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Realistbear

China: Economic Correction Is Now Imminent

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http://www.iii.co.uk/news/?type=afxnews&ar...&action=article

SHANGHAI (AFX) - Low profitability among Chinese manufacturers points to an economic slowdown in China within a year,
possibly cutting the annual gross domestic product (GDP) growth to about 5 pct from 10 pct currently,
CLSA chief economist Jim Walker said.
Speaking at the investment bank's annual China forum, Walker said: "In our view over the next year economic growth in China is going to come down from around 10 pct to about five."
Walker said that this would be a healthy correction as industries consolidate and unprofitable businesses cease to exist. "In the country as a whole companies need to consolidate so that profitability can be restored," he said.
He said that the correction would last for about six quarters.

Pop goes the Chinese bubble?

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So less inflationary pressure then? Rate rises less likely.

Be good to see the commodities markets back to normality.

No chance. They'll raise their prices.

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So less inflationary pressure then? Rate rises less likely.

Be good to see the commodities markets back to normality.

No, more inflationary pressure as the many unprofitable companies there go out of business. Stuff coming over from China is way too cheap for commerical viability at the moment.

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No chance. They'll raise their prices.

Indeed. Low profitability means they need to raise prices: which means they stop exporting deflation and start exporting inflation.

Which then means that Western interest rates have to rise even while Western economies are collapsing.

Edited by MarkG

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http://uk.biz.yahoo.com//15052006/323/chin...llar-level.html

China's yuan breaks 8.00 key dollar level

By by Peter Harmsen

BEIJING (AFP) - China's currency, the yuan, has strengthened to close below the psychologically important 8.000 US dollars for the first time since a revaluation last year was supposed to herald in greater foreign exchange flexibility.

As Chinese exports rise in price inflationary pressures will increase. Higher IR will be required to keep a check on spending and to hold inflation down:

http://money.cnn.com/2006/05/15/markets/st...watch/index.htm

Poised for a fall

Stock futures lower, oil falls over $2 to just under $70 in electronic trading.

May 15, 2006: 8:18 AM EDT

NEW YORK (CNNMoney.com) - Stocks looked to continue their slide on Monday, as a climb in the value of the Chinese yuan against the dollar raised new inflation concerns, while oil shed over $2.
Edited by Realistbear

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  • 301 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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