I'm testing the SHU water again with my remaining big toe in response to a multitude of requests.
New Math does not compute when it comes to understanding the world dynamics. My Old Math is simple and logical.
To my opnion, the negativity in the press is due to their lack of numeracy, not their desire to foment fear.
China GDP in 2005 was $2.3 Trillion. A +10% GDP Growth Rate back then was equivalent to only + $230 Billion
China GDP in 2014 was $10.3 Trillion. A +7% GDP Growth Rate was equivalent to + $721 Billion ... much more than in 2005
China GDP in 2015 will be $11.0 Billion. A +6.9% GDP Growth Rate will be equivalent to + $759 Billion .... GDP Growth INCREASED over 2014, so what's the issue????
Here's the issue in my view:
A much larger portion of the INCREASED GDP Growth in China is coming from an increased focus on Consumer spending rather than building more skyscrapers and apartments and infrastructure. This is exactly what the US has been pushing China to do for many years. HOWEVER, the US was hoping that the Chinese man-in-the-street would start buying imported products from America. Instead they're buying Chinese-produced stuff including cars, electronics and furniture etc.
This ongoing "progress" in China is why the US was so upset when China devalued the RMB by a few percent.
An increase in the Greenback will only worsen this situation, making US-produced goods even more expensive.
THE FED SHOULD GO TO NEGATIVE RATES AND STAY THERE FOR 2 YEARS.
Below is some insight on the situation in Singapore which is a mirror for other developed economies:
SINGAPORE AVOID TECHNICAL RECESSION, EASES MONETARY POLICY
Trade-dependent Singapore narrowly avoided a technical recession in the third quarter, official estimates showed Wednesday, but analysts said the city-state's growth outlook remains subdued because of China's slowdown.
In a move to bolster growth, the Monetary Authority of Singapore (MAS) eased policy for a second time this year, slightly reducing the local dollar's rate of appreciation to make exports more competitive after other Asian countries weakened their own currencies.
The central bank uses currency policy rather than interest rates as a tool to tweak the island's open economy. It manages the Singapore dollar against an undisclosed basket of currencies of its major trading partners and competitors.
"The global disinflationary trend and depreciating currencies of our trading partners and competitors had somewhat eroded Singapore's export competitiveness," United Overseas Bank said in a market commentary.
"Going ahead, the 'milder' appreciation of our currency against the basket of currencies could help to support our export growth."
The Singapore dollar rose following the central bank move as traders focused on news that the economy averted a recession, but analysts expect it to ease in the coming months.
Advance estimates from the trade ministry showed GDP grew 0.1 percent in the July-September quarter, defying expectations of a second consecutive quarterly contraction, which would have pushed the economy into a technical recession.
An economic slump in China -- the world's second biggest economy -- is hurting demand for exports from Singapore and other Asian countries.
"Despite the close shave, the storyline hasn't changed," leading bank DBS said, adding that the "growth outlook remains dicey".
- 'Not out of the woods' -
The MAS noted that "China's growth momentum is easing on a sharp deceleration in investment growth" which it said was among the factors weighing on trade-dependent economies.
On an annual basis, GDP expanded 1.4 percent in the three months to September, slowing from 2.0 percent year-on-year growth in the June quarter.
The GDP estimates released Wednesday were based on only two months of data -- July and August -- and adjustments could still be made when the final numbers are calculated with the September figures.
"Singapore is not yet out of the woods," Rajiv Biswas, Asia-Pacific chief economist at IHS Global Insight, told AFP.
The government expects GDP to expand 2.0-2.5 percent for the full year, but DBS, Southeast Asia's biggest lender, is forecasting 1.8 percent growth.
"As China's GDP growth continues to slide, its Asia Pacific neighbours are starting to feel the pain," Biswas said.
He said the region's vulnerability to the slowdown in China has risen over the past decade as China's GDP surged to $10.3 trillion in 2014 from only $2.3 trillion in 2005.
Last year, China accounted for 15.3 percent of Singapore's non-oil domestic exports, much larger than the European Union's share of 11.1 percent and 9.5 percent for the United States, he said.
China also bought 35 percent of Australia's exports, 25 percent of South Korea's and 20 percent of Japan's in 2014, he said.
The World Bank is forecasting China's GDP to grow by 6.9 percent this year, moderating to 6.7 percent next year and 6.5 percent in 2017. GDP rose 7.3 percent in 2014