{"id":14965,"date":"2015-12-02T06:57:36","date_gmt":"2015-12-02T11:57:36","guid":{"rendered":"http:\/\/olduvai.ca\/?p=14965"},"modified":"2015-12-02T06:57:58","modified_gmt":"2015-12-02T11:57:58","slug":"the-lull-before-the-storm-its-getting-narrow-at-the-top-part-2","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=14965","title":{"rendered":"The Lull Before The Storm\u2014\u2013It\u2019s Getting Narrow At The Top, Part 2"},"content":{"rendered":"<header>\n<h3 class=\"entry-title\"><a href=\"http:\/\/davidstockmanscontracorner.com\/the-lull-before-the-storm-its-getting-narrow-at-the-top-part-2\/\" target=\"_blank\">The Lull Before The Storm\u2014\u2013It\u2019s Getting Narrow At The Top, Part 2<\/a><\/h3>\n<p class=\"entry-meta\">The danger lurking in the risk asset markets was succinctly captured\u00a0by MarketWatch\u2019s post on overnight action in Asia.\u00a0The latter\u00a0proved once again that the casino gamblers are incapable of recognizing the on-rushing train of global recession because they have become addicted to \u201cstimulus\u201d as a way of life:<\/p>\n<\/header>\n<div class=\"entry-content\">\n<div class=\"pf-content\">\n<blockquote><p>Shares in Hong Kong led a\u00a0<em><strong>rally<\/strong>\u00a0<\/em>across most of Asia Tuesday, on expectations for\u00a0<em><strong>more stimulus<\/strong>\u00a0<\/em>from Chinese authorities, specifically in the property sector\u2026\u2026.The gains follow fresh readings on China\u2019s economy, which showed\u00a0<em><strong>further signs of slowdown<\/strong>\u00a0<\/em>in manufacturing data released Tuesday (which)\u00a0remains plagued by overcapacity, falling prices and weak demand. The dimming view casts doubt that the world\u2019s second-largest economy can achieve its target growth of around 7% for the year. The central bank has cut interest rates six times since last November.<\/p><\/blockquote>\n<p>More stimulus from China? Now that\u2019s a true absurdity\u2014-not because the desperate suzerains of red capitalism in Beijing won\u2019t try it, but because it can\u2019t possibly enhance the earnings capacity of either Chinese companies or the international equities.<\/p>\n<p>In fact, it is plain as day that China has reached \u201cpeak debt\u201d. Additional borrowing there\u00a0will\u00a0not only\u00a0prolong the Ponzi and thereby\u00a0exacerbate the eventual crash, but\u00a0won\u2019t even do much in the short-run\u00a0to\u00a0brake the current downward economic\u00a0spiral.<\/p>\n<p>That\u2019s because China is so saturated with debt that still lower interest\u00a0rates or further reduction of bank reserve requirements would\u00a0amount to pushing on an exceedingly\u00a0limp credit string.<\/p>\n<p>To wit, at the time of the 2008 crisis, China\u2019s\u00a0\u201cofficial\u201d GDP was about $5 trillion and its total public and private credit market debt was roughly\u00a0$8 trillion. Since then, debt has soared to $30 trillion while GDP has purportedly\u00a0doubled. But \u00a0that\u2019s only when you count the massive outlays for white elephants and malinvestments which\u00a0get counted as fixed asset spending.<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n<p>.<\/p>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>The Lull Before The Storm\u2014\u2013It\u2019s Getting Narrow At The Top, Part 2 The danger lurking in the risk asset markets was succinctly captured\u00a0by MarketWatch\u2019s post on overnight action in Asia.\u00a0The latter\u00a0proved once again that the casino gamblers are incapable of recognizing the on-rushing train of global recession because they have become addicted to \u201cstimulus\u201d as [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[130,3598,2120,9456,403,5220,3128,1234,827],"class_list":["post-14965","post","type-post","status-publish","format-standard","hentry","category-economics","tag-china","tag-contra-corner","tag-david-stockman","tag-gap","tag-hong-kong","tag-marketwatch","tag-peak-debt","tag-stimulus","tag-united-states"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/14965","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=14965"}],"version-history":[{"count":2,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/14965\/revisions"}],"predecessor-version":[{"id":14967,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/14965\/revisions\/14967"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=14965"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=14965"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=14965"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}