Friday, August 10, 2012
Right On Schedule
Note that you can see the impact of lower shipments in rail container figures, which are beginning to come off their annual pace.
The global economic environment is decaying at a relatively rapid pace.
To really boost internal demand, China needs better social infrastructure. It is coming to the end of random building and borrowing.
Have you changed your recession call, especially in light of the recent steep run-up in gas and food prices?
The last few posts have explained why I think we are in a recession. Earlier sensitive indicators showed a worsening of circumstances, but now we are in the rapid diffusion stage. The whole world is whacking around the weakness ball, and every time it gets returned the weakness gets deeper.
Right now money is going to where the profits are, and the hope of widespread helicopter money drops globally is sustaining a rally in stocks (often thinly traded) and commodities. When that breaks down on fundamentals, bonds will resurge.
This, in large part, explains Germany's downturn.
It will be very interesting to see the port traffic numbers coming out of Los Angeles and Long Beach this month.
And by very interesting, I actually mean potentially terrifying. Sigh.
Unfortunately, Alien is my favorite horror movie.
The movie has nest eggs; it has parasites; and just like our economy, they thought Kane (John Hurt) was recovering too.
Looks like the big problem is finding a safe place to put money and property rights.
Links to this post: