Sign of the Times:
Chinese exports in July have for the first time out paced the US and taken the number one position globally. China had exports of $80.3 billion in July verses the US at $79.2 billion. This is the first time in history that China has reached this level of exports and the momentum appears to be very strong with August exports up another 12.95% higher at $90.7 billion, the US figures are not yet available. It is not very likely that the US figure will be up by more then 12.95% making this the second month in a row where China is the global leader in exports.
The movement of manufacturing capacity to China has been an ongoing process for a number of years now and the momentum appears to be picking up steam. The change in the North American economy to service verses production has been evolving over the past 30 years or more and there is no going back. The loss of the dominant global exporter position by the US should not really be a surprise.
There are many investors who do not believe the changes going on in Asia are sustainable but this latest information should be a wake up call for them. The pace of change is only picking up steam and will still take a number of years before it is complete.
Investors should be looking to Asia as the measure of the potential for investments and be focusing on companies that supply Asia with materials or services. Avoid those companies that are in direct competition with China as they are going to be facing increasing competition and loss of market share globally.
US consumers have received some mixed news as gasoline prices have declined again for the seventh week in a row, the average nationally is now $2.38 a gallon down 48 cents fro the same time last year.
On the flip side existing home sales were down 0.5% in August to a 6.3 million annualized rate and the inventory of homes for sale increased again by 1.5% for the month but is up 37.9% from a year ago. This is becoming a buyers market and median sale price declined by 1.7% the first decline in 11 years coming in at $225,000 verses $230,000 in July.
The long bull market in home prices has been fueling a large percentage of the increase in consumer spending and that support appears to be ending. This will have a significant impact on the pace of US economic growth going forward.
Investors should avoid the suppliers to the housing market such as Home Depot and Lowe’s as earnings growth will be very difficult for any in this business.
For more information go to www.campbellreport.com
The movement of manufacturing capacity to China has been an ongoing process for a number of years now and the momentum appears to be picking up steam. The change in the North American economy to service verses production has been evolving over the past 30 years or more and there is no going back. The loss of the dominant global exporter position by the US should not really be a surprise.
There are many investors who do not believe the changes going on in Asia are sustainable but this latest information should be a wake up call for them. The pace of change is only picking up steam and will still take a number of years before it is complete.
Investors should be looking to Asia as the measure of the potential for investments and be focusing on companies that supply Asia with materials or services. Avoid those companies that are in direct competition with China as they are going to be facing increasing competition and loss of market share globally.
US consumers have received some mixed news as gasoline prices have declined again for the seventh week in a row, the average nationally is now $2.38 a gallon down 48 cents fro the same time last year.
On the flip side existing home sales were down 0.5% in August to a 6.3 million annualized rate and the inventory of homes for sale increased again by 1.5% for the month but is up 37.9% from a year ago. This is becoming a buyers market and median sale price declined by 1.7% the first decline in 11 years coming in at $225,000 verses $230,000 in July.
The long bull market in home prices has been fueling a large percentage of the increase in consumer spending and that support appears to be ending. This will have a significant impact on the pace of US economic growth going forward.
Investors should avoid the suppliers to the housing market such as Home Depot and Lowe’s as earnings growth will be very difficult for any in this business.
For more information go to www.campbellreport.com
posted by Grant | 3:51 PM
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