Gloomy Forecast of China's Economy, Thanks to Those of US and EU

choi

In chronological order.

(1) Carol E Lee, Sudeep Reddy and Joseph B White, US Candidates Exchange Barbs on Trade. Wall Street Journal (WSJ), Sept 18, 2012.
http://online.wsj.com/article/SB ... 02142029597574.html

My comment:
(a) There is no need to read the report (I did not). But the graphic tells a story. The graphic:

"Trading Places

[(i) left side of the graphic] China's volume of trade with the US has surpassed Japan's . . .
US quarterly trade in good and services, in billions (2 panels (Exports to, Imports from), both from 1999-2012)

[(ii) left side of the graphic] . . . and China now rivals the US globally.
Share of annual world trade in goods (2 panels (Exports, Imports), both 2002-2011).

Sources: US Commerce Department; International Monetary Fund Direction of Trade Database"

(b) I did not know US exports to China surpassed US exports to Japan in 2011--though imports from China to US has increased at a muck quicker pace (versus US exports to China) causing steadily yawning trade gaps between the two nations.


(2) Drew FitzGerald, IPhone 5 Pre-Oreder Surpass 2 Million. WSJ, Sept 18, 2012.

(a) Quote:

"Apple Inc said customers placed more than 2 million pre-orders for the iPhone 5 on the first day it was available [online], doubling previous results and exceeding initial supply of smartphone.  

"The Cupertino, Calif, company said that wile the majority of pre-orders will be delivered to customers on Friday--when he phone becomes available in stores--many are scheduled to arrive in October.  

"The initial reception surpassed sales of the device's predecessor, he iPhone 4S, which received more than 1 million pre-orders during its first day of requests Oct 7 [2011].

"The iPhone 5 pre-orders also easily.y top the 600,000 handsets pre-ordered after the debut of iPhone 4.

(b) My comment: The iPhone 5 are being airlifted from China to US, a fact that forms a backdrop of the next report.


(3) Bob Sechler, FedEx: China's Problems Growing. Wall Street Journal, Sept 19, 2012 (title in print).
http://online.wsj.com/article/SB ... 03933876146570.html

(a) The first eight paragraphs:

"The head of FedEx Corp on Tuesday sounded a warning about the fate of China's export-driven economy as the world's largest air package shipper cut its forecast for global growth in 2012 and 2013.

Fred Smith, the company's chief executive, said the economic weakness in Europe and the US had slowed global trade, with product launches by tech-industry stalwarts such as Apple Inc and Microsoft Corp providing only a temporary lift.

"Some China observers 'completely underestimate' the impact of slowing exports despite the country's domestic stimulus efforts, Mr Smith said during a conference call with analysts after the company reported a slip in fiscal first-quarter profit.

"Mr Smith's comments echo recent concerns expressed by other prominent executives. Andrew Liveris, chief executive of Dow Chemical Co, last week cautioned that destocking by Chinese clients was continuing, while small and medium-sized enterprises were suffering from a liquidity crunch. 'They really are hurting, and bankruptcies are starting to occur,' said Mr Liveris at an investor event.

"FedEx and rivals including United Parcel Service Inc have invested heavily in building the infrastructure to handle Chinese exports, and the two companies recently won approval to launch domestic parcel delivery services in the country.

"Both companies have already trimmed the amount of flying to the US as the volume of consumer electronics, auto parts and other goods that make them closely watched economic bellwethers has fallen, in part because of competition from cheaper ocean shipping options.

"The weakness of the global economy and the broader changes in trade flows will see FedEx next month detail a shake-up of its express-delivery network.

"'We see the [US] economy not improving from here,' FedEx Chief Financial Officer Alan Graf said Tuesday.

(b) Note:
(i) The addition in last sentence is in the original.
(ii) A photo caption reads, "FedEx is hoping for a 'surge volume event' as Apple prepares for sales of its new iPhone 5 this week, shipping them as fast as it can by air from factories in China. Spencer Jakab reports on Markets Hub. Photo: AP."