These 4 Charts Show How World Trade Has Collapsed In Just One Year
Lately, nothing seems able to shake Wall Street’s bullish attitude.
Investors and the mainstream continue to still ignore the worsening trade war – which is evolving into a currency war – with China.
But since early May – we at Palisade have maintained that there’s going to be a worldwide earnings recession sometime in summer 2019. . .
I haven’t been shy writing about this topic – and if you haven’t read my thesis of why I think this yet, you can check it out here – and here.
If you looked at the markets enthusiasm today – and share prices – you’d think I was dead wrong.
But if you look between the lines – things are getting even worse for global corporations.
Goldman Sachs recently published some damning data that only bolsters my global earnings recession hypothesis. . .
To summarize: world trade has continually declined since early 2017 – long before the trade war talks – and the recent data only suggests this trend is worsening.
The U.S. Dollar has rallied significantly since March of this year – after declining nearly 15% between January 2017 and February 2018.
This paired with the Federal Reserve’s tightening has created chaos for the emerging markets and their currencies throughout much of 2018.
And yet, instead of weaker currencies boosting foreign exports, things have only worsened since. This signals that there’s a deceleration in world wide demand.
Just take a look at the following charts. . .
If you study the growth of ‘global air and sea freight volumes’ year-over-year (YoY), there’s significant declines over the last 24 months – especially for air freight volume. It recently dipped into negative YoY growth.
Making matters worse – China’s economy has slowed down considerably the last couple of years. This no doubt has affected world trade.
But it’s not just China that’s seeing a slowdown in trade activity. . .
…click on the above link to read the rest of the article…
