2018-01-18

Defacto Secession in America

The authority of the federal government is collapsing. This isn't going to stop when administrations change. The right will find laws to ignore such as abortion and gun control too.

SacBee: ‘We will prosecute’ employers who help immigration sweeps, California AG says
The state’s top cop issued a warning to California employers Thursday that businesses face legal repercussions, including fines up to $10,000, if they assist federal immigration authorities with a potential widespread immigration crackdown.

Did China Revise Data or Did Growth Collapse? FAI, PFAI Contracts 2.3pc in December

I take the official growth rate for China as given (the cumulative YTD growth rate) and calculate the single month, yoy change for the charts I put out each month. I didn't notice a discrepancy the past few months, but this month I noticed a discrepancy in fixed asset investment.

I calculated a 2.3 percent drop in private fixed asset investment, but China says the cumulative YTD rate went up from 5.7 percent in November to 6.0 percent in December.

I rechecked the December 2016 release and did a database query: National Data. I see no revision to show my calculation is an error and my raw data is what NBS reports for fixed asset investment and private fixed asset investment covering all the relevant time periods.

When I calculate the cumulative YTD growth rate, using NBS figure, I'm accurate for years until October. The NBS says cumulative YTD private fixed asset investment growth in October, November and December was 5.8, 5.7 and 6.0 percent.
My calculation says cumulative YTD private fixed asset investment growth in those three months was 5.4, 5.2 and 4.5 percent.

I always assume I've made an error first, but I didn't change anything in my calculations. Was there a new seasonal adjustment that kicked off in October? I don't see any announcement. I also assume I didn't catch the NBS making a booboo (reporting the wrong headline number) because I would think someone would have caught it before me in the past three months. The real estate investment data matches up, I don't see any discrepancy there.

Here's private fixed asset investment, the green line in my cumulative YTD total against the official reported number in yellow.


I see a similar divergence in fixed asset investment, but it starts in August.

NBS reports cumulative YTD growth for August through December: 7.8, 7.5, 7.3, 7.2, 7.2 percent.
I calculate: 7.6, 7.4, 6.9, 6.8 and 5.9 percent.
As with PFAI my numbers line up going back years until August.

I also calculate a 2.3 percent decline in fixed asset investment for the month of December.


Here's the breakdown showing the drop. The December decline is consistent with end of 2015.


The breakdown of private fixed asset investment shows a contraction in services and manufacturing for the month of December. Last time it went negative was mid-2016.

Assuming my calculations are correct, we don't have to wait to see the impact of the credit slowdown. It is already here.

Reuters reports the official NBS number: China 2017 fixed asset investment grows 7.2 pct, slowest since 1999

Real Estate Investment Growth Slows to 2.4pc in December

Real estate investment growth peaked in late 2016 and fairly steadily declined throughout 2017. The government's reflation efforts are getting weaker both in time and strength.

I don't have a crystal ball, but I am definitely hedging my commodities bets heading into March. (Spring Festival is late this year, February 16.) The market looks extremely out of whack with fundamentals in the short-term, heavily overbought when China looks about where it was when financial markets went sideways in 2014.

2018-01-17

Another Make or Break: Spain Approaching Resistance

iShares MSCI Spain (EWP)

China RRR Cut Takes Effect Next Week

The PBoC cut the RRR in September 2017, but it takes effect on January 25, 2018.

iFeng: 央行:预计普惠金融定向降准2018年1月25日全面实施

Real Estate Stocks Limit Up on Increased Rural Property Rights

China's trump card has always been increased economic liberty. Transferring economic rights/property from the state to the people will boost asset prices and alleviate the debt situation. It's probably too late to forestall a crisis now, but it's still offers the best cost/benefit of any potential policy.

iFeng: 中国土地制度巨变!宅基地入市利好 地产股爆发

2018-01-16

Technical Analysis Works Well in Bitcoin Market

A market dominated by amateurs and emotion. If TA and Elliot Wave work, this is when they should shine.
Someone on Reddit predicted a crash on January 15 based on Elliot Wave. Off by only one day.

China Increases Property Rights

ECNS: Gov't to stop being single supplier of residential land: official
China's land resources minister said on Monday that China is studying ways to allow rural land to be sold for rental housing, a policy that, if implemented, could terminate the State monopoly over land sales, a media outlet belonging to the Xinhua News Agency reported on Monday.

Minister of Land and Resources Jiang Daming said China will explore ways to separate three rights of countryside homesteads: to ensure the collective ownership rights for such land, to ensure farmers' qualification rights and to reasonably relax usage rights.

Jiang noted that this would be a major innovation in both theory and practice.
iFeng: 政府将不再垄断住房供地 这些影响你要知道