Category Archives: China

We Will All Go Down Together

When we last wrote, some brave analyst at a Chinese brokerage was making headlines by talking of there being at least another CNY2–2.5 trillion in ‘shadow’ margin debt to add to the peak CNY2.3 trillion registered on the exchange ( that latter now already shrunken by over a third). Since then, the ante has been upped […]

Monday Morning Macro

Though the punditocracy has become much more aware of the sheer scale of China’s equity bubble in recent weeks, it is still arguably the case that reality is running ahead of reportage even as more and more evidence emerges of just how dire things are in the world beyond the brokerage screens.

Market Mayhem

Between Li Keqiang, Mario Draghi, and the BLS, markets everywhere had a wild ride into the weekend. Starting east and working west, the upshot of the Chinese ‘Twin Sessions’ was a perseverance with the so-called ‘New Normal’ theme – namely, with the idea that headline, GDP-style growth should be lower in future with the emphasis shifting […]

Chart(s) of the Day

Taken over a forty year history, US gasoline is trading in its 3rd percentile – 1.8 sigmas from the mean – when expressed as a ratio of the price of heating oil. In seasonal terms, this makes sense as the winter draw for space heating coincides with the consumption lull in (discretionary) road transport and the anticipatory […]

Macro & Market Update

More than half a century ago, in his role as an advisor to the men responsible for trying to set Taiwan on the road to prosperity, a redoubtable economist called Sho-Chie Tsiang argued that the monetary authorities should stop suppressing interest rates and directly rationing credit and should move instead toward a more market-oriented system where […]

A Slow Boat in China

Still struggling to move from its ‘Three Overlay’ period – essentially the indigestion added by the post-GFC ‘stimulus’ burst to the already unbalanced economic structure – to its vaunted ‘New Normal’ – slower headline growth but growth of much higher quality, to be concentrated not in building steel mills, metal smelters, and dormitory towns just […]