{"id":19824,"date":"2016-04-12T11:54:41","date_gmt":"2016-04-12T16:54:41","guid":{"rendered":"http:\/\/olduvai.ca\/?p=19824"},"modified":"2016-04-12T11:54:41","modified_gmt":"2016-04-12T16:54:41","slug":"is-chinas-economy-in-even-deeper-trouble-than-we-think","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=19824","title":{"rendered":"Is China\u2019s Economy in even Deeper Trouble than We Think?"},"content":{"rendered":"<header>\n<h3 class=\"entry-title\"><a href=\"http:\/\/wolfstreet.com\/2016\/04\/12\/china-rail-freight-volume-plunges-2016-2015-economy-even-in-deeper-trouble\/\" target=\"_blank\">Is China\u2019s Economy in even Deeper Trouble than We Think?<\/a><\/h3>\n<\/header>\n<div class=\"entry-content\">\n<p><strong>Rail freight volume plunges to 2007 levels.<\/strong><\/p>\n<p>Rail freight volumes are an indicator of China\u2019s goods-producing and goods-consuming economy, not just manufacturing, construction, agriculture, and the like, but also consumer goods. Thus they\u2019re also an indication of consumer spending on goods. Alas,\u00a0rail freight volume is collapsing: the first quarter this year puts volume for the whole year on track to revisit levels not seen since 2007.<\/p>\n<p>While China\u2019s economy was strong, rail freight volumes were soaring. For example, in 2010, when China was pump-priming its economy, rail freight volume jumped 10.8% from a year earlier. In 2011, it rose 6.9%. It had soared 44% from 2005 to 2011! But 2011 was the peak.<\/p>\n<p>In 2012, volume in\u00a0<a href=\"http:\/\/www.statista.com\/statistics\/276066\/volume-of-rail-freight-traffic-in-china\/\" target=\"_blank\">trillion ton-kilometers<\/a>\u00a0declined one notch and in 2013 stagnated. But in 2014, volume skidded 5.8%. And in 2015, volume plunged 10.5% to 3.4 billion tons,\u00a0<a href=\"http:\/\/www.americanshipper.com\/Main\/News\/Report_China_rail_freight_volumes_drop_105_in_2015_62605.aspx#hide\" target=\"_blank\">according<\/a>\u00a0to Caixin, citing figures from the National Railway Administration. It was the largest annual decline ever booked in China.<\/p>\n<p>It was a year that the\u00a0<a href=\"http:\/\/en.people.cn\/n3\/2016\/0411\/c90000-9042791.html\" target=\"_blank\">People\u2019s Daily<\/a>, the official paper of the Communist Party, described in this elegant manner:<\/p>\n<blockquote><p>Dragged by a housing slowdown, softening domestic demand, and unsteady exports, China\u2019s economy expanded 6.9% year on year in 2015, the weakest reading in around a quarter of a century.<\/p><\/blockquote>\n<p>Which is precisely where things stop making sense: rail freight volume plunges 10.5% in 2015, and the economy still increases 6.9%? I mean, come on.<\/p>\n<p>At the time, Caixin said that China\u2019s central planners aimed to increase rail freight volumes to 4.2 billion tons by 2020. This would assume an average annual growth rate of 4.3%. So these declines are not part of the planned transition to a consumption-based economy. They\u2019re totally against that plan or any other plan. They\u2019re very inconvenient for the rosy scenario!<\/p>\n<p>Then came the first quarter of 2016.<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Is China\u2019s Economy in even Deeper Trouble than We Think? Rail freight volume plunges to 2007 levels. Rail freight volumes are an indicator of China\u2019s goods-producing and goods-consuming economy, not just manufacturing, construction, agriculture, and the like, but also consumer goods. Thus they\u2019re also an indication of consumer spending on goods. Alas,\u00a0rail freight volume is [&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":[130,4862,4254,4255],"class_list":["post-19824","post","type-post","status-publish","format-standard","hentry","category-economics","tag-china","tag-rail-freight","tag-wolf-richter","tag-wolfstreet"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/19824","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=19824"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/19824\/revisions"}],"predecessor-version":[{"id":19825,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/19824\/revisions\/19825"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=19824"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=19824"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=19824"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}