Will This Weekend News Re-Trigger the Bear Market?
Last week's discussion of all things Chinese now connects with global markets with this news over the weekend:
Whatever the impact at the moment, this flies in the face of Chinese officials who have taken umbrage at the idea that Chinese demand has slowed, as we pointed out last week. And we take the opportunity to remind you that the communists in charge of China's government have no regard for truth, consistent with their communist atheist totalitarian world view. Objective truth has not place in such a world view. All that matters is what suits the political aims of the party, facts no withstanding.
And that means that even though statistics point downward, they very well could be a lot worse.
BEIJING—Factories and retailers in China put in weaker-than-expected performances in the first two months of the year, as anemic demand and excess capacity continued to bear down on the world’s second-largest economy.After a month in rally-mode, will this re-trigger the bear market in stocks? Our guess: No. First, placing this story in the weekend edition of WSJ Online will lower the impact the story might have had if it appeared during the week. That's just the way it goes in the world of media. In fact, many stories are purposely put out at the end of business Friday or over the weekend specifically to mute their impact. Was this one of those stories? Maybe.
Whatever the impact at the moment, this flies in the face of Chinese officials who have taken umbrage at the idea that Chinese demand has slowed, as we pointed out last week. And we take the opportunity to remind you that the communists in charge of China's government have no regard for truth, consistent with their communist atheist totalitarian world view. Objective truth has not place in such a world view. All that matters is what suits the political aims of the party, facts no withstanding.
And that means that even though statistics point downward, they very well could be a lot worse.
Even accounting for data volatility around the Lunar New Year holiday, China’s economy is off to a slow start this year following economic growth in 2015 of 6.9%, the slowest pace in 25 years. A host of stimulus measures late last year and into 2016—most recently a 0.5 percentage point cut in bank reserves late last month—have yet to reverse the slide in momentum.But if the Chinese government lacks of regard for objective truth, we should not. And so if the stock market rally continues this week, it will likely do so by ignoring the gloomy news from China. If so, it will be up to us to decide whether the bear will return into his cave to allow the bull to continue running, or whether he's lurking in the shadows ready to pounce in the coming weeks and months. A deteriorating Chinese economy argues for the latter.
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