It’s a bizarre world. We seem to live in a “parallel universe” or a separate reality coexisting with one’s own (Wikipedia.org)
On the one hand, you have soaring financial markets.
On the other hand, signs of a staggering real economy have become more evident.
Singapore’s self-contradicting financial markets and the real economy seem like a good example.
From Bloomberg,
Singapore’s exports fell more than economists estimated in August as shipments of electronics dropped and companies sold fewer goods to Europe.
Non-oil domestic exports slid 10.6 percent from a year earlier, after a revised 5.7 percent increase in July, the trade promotion agency said in a statement today. The decline exceeded all 15 estimates in a Bloomberg News survey, where the median was for a 4 percent drop…
Singapore’s electronics shipments by companies such as Venture Corp. fell 11 percent in August from a year earlier, after climbing 2 percent the previous month.
Non-electronics shipments, which include petrochemicals and pharmaceuticals, decreased 10.4 percent. Petrochemicals exports gained 1.3 percent, while pharmaceutical shipments slid 3.2 percent after rising 1.3 percent in July.
Singapore’s non-oil exports fell a seasonally adjusted 9.1 percent last month from July, when they dropped 3.6 percent, today’s report showed.
Who says economic growth drives stock market prices? Singapore’s STI has been up an amazing 16.02% year-to-date as of Friday’s close, even as annual economic growth rate has been faltering. (chart from tradingeconomics.com)
Central bank policies have nurtured a parallel universe.
