All the way back in January I calculated the total size of China’s 2016 fiscal “stimulus.” Starting in January 2016, authorities conducted what was an enormous spending program. As it had twice before, the government directed increased “investment” from State-owned Enterprises (SOE).By my back-of-the-envelope numbers, the scale of this fiscal side program was about RMB 1.45 trillion, or nearly 2% of GDP. It was about...
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Macroview As growth fails to attain a stronger trajectory and deflation remains a threat, the credibility of central banks has begun to suffer. Yet we remain relatively upbeat on prospects for world growth although we expect continued volatility in some asset classes. April insights from Pictet Wealth Management's Asset Allocation & Macro Research team The current decline in US profit margins would usually herald a recession. The continued decline in earnings expectations is a concern,...
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Quick: Name the Asian country whose cheap labor costs have attracted droves of foreign manufacturers, driving an explosion in export-driven economic activity that is now transitioning to more moderate, consumer-based growth. Did you say China? Vietnam would have been correct, too. As labor costs have risen dramatically in China over the last several years, a growing number of manufacturers have moved operations from the Middle Kingdom to Vietnam or even decided to set up shop there...
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