HSBC Flash China PMI Still Contracting

Markit reports,

Commenting on the Flash China Manufacturing PMI survey, Hongbin Qu, Chief Economist, China & Co-Head of Asian Economic Research at HSBC said:
“As April flash PMI ticked higher, this suggests that the earlier easing measures have started to work and hence should ease concerns of a sharp growth slowdown. That said, the pace of both output and demand growth remains at a low level in an historical context and the job market is under pressure. This calls for additional easing measures in the coming months. We expect monetary and fiscal easing to speed up in 2Q.”

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Week in Review

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Global Trend Indicators

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Weekly Eurozone Watch: France Wider Ahead of Election

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Euro Crisis: Lorenzo Bini Smaghi

Lorenzo Bini Smagi,  former Member of the Executive Board of the European Central Bank, nails it,

You call it austerity, i would call it putting your house in order. You can’t grow especially if you have a deficit which is so high if you spend more than you earn at the government level.  You cannot grow and the markets have understood this.  So you have to make these adjustments and it will take time. The problem is that markets are impatient…

Europe’s Ricardian Equivalence vs America’s Keynesianism.

The American markets just don’t understand it quite yet, that “…you can’t grow especially if you have a deficit which is so high” — and as the Congress and Administration dither they’ll be craving the Fed crack as soon as Operation Twist ends next month.

Furthermore, the Fed’s zero interest rate policy and quanto easing has reduced the the Congress and Administration’s incentive to take decisive action to address the country’s structural deficit and debt problem.  At some point, the markets will.

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Vodpod videos no longer available.

Posted in Black Swan Watch, Budget Deficit, Eurozone Sovereign Spreads, Fiscal Policy, PIIGS, Sovereign Debt | Tagged , , , , , | 2 Comments

Government Gross Financing Needs

The latest data from the IMF’s Fiscal Monitor.  Read it and gulp!  Then fire up the printing presses.

Click on the tables to enlarge and for better resolution.

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Posted in Black Swan Watch, BRICs, Budget Deficit, Fiscal Policy, Sovereign Debt, Sovereign Risk | Tagged , , , | 1 Comment

Spanish Yields Move Higher After Auction

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Picture of the Day: College Football Fault Line

The Wall Street Journal ran this picture today of the University of California-Berkeley’s football stadium.  An earthquake during a game could literally move the ball forward an extra few yards.   Stunning.

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TR50: The 50 Most Innovative Companies (41-45)

Here are 41-45 of MIT’s Technology Review’s 50 Most Innovative Companies in 2011.  We’re posting in increments of five every few days as not to overwhelm you with info and required reading.

Click here for 1-5 of TR’s most innovative companies of 2011;
Click here for 6-10 of TR’s most innovative companies of 2011;
Click here for 11-15 of TR’s most innovative companies of 2011;
Click here for 16-20 of TR’s most innovative companies of 2011.
Click here for 21-25 of TR’s most innovative companies of 2011.
Click here for 26-30 of TR’s most innovative companies of 2011.
Click here for 31-35 of TR’s most innovative companies of 2011.
Click here for 36-40 of TR’s most innovative companies of 2011.

Technology Review uses the following criteria to choose the most innovative companies,

What is a TR50 company?   It is a business whose innovations force other businesses to alter their strategic course. TR50 members are nominated by Technology Review’s editors, who look for companies that over the last year have demonstrated original and valuable technology, are bringing that technology to market at a significant scale, and are clearly influencing their competitors.

41)   SpaceX       (private)
Why:
 Its spacecraft and rockets could replace expensive government vehicles as a way into orbit.
Key innovation: 
The reusable Dragon cargo capsule is set to become the first private spacecraft to visit the International Space Station.

42)   Spotify     (private)
Why:
Its digital music subscription service has succeeded where others have failed or had only lackluster results.
Key innovation:
Spotify has negotiated with record labels to allow users access to a large library of music one track at a time; they can even download music for offline use.

43)  Square       (private)
Why:
Small businesses benefit from its simple mobile payment system.
Key innovation:
Square has moved beyond its initial credit card reader for smart phones; a new app lets you automatically open a tab with a merchant on entering a store.

44)   Suntech     (STP)
Why:
  Has developed a low-cost way of making better silicon solar cells.
Key innovation:
  Its new panels are more efficient because they reflect less light and use thinner electrodes that block less light.

45)  Tabula   (private)
Why:
Its processors combine the flexibility of software with the efficiency of hardware.
Key innovation:
Chip designs that can reconfigure themselves faster than existing reprogrammable designs make smaller, cheaper chips possible.

TR – (1-5)
TR – (6-10)
TR – (11-15)
TR – (16-20)
TR – (21-25)
TR – (26-30)
TR – (31-35)
TR – (36-40)

 

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Enter French Politics

President Nicolas Sarkozy and Socialist candidate Francois Hollande will likely emerge Sunday as the top two vote-getters in the first round of France’s Presidential election.  The run-off is set for May 6th.  Intrade gives Hollande more than an 80 percent probability of becoming France’s next President.

We don’t think this is fully priced.   Markets may begin to focus on French politics after Sunday, which will be another source of volatility and angst.   It’s going to be interesting to see how the other candidates,  such as the far-right populist National Front candidate, Marine Le Pen,  poll on Sunday.

Stay tuned.

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