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China's economy is looking scary at this point. Also from Bloomberg: Chinese consumer tax receipts down 70% in November. https://www.bloomberg.com/opinion/arti

China's economy is looking scary at this point. Also from Bloomberg: Chinese consumer tax receipts down 70% in November. https://www.bloomberg.com/opinion/articles/2018-12-31/china-s-economic-slowdown-is-worsening-stop-dithering-beijing https://www.bloomberg.com/opinion/articles/2018-12-31/china-...

adventured 8y ago
The corporate bond defaults [1] are also interesting as a tell on their real situation. I'll be curious to see if the central government relents and unleashes a far larger stimulus as it appears there isn't going to be a trade deal near-term. Granted, you've also got Germany in a de facto recession and the UK inching toward one [2]. If the US can maintain a 2.5%+ GDP growth pace for 2019 against all of that, it'll be surprising. Projections on S&P 500 Q1 earnings have turned from 6-7% growth to an expected contraction. The market will weaken further with earnings growth disappearing, which is guaranteed to force the Fed to pause rate hikes and then cut. [1] https://www.bloomberg.com/news/articles/2019-02-11/two-large-chinese-borrowers-are-said-to-miss-bond-payments https://www.bloomberg.com/news/articles/2019-02-11/two-large... [2] https://www.bloomberg.com/news/articles/2019-02-11/u-k-economy-wilts-as-brexit-jitters-hit-business-investment https://www.bloomberg.com/news/articles/2019-02-11/u-k-econo...
- paganel 8y ago
  > Granted, you've also got Germany in a de facto recession Added to that, Deutsche Bank's recent "funding woes" (to quote the FT) personally give me a bad vibe, not sure if we're at the "summer 2007 phase" of Northern Rock's troubles [2] or if we're already in the "early September 2008 phase", i.e. a couple of weeks before Lehman fell. The nastier news is that, afaik, Deutsche is (was?) seen as being supported by the German government (the same as Volkswagen, for example), even more than the Wall Street investment banks were supported by Washington, and if Deutsche falls that will reflect very, very badly on the perceived financial soundness of the German government and hence of Europe as a whole. [1] https://www.ft.com/content/cb739552-2c5d-11e9-8744-e7016697f225 https://www.ft.com/content/cb739552-2c5d-11e9-8744-e7016697f... [2] http://news.bbc.co.uk/2/hi/business/6996136.stm http://news.bbc.co.uk/2/hi/business/6996136.stm

adventured 8y ago

The corporate bond defaults [1] are also interesting as a tell on their real situation. I'll be curious to see if the central government relents and unleashes a far larger stimulus as it appears there isn't going to be a trade deal near-term. Granted, you've also got Germany in a de facto recession and the UK inching toward one [2]. If the US can maintain a 2.5%+ GDP growth pace for 2019 against all of that, it'll be surprising. Projections on S&P 500 Q1 earnings have turned from 6-7% growth to an expected contraction. The market will weaken further with earnings growth disappearing, which is guaranteed to force the Fed to pause rate hikes and then cut. [1] https://www.bloomberg.com/news/articles/2019-02-11/two-large-chinese-borrowers-are-said-to-miss-bond-payments https://www.bloomberg.com/news/articles/2019-02-11/two-large... [2] https://www.bloomberg.com/news/articles/2019-02-11/u-k-economy-wilts-as-brexit-jitters-hit-business-investment https://www.bloomberg.com/news/articles/2019-02-11/u-k-econo...

paganel 8y ago
> Granted, you've also got Germany in a de facto recession Added to that, Deutsche Bank's recent "funding woes" (to quote the FT) personally give me a bad vibe, not sure if we're at the "summer 2007 phase" of Northern Rock's troubles [2] or if we're already in the "early September 2008 phase", i.e. a couple of weeks before Lehman fell. The nastier news is that, afaik, Deutsche is (was?) seen as being supported by the German government (the same as Volkswagen, for example), even more than the Wall Street investment banks were supported by Washington, and if Deutsche falls that will reflect very, very badly on the perceived financial soundness of the German government and hence of Europe as a whole. [1] https://www.ft.com/content/cb739552-2c5d-11e9-8744-e7016697f225 https://www.ft.com/content/cb739552-2c5d-11e9-8744-e7016697f... [2] http://news.bbc.co.uk/2/hi/business/6996136.stm http://news.bbc.co.uk/2/hi/business/6996136.stm