The US Labor Department’s latest jobless claims filings report showed that such applications fell by 26,000 (to 350,000) – the lowest level in more than four years. So, while some folks made a lot of noise about last Friday’s figure of 80,000 positions having been created, the same folks fell curiously silent yesterday morning (perhaps they had an agenda full of campaign speeches to deliver).
But let’s leave all of the above by the wayside for now. Some of us (include this writer) gave up viewing the latest episode of “Keeping Up With The Kardashians” to catch the latest installment of “Keeping Up With China’s Landing” last night at 10PM New York time. It was as important a news release as (at least) the one that had to do with whether or not the Church of Scientology did or did not play a part in the divorce of Tom Cruise and Katie Holmes.
The verdict: China’s second-quarter economic growth came in at the weakest rate in over three years. The 7.6% rate of expansion reading was half a percent lower than that recorded in the first quarter of the current year, however, the first-half advance of 7.8% compared very poorly to the 9.6% reading of the Chinese economy’s progress reported in the same period one year ago. All of this means that with the current reported growth rate China’s economy has been slowing for six consecutive trimesters.
As such, the string of slowing quarters exceeds the last such prolonged period of economic difficulties, last seen in the late 1990s. However, the 7.6% figure was in line with economists’ expectations and not that far from official projections of a critical-to-maintain 7.5% rate of expansion. While Asian stock markets initially advanced on the news, the perceptions that this slowing is very close to a serious problem for the world’s second largest economy remained palpable among investors and economists the world over. China’s trading partners are justifiably worried about the trend afoot in that country.
Moreover, some view the Chinese problem in the making as the opening act to a bigger drama yet to come. In the tradition of some of the best hard money doomsday newsletters available out there, Markewatch’s Paul B. Farrell paints a grisly picture of China’s “5 apocalypses” in his latest contribution to that site’s commentary section. Mr. Farrell warns that China’s local governments are sinking under the burden of a staggering debt. Some cities, such as Wenzhou, have resorted to auctioning off most of their fleet of luxury cars that were bought in the good old days of the seemingly never-ending boom.