Japan Headed Into Recession -- Carry Trade Cancelled

[Realistbear]

Actually RB, I think it is you who doesn't understand the article. Your interpretation was, "With 3 of the world's top 5 economies going into recession"...so somehow you concluded that China was going into recession.

Slowing past the high point = a slowing rate of growth. It is still growth. The economy is still larger despite the rate of growth slowing, let alone that this slowing growth is from >10% growth. Just because the rate of growth slowed does not meet that it will go -ve. The rate of growth could halve each quarter for the next 10 years, the economy will always be larger than previous and it will never be in recession.

As with all things that rely on forecast. Time will tell. As the article suggests China is turning we will have to wait and see by how much. If the US and Japan go into recession we will have to wait and see if the rest follow. Past history tells us that whjen the biggest economy sneezes the rest get a cold. Perhaps the same old pattern will repeat. If the US gets a cold they might stop buying as much tat from China and if China doesn't move enough tat to keep momentum moving what happens next....................?

Bingo!

[Methinkshe]

Actually RB, I think it is you who doesn't understand the article. Your interpretation was, "With 3 of the world's top 5 economies going into recession"...so somehow you concluded that China was going into recession.

Slowing past the high point = a slowing rate of growth. It is still growth. The economy is still larger despite the rate of growth slowing, let alone that this slowing growth is from >10% growth. Just because the rate of growth slowed does not meet that it will go -ve. The rate of growth could halve each quarter for the next 10 years, the economy will always be larger than previous and it will never be in recession.

At this point I have to offer the concept of discontinuity - and it isn't mine, just repeating others' words of wisdom. In a linear world, the aeroplane takes off from its destination, flies for a few hundred miles and then lands. That is considered the norm. But we are beginning to recognise that we don't live in a linear world, we live in a Mandelbrot (fractal) world and occasionally an aeroplane takes off and halfway through its journey it stalls. At that point all possibilities come into play. Will it plummet to the ground? Will it make a soft landing on a convenient alternative runway? What will happen at the stall-point? Yes, it will conform with fractal expectations but God help those who are stuck with linear expectations.

That's where we are now, economically. I'm not putting any money on a soft landing.

[i_godzuki]

Re Japan, what a load of codswallop in the Telegraph.Japan is currently in it's longest uninterrupted post war economic expansion. However, it's possible that on Monday the revised GDP figure will be negative for the three months ended June. -0.2% is expected by economists but many say it's basically a statistical glitch and growth will have returned by the time the July-Sept quarter is meeasured. Growth of about 2.7% is expected for the full year--hardly recession.

Japanese banks, meanwhile, have next to no subprime exposure and Toyota, which apparently will be hit according to the story, is the most profitable major automaker in the world. It's true that there are some problems, notoably the slight deflation, but the tone of the article was so far off the reality it's untrue.

Edited September 4, 2007 by i_godzuki

[meow]

Bottom line: if you are seeking certainty you wil not find it. That's the beauty and thrill of the financial world--It's like a box of chocolates, you never know what you are going to get (as Forest Gump said).

It was his mother that said it.

I'll go back to pedant corner now...

[Realistbear]

At this point I have to offer the concept of discontinuity - and it isn't mine, just repeating others' words of wisdom. In a linear world, the aeroplane takes off from its destination, flies for a few hundred miles and then lands. That is considered the norm. But we are beginning to recognise that we don't live in a linear world, we live in a Mandelbrot (fractal) world and occasionally an aeroplane takes off and halfway through its journey it stalls. At that point all possibilities come into play. Will it plummet to the ground? Will it make a soft landing on a convenient alternative runway? What will happen at the stall-point? Yes, it will conform with fractal expectations but God help those who are stuck with linear expectations.

That's where we are now, economically. I'm not putting any money on a soft landing.

Agree.

A good example of disconnected logic in the market is the fact that the stockmarkets are going up while the banks and property markets are hitting panic buttons. It seems like the pre-dotcom crash days when good news was bad and bad news good. The bigger the projected losses the more people who piled in to buy the shares.

Bottom line: We don't know (the three most common words used by the "experts" these days).

Anyone who has ever put money on a soft landing lost as we have never had one yet--especially after a monster-size bubble we have just had.

[Methinkshe]

Re Japan, what a load of codswallop. Japan is currently in it's longest uninterrupted post war economic expansion. However, it's possible that on Monday the revised GDP figure will be negative for the three months ended June. -0.2% is expected by economists but many say it's basically a statistical glitch and growth will have returned by the time the July-Sept quarter is meeasured. Growth of about 2.7% is expected for the full year--hardly recession.

Evidence, please.

[Guest d23]

I think your comments are a desperate attempt to discredit bear threads as you seem to go off on tangents (which defines trollish activity) that have no bearing on the thread itself. Why do you do this if it isn't to troll a thread?

you mention china is headed into a recession and I asked on what basis considering it's increased it's YoY GDP growth over the last 6 months

seems pretty much central to the point of this thread so not sure on what basis you say it's a tangent with no bearing etc etc etc.

I called the start of the turn to the downside by the 2nd Q of 2007.

that was your latest backpedalling prediction; I could find sooooooo many quietly forgotten earlier predictions of yours that you've brushed under the carpet now, you've been predicting imminent price crashes since you joined, of which the q207 is the latest

What is it that motivates you? You must be someone with a lot to lose in a HPC? This is why I think you are a BTLer or an overgeared OO who is in denial about the crash (albeit beginning slowly, almost imperceptibly). I still think you are a History teacher somewhere in central UK somewhere as I seem to remember you stating something about being a teacher several months back. But that is off topic isn't it?

I'm happy to categorically deny being a midlands teacher with a BTL portfolio; I've never, not once said that. I've also never lied on this forum and confirm that I work for a clothing company in East London and have rented for the last 17 years.

I notice you didn't deny your theological career leanings RB.

[i_godzuki]

Evidence, please.

Sorry for the delay:

November 23, 2006

Economy Reaches Record Postwar Expansion Amid Weaker Consumption

TOKYO (Nikkei)--The economy is expanding for the 58th month in a row as of November, marking a new postwar record, based on the government's monthly economic report issued Wednesday.

Economic and Fiscal Policy Minister Hiroko Ota submitted the November report at a meeting of relevant cabinet ministers. The current streak, which began in February 2002, eclipses the 57-month expansion from 1965 to 1970.

Edited September 8, 2007 by i_godzuki