There still are some economic numbers that aren’t seasonally adjusted or manipulated with fancy statistical footwork by governmental, quasi-governmental, or non-governmental number mongers. And they give us the true picture of the worldwide economy: beer, wine, mood, and San Francisco real estate—with more predictive power than is allowed by law.
China
When The White House Touts Falling Wages
by Wolf Richter • • Comments Off on When The White House Touts Falling Wages
150 factory workers in China threatened to jump off the roof of an iPhone factory unless they received a raise. Similar stories are accumulating. To make ends meet, desperate workers sometimes take drastic measures. These anecdotes underscore a major trend in China: skyrocketing cost of labor. But in the US, it’s the opposite—and now part of the official White House strategy.
The US Auto Industry Drifts Off To China
by Wolf Richter • • Comments Off on The US Auto Industry Drifts Off To China
Practically every car or truck sold in the US today contains Chinese-made components, though Chinese-designed vehicles haven’t made it yet. Chinese automakers scramble to move from nice-looking but shoddy copy-and-paste models to reliable products that would be competitive in the US. It’s a government priority. And they’re getting there through the back door.
The Previously Unthinkable Becomes A Planned Event
by Wolf Richter • • Comments Off on The Previously Unthinkable Becomes A Planned Event
Governments and companies around the world have been preparing for a collapse of the Eurozone—simple prudence requires them to do that. Theoretical exercises for a hypothetical scenario, they call it. But recently, these theoretical exercises have taken on practical overtones. And even the public is now encouraged to prepare for the demise of the euro.
Merde! Chinese Wines Did What to French Wines?
by Wolf Richter • • Comments Off on Merde! Chinese Wines Did What to French Wines?
In France, the litany of job reductions continues. Today, it was Air France. It followed automaker PSA Peugeot Citroën, French banks, nuclear-power conglomerate Areva, drug maker Sanofi, newspapers, ferry operator Seafrance, etc. It’s tough out there. And now, France’s heavily subsidized signature industry—wines—got slapped in the face. By China.
The Trade Debacle With China
by Wolf Richter • • Comments Off on The Trade Debacle With China
The US trade deficit with China will hit a record $300 billion for the year, a big hit to the economy. It’s politically convenient to blame China, particularly its yuan policy. But the driver is a broad strategy by US corporations to shift an increasing range of economic activities to China. And now a trade war has broken out. Politicians, have a word with your corporate sponsors!
When The Truth About The US Economy Comes From China
by Wolf Richter • • Comments Off on When The Truth About The US Economy Comes From China
In his “enough’s-enough” speech in Hawaii, Obama castigated China for its currency peg, a perennial complaint. Congress too regularly hyperventilates about the yuan being “artificially undervalued.” If China just allowed the yuan to trade freely, they say, it would solve the U.S. economic quagmire. Cheap political posturing—and full of bitter ironies.
The Eurozone Turns Down Chinese Money And Quid Pro Quo
by Wolf Richter • • Comments Off on The Eurozone Turns Down Chinese Money And Quid Pro Quo
For months, rumors China would use its foreign exchange reserves to bail out the Eurozone with the stroke of a plastic pen goosed financial markets. But China has a list of demands. German industry refuses to cede ground. People shudder at becoming dependent on money from the communist regime. Clearly, the debt crisis isn’t deep enough yet.
The Brutal Trade Deficit
by Wolf Richter • • Comments Off on The Brutal Trade Deficit
At $46 billion in August and a hair-raising $376 billion year to date, the trade deficit is a powerful descriptor of what’s wrong with the U.S. economy. By year end, it will amount to half a trillion. Economic activity gone overseas. The cause: an ancient and valid business principle that is now harming the overall economy.
The China Bubble Makes Contact with A Cactus
by Wolf Richter • • Comments Off on The China Bubble Makes Contact with A Cactus
Bubbles go on much longer than a rational mind can fathom, especially bubbles that are supported by governments and central banks. Everyone benefits, so everyone (except for a few hapless shorts) pushes to keep them going. But when they burst, they wreak havoc. And in China, there are new ominous signs.