China’s Trade and Manufacturing Flourish … While America’s Tanks
U.S. manufacturing has shrunk to a 3-year low.
Business Insider notes:
As we wrote earlier, one of the big stories from today’s PMI (Purchasing Managers Index – a primary measure of a country’s manufacturing activity) reports was the strength of the BRICS. China, Brazil, South Africa, India, and Indonesia all turned in good reports.
Europe was stable too. Eurozone PMI hit its highest level in 8 months.
And this time it was the U.S. ISM report that laid a brick, with the headline number going sub-50 (signaling contraction) and various sub-indices doing poorly.
Whereas the rest of the world is now on an up-tick in momentum, it appears that the U.S. (perhaps due to a combination of Cliff worries and Sandy) is seeing a rough patch.
Earlier today, we posted a couple of sentences from SocGen analyst Kit Juckes. The gist was: The China hard landing risk was coming off the table, the Euro crisis was fading, and now the last risk was the U.S. and the cliff.
Juckes wrote:
An optimist will tell me that at 50.6 China’s manufacturing PMI is at its highest level since April, a pessimist will point out that it’s barely above 50. But the ‘tail risk’ of an imminent hard landing for the Chinese economy is fading, just as the conclusion of the latest Greek drama means that risk of a return to full-blown Euro Zone crisis is fading. So, two of three major risks are reduced, leaving only the dreaded ‘fiscal cliff’ to worry about.
And in a must-read article, AP analyzes IMF data on 180 nations’ trade with China – and concludes that China has surpassed America as the world’s “top global trader”:
As recently as 2006, the U.S. was the larger trading partner for 127 countries, versus just 70 for China. By last year the two had clearly traded
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http://www.ritholtz.com/blog/2012/12/u-s-manufacturing-index-plunges-to-3-year-low-while-manufacturing-rises-in-the-brics/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+TheBigPicture+%28The+Big+Picture%29
As recently as 2006, the U.S. was the larger trading partner for 127 countries, versus just 70 for China. By last year the two had clearly traded places: 124 countries for China, 76 for the U.S.
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Despite China’s now-slowing economy, its share of world output and trade is expected to keep rising, with growth forecast at up to 8 percent a year over the next decade, far above U.S. and European levels.
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The United States is still the world’s biggest importer. no chit but China is gaining. It was a bigger market than the United States for 77 countries in 2011, up from 20 in 2000, according to the AP analysis.
Realist - Everybody in America is soft, and hates conflict. The cure for this, both in politics and social life, is the same -- hardihood. Give them raw truth.
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