This idea that China’s efforts at stimulating its own economy could provide enough of a lift to move the needle for our companies has always seemed pretty tenuous.
Economist Brad Setser marvels at this WSJ column from Andrew Batson and John W. Miller, which notes that while domestic Chinese fixed capital spending surged in May, import declines actually accelerated from April.
Setser says this is practically unheard of. Aggressive domestic investment has always coincided with a thirst for goods made abroad. And this is at a time when China is said to be stockpiling commodities sourced from around the world.
Could China be big and diverse with enough excess industrial capacity that it doesn’t need to import (much) from the rest of the world? Hopefully they’ll at least need our investment banking and legal expertise.