As China’s Export Growth Falls, Import Growth Contracts, Stocks Fly!

China’s international trade data speaks loudly of the Chinese and global economic conditions.

The Zero Hedge writes: (bold original)

Chinese imports and exports dramatically missed expectations this evening but it is imports that was the real driver that pushed the trade surplus to $54.47 billion (higher than the $43.95 billion expected) record highs. Exports rose just 4.7% YoY (against expectations of an 8.0% rise and previous 11.6% rise) for the slowest growth since April. Imports utterly collapsed; plunging 6.7% YoY (against expectations of a 3.8% rise and prior 4.6% YoY rise). This is the biggest drop since March and 4th largest plunge since Aug 2009. Of course, in any real world this means 'the rest of the world' should be suffering from huge drops in exports... but we are sure, by the magic of fradulent invoicing that will not be the case. The PBOC may have got a glimpse and fixed CNY at its strongest since March and highest premium to the market since August.

Add to "the rest of the world' should be suffering from huge drops in exports", contracting imports postulates to a sharp slowdown in domestic economic activities. 

Yet the slowdown in exports have been blamed on supposed  crackdown on over-invoicing. Perhaps.

But this may also reflect on a substantial downdraft in the economic activities of China’s trading partners. (chart from statista.com)

I said last night: 

since 2008, stocks have NOWHERE been about G-R-O-W-T-H, but about LIQUIDITY and CREDIT from which CONFIDENCE or MOMENTUM has been a product of. Expand liquidity and or credit, then financial assets (stocks, real estate, bonds etc…) booms, regardless of the direction of the economy.

Well, bad news has actually been good news for Chinese stock market speculators

The Shanghai index has even broken the 3,000 levels! 

This according to the Bloomberg, has been the first time in 2011. Why? Because according to a quoted expert, “There are expectations for further rate cuts”

Well it’s not just China.  

Japan’s 3Q adjusted GDP reportedly fell to 1.9% from 1.6%. This means that the 3Q recession has been worst than originally estimated. 

No bad news for stocks, though. Japan’s Nikkei closed higher marginally higher by .08% today!