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Since 2009, a massive debt bubble has inflated in China. This bubble helped to supercharge China's economy, which then allowed it to become one of the major "growth engines" that has driven the global economy since the Financial Crisis. $FXI $ASHR
I am very concerned that Coronavirus could be the pin that finally bursts China's very dangerous bubble, which would reverberate around the world and burst bubbles in Hong Kong, Singapore, Australia, emerging markets, and more.

China's economy is in a state of paralysis right now:

As I've been saying (even before coronavirus outbreak), the bursting of bubbles in China, Hong Kong, Singapore, etc. will be the cause of the coming recession/depression.

That scenario looks increasingly likely. Learn more: forbes.com/sites/jessecol…
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More from @TheBubbleBubble see all

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Jesse Colombo
@TheBubbleBubble
One of the big reasons why I had to take time off from my media activities was because of how infuriated I became (and still am) due to President Trump's extremely irresponsible hyping of our debt & QE-driven economy and stock market.

As I wrote last year, Trump has been recklessly demanding and fanning the flames of a massive asset bubble:

zerohedge.com/news/2019-05-1…

zerohedge.com/news/2019-06-2…
Trump hyping the stock market would be like Bush telling everyone to speculate in the housing market in 2007.

It's absolutely insane. That's why I threw my hands up in desperation - "we're done - it's over."

One Trump tweet hyping this bubble negates 8 years of my work.
Read 9 tweets
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Jesse Colombo
@TheBubbleBubble
The market continues to sink as recession signs mount.

Please read my recession warning in Forbes - it contains everything you need to know about what's ahead:

forbes.com/sites/jessecol…

$SPY $QQQ
I'm still taking some time off social media. Thanks again for your patience. I'm still in the process of moving and planning my next act...

I have been warning about the unsustainability of our debt and bubble-based economic cycle, and these warnings, for the most part, have been falling on deaf ears and have been met with incredible hostility.

It's emotionally & intellectually exhausting...

Read 9 tweets
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Jesse Colombo
@TheBubbleBubble
Why the Great Recession never actually ended: thegreatrecession.info/blog/great-rec… by @EconomicRecess $SPY $QQQ
The Great Recession never actually ended when you use more classic/original GDP calculations. Especially when you factor in how much debt was necessary to grow our economy in the past decade.
This is one of the main reasons why I rail against rising housing and stock prices; they are NOT justified by the underlying economy. They are not rising because our economy and society are genuinely improving; they're rising due to Fed funny money.

Read 7 tweets

Related threads

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Tuomas Malinen
@mtmalinen
There are some deep misconceptions about the ability of #China to recover from the economic fallout of #coronavirus relatively quickly.

In this thread, I explain why this is unlikely, and why it's not China we should be truly worried about.

Let's start with the facts. 1/
It has been obvious for a while that China's economic growth lays in unsustainable ground.

If we deduct the growth of debt on the growth of GDP, we get an estimate on the 'organic' growth rate for Chinese #economy.

Which has been negative since 2011 (till 2017). 2/
This, unsurprisingly, has led to another pressing problem. China's productivity growth turned negative in 2012.

This, quite simply, means that China has been accumulating vast amounts of unprofitable investments, at least since 2011. 3/
Read 12 tweets
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Christophe Barraud🛢
@C_Barraud
🇨🇳 #China (1) | The question is no longer if, but how hard, the #coronavirus will damage Chinese economy (and its trading partners) in 1Q20.
🇨🇳 #China (2) | A blockage of 16 cities (~50 million people) coupled with the extension of the Lunar New Year holiday and prohibition for Cos to return to work soon implies that 1Q will fall below 6% for the first time since QoQ figures are recorded.
🇨🇳 #China (3) | The impact will probably broaden from retail sales, tourism/transportation...

Read 93 tweets
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IndoPacific_SCS_Info
@IndoPac_Info
#China economy: ‘worst is yet to come’ with trade war tariffs likely to escalate, Nomura economists say - High debt levels restrict Beijing’s room to manoeuvre on monetary easing, with better-than-expected first quarter growth proving ‘illusory’ scmp.com/economy/china-…
For China’s economy, already bruised from the trade war with the United States and a series of sluggish data, “the worst is yet to come” in the second half of this year, Nomura analysts have warned.
The economists, led by Lu Ting, said that the better-than-expected 6.4 per cent growth in China’s economy in the first quarter, was a blip that “proved to be illusory”.
Read 8 tweets
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IndoPacific_SCS_Info
@IndoPac_Info
#China’s total debt rises to over 300% of GDP as Beijing loosens borrowing curbs to boost growth - The figure has risen to over US$40 trillion, some 15 per cent of overall global debt, according to data released by the Institute of International Finance scmp.com/economy/china-…
China eased its deleveraging campaign in a bid to aid the slowing economy amid the trade war with the US. China's total debt burden rose strongly in the first quarter of 2019 as Beijing allowed more loans and local government bond issuance to help shore up the slowing economy.
The figure stood at nearly 304 per cent of its gross domestic product (GDP) in the first three months of the year, up from 297 per cent a year earlier, the US-based trade association said.
Read 5 tweets
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IndoPacific_SCS_Info
@IndoPac_Info
#China backtracked on nearly all aspects of #US trade deal - All of us that follow & know China knew that this was never going to fly. You can't negotiate with a rogue, predatory state like China. This is for the better. mobile.reuters.com/article/amp/id…
The diplomatic cable from Beijing arrived in Washington late on Friday night, with systematic edits to a nearly 150-page draft trade agreement that would blow up months of negotiations. The document was riddled with reversals by China that undermined core US demands, sources said
In each of the 7 chapters of the draft trade deal, China deleted its commitments to change laws to resolve core complaints that caused the US to launch a trade war: theft of US IP & trade secrets; forced tech transfers; competition policy; access to financial services, etc, etc.
Read 43 tweets
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Christophe Barraud🛢
@C_Barraud
🇨🇳 #CHINA Q3 GDP Y/Y: 6.5% V 6.6%E (slowest growth since Q1 2009)
*NBS spokesman Mao Shengyong said that the international situation was bringing “downward pressure” on China.
*Link: bloom.bg/2RVX1ZA
🇫🇷 🇪🇺 🇨🇳 French tire maker Michelin warned of declining sales in Europe and #China in the second half of the year, dragging down shares of its competitors in the U.S. and Europe - Bloomberg
*Statement: bit.ly/2EujhqH
🇺🇸🇨🇳🇪🇺 In a volley of filings, the EU, #China and the U.S. this week escalated disputes over new U.S. metals tariffs, the European response to those levies, and Chinese intellectual property practices - Bloomberg
bloomberg.com/news/articles/…
Read 634 tweets

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