Like many countries, China attempted to rein in its debt growth over
the past couple years, but ultimately gave up and is now back to piling
on even more debt. Bloomberg reports –
For almost two years, the question
has lingered over China’s market-roiling crackdown on financial
leverage: How much pain can the country’s policy makers stomach?
Evidence
is mounting that their limit has been reached. From bank loans to
trust-product issuance to margin-trading accounts at stock brokerages,
leverage in China is rising nearly everywhere you look.
While
seasonal effects explain some of the gains, analysts say the trend has
staying power as authorities shift their focus from containing the
nation’s $34 trillion debt pile to shoring up the weakest economic
expansion since 2009. The government’s evolving stance was underscored
by President Xi Jinping’s call for stable growth late last week, while
on Monday the banking regulator said the deleveraging push had reached
its target.
As I’ve been warning,
China has been experiencing a powerful credit bubble over the past
decade (see the chart below). China’s leaders inflated the credit bubble
in order to supercharge economic growth during and after the global
financial crisis in 2008/2009. China’s credit-driven economy has become
one of the main growth engines of the global economy, which has scary
implications because it’s even more evidence that the global economic
recovery is predicated on debt.
China’s aggressive credit expansion is a major contributor to the
global debt explosion over the past couple decades. Global debt has
increased by $150 trillion since 2003 and $70 trillion since 2008:
China’s credit bubble is very similar to Japan’s economic bubble
in the late-1980s. For many years, Japan’s economic growth seemed
unstoppable and many people believed that Japan would overtake Western
economies in short order. Of course, Japan’s growth miracle came to a
screeching halt in the early-1990s when the country’s bubble burst. By
ramping up debt so aggressively (which borrows economic growth from the
future), China is following in the same footsteps as Japan and will soon
experience the downsides of debt-fueled growth.
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最後の二段落だけ訳しておきます。 Stock Euphoria Stunts Gold Adam Hamilton April 19, 2019 3257 Words The great euphoria emanating from these near-record-high stock markets is breathtaking. Traders are again convinced stocks do nothing but rally indefinitely. That everything-is-awesome mindset has stunted gold’s latest upleg, since there’s no perceived need for prudently diversifying stock-heavy portfolios. But that psychology can change fast, as we saw a half-year ago. Gold investment roars back as stocks roll over. The word “euphoria” is widely misunderstood, often confused with “mania”. The latter is when stocks rocket vertically in blowoff tops, and is defined as “an excessively intense enthusiasm, interest, or desire”. The US stock markets certainly aren’t in a mania. At its latest high last Friday, the flagship US S&P 500 broad-market s...
The Message From The Jobs Report – The Economy Is Slowing Written by Lance Roberts | Apr, 8, 2019 Last week, the Bureau of Labor Statistics (BLS) published the March monthly “employment report” which showed an increase in employment of 196,000 jobs. As Mike Shedlock noted on Friday: 先週、BLSが３月の月例「雇用統計」を発表した、雇用が１９６，０００増えたという。Mike Shedlockは金曜にこう書いた： “The change in total non-farm payroll employment for January was revised up from +311,000 to +312,000, and the change for February was revised up from +20,000 to +33,000. With these revisions, employment gains in January and February combined were 14,000 more than previously reported. After revisions, job gains have averaged 180,000 per month over the last 3 months. 「１月全非農業雇用は＋３１１，０００から＋３１２，０００に改定された、２月のデータは＋２０，０００から＋３３，０００に改定された。これらの改定で１月と２月を合算した雇用増は以前の報告よりも１４，０００多くなった。改定後でみると、雇用増は直近三ヶ月で平均１８０，０００／月となる。 BLS Jobs Statistics at a Glance BLS 雇用統計概観 Nonfarm Payroll : +196,000 – Establishment Survey Emp...
