Comments on: Brad Setser Need Be Curious No Longer

By: Do you see what I see? | 1800blogger

Do you see what I see? | 1800blogger — Sun, 14 Jun 2009 23:42:50 +0000

[...] elsewhere on this globe. Some point to a resumption of strong economic growth from China. But Edward Hugh (via Brad DeLong) notes that any growth in China is not coming from their ability to sell more [...]

By: Economic Recovery: Do You See What I See?

Economic Recovery: Do You See What I See? — Sun, 14 Jun 2009 21:02:33 +0000

By: Do you see what I see? | Bear Market Investments

Do you see what I see? | Bear Market Investments — Sun, 14 Jun 2009 19:14:45 +0000

By: TheTradingReport » Blog Archive » links for 2009-06-12

TheTradingReport » Blog Archive » links for 2009-06-12 — Fri, 12 Jun 2009 13:44:05 +0000

[...] Ed Hugh: Brad Setser Need Be Curious No Longer: China’s exports fell by a record in May [...]

By: Chinese Economist

Chinese Economist — Fri, 12 Jun 2009 10:39:49 +0000

“Empty apartments are not a problem as long as you can find people who can live in them.”

No, you are right. But the problem is how people can pay prices at current valuations and how China can maintain wages at competitive levels in the key export industries. The circle doesn’t square here.

The excess is in the higher income segment of the market. How large it is exactly, here I’m firing in the dark too

There’s surely a valuation problem. I understand for example that house price/household income ratios are around
12-14x in cities like Shanghai/Beijing, and were as high as 18x at the peak. Prices have apparently come off around 30% or so.
(still, an analyst like Cao thinks at 10-12x, 60% of homebuyers income have to go into mortgage payments …. not much left then for consumption eh?)

But there is certainly a large amount of speculative purchases in the upper segments of the market. I hear from conversations that
more than a third of recent purchases in Shenzhen may be speculative. This is not surprising, & it matches the behaviour back
in 2006 …

By: Charly

Charly — Thu, 11 Jun 2009 22:40:00 +0000

Empty apartments are not a problem as long as you can find people who can live in them. That is the big problem in the USA but in China you only need to give the people a loan and they can move in. You also will have the benefit that they will spend money to paint etc. the apartment.

By: Ron Hulscher

Ron Hulscher — Thu, 11 Jun 2009 21:29:13 +0000

For a while I was wondering; when we notice an overall production decline of the world’s most important economies, there is obvious less demand for oil. So, what causes the recent increase of the oil price? Is the oil production decreased, or is it just speculation?
But now I read here “China’s imports of commodities such as iron ore, coal and crude oil have been extraordinarily strong, increasing speculation that China is currently building strategic inventories of the most important commodities (see chart on next page). For that reason, Latin America (not least Brazil) and the ASEAN countries have benefited recently from China’s strong import volumes.”
Also, that’s good news from China for the heavily oil- and gas export-depending Russian economy. But the bad news is that I expect this price-increasing effect to be only temporary. Well, this gives me something else to be wondering about. Is the bad Russian economical situation really much improved recently, due to the rice of the oil price?
Ron.

By: China’s exports in May presage wilting green shoots « Der Don

China’s exports in May presage wilting green shoots « Der Don — Thu, 11 Jun 2009 15:13:01 +0000

[...] Investment Bonanza? [...]