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Old 06-29-2018, 03:11 PM
Danny B Danny B is online now
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Join Date: Oct 2012
Location: L.A. Ca.
Posts: 4,494
China and a change of course

Draghi says that he will end bond buying from the ECB AND stabilize the Euro. He can't have both. NO possibility.
Evidently, the PBOC is drinking from the same glass of koolaide.
6/29 PBOC signals shift to growth and market stabilization – Bloomberg
The PBOC created more debt than the FED, BOJ and ECB combined. They bought all the growth with wet-ink money. Just the same, growth is slowing. Their workforce is shrinking by 1 million a year. The only way to grow the economy is to grow your markets. They have to drastically raise the standard of living / consumption to grow the markets. China has set the roof on global wages and can't raise the roof. Otherwise, they risk losing market share to low-wage competitors.
Their debt is now more than 300% of GDP. They can't possibly shift to growth with a falling population. Japan proves that. They can't possibility stabilize their markets when their debt bubble is so large.
The impossible trinity (also known as the trilemma, or the unholy trinity) is a concept in international economics which states that it is impossible to have all three of the following at the same time: a fixed foreign exchange rate. free capital movement (absence of capital controls) an independent monetary policy.

6/29 Global stocks see biggest loss of investor cash since the financial crisis – CNBC
6/29 Wall Street braces for Trump’s economic colonic – Vanity Fair
6/29 For stocks, the line in the sand has been drawn – Elliott Wave

Wait for that line to be drawn in blood.
6/29 China slowdown deepens on trade tensions and weak credit growth – Bloomberg
6/29 What China’s recent bond defaults mean for investors – Forbes

A little debt is GOOD but;
Hormesis is a term used by toxicologists to refer to a biphasic dose response to an environmental agent characterized by a low dose stimulation or beneficial effect and a high dose inhibitory or toxic effect. China has a dollar problem.

Apparently, a republic is a terrible form of GOV. Like communism, they always break the bank.
Analysts make grim projections for U.S. debt - The Japan News
They do it with taxes.
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