Summary: I had the chance to talk with Closing Bell anchors Sara and Wilfred about what China’s ugly trade report–both exports and imports fell–means for the Chinese economy economy and for the ongoing US/China trade negotiations. You can see a video clip of the discussion by clicking here or by clicking on the image below.
Unfortunately, it means that the entire global economy is slowing because nobody is able to see far enough ahead to make capital spending decisions. I have copied both a scan of the notes I use for the discussion and the briefing points (complete with typos) that I sent to the anchors before the show below FYI.
Briefing Points for the anchors
-When you are driving in a heavy fog (can’t see the road ahead) you slow down.
-any CEO approving a major cap spending project now is nuts. (Real option theory)
-Economy definitely slowing.
-don’t need (nonexistent) Govt data to know that. I have 35 companies to watch over. CEOs are a far better source of information better info than Govt.
-Not just US
-China slowing. Exports, imports both down. Dependent on EU capital goods
-EU slowing. Business spending
-Japan slowing.
-UK is a total mess due to Brexit. Big vote tomorrow. Parliament threatening coup. May not be a Brexit.
-China story broadband.
-exports down to all markets, not just US.
-imports down too (consumer/Apple story)
-trade war is making a lot of this worse.
-foolish to think about who has the upper hand. Both losing.
-think both sides may now be ready to end it
-last week mtgs hopeful, although press releases told 2 diff stories.
-May make progress when Vice Premier Liu He here in 2 weeks.
-cross fingers
-hold a lot of cash.
