April 10, 2024 | Daily JAM, Long Term |
Fitch Ratings revised China’s outlook to negative from stable. The Big 3 rating company (along with Standard & Poor’s and Moody’s Investor Services) said the government is likely to pile on debt as it seeks to pull the economy out of a real estate-driven slowdown.The Fitch announcement matches a similar warning from Moody’s Investors Service in December. China’s public debt has risen rapidly over the past dozen years or so, as the government pumped money into the economy in order to prop up economic growth. To end a now years-long property slump, the government has already outlined new stimulus measures—like subsidies for households and businesses that want to upgrade appliances or machinery— and signaled that more will follow.Public debt was close to 80% of gross domestic product as of the middle of last year, roughly double the level of the mid-2010s, according to the Bank for International Settlements.
July 15, 2019 | Daily JAM, Mid Term |
Okay, we all know that the current rally that has pushed U.S. equities to one record after another is built on cheap money. That is on a Federal Reserve that has promised to cut interest rates one, two, or maybe even three times in 2019. And on a hope on Wall Street...
May 24, 2017 | Daily JAM |
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March 6, 2017 | Daily JAM, Mid Term, Morning Briefing, You Might Have Missed |
China’s government has announced its new economic growth target for 2017. At “around” 6.5% it’s just a bit lower than the 2016 target of 6.5% to 7%. China’s GDP grew by 6.7% in 2016. The slight decline in the headline growth target is echoed throughout the government’s planning.
December 27, 2016 | Daily JAM, Mid Term, Volatility |
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October 19, 2016 | Daily JAM, Morning Briefing, Short Term |
Last night the Chinese government reported a wok full of economic data. GDP climbed 6.7% in the third quarter of 2016 from the third quarter of 2015. That matches the 6.7% year over year growth reported for the second quarter. And it just happens to lie smack dab in the middle of the government’s goal of 6.5% to 7% growth for 2016
April 11, 2016 | Daily JAM, Morning Briefing |
This is a big week for China data. By Friday we’ll know what the official growth rate for China’s economy was in the first quarter. Then all we’ll have to do is figure out how that official number correlates with reality. Estimates now call for the Friday report of first quarter GDP to show year over year growth of 6.7% in the period
April 1, 2016 | Daily JAM |
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July 23, 2014 | Daily JAM, Morning Briefing |
The amount of air in the Chinese credit/debt bubble that will need to be let out eventually is truly scary according to new estimates. China’s total debt load—that’s debt at all levels and not just national government debt–hit 251% of GDP at the end of June
July 2, 2014 | Daily JAM, Morning Briefing, Short Term |
Corporate bond issuance by Chinese companies grew by 54% in the first quarter of 2014 from the fourth quarter of 2013 to 1.55 trillion yuan ($250 billion.) Because bond sales in China have to be approved by central government regulators, this record for bond issuance argues that any restrictions on bank credit the government outs as evidence of monetary tightening are being more than balanced by increases in cash flow from corporate bond issuance
July 12, 2011 | Daily JAM, Morning Briefing |
Yesterday, for the first time ever, China’s national Ministry of Finance, which conducts auctions for local government bonds, failed to sell some of the three-year bonds on offer. The bonds that did sell went with yields of 3.93% for three-year notes and 3.84% for five-year notes.
