China is once again proving that it’s the most important country in the
world right now both in terms of its own growth as the 3rd biggest
economy in the world and also its impact on commodity prices and the
subsequent benefit that it gives to a variety of emerging markets that
produce them. Both the Chinese PMI (mostly state enterprise) and the
CLSA PMI (mostly private sector weighted) remained above 50 and it
spurred a sharp rally in Asia that spilled over into Europe. This also
comes ahead of Treasury Secretary Geithner’s trip to China where he
visits his biggest customer. The S&P futures are now rising above its
magic 200 day moving average and assuming it holds at 9:30, the SPX cash
will breach its 200 day moving average for the 1st time since May ’08.
The $ index is falling to the lowest level since late Sept after better
than expected PMI data out of Europe. The US ISM and savings rate data
will be key today. GM entering bankruptcy 6 months after they should
have is an example of how policy mistakes here are mirroring that of the
Japanese, pushing out into the future the inevitable.
What's been said:
Discussions found on the web: