Tuesday, December 11, 2007

How much longer before the China effect goes into reverse?

China's consumer inflation blazes to 11-year high

Hmm, I'd imagine this is going to crop up in our basket of goods sooner or later

Posted by surfgatinho @ 09:47 AM (575 views)
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2 thoughts on “How much longer before the China effect goes into reverse?

  • Something like high interest rates could choke off growth in China. I predict that after the Olympics the China boom will become more muted. This will put downward pressure on oil and commodities that could then temper inflation in the west. India is a bit more sophisticated and will manage their growth better.

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  • “On Saturday, the central bank raised the proportion of deposits that banks must hold in reserve by a full percentage point to 14.5 percent as part of its drive to tame credit growth and inflation. It was the tenth reserve requirement increase this year by the central bank, which has also raised interest rates five times in 2007.”

    With emerging economies IRs rising and western economies IRs falling we are looking at some big exchange rate movements.
    What we could end up with is a gigantic carry trade between the east and west in one crazy blow-off phase.

    We have SWFs bailing out western banks, who will then create more money to be shipped to emerging economies’ currencies and assets.

    In the memory of glorious_sunshine I can only think the of Bon Jovi – Blaze Of Glory Lyrics

    I wake up in the morning
    And I raise my weary head
    I’ve got an old coat for a pillow
    And the earth was last night’s bed
    I don’t know where I’m going
    Only God knows where I’ve been
    I’m a devil on the run
    A six gun lover
    A candle in the wind

    When you’re brought into this world
    They say you’re born in sin
    Well at least they gave me something
    I didn’t have to steal or have to win
    Well they tell me that I’m wanted
    Yeah, I’m a wanted man
    I’m a colt in your stable
    I’m what Cain was to Abel
    Mister catch me if you can

    I’m going out in a blaze of glory
    Take me now but know the truth
    I’m going out in a blaze of glory
    Lord I never drew first
    But I drew first blood
    I’m no one’s son
    Call me young gun

    You ask about my conscience
    And I offer you my soul
    You ask if I’ll grow to be a wise man
    Well I ask if I’ll grow old
    You ask me if I’ve known love
    And what it’s like to sing songs in the rain
    Well, I’ve seen love come
    And I’ve seen it shot down
    I’ve seen it die in vain

    Shot down in a blaze of glory
    Take me now but know the truth
    ‘Cause I’m going down in a blaze of glory
    Lord I never drew first
    But I drew first blood
    I’m the devil’s son
    Call me young gun

    Solo

    Each night I go to bed
    I pray the Lord my soul to keep
    No I ain’t looking for forgiveness
    But before I’m six foot deep
    Lord, I got to ask a favor
    And hope you’ll understand
    ‘Cause I’ve lived life to the fullest
    Let this boy die like a man
    Staring down a bullet
    Let me make my final stand

    Shot down in a blaze of glory
    Take me now but know the truth
    I’m going out in a blaze of glory
    Lord I never drew first
    But I drew first blood
    And I’m no one’s son
    Call me young gun
    I’m a young gun

    Reply
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