3 Nasty Looking China Charts

Takeaway: All clear in China? Not by a long shot.

Editor's Note: As our Financials analyst Josh Steiner remarked on The Macro Show today, "Markets were in free-fall earlier this year and pundits were saying a recession was imminent. Then, in mid-February, it all stopped. One of the reasons is that China started pushing credit like crazy, reflating commodities, emerging markets and the U.S. stock market. But China cannot keep rapidly growing credit like it has been. China is now an enormous systemic risk to the global economy."

 

3 Nasty Looking China Charts - China cartoon 05.09.2016

(STEEL) free fallin'

"Chinese Steel – Risk measures were subdued last week. However, the price for Chinese steel continued to drop, falling by another 5% last week, bringing the month-over-month change to -21% as the mid-February to mid-April artificial reflation trade unwinds. We use Chinese steel rebar prices to gauge Chinese construction activity and, by extension, the health of the Chinese economy." 

 

3 Nasty Looking China Charts - steiner3 5 25

GOT nON-PERFORMING LOANS?

"Chinese Non-Performing Loans – Chinese non-performing loans amount to 1,392 billion Yuan as of March 31, 2016, which is up +41.7% year over year. Given the growing focus on China's debt growth and the potential fallout, we've decided to begin tracking loan quality. Note: this data is only updated quarterly."

 

3 Nasty Looking China Charts - steiner2 5 25

Debt, Debt & More Debt...

"Chinese Credit Outstanding – Chinese credit outstanding amounts to 148.7 trillion RMB as of April 30, 2016, which is up +11.9% year over year. Note: this data is only updated monthly."

 

3 Nasty Looking China Charts - steiner1 5 25

 

*This is an excerpt from an institutional research note. To access our research email sales@hedgeye.com.


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