Tag Archives: usa

China, USA

China’s Economy Surpassing U.S.? #China #USA

There are a number of reports around Wednesday that China’s economy, by one measure at least, is likely to surpass the U.S. in size sometime this year.

The headlines will surprise many people, used to hearing China’s economy will overtake the U.S. sometime in the 2020s, or even later.

On Wednesday, the International Comparison Program, a statistical project coordinated by the World Bank, announced new data on the size of economies by purchasing power parity that suggests China’s economy is bigger than previously thought.

But the latest news is anything but surprising.

Regular GDP power rankings are compiled by converting a country’s gross domestic product into U.S. dollars at market exchange rates. The U.S.’s economy in 2012 was valued at over $16 trillion, twice the size of China’s, according to World Bank statistics. It’s by these measures that China’s economy won’t overtake the U.S. for a decade or more.

http://blogs.wsj.com/

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    11 Ugly Charts That Confirm China's Dramatic Slowdown During the National People's Congress, China's policymakers announced that it would target 7.5% GDP growth target for 2014. This is down from 7.7% growth in 2013, and the recent data shows that the economy is clearly off to a slower start to…
    Tags: data, economy, domestic, announced, gdp, year, china
  • China real-estate: A bubble bursting
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USA

After Alibaba IPO US Giants may stop ignoring chinese rivals

The largest technology stock offering in history is looming, but few in Silicon Valley seem to care.

http://www.nytimes.com/

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    The dichotomy of reaction to the Trump election victory from the mainstream media versus financial markets is truly extraordinary.
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    For the first time, New York City has surpassed Moscow for the most billionaire residents, according to the latest global rich list from Hurun, a group that tracks wealth in China. According to Hurun, New York added 14 billionaires this year, bringing its total to 84. Moscow, meanwhile, lost a…
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  • Wolf of Wallstreet is paying back everyone this year.
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Trading, USA

Faulty technology triggered CME trading outage

The worst-ever trading outage on the world’s most important agricultural markets was triggered when sophisticated technology tripped over a trading halt in a single market, the executive chairman of exchange operator CME Group Inc told Reuters.

The April 8 outage stopped electronic trading in 31 agricultural markets that influence global prices for food staples such as wheat, corn and pork, and sent a flood of traders into CME’s normally deserted open-outcry futures pits to execute transactions.

The electronic trading platform handles around 95 percent of the volumes in grain futures on a typical day, and market participants have been in the dark about the cause of the failure, with CME only saying a “technical issue” was to blame.

The unusual outage came from a technical fault that involved “implied technology” systems, which can facilitate the execution of spread trades, CME Executive Chairman Terrence Duffy said in an interview this week.

http://www.reuters.com/

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  • #EUR/USD fresh highs after breaking through 1.3650 resistance and 50DMA at 1.3655
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    David Matsuda had never been a mariner or an administrator before he became the head of the U.S. Maritime Administration in 2009. He had been a government lawyer and a congressional staffer, focusing on railroad issues; the ringtone on his phone was the choo-choo of a train. Matsuda had never been…
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  • Is the U.S. stock market rigged?
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Trading

The Rise and Fall of Gold #Gold

King Midas lusted after it. The Incas worshipped it. Shiny flakes of it set off a 19th-century rush to California and ship captains never stop looking for it at the bottom of the sea. While gold has ignited passions for centuries, for today’s investors, it seems, the metal has been losing its allure. After surging sevenfold during a 12-year bull market — a run matched by only a handful of assets, including U.S. Treasuries and stamps — investors sold it wildly in 2013, triggering the first annual drop in 13 years. Is the epic boom and bust in gold just another market cycle or is it a change in human appetites?

http://www.bloomberg.com/

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NoTrading

@BarackObama to reassure #Putin : Won’t provide lethal aid to #Ukraine

Lavrov warns West from supporting Ukrainian military action as Kiev’s deadline passes for separatists to end siege of government buildings in eastern Ukraine.

The White House on Monday said President Barack Obama would speak to Russian President Vladimir Putin soon, perhaps later in the day, and made clear the United States was not considering lethal aid for Ukraine.

“We are looking at a variety of ways to demonstrate our strong support for Ukraine including diplomatically and economically,” White House spokesman Jay Carney told reporters.

“We’re not actively considering lethal aid but we are reviewing the kinds of assistance we can provide,” he said.

http://www.haaretz.com/news/world/.premium-1.585598

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BOE, ECB, Trading, USA

Pound Rises Most in Two Months on Recovery Signs, #IMF Forecasts #GBP

The pound rose the most in two months versus the dollar this week as manufacturing and production data signaled the U.K. recovery is on track, boosting bets the Bank of England will raise interest rate and is going to nudge higher throughout the course of this month

The pound gained 1 percent this week, Industrial production increased 0.9 percent in February from the previous month and manufacturing output climbed 1 percent.

Growth Estimates

The IMF raised its forecasts for U.K. growth, predicting the economy will grow 2.9 percent in 2014.

Sterling gained 4.4 percent in the past six months, The euro climbed 1.9 percent, while the dollar slid 1 percent.Policy makers kept the benchmark interest rate unchanged at a record-low 0.5 percent at a meeting this week.

Annualized inflation slowed to 1.6 percent in March, from 1.7 percent the month before. The unemployment rate is estimated to 7.1 percent in the three months through February. This may prompt policy makers to consider to raise the interest rate.

Officials said in February there would be scope to maintain record-low rates even after the threshold is reached.

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Trading, USA

Is this the beginning of a crash? @reformedbroker

It certainly could be, but the odds do not favor it. Statistically speaking, it is far more likely that a run-of-the-mill correction is now underway and working its way through each sector of the market, to varying degrees of severity. Counter-trend rallies are sharp and short (think Wednesday), which is fairly characteristic of a defined downtrend. The 200-day moving average is rising up just beneath us and it may offer some solid support, just as it had in December of 2012.

http://www.thereformedbroker.com/

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Trading, trend

Kris eller uppgång för världen ?

För 10 år sedan verkade den globala ekonomin att vara på bättringsvägen.  Räntorna gick ner till 1 %, Storbritannien var i sitt 12:e år av oavbruten tillväxt, Kina var en del av WTO och alla trodde på att marknaderna själva kunde korrigera sig.

Den monetära systemkrasch som kom var oförutsedd och en total överraskning. IMF erkände att det hade gjort sig skyldiga till grupptänkande och tonade ner tecken på problem.

Ser man tillbaka och jämför, är dock 2014 inte så annorlunda jämfört med 2004. Den globala ekonomin är aktiv igen, med stor tillgång på billigt kapital.

En del optimister tror att perioden med låg inflation och fortsatt expansion har återvänt efter ett uppehåll som orsakats av kraschen. Lågkonjunkturer är sällsynta och länder återgår så småningom till en trendmässig tillväxt. Detta kan antingen vara början på en ny lång global uppgång, eller i ett annat fall en del av grupptänkande.

Kanske har IMF ännu en gång valt att ignorera de tecken som kan anas i 2014 som återigen kan leda till turbulens:

1. Den globala ekonomin är beroende av exceptionellt låga räntor. Räntorna är lägre i varje efterföljande cykel och räntorna är nu knappt över noll.

2. Obligationsmarknaden kan krascha eftersom världens centralbanker försöker återvända till en mer normal penningpolitik med en måttlig och gradvis höjning av styrräntorna.

3. Alla åberopade att skiffer olja och gas skulle bli vår nästa energikälla. Men 15 stora företag har skrivit av $35 miljarder i investeringar sedan boomen inleddes. Att få olja och gas ur marken har visat sig dyrare och mindre lönsamt än väntat.

4. Risken för resurskonflikter inom de kommande fem till tio åren, om inte det internationella samfundet blir bättre på att hantera den globala uppvärmningen . Extrema väderhändelser – från översvämningar i Storbritannien till torka i Australien – ökar.

5. Ökande ojämlikhet – en liten elit tjänar på den globala tillväxten. Längst ner, och i allt högre grad även för dem i mitten, är det en fråga om lönesänkningar, högre arbetslöshet, skuldsättning, åtstramning och fattigdom. De 85 rikaste människorna i världen äger tillsammans lika mycket som hälften av världens befolkning, men verkar omedveten om risken för omfattande social oro .

Vi får hoppas att dessa tecken inte blir mer reella och att vi ser en uppgång istället för en längre och djupare kris.

Posted on http://hedgenordic.com/

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FED, USA

Notes from #FOMC from 9-Apr-2014

Several Fed Officials Said Forecasts Overstated Rate Rise Meeting minutes revealed that in March, Fed Reserve policy makers discussed that a rise in their median projection for the main interest rate exaggerated the likely speed of tightening. Treasury yields rose last month after policy makers predicted that the benchmark interest rate would rise faster than previously forecast. The Fed reduced the monthly pace of bond purchases from $65 billion to $55 billion, and repeated it is likely to continue paring the program in “further measured steps”.

U.S. stocks rose, with the benchmark Standard & Poor’s 500 Index increasing 0.6 percent to 1,862.17 at 2:03 p.m. in New York. The yield on the 10-year Treasury note rose 1 basis point, or 0.01 percentage point, to 2.69 percent.

The committee last month scrapped its pledge to keep the main interest rate low at least as long as unemployment exceeds 6.5 percent

The economy and employment are showing steady gains, the economy isn’t “running flat-out, but it’s running fast enough to push down the unemployment rate and put people back to work.”Payrolls excluding government agencies rose by 192,000 workers after a 188,000 gain in February that was larger than first estimated. That brought the job count to 116.1 million, beating the January 2008 high of 116 million.

While flagging “a weak first quarter in the U.S. due to weather,” it is expected that the economy would grow at a 3 percent annual pace for “the rest of the year and into 2015.” Miami-based Lennar Corp., the biggest U.S. home builder by market value, saw customer traffic and sales volume rise through the first quarter.

Janet Yellen, 67, succeeded Ben S. Bernanke as Fed chief in February after three years as vice chair. In that role, she helped shape communication as the central bank sought to support the recovery from the longest recession since the Great Depression.

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Trading

World turbulences ahead ? #IMF #Forex #Economy

10 years ago, the global economy seemed to be on the mend. Interests rates down to 1%, UK was in its 12th year of uninterrupted growth, China was a part of WTO and everyone firmly believed in self correcting markets. The monetary system crash was unforeseen and a surprise. IMF confessed that it had been guilty of groupthink and played down the signs of trouble.
2014 is not that different from 2004. The global economy is mobile again, with the cheap money available.

Some optimists believe that the period of low inflation and continual expansion has returned after the hiatus caused by the crash. Recessions are rare and countries eventually revert to a trend rate of growth. This could either be the start of another long global upswing, another case of groupthink. Maybe the IMF is yet again choosing to ignore the signs in 2014 which might lead to another turbulence. 5 of such sings are

  1. The global economy’s dependency on exceptionally low interest rates. The trough in interest rates has been lower in each subsequent cycle and they are now barely above zero.  
  2. The bond market crashed as the world’s central banks cautiously try to return monetary policy to a more normal setting with a modest and gradual increase in official interest rates. 
  3. Everyone relied on Shale Oil and Gas to be our next source of energy. However 15 major companies have written off $35bn in investment since the boom began. Getting oil and gas out of the ground is proving costlier and less profitable than expected
  4. the risk of resource conflicts within the next five to 10 years unless the international community gets serious about dealing with global warming. The catalogue of extreme weather events – from floods in the UK to droughts in Australia – is growing. 
  5. Rising inequality – a tiny elite now grabbing the lion’s share of global growth. At the bottom, and increasingly for those in the middle as well, it is a case of wage squeezes, high unemployment, debt, austerity and poverty. The 85 richest people on the planet own the same wealth as half the world’s population but seem oblivious to the risk of widespread social unrest.

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