World stocks slide as China manufacturing shrinks
Source: AP-Excite
By KELVIN CHAN
HONG KONG (AP) World stock markets were mostly lower Monday after a survey showed that Chinese manufacturing shrank in April for the fourth month in a row.
The HSBC index of Chinese factory activity also fell short of its already weak preliminary result, stoking fears among investors that the slowdown in the world's second biggest economy is entrenched.
"People were in general expecting from the recent data that the market was stabilizing rather than slowing. This would seem to indicate that it's still slowing rather than stabilizing," said Andrew Sullivan, director of Asian sales trading at Kim Eng Securities.
The index rose by 0.1 point to 48.1 in April, using a 100-point scale on which readings below 50 indicate contraction. The preliminary index level was 48.3.
FULL story at link.
Read more: http://apnews.excite.com/article/20140505/world_markets-cc1167c185.html
GliderGuider
(21,088 posts)Or the leading edge of a longer slide in the world economy?
It would be nice if it were the latter. IMO we need to get busy contracting the human presence on this planet while there's still something left of it.
BumRushDaShow
(128,905 posts)As long as employers buy into the "cheap labor" to "maximize profit" model - and also try to do this for almost every sector of the workforce (blue collar, pink collar, white collar), then eventually the consumers will no longer have enough income to buy all of the goods generated from the overheated mass production, which eventually leads to a surplus. And since these same employers don't want to lose any fictional profits by major discounting to reduce the stock, that stock sits and deteriorates, as they pay for storage. And I expect in many cases the un-purchased stock is finally destroyed and they write off the loss on their tax forms.
So it appears that they may be trying to address the oversupply by reducing the production (short term, temporary gain) rather than increasing the incomes (long term, more permanent gain).
It has always felt to me like they have purposely chopped things down to the point where people and production suffers, and then plan to take it back a notch so they can say that they did everything they could to "wring out efficiencies".