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China Economic “Miracle” Has Failed… What’s Next For the Stock Market?

Stock-Markets / Chinese Stock Market Jul 10, 2013 - 10:30 AM GMT

By: Graham_Summers

Stock-Markets

China, which the investment world blindly continues to believe will power the global economy to growth, just posted its single worst export data since 2009.

All in all, Chinese exports fell 3.1% from a year earlier. Analysts had forecast growth of 3.7%. The reason? They continue to believe China will somehow pull a rabbit out of a hat and grow exports at a time when the global economy is sharply contracting.


Let’s look at the facts here.

In the last six months, China has pumped roughly $1.6 trillion in new credit (that’s 21% of GDP) into its economy. Despite this incredible monetary expansion, Chinese GDP growth is slowing.

Mind you, this slowing growth is occurring even after China massages the heck out of its GDP data. As I recently told my Private Wealth Advisory subscribers, when you look at electrical usage by the People’s Republic, real GDP growth is likely just 2.9%.

This is truly astounding: a country has expanded its credit by 21% of GDP in just six months and is barely able to generate positive GDP growth. Small wonder that the Chinese stock market has taken out its post-2009 trendline.

China is giving us a taste of what will be spreading throughout the global economy: a collapse in spite of massive monetary expansion. The entire “recovery” since 2009 has been based Central banks pushing money into the financial system… which did little more than allow corporations to borrow even more debt.

Indeed, globally the leverage in the financial system today is as bad if not worse than it was going into the 2008 Crash. Can you imagine what would happen if we suffered another collapse now, when Central Banks are already pumping their brains out trying to push market higher?

On that note, NOW is the time to prepare for another stock market bloodbath BEFORE this happens.

I’ve been warning subscribers of my Private Wealth Advisory newsletter that we were heading for a dark period in the stock market. We’ve since taken action to insure that when the market falls, we make money.

Clicking Here Now!!!

Graham Summers

Chief Market Strategist

Good Investing!

http://gainspainscapital.com

PS. If you’re getting worried about the future of the stock market and have yet to take steps to prepare for the Second Round of the Financial Crisis… I highly suggest you download my FREE Special Report specifying exactly how to prepare for what’s to come.

I call it The Financial Crisis “Round Two” Survival Kit. And its 17 pages contain a wealth of information about portfolio protection, which investments to own and how to take out Catastrophe Insurance on the stock market (this “insurance” paid out triple digit gains in the Autumn of 2008).

Again, this is all 100% FREE. To pick up your copy today, got to http://www.gainspainscapital.com and click on FREE REPORTS.

Graham also writes Private Wealth Advisory, a monthly investment advisory focusing on the most lucrative investment opportunities the financial markets have to offer. Graham understands the big picture from both a macro-economic and capital in/outflow perspective. He translates his understanding into finding trends and undervalued investment opportunities months before the markets catch on: the Private Wealth Advisory portfolio has outperformed the S&P 500 three of the last five years, including a 7% return in 2008 vs. a 37% loss for the S&P 500.

Previously, Graham worked as a Senior Financial Analyst covering global markets for several investment firms in the Mid-Atlantic region. He’s lived and performed research in Europe, Asia, the Middle East, and the United States.

© 2013 Copyright Graham Summers - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Graham Summers Archive

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