Category Archives: Japan

Euro area business climate, US small business employment, Japan retail sales, Australia

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Happy Thanksgiving to all!

Who would’ve thought?
;)

Australia Q3 Private Investment Falls More than Estimated

Private capital expenditure in Australia dropped by 0.2 percent quarter-on-quarter in the three months to September 2019, following a revised 0.6 percent fall in the previous period and compared with market expectations of a 0.1 percent drop. This was the third straight quarter of decline in private investment, mainly due to a decrease in capital expenditure for equipment, plant and machinery (-3.5 percent vs 2 percent in Q2). On the other hand, spending for building and structure rebounded (2.7 percent vs -3 percent). Through the year to the third quarter, private capital expenditure shrank 1.3 percent.

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Housing, Eurozone construction, Singapore, Consumer comfort, Air freight

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You can see from the charts how depressed this cycle has been, and how housing has stalled out overall for the last few years, and all with ultra low mortgage rates:


Permits which are more volatile have ‘spiked’ back to 1965 levels when the population was about half:

A relatively small economy but the drop in exports is telling:

Singapore’s non-oil domestic exports (NODX) tumbled 12.30 percent year-on-year in October 2019, following an 8.1 percent drop in September and compared with market consensus of a 10.40 percent decrease. It was the eighth straight month decline in NODX and the steepest drop since June, as sales of non-electronics products fell faster (-11.0 vs -2.3% in September), of which primary chemicals (-47.3%); pharmaceuticals (-36.0%), and petrochemicals (-19.2%). Meantime, sales of sales of electronics continued to declined (-16.4 vs -24.8%), including ICs (-17.2%), parts of ICs (-31.3%), and telecommunications equipment (-15.7%).Meanwhile, sales of. Among major trading partners, exports dropped to China (-21.3%); Taiwan (-23.8%); Hong Kong (-13.6%); Japan (-30.3%); Indonesia (-7.3%); Malaysia (-3.6%); the US (-3.1%); South Korea (-12.6%), and the EU (-39.6%), while increased to Thailand (1.5%). Domestic Exports of Non Oil (nodx) (%yoy) in Singapore averaged 9.90 percent from 1977 until 2019, reaching an all time high of 70 percent in February of 1980 and a record low of -34.90 percent in January of 2009.


Largest 3 month drop in 8 years:

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Employment, Vehicle sales, Factory orders, Headlines, US and Japan services, US and Euro area trade, Credit standards

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Job openings now in full retreat:

The contraction continues:

Highlights

Unit vehicle sales, at a much lower-than-expected annual rate of 16.5 million, proved very soft in October and will lower expectations for next week’s retail sales report. October’s pace is the slowest since April reflecting sharp slowing in light truck sales. Vehicle sales have been soft this year, averaging a 16.9 million pace versus 17.2 million and 17.1 million in the two prior years. Despite this, 2019 has been a good year for overall consumer spending and is the fundamental reason why the Federal Reserve stepped back last week from signaling any further rate cuts.


Typical headlines:


Service sectors following manufacturing into contraction:


Global trade collapse- imports and exports going down:

Procyclical action underway maybe:

Banks tightened standards on credit cards in third quarter, Fed survey finds

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Small business, Japan, Rails

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Highlights

Small business optimism continues to ease, down 1.3 points in September to a slightly lower-than-expected 101.8. No components rose in the month with six down and three unchanged. The report notes that uncertainty is up and respondents are more reluctant to make major spending commitments. Tariffs are cited by 30 percent of the sample as a negative for their business. Labor compensation continues to rise in contrast, however, to selling prices which are comparatively flat.

Global trade continuing to contract:

Japan’s current account surplus came in at JPY 2.16 trillion in August 2019, widening from last year’s JPY 1.82 trillion and above market expectations of JPY 2.07 trillion. The goods account switched to a JPY 0.05 trillion surplus from a JPY 0.26 trillion deficit, as imports fell to JPY 6.03 trillion from JPY 6.91 trillion, while exports fell to JPY 6.08 trillion from 6.65 trillion.

Deep in contraction:

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ECB trade comments, US rates, UK, Germany, France, Japan

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Someone else agrees with me about the tariffs and the global trade collapse:

CNBC: The trade war is weighing ‘like a big, dark cloud’ on the global economy, says Christine Lagarde.

And this would function like a tax increase:

Bloomberg: President Trump Doubles Down on Call for Negative Interest Rates.

Today’s tariff induced bad news:

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Japan, China, Housing starts

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The global trade collapse from tariffs continues:

They all have it backwards- it’s the 5th deadly innocent fraud- as the great global trade collapse continues:

Blackstone’s Schwarzman: China’s economic ‘miracle’ came at the expense of the US and the West

“That leads the developed world to say to China: ‘We’ve got to rebalance this. It’s working for you. It’s not working for us,’” says Blackstone CEO Stephen Schwarzman.

Up a bit this month, but levels remain historically depressed, and it’s likely some demand was moved forward by the sudden drop in rates. Also note that the chart isn’t population adjusted.

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Japan exports, RV sales, Tariff delays

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Japan Exports Fall for 8th Month

Exports from Japan dropped 1.6 percent from a year earlier to JPY 6.64 trillion in July 2019, the eighth straight month of decrease and compared to market expectations of 2.2 percent fall, amid weakening global demand and the US-China trade dispute.

An Economic Warning Sign: RV Sales Are Slipping

Elkhart, Ind., is flashing a warning sign that a recession could be just ahead.

Capital of the country’s recreational-vehicle industry, the northern Indiana city and the surrounding area are watched by economists and investors for early indications of waning consumer demand for luxury items, often the first sign of economic anxiety.

Shipments of recreational vehicles to dealers have fallen about 20% so far this year, after a 4.1% drop last year, according to data from the RV Industry Association. Multiyear drops in shipments have preceded the last three recessions.

Aides got Trump to delay tariffs by telling President it could ‘ruin Christmas’

(CNN)- President Donald Trump’s trade advisers were searching last week for a strategy to forestall his threatened tariffs on China, they struck upon a novel approach: appeal to his Christmas cheer.

Under pressure from retailers to prevent a move that would likely have caused prices of popular consumer goods to spike, the President’s team came to him during a meeting last week with a warning. Applying new tariffs on all Chinese imports, they cautioned, could effectively “ruin Christmas,” according to people familiar with the matter.
It was a tactic that worked: Trump announced the tariffs would be delayed until December 15.

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Manhattan home prices, Capital goods imports, Rails, Euro area industrial production, China imports

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Still in contraction:

China Imports Tumble in June

Imports to China plunged 7.3 percent from a year earlier to USD 161.86 billion in June 2019, much worse than forecasts of a 4.5 percent drop, a further sign of weak domestic demand that could lead Beijing to add more stimulus. Purchases fell for: unwrought copper (-27.2 percent); iron ore (-9.7 percent); and soybeans (-25.1 percent) amid higher tariff on US cargoes and following outbreaks of African swine fever. By contrast, increases were seen in imports of crude oil (15.2 percent) and coal (6.4 percent). Among China’s largest trade partners, imports fell from the US (-31.4 percent), South Korea (-21.9 percent), Taiwan (-7.4 percent) and Japan (-5 percent), but grew from the EU (8.6 percent), Australia (8.8 percent) and ASEAN (0.4 percent).

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