Chinese stocks got whacked overnight, down 6.7%. Will it matter? If the story about China finally increasing domestic demand proves true, evidenced by increasing exports from the Asian countries into China, it could likely blunt any negative impact of falling stocks in Shanghai. But, we won’t know that till we know it.
Somebody flipped the switch at 10:00 EST a.m. yesterday, as oil surged and the buck sank sharply:
Here we are ... always ripping on China for their notorious stimulus package that is the reason behind their economic good of the last four or five months, always lambasting the analysts who keep touting China’s recovery thanks to stimulus and lending. But maybe it’s time to turn inward for a closer look at the US recovery.
Sure, we haven’t neglected the US recovery, or lack thereof, in our daily writings ... but we certainly haven’t jumped on the reasons for recovery like we have elsewhere. In fact, how real is the end of the US recession that everyone seems to be talking about?
If China is the spark for global demand, why are Japanese exports to China still in the proverbial toilet? If Europe is on the road to recovery, why have Japan exports to the continent been crushed?
In the AP story regarding the dismal export performance for Japan in July, noted above, were these tidbits of information:
Quickly, a brief market update before I revisit two components vital to global recovery, as we see it.
Yesterday the European currencies struggled while the commodity dollars firmed up … that is until US stocks began rolling over late in the session to ultimately finish the day flat. The dollar strengthened.
The US dollar was stronger early this morning, giving it back now, while the British pound is the weakest of the pack. Many analysts noted the particularly dismal day that gold had yesterday after finishing last week on a strong note.
