The leading economic indicator for Europe shows the scale of the significant drawdowns that have preceded recessions. The decline in Europe's trade surplus has been the sharpest in decades. President Trump and Xi Jinping enter into a 90- day trade truce. Will this temporary solution lead to the end of the trade dispute, or will someone break the truce? The trade war does not stop in China: both South Korea and Taiwan's manufacturing is in contraction mode.
1. A few more months of bad news and Europe may enter a recession...
Source: Longview Economics, as of 12/3/18
2. And the trade war has a lot to do with it...
Source: Longview Economics, as of 12/3/18
3. The "truce" is certainly welcome, but I wonder how long it will be until someone breaks the truce with bluster...
Source: CNBC, as of 12/3/18
4. Tariffs destroy free trade...
Source: Deutsche Bank, as of 11/29/18
5. This measure shows that China, the world's second largest economy on the line between manufacturing growth and contraction.
Source: Citigroup, as of 11/29/18
6. Using this gauge, the 2nd and 5th largest economies, China and Germany respectively, are already contracting (below 50) with the U.S. and global economies right on the line...
Source: WSJ Daily Shot, as of 12/3/18
7. The world's 11th and 15th largest economies, respectively, are showing their manufacturing sectors to be in economic contraction...
Source: Nikkei, as of 12/3/18
8. On the bright side, India is showing economic growth.
Source: WSJ Daily Shot, as of 11/28/18
Trade, tariffs, tirades, and troughs; what more can the global economy handle? For a look back on what we predicted on the global trade war, read our Portfolio Manager's piece from May.
Disclosure: The charts and info-graphics contained in this blog are typically based on data obtained from 3rd parties and are believed to be accurate. The commentary included is the opinion of the author and subject to change at any time. Any reference to specific securities or investments are for illustrative purposes only and are not intended as investment advice nor are a recommendation to take any action. Individual securities mentioned may be held in client accounts.
