This One Chart Shows Where All The Important Economies Are Right Now In The Growth Cycle

By JOE WEISENTHAL

Here's a cool chart from Morgan Stanley.

It shows where all of the major world economies are in their respective economic cycles.

The country most closes to "peaking" right now is China. The US, Canada, New Zealand, and Kazakhstan are past the halfway point, but still have room to grow.

Countries like India, Brazil, and Russia are troughing, while Australia, Malaysia, and Thailand are still on the way down, though getting close to the bottom of their respective cycles.

Read more: http://www.businessinsider.com/chart-where-all-the-major-world-economies-are-in-the-economic-cycle-2013-12#ixzz2mJhbvcCm

CHART OF THE DAY: The State Of The World Economy

Earlier, we presented a big run-down of the state of the world economy showing how countries have been performing of late according to their newly released August purchasing managers index (PMI) reports.

Deutsche Bank just published a chart that captures all of that in a single image.

Any country above the dotted line is improving at an accelerating pace.

As you can see, the developed economies are trouncing the developing ones.

This also happened to be echoed this morning by the OECD, which revised its year-end GDP projections for almost all major European economies upward.

Here are four key takeaways from Deutsche Bank:

• "Positive momentum with data on an improving trajectory across key economic regions, except EM"
• "EM: data weakness due to country-specific structural challenges and liquidity concerns driven by Fed tapering speculation"
• "Eurozone: positive Q2 growth marked an end to the longest recession in region’s history"
• "China: slowdown fears reduced on the back of improving recent data"

Check it out:

Deutsche Bank

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Read more: http://www.businessinsider.com/chart-manufacturing-pmi-acceleration-2013-9#ixzz2dqYFSwfY

Here's The State Of The World Economy

Today is the perfect day to step back and take a big picture look at the world economy.

For one thing, it's Labor Day in the US, so it's a natural time to gain perspective. It's also, fortuitously, PMI Day in the rest of the world, so we have a lot of fresh economic data.

So let's hit on the big themes.

1) Europe is coming back.

We've been writing about this since early in the summer, but the latest data makes it clear that across the Eurozone, a comeback is happening.

Both Spanish and Italian PMIs had their best months since Spring 2011. Germany remains solid. And even Greece (!) is surging back. It's nearly back to growth.

This table from Markit nicely tells the whole story in the Eurozone.

Markit

And it's not just the Eurozone.

UK data has been solid lately, and Eastern European numbers are looking very strong.

Here for example is the Czech Republic (Poland looks similar).

Markit

Europe is not "out of the woods" or anything. But the numbers are going in the right direction, which makes everything from debt to politics a lot smoother.

2) China is not crashing

For years, China has been in a a Schrödinger's Hard Landing. Some people are convinced that it's all falling apart. Others insist that things are just fine, or maybe slowing a tad.

Earlier this year there was serious concern about a hard China fall, but the recent data has eased those concerns somewhat.

Again going to the latest PMI data, it looks like things are doing fine. Growth isn't at its most spectacular levels, but the situation is not deteriorating too hard, and the numbers right now are a tad better than expected.

Markit

Anyway, the more important story in China seems to be the government's eagerness to see "quality" growth (i.e. growth that's not just driven by aggressive investment), and also a push to reform and crack down on corruption, which we're seeing in the newsflow coming out of the country. So China might not be the voracious consumer of the world's commodities quite the way it used to be, but a full-on meltdown in the world's most populous country doesn't seem that likely either.

3) Emerging Pain

Outside of China, it's clear that several of the world's formerly red-hot emerging markets are experiencing serious pain.

Indonesia and India are the pits, as both are seeing deteriorating economic data, a rush of outflows, diving currencies, diving stock markets, inflation, and all that stuff. What's causing the weakness? Part of the issue is being ascribed to the rise in US interest rates causing dollar strength and a reversal of hot-month investment inflows. Strong inflows in earlier years had helped paper over, it's argued, structural flaws in the economy, that now need to be addressed.

Just today, both clocked in with some ugly numbers. India had its worst PMI Manufacturing report in years, and Indonesia whiffed on a trade number. The Jakarta Market fell 2.6%. The question is not whether the scene is bad, but whether things develop into a real "crisis." So far, the thinking seems to be that this doesn't have to be an actual crisis-crisis, a la the late 90s.

4) The US: A little better than same-old, same old

Better-than-expected growth is right around the corner in the US... of course we've been saying that for like 3 years now. But now, maybe this time it's real. Maybe? Possibly?

Economic data in 2013 is a bit stronger, and seems more durable than at any time since the crisis. The labor market continues to improve, and the strength of the housing market is well known. But none of it is that good, especially on the labor front, and lately some of the housing data has been mediocre (though actual prices are quite robust).

Once again, goings on in Washington appear likely to be unhelpful. The coming September chaos (Fed nomination, Fed tapering, budget debates, and debt ceiling) are very well known. Once again, it seems like we can't get out of our own way:

5) Some other themes

• Syria. We're now in a weird holding pattern, and shaping up for one of the biggest votes in Washington DC since TARP.
• Oil is on the rise.
• Japan seems to be doing okay, though things have quieted down quite a bit.
• Iraq: A mess again.

So there's your state of the world: We have the tantalizing prospect of all of the major economies: Japan, Europe, the US, and China in a state of decent growth, which would be something we haven't seen at all since the 2008-2009 global economic crisis.

But we have a fresh spate of geopolitical concerns hanging over everything, and the familiar shenanigans out of Washington threatening to the spoil the party.

SEE ALSO:  26 things that China ripped off

Read more: http://www.businessinsider.com/the-state-of-the-world-economy-2013-9#ixzz2dkNq9VXH

LIVE: Thousands Of Companies Around The World Reveal The Truth About The Economy

HEADS UP: The world's biggest economies are rolling out their July manufacturing PMI reports right now, and the party will end at 11:00 a.m. ET, Thursday.

And this is our scorecard.

So far, we've learned that most of Asia is either decelerating or contracting. Japan, South Korea, Taiwan, Vietnam, and Indonesia all reported deteriorating numbers in July.

China's official PMI number climbed, but its unofficial HSBC PMI number fell.

The global economic tides appear to be turning. Economic data in recent weeks have shown that China's hot economy is slowing quickly.

Meanwhile, the beleaguered eurozone economies have been showing signs of life.

The U.S. economy seems to be heading in the right direction.  On Wednesday, we learned that U.S. GDP was growing at a 1.7% rate in Q2.

PMI

At the beginning of each month, Markit, HSBC, RBC, JP Morgan, and several other major data gathering institutions publish the latest local readings of the manufacturing purchasing managers index (PMI) for countries around the world. Read more about it at Markit.

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Click here to refresh this page for the latest updates to our scorecard »

July 30 (All Times ET)

• 7:15 p.m. Japan: Markit/JMMA Manufacturing PMI — 50.7, down from 52.3 in June

July 31, August 1

• 7:30 p.m. Australia: AiG Manufacturing PMI — 42.0, down from 49.6
• 8 p.m. South Korea: HSBC Manufacturing PMI - 47.2, down from 49.4 
• 9:00 p.m. China: NBS Manufacturing PMI - 50.3, up from 50.1 
• 9:45 p.m. China: HSBC Manufacturing PMI - 47.7, down from 48.2
• 10 p.m. Taiwan: HSBC Manufacturing PMI - 48.6, down from 49.5
• 10 p.m. Vietnam: HSBC Manufacturing PMI - 48.5, down from 46.4 
• 11 p.m. Indonesia: HSBC Manufacturing PMI - 50.7, down from 51.0 
• 1 a.m. India: HSBC Manufacturing PMI - 50.1, from 50.3
• 1 a.m. Russia: HSBC Manufacturing PMI - 49.2, down from 51.7
• 1 a.m. Ireland: Investec Manufacturing PMI - 51.0, up from 50.3 
• 3 a.m. Turkey: HSBC Manufacturing PMI — 49.8, down from 51.2 
• 3 a.m. Poland: HSBC Manufacturing PMI — 51.1, up from 49.3. 
• 3 a.m. Netherlands: NEVI Manufacturing PMI — 50.8, up from 48.8 
• 3:15 a.m. Spain: Markit Manufacturing PMI — 49.8, down from 50.0. 
• 3:45 a.m. Italy: Markit/ADACI Manufacturing PMI — 50.4, up from 49.7 
• 3:50 a.m. France: Markit Manufacturing PMI — 49.7, up from 48.4
• 3:55 a.m. Germany: Markit/BME Manufacturing PMI — 50.7, up from 48.6 
• 4 a.m. Greece: Markit Manufacturing PMI — 47.0, up from 45.4. 
• 4 a.m. Eurozone: Markit Manufacturing PMI — 50.3, up from 48.8. 
• 4:30 a.m. U.K.: Markit / CIPS Manufacturing PMI — 54.6, up from 52.9
• 9 a.m. U.S.: Markit Manufacturing PMI — 53.7, up from 53.2 
• 9 a.m. Brazil: HSBC Manufacturing PMI — 54.8, down from 50.4
• 9:30 a.m. Canada: RBC Canadian Manufacturing PMI — 52.0, down from 52.4
• 10 a.m. U.S.: ISM Manufacturing — 55.4, up from 52.0 
• 10:30 a.m. Mexico: HSBC Manufacturing PMI 
• 11 a.m. Global: JPMorgan Manufacturing PMI 

Click here to refresh this page for the latest updates to our scorecard »

Read more: http://www.businessinsider.com/july-2013-manufacturing-pmi-global-2013-7#ixzz2ajFw5ZAR

The end of the affair

The prospect of less quantitative easing in America has rocked currency and bond markets in the emerging world

THERE are many reasons why a fund manager might want to sell the rand. South Africa’s economy is barely growing. Unemployment, at 25% of the workforce, is on a par with the grimmest parts of the euro zone. The mining industry is beset by labour unrest just as commodity prices are falling. The country’s large trade deficit is a sign that local producers are struggling in vain against foreign competition. The rand has fallen by 16% against the US dollar this year. Only the Syrian pound and Venezuelan bolívar have fared worse.

Yet these local difficulties are not the only reasons for the rand’s slump. South Africa has the financial markets of a rich country: it is easier to buy and sell bonds and stocks there than in most middle-income countries. So the rand is a convenient currency in which speculators can take a position on emerging markets more generally. As the fast-money crowd sense the beginning of the end of loose monetary policy in America, bonds and currencies in emerging markets are the assets they want to sell. The rand is merely the worst-hit in a long list of vulnerable currencies.

In this section

• The end of the affair
• Quality street
• The triple-digit barrel
• It ain’t over yet
• Darkness at midnight
• Boon or burden?
• Start me up
• Taking credit for nothing
• Correction: Free exchange

Reprints

Related topics

• South African economy
• African economy
• South Africa
• United States
• Economies

In the past month 19 of the 24 emerging-market currencies tracked by Bloomberg have fallen in value against the dollar. The trigger for this sell-off was a remark in May by the chairman of the Federal Reserve, Ben Bernanke, that the Fed’s purchases of bonds using central-bank money might soon tail off. The yield on America’s benchmark ten-year government bond has risen from a low of 1.6% to 2.2%. The prospect of a further rise in yields over time is likely to push up the dollar and draw money back to America from riskier parts of the world. The slump in emerging markets over the past month is in anticipation of such a trend.

It seems a violent response to what was an offhand comment. Mr Bernanke did not suggest an immediate change in policy. The Fed’s bond purchases will continue but perhaps not for long at the present rate of $85 billion a month. An increase by the Fed in short-term interest rates, currently near zero, may still be years away.

Even so, the prospect of a tapering in the Fed’s bond purchases probably marks the start of a long grind upwards in American bond yields to more normal levels. “It won’t be a straight-line affair,” says Kit Juckes of Société Générale. Interest rates will bobble around in search of the right price. The absence until recently of such volatility has made rich-world investors comfortable with exotic punts in emerging-market bonds. As the waters become choppier, they will be far less willing to take such gambles. Tougher capital requirements mean that trading desks of banks are now less keen to buy and hold assets dumped by investors: that will only make bond prices more volatile.

The most vulnerable countries are those that rely on foreign capital to bridge the gap between what they spend and what they earn (see chart 1). South Africa has a biggish current-account deficit relative to GDP: the rand has suffered accordingly. Its standing has also been hurt by weaker commodity prices, in part because of slower growth in China. A handful of other countries, from Chile and Brazil in the emerging world to Australia in the rich world, share the debilitating status of having a commodities bent, a biggish current-account deficit and a wilting currency.

The currencies of some commodity importers are also wobbling. India has a current-account deficit of 5.1% of GDP; the rupee fell to a record low against the dollar this week. Turkey relies on hot money to finance its deficit. The protests in Istanbul are just one more reason to sell the lira.

Is this a panic or something more serious? Emerging-market currencies have endured the occasional bad month only to bounce back. The Fed is likely to tread carefully. But even a slow, steady rise in Treasury yields and a shallow dollar rally would spell trouble. Around $4 trillion has washed into emerging markets since 2009, according to Stephen Jen of SLJ Macro Partners, a hedge fund. Much of that has been “pushed” abroad by the low yields on offer in the rich world rather than “pulled” by the prospect of superior returns, says Mr Jen. If only a fraction of that capital is yanked out by jittery investors it would turn a sell-off into a rout.

Track global exchange rates over time with our interactive Big Mac index

Past episodes of dollar strength and rising Treasury yields were followed by currency and debt crises—in Latin America in the early 1980s and Asia in the mid-1990s. Things are now different in one important regard, notes George Papamarkakis of North Asset Management, a hedge fund. In the past rich-world banks lent to poorer countries in dollars. When capital flows reversed, borrowers were left with debts that grew larger as the dollar strengthened. By contrast the recent flood of capital went into local-currency bonds. For a while investors enjoyed a virtuous circle of higher bond prices and stronger currencies. But they now face losses that are likely to grow.

So some of the pain of adjustment will be felt in the rich world. Central banks in emerging markets can even profit from it. They can sell the dollars that they added to reserves on the cheap while at the same time checking the fall in exchange rates. But emerging markets cannot escape the fallout. Even the shallowest of turns in America’s monetary cycle is amplified there: interest rates are rising in some countries as foreign buyers for local-currency bonds dry up (see chart 2).

Not so long ago there were complaints that the Fed’s loose policy was pushing up emerging-market currencies to the detriment of exporters there. Now they are falling. But the results won’t be painless. Export-led growth is not nearly as much fun as a consumer boom spurred by cheap foreign credit and a dear currency.

From the print edition: Finance and economics

Here's The Argument That The Entire World Economy Is Starting To Go Bad

The stock market has been weak lately, and commodities have been getting crushed.

Does this mean that the global economy is really slowing down hard?

Maybe.

Recent U.S. economic data has been disappointing, especially in the realm of housing, which is what the U.S. bull case is all about.

In Germany, dubbed the strong-arm of Europe, economic sentiment just fell.

And growth has begun to slow in China – still considered a global growth engine – as it continues to crack down on corruption, property prices, and shadow banking. China's plan to shift its economic model away from exports to domestic demand led growth has also contributed to the lower growth rate. 

Here's a quick look at some key data emerging from around the world:

The U.S.

• Housing, which has been a huge part of the economic recovery, is also showing signs of stalling. Building permits are down, homebuilder confidence is down, foreclosure starts are up, and capacity constraints among mortgage lenders are also impacting the recovery.
• America's manufacturing Renaissance also looks to be a way off. The Empire Fed manufacturing survey fell to 3.05 in April, missing expectations. This morning we saw the April Philly Fed fall to 1.3, with the unemployment sub-index falling to -6.8.
• Retail sales unexpectedly fell 0.4% in March. Nomura pointed out that the downward revisions to sales in the last two months showed that "consumer adjustment to lower disposable income at the start of the year has begun." Consumer confidence also missed expectations and fell to 72.3 in April, from 78.6 in March.
• And of course there is the jobs report, which showed that only 88,000 new jobs were created in March, very shy of expectations for 190,000. The unemployment rate fell to 7.6% but this was because of a decline in the labor force participation rate.
• On top of all this, there's the sequester, which has only just gotten going.

Europe

• Germany has seen some positive data, but economic sentiment tumbled to 42.
• In the United Kingdom, joblessness climbed by 70,000 to 2.56 million from December through February. The unemployment rate climbed to 7.9%. Moreover, Retail sales, including fuels, fell 0.7% on the month in March, and 0.5% on the year. And next week's GDP data will tell us if the U.K. has entered a triple-dip recession.

China

• Chinese GDP slowed to 7.7% in Q1, missing expectations of 8% growth. Industrial production, manufacturing (as represented through PMI) and exports also missed expectations. 
• The government's crackdown on corruption by way of 'gift giving' has impacted retail sales, especially the catering industry. 
• Latest data also showed that Chinese home prices were up in 68 of 70 cities surveyed. First-tier cities posted a huge rise in home prices. Policymakers are likely to continue with tightening measures to limit a rebound in property prices and shadow banking. 

Bottom line: In the three most important economic regions, there are signs of flagging all over the place.

SEE ALSO:  10 Ways Chinese Manufacturing Makes The Rest Of The World Look Tiny >

Read more: http://www.businessinsider.com/signs-world-economy-is-grinding-down-2013-4#ixzz2QpyT5NAx

Europa recorta pérdidas y Wall Street sube con fuerza

La renta variable europea comenzaba ayer la jornada con fuertes caídas ante la persistente incertidumbre de los mercados. Los principales índices presentaban repliegues de hasta 2,5% debido a las complicaciones en torno al rescate de Grecia y a la amenaza de Moody´s de revisar la calificación a 17 bancos globales y 114 instituciones financieras en 16 países de Europa.



Sin embargo, tras conocer el positivo dato de peticiones de subsidios de desempleo en EEUU, que se ubicó por debajo de las expectativas, las plazas del Viejo Continente recortaron las pérdidas y finalmente no superaron el 0,8% de caídas. No obstante, España no pudo seguir la tendencia y cayó sobre 2%, arrastrada por la negativa jornada de la banca.

En Wall Street, el optimismo se tomó los mercados para cerrar la sesión con el Dow Jones y el 
S&P 500 subiendo en torno al 1%.

Mientras, el Bovespa avanzó con fuerza hasta los 66.141,70 puntos, comportamiento similar al del IGBC colombiano.

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Las otras amenazas a la economía global

Crisis de deuda en economías avanzadas
Otro de los riesgos para la recuperación es la crisis de deuda fiscal en Europa, que se arrastra por 18 meses, y que amenaza con expadirse a España, la cuarta economía de la zona euro. 
Pero la crisis no se limita al Viejo Continente. La OCDE pronosticó la semana pasada que la deuda de EEUU llegará a 107% del PIB el próximo año, mientras que la de Japón subirá a 218,7% del PIB. EEUU arriesga el default si el Congreso no eleva el límite de la deuda federal, que se ubica en US$ 14,3 billones (millones de millones), antes de agosto. 


Y la agencia Fitch se unió a Standard & Poor’s y Moody’s en bajar la perspectiva de la calificación de Japón a “negativa”, desde “estable”, por el endeudamiento del gobierno.




Efectos del terremoto en Japón



El terremoto y tsunami del 11 de marzo, y la posterior crisis nuclear, afectaron fuertemente a los consumidores japoneses, y provocaron interrupciones en las cadenas de suministro de las empresas tecnológicas y automotrices.
Las ventas minoristas cayeron 4,8% en abril, frente al año anterior, y se espera que el PIB se contraiga por tercer trimestre consecutivo en los tres meses hasta junio.
Asimismo, las interrupciones en la cadena de suministro se mantendrían hasta septiembre, cuando comience a recuperarse recién la producción de las fábricas y las exportaciones niponas.


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