rebalancing

As analysts and official entities like the World Bank continue to downgrade their forecasts for medium-term growth in China, I have been asked increasingly often for the reasons I believe that 3-4% average annual growth rates is likely to…

If you look at the last two posts on this site from Marc Chandler and from Sober Look the connection between Fed tapering and money flows is clear. Hot money is flowing out of emerging markets and into Europe.

Michael Pettis had a very good post out yesterday that focused on the sectoral balances within and across eurozone countries which I recommend. His point is that excess German savings driven by wage suppression was behind macro imbalances…

I’ll be watching a number of things in 2013 in order to get a better sense of what the future will bring. On January 22 Princeton University Press will be publishing my book, The Great Rebalancing: Trade, Conflict, and the Perilous Road…

In China, I have argued many times, high growth is no longer compatible with a strengthening balance sheet. If China is growing at a rate that approaches or exceeds five or six percent, it is probably a safe bet that debt is rising faster…

According to the Financial Times, the Australian mining group Fortescue has moved into expansion mode on the back of robust iron-ore prices that are now at an eight-month high. The reason for the rebound is the reflation efforts of the…

By Michael Pettis The big news in the past two weeks has been the slew of economic data suggesting that China has firmly turned the corner on its economic closedown. Growth is up, investment is up, and inflation is down. Here, for example,…

By Michael Pettis Three weeks ago the Wall Street Journal published my OpEd piece about concern that China may try to make the rebalancing process less painful by allowing the RMB to depreciate. In the piece I argue that this isn’t as…

In the short term rebalancing may increase the amount of global demand absorbed by China, but over the longer term it should reduce it. Rebalancing will inevitably result in falling prices for hard commodities, and so will hurt countries…

Michael Pettis writes that in the current environment is that small and medium enterprises (SMEs) are hurting, and last week’s minimum reserve hike – which came out the same day as the CPI number – will undoubtedly make things worse since…