Comments on: Graduating this year?

By: Can China Handle Massive Unemployment? | College News In China

Can China Handle Massive Unemployment? | College News In China — Tue, 12 May 2009 12:38:15 +0000

[...] (gotta love Chinese media for looking on the bright side of things). China blogger Michael Pettis commented on this trend last month with some optimism about what this could mean for China’s future [...]

By: aliplanning

aliplanning — Wed, 29 Apr 2009 12:01:50 +0000

The study of Chinese is not as simple as

By: Dr.Frank Loo

Dr.Frank Loo — Wed, 08 Apr 2009 09:14:48 +0000

bcg_81 – Looking at the Shanghai and Shenzhen Stock markets today you being skeptical is well founded. I am of the opinion both markets will pull back further.

By: Dr.Frank Loo

Dr.Frank Loo — Tue, 07 Apr 2009 16:36:39 +0000

bcg_81 – In this case the stock markets will be going south again soon. Based on my calculation the Shanghai Index will pull back to around 2100.

By: bcg_81

bcg_81 — Tue, 07 Apr 2009 08:48:11 +0000

There seem to be a lot of people who think so. Personally, I’m skeptical.

By: Dr.Frank Loo

Dr.Frank Loo — Mon, 06 Apr 2009 13:35:57 +0000

Bcg_81 – Thanks. The stock markets in China have been going up since January. Does it indicate that it is an early signal that the economy will soon bottom out as the stock market always moves ahead?

By: bcg_81

bcg_81 — Mon, 06 Apr 2009 10:51:09 +0000

Dr Frank – as I understand it CLSA’s rationale is that the official PMI results leave in too much seasonality. So when the official Mar is compared to Feb, for example, which has fewer calendar days and includes the New Year holiday, Mar is naturally higher. They don’t give specifics as to why the seasonal spike in Apr vs Mar is “even worse” but note that historically the official Apr number has been around 4 pts higher than CLSA’s, Mar around 3 pts higher, and that this discrepancy is 0 by May. So they caution about interpreting numbers above 50 in Mar and Apr as anything more than a seasonal jump, and argue that the true picture is that manufacturing contracted in Mar at the same pace as in Feb.

By: Dr.Frank Loo

Dr.Frank Loo — Sun, 05 Apr 2009 18:55:09 +0000

Michael – The average between the CLSA and the CFLP is 48.6 which is still below 50. I am wondering if this makes sense. If it does I am still maintaining it is premature to call bearing in mind what bcg_81 has said it will flatten out again in May.

By: Dr.Frank Loo

Dr.Frank Loo — Sun, 05 Apr 2009 18:38:40 +0000

Bcg_81: “Who’s buying the stuff?”. Just take a look at the Baltic Dry Goods Index maybe one can find the answer to this question.

http://www.bloomberg.com/apps/cbuilder?ticker1=bdiy%3Aind

“The PMI always increases in March, even more in April, before flattening out again in May”. Can you tell us the rationale behind it? Thanks.

By: bcg_81

bcg_81 — Sun, 05 Apr 2009 09:36:31 +0000

CLSA explained the difference between their PMI and the official index as driven by different methods of seasonal adjustment, which is nercessary if you’re going to compare month-month. According to CLSA the official index is effectively NOT adjusted and therefore always increases in March, even more in April, before flattening out again in May. When they released their PMI several days before the official numbers, CLSA actually predicted that the official result would come in around 50. Based on which Credit Suisse is now calling Chinese recovery a “high certainty”. Kids these days…

I would also like to know the answer to Nick’s first question: who’s buying the stuff? It’s tempting to think re-stocking but there was never much of a drawdown. Was there?