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Thread: China disintegrating. Steel demand, property sales both approaching ZERO

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    Default China disintegrating. Steel demand, property sales both approaching ZERO

    Article from ZeroHedge via Infowars. China's GDP is as big as ours and if it collapses so will the world economy.

    https://www.infowars.com/china-disin...roaching-zero/

    feb 14 2020 In our ongoing attempts to glean some objective insight into what is actually happening “on the ground” in the notoriously opaque China, whose economy has been hammered by the Coronavirus epidemic, yesterday we showed several “alternative” economic indicators such as real-time measurements of air pollution (a proxy for industrial output), daily coal consumption (a proxy for electricity usage and manufacturing) and traffic congestion levels (a proxy for commerce and mobility), before concluding that China’s economy appears to have ground to a halt.

    That conclusion was cemented after looking at some other real-time charts which suggest that there is a very high probability that China’s GDP in Q1 will not only flatline, but crater deep in the red for one simple reason: there is no economic activity taking place whatsoever.

    We start with China’s infrastructure and fixed asset investment, which until recently accounted for the bulk of Chinese GDP. As Goldman writes in an overnight report, in the Feb 7-13 week, steel apparent demand is down a whopping 40%, but that’s only because flat steel is down “only” 12% Y/Y as some car plants have ordered their employee to return to work (likely against their will as the epidemic still rages).

    However, it is the far more important – for China’s GDP – construction steel sector where apparent demand has literally hit the bottom of the chart, down an unprecedented 88% Y/Y or as Goldman puts it, “construction steel demand is approaching zero.”

    Courtesy of Capital Economics, which has compiled a handy breakdown of real-time China indicators, we can see the full extent of just how pervasive the crash in China’s economy has been, starting with familiar indicator, the average road congestion across 100 Chinese cities, which has collapsed into the New Year and has since failed to rebound.

    Parallel to this, daily passenger traffic has also flatlined since the New Year and has yet to post an even modest rebound.

    And the biggest shocker: a total collapse in passenger traffic (measured in person-km y/y % change), largely due to the quarantine that has been imposed on hundreds of millions of Chinese citizens.

    And while we already noted the plunge in coal consumption in power plants as Chinese electricity use has cratered…

    … what is perhaps most striking, is the devastation facing the Chinese real estate sector where property sales across 30 major cities have basically frozen.

    Finally, and most ominously perhaps, as the economy craters and internal supply chains fray, prices for everyday staples such as food are soaring as China faces not only economic collapse, but also surging prices for critical goods, such as food as shown in the wholesale food price index chart below…
    Reckless drivers are a bigger threat to you than all other criminals put together!

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    A suggestion to take a little money off the table has been floating around Wall Street lately. (seems like good advice to me)

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    Finally, and most ominously perhaps, as the economy craters and internal supply chains fray, prices for everyday staples such as food are soaring as China faces not only economic collapse, but also surging prices for critical goods, such as food as shown in the wholesale food price index chart below…
    wow

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    Quote Originally Posted by Jack View Post
    A suggestion to take a little money off the table has been floating around Wall Street lately. (seems like good advice to me)
    And where do you put your money then.? Maybe gold?

    No question stocks are extremely over-valued and over-bought. But as long as the fed keeps injecting $2 trillion dollars per year of phony money into the markets they will go up. Capitalism is gone. As are free markets.
    Reckless drivers are a bigger threat to you than all other criminals put together!

    The core of liberalism is anti-white racism

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    Quote Originally Posted by Text Drivers are Killers View Post
    And where do you put your money then.? Maybe gold?

    No question stocks are extremely over-valued and over-bought. But as long as the fed keeps injecting $2 trillion dollars per year of phony money into the markets they will go up. Capitalism is gone. As are free markets.
    You know the Old Saying: "You make your money in Stocks, you keep your money in Bonds".

    So Triple A Treasuries or at least Corporate Bonds would be the logical answer.

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    Quote Originally Posted by Jack View Post
    You know the Old Saying: "You make your money in Stocks, you keep your money in Bonds".

    So Triple A Treasuries or at least Corporate Bonds would be the logical answer.
    Right now the yield on treasuries is extremely low by historical standards. If the yield on 30 year bonds goes up to 8% (as it should) the value of your 2% bonds will go off a cliff.
    Reckless drivers are a bigger threat to you than all other criminals put together!

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    Quote Originally Posted by Text Drivers are Killers View Post
    Right now the yield on treasuries is extremely low by historical standards. If the yield on 30 year bonds goes up to 8% (as it should) the value of your 2% bonds will go off a cliff.
    Yes. But I don't see '8%' anytime soon. Global capital is flowing into the US keeping rates low.

    "Foreign Money Flowing into U.S. Markets"
    http://www.cftech.com/the-brainbank-...to-u-s-markets

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    Quote Originally Posted by Jack View Post
    Yes. But I don't see '8%' anytime soon. Global capital is flowing into the US keeping rates low.
    Until this century 8% for the long bond was normal.
    Reckless drivers are a bigger threat to you than all other criminals put together!

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    Quote Originally Posted by Text Drivers are Killers View Post
    Until this century 8% for the long bond was normal.
    Cool. You might be able to get 5% buying High Yield (Junk) Bonds, but they sink when Stocks sink. You want something with low correlation (R squared).
    You mentioned 'gold'. When Stocks sink, gold rises. Gold is close to touching 1600. The problem with Gold, it doesn't pay Dividends, while Bonds do.

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    Quote Originally Posted by Jack View Post
    Cool. You might be able to get 5% buying High Yield (Junk) Bonds, but they sink when Stocks sink. You want something with low correlation (R squared).
    You mentioned 'gold'. When Stocks sink, gold rises. Gold is close to touching 1600. The problem with Gold, it doesn't pay Dividends, while Bonds do.
    No - the problem with gold is the bankers manipulate it to keep its price down.
    Reckless drivers are a bigger threat to you than all other criminals put together!

    The core of liberalism is anti-white racism

    When the guns are gone, EVERYTHING IS GONE.

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    Quote Originally Posted by Text Drivers are Killers View Post
    No - the problem with gold is the bankers manipulate it to keep its price down.
    OK. Well, keep it under your mattress then.

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    Quote Originally Posted by Jack View Post
    Yes. But I don't see '8%' anytime soon. Global capital is flowing into the US keeping rates low.

    "Foreign Money Flowing into U.S. Markets"
    http://www.cftech.com/the-brainbank-...to-u-s-markets
    Global capital flowing into the US?

    #MAGA

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    Quote Originally Posted by Text Drivers are Killers View Post
    Article from ZeroHedge via Infowars. China's GDP is as big as ours and if it collapses so will the world economy.
    info wars? how low IQ is that!
    Nationalism is an infantile disease. It is the measles of mankind. Albert Einstein

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    And it's not surprising then they get bitter, they cling to guns or religion or antipathy toward people who aren't like them or anti-immigrant sentiment



    ברוך השם

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    Quote Originally Posted by Jack View Post
    OK. Well, keep it under your mattress then.
    Money won't grow under a mattress. But if corona turns into a nightmare, gold might triple in a few months.
    Reckless drivers are a bigger threat to you than all other criminals put together!

    The core of liberalism is anti-white racism

    When the guns are gone, EVERYTHING IS GONE.

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