REVISION: It has been pointed out to me that Chinese New Year was in January this year (one week holiday) while it was in February last year. So, this whole story is really a non-story. Tune back into the Chinese electricity story when the march statistics come out. This is just another case where I wish I was a little bit smarter or did a little more fact checking.
China electricity consumption dropped 12% year over year in January (click here). This is the clearest indication we've had that China is not in an economic "slow down", but an actual economic downturn (recession at least or probably much worse).
Major hat-tip to Ninestreams for calling this way before anyone else.
Electricity consumption is a great way of measuring an economy when there are no official statistics or the official statistics are not reliable. I'd call that the case for China. Will be looking at the same for the USA and Mexico. If you have a link for either please leave me a comment.
Back to China and this news story: Of course, this is bad news if you are a Uranium miner (counting on
continued Chinese electrical growth to increase uranium demand) or a
coal exporter to China (which has a bunch of coal itself and will, no
doubt, be cranking up internal coal production to provide increased
employment). I would say the same thing goes for other materials China can mine internally (zinc, molybdenum and even copper).
MontyHigh, www.worldofwallstreet.us
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