The recently released ISM Data showed that the manufacturing sector is contracting at a severe and accelerating rate.
It’s one of the lowest readings in the last 60 years.
In the chart below, above 50 means expansion, below contraction of the sector.
WSJ data also clearly showes that all markets, including india and china are following the global downward spiral.
With rising retail bancruptcies in the U.S. and consumers tightening worldwide this seems to be just the beginning of a long road to recovery.
A side thought,
with 700 Billion Dollars (maybe soon 2 Trillion after Obama), the US Dollar will probably take an amazing dive.
The new money (or paper) taking away value from the already existing money.
And with china having their own domestic slowdown (god forbid me say recession) it’s unlikely that they will bail out the dollar.
Seeing their US Treasury Bill investement evaporate into thin air, I find it very possible, that maybe, just maybe, the government will actually begin to get rid of some USD reserves or trade it into some real value.
(Land, Energy, Oil, Alaska…)
They warned many times, that they can’t “invest” forever, and they will at some point stop to do so.
Hmm, any thoughts?