in its power to keep its economy stable.
     
  8. Corzhens

    Corzhens Senior Investor

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    I am not an economist but I have been following the changes in China's economy. It seems to me that they had over-invested their money in so many places particularly in African countries that they have neglected their own needs (the businesses in China). Now that export is down and they had devalued the Yuan, I guess China is into belt-tightening for now until the time their economy recovers... if ever.
     
  9. WaveWage

    WaveWage Well-Known Member

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    I think the market volatility, craziness and uncertainty was there since a lot more of time than 2006/2007. Otherwise, the previous speculation bubbles wouldn't have existed as well. But we already went these phases in the history of economical problem, oil shock and then recovery of these economy problem. The thing is, the world can't run like markets wants and the difference between their willings and the reality is the result of these problems, in my opinion.


    Well, you say "if ever the China's economy can get back", China have 1 billion citizen. It can't be an nonexistent country of the world, perhaps it may be for some time, but can't be too long, there's a so big market in that country that you can hardly ignore it. You can try to, but that seems pretty surprising.
     
  10. Onionman

    Onionman Senior Investor

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    A lot of what's happening in China shouldn't be a major surprise. Some of it is cyclical - economic conditions simply aren't as favorable any more and there's only so much propping up of the economy that the government will allow.

    Some of it is also structurally-driven - the government there is looking to shift the focus on how the country grows and rather than be reliant on infrastructure investment and government spending, they want it to be domestic consumption led. Shifting to that new model was always going to be a challenge. It's just a lot harder given the external factors.
     

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