Maybe Google Knows Something….

Notes from the 2009 Central Propaganda Department in China:

C. Currently, our country’s main internal contradictions (conflicts) are:
i. Mass incidents caused by changes in businesses.
ii. Problems with ex-members of the armed forces. The central government requests: they must be well taken care of, every effort must be made to resolve their difficulties, and it is necessary to prevent them from being used by hostile forces.

Lessons to be learned.

“Meanwhile, the rest of the world has to wonder whether it is learning the lessons from Japan’s fall from economic grace. Japan’s experience strongly suggests that even sustained fiscal deficits, zero interest rates and quantitative easing will not lead to soaring inflation in post-bubble economies suffering from excess capacity and a balancesheet overhang, such as the US. It also suggests that unwinding from such excesses is a long-term process.

Complacency vs. Risk Aversion Probabilities Seemingly Rising

This morning, writing in the Financial Times, long-time Asian market seer and excellent analyst/writer Peter Tasker tells us most emerging markets are looking dicey, given the overvaluation. The biggest problem flows from the biggest one—China, according to Tasker.

Early last week, emerging markets guru (well deserved we might add for his excellent work over the years) Mark Mobius sounding a similar warning, suggesting EM equities were overdone and the rush of IPOs was not good.

Face It: Everything Looks Hunky Dory

Big news for risk appetite this morning ...

China has reaffirmed common belief that it will continue to press on and realize a legitimate and sufficient recovery. They will retain their position as a global economic leader and in doing so will help out many smaller economies at the same time.

The news: China’s exports grew by 17.7% in December, and imports screamed higher by 55.9%. In each case the actual number trounced what analysts had been expecting.