EMERGING MARKETS POISED TO COLLAPSE

Smokey. The Super Bowl isn’t too far off. China will collapse beforehand. Pucker up.

Albert Edwards: The Bubble In China And The Rest Of The Emerging World Is On The Brink Of Popping

Gregory White | Dec. 1, 2010, 2:59 PM |

The emerging market bubble that everyone has been ignoring is on the brink of popping, according to Albert Edwards of Societe Generale.

This isn’t’ the first Edwards has pointed out the threat of the EM bubble. But this time he’s backing it up with a little more data.

Specifically, leading indicators around the emerging world are now saying slowdown.

From Societe Generale:

Not only is the market’s favorite EM economy seemingly set to slow rapidly, but the OECD concludes that Brazil is also officially in “slowdown”. India is even worse, being defined as in a “downturn”, as are the Asian big five in aggregate, China, India, Indonesia, Japan and Korea – link. Funny how this news just doesn’t seem to be getting much attention recently amid the runaway EM/commodity euphoria.

China’s leading indicator is now where it was back in the middle of 2008, right before the crash.

 

Chart

Image: Societe Generale

And while the situation in emerging markets is bad, Edwards warns that the U.S. isn’t much better, even if the data suggests otherwise.

From Societe Generale:

The rally in the US equity market seems to be underpinned by some stronger than expected economic data. Yet we once again urge caution and remind our readers of the early 1990s experience. Then we went through a few years of private sector de-leveraging in the wake of the Savings and Loans crisis (see chart below). It wasn’t until the second half of 1993, well after the recession finished, that the private sector’s appetite for debt recovered and “normal service” was resumed.

Chart

Image: Societe Generale

Read more: http://www.businessinsider.com/albert-edwards-china-and-the-rest-of-the-emerging-world-is-on-the-brink-of-popping-2010-12#ixzz16zK8DhQL

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Smokey
Smokey

8 1/2 Weeks is not much time and China looks mighty strong. I don’t see a catalyst. Save your refried beans or pork & beans or whatever it was and maybe, if you’re lucky, SIXTY YEARS from now you’ll get the crash you want.

hugh betcha
hugh betcha

with individuals the world over stashing some cash into gold and silver and mattresses does it have an impact on economies?

Centerfield
Centerfield

A real global depression would F up India quite easily. They don’t understand unemployment over there. Same with most of industrial China. All of the young people there spend like drunken sailors and don’t save a penny for tomorrow. They are no worse than the youth in the U.S….they want it NOW. It won’t be tomorrow and it won’t be in 60 years. But when the U.S. sneezes, the rest of the world still catches a cold.

eugend66
eugend66

TBTF banks were wrong more than once and Soc Gen is one of them.

Punk in Drublic

Admin
I am going to buy the fucking dip, and I will make money. If you do not buy the dip, you are a fucking idiot. Buy the fucking dip you fucking idiot.

Punk in Drublic

Thanks, Admin.

Punk in Drublic

Admin
Did you see my post on the Lies Across America thread? I grossed out SSS. If I can make a CIA agent gag, the Homeland Security guys monitoring this site must be puking all over each other.

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