World Economy Cooling?

[GRG55]

Here's the headlines from Bloomberg's Economy Section at about 14:00 GMT today. Does this sound like a slowing global economy to you?

German Exports Unexpectedly Increased Even as Euro Rose; Surplus Widens Germany's trade surplus widened to a record in October after exports unexpectedly rose, suggesting companies in Europe's largest economy are coping with the euro's appreciation.

Japan Machine Orders Rise at Double Expected Pace on Asian, European Sales Japan's October machinery orders rose at twice the pace economists forecast, signaling companies will increase spending to meet Asian and European demand for chips, cars and electronics.

French Industrial Output Rises by Most in Almost Two Years on Carmakers Industrial production in France jumped by the most in almost two years in October as car manufacturers boosted output.

U.K. Factories Raised Prices at Fastest Annual Pace Since 1991 in November U.K. factories increased prices at the fastest annual pace since 1991 in November as companies passed on higher costs of food and oil.

[jk]

Re: World Economy Cooling?

U.K. Factories Raised Prices at Fastest Annual Pace Since 1991 in November U.K. factories increased prices at the fastest annual pace since 1991 in November as companies passed on higher costs of food and oil.

inflation based on cost-push, not demand-pull, is not a sign of growth

[GRG55]

Re: World Economy Cooling?

inflation based on cost-push, not demand-pull, is not a sign of growth

Passing on higher costs by any means means pricing power...

[The Outback Oracle]

Re: World Economy Cooling?

Cost push vs Demand Pull

At the moment i am making pricing decisions like this....

The cost, out of China, of an item is increased, for example, 70% on a Cast iron pot in the last 9 months. I am already squeezed on the price. The market is very competitive. The price must go up about 50% at least. I can only assume my competitors are subject to the same sorts of increases. I check alternate suppliers in China and find a rough equivalent of price for quality. So, either the price goes up 50 - 70% or I judge that Australians can no longer afford (perhaps will just not pay the price of) a common cast iron pot out of China. Frankly I have concluded the latter which is a real indication of the decline of our system.
So it is cost-push...demand-pull has nothing to do with it.

For other items the price increases are not so large and are more essential to the family holiday....so despite price increases the population will still buy. All be it in lower quantities perhaps.

It doesn't mattter which way you look at it. We have not had any real pricing power for many years. We are a small business in a competitive industry. It's all cost-push now.
I suspect a lot of decisions, by lots of companies, are being made the same way at the moment.

[Guest]

Re: World Economy Cooling?

OK, this is for you Outback. As I know you Aussies maintain a caustic sense of humor under even the most adverse conditions ...

CHINESE_BILLBOARD_CONUNDRUM.jpg

[The Outback Oracle]

Re: World Economy Cooling?

Thanks Lukester!

Love it... although I suspect the sign belongs to a 'native' Chinese Ameriacan!! Or was it just one of those confusions of speech ot theirs?

The profane version of the verb 'to copulate' seems to crop up a bit in the Chinese language.! Of course not with the same meaning. However I have noticed a certain tendency amongst the young to use English when they wish to swear with real meaning!
Cheers

[Guest]

Re: World Economy Cooling?

Outback -

Stands to reason. Chaucer's English is one of the most pungent, truly foul-mouthed swearing languages in the world. The Saxon roots have a particularly pungent quality in the "schatological" forms of expression. Wonderful stuff in our bland modern world. Very "bracing". Oh and BTW, the Aussies are no mean experts in that department!

[touchring]

Re: World Economy Cooling?

The chinese word for "dry" is also slang for "fu*k".

[The Outback Oracle]

Re: World Economy Cooling?

Touch

That's a BAD association!!!!