Tuesday Charts – Slugging It Out

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Howdy folks! This latest collection pitches developed nations versus developing nations, China versus naysayers, OPEC against itself, and the battle within ourselves (serious stuff, huh). Read on!

This first chart illustrates the changing role of developed and developing nations. In the last decade or so, we have seen emerging markets leading the charge, carrying the burden of global economic growth on its shoulders.

The problem now, however, is that the economies of Brazil, Russia, and China are stuttering, and developed nations are unable to carry this burden; weakness in emerging markets is providing headwinds for the likes of the US, Japan, and the Eurozone:

boomerang

China continues to show growing pains as it switches from being an export-driven economy to one driven its own domestic consumption. As this chart from the St.Louis Fed illustrates, the contribution of exports to the Chinese economy is being marginalized:

importance of chinese exports

Staying on the topic of China, this week’s Q3 GDP print was met with surprise, and to a large degree, skepticism. This was not only because the number was conveniently just above consensus at 6.9%, but also because it was released amid a broad swathe of deteriorating data. The chart below from Capital Economics highlights what many other economists believe: that official statistics are overstating economic growth:

China gdp q3 2015

It’s not all bad news from China, however. Despite Q3 economic growth coming in at sub-7%, higher domestic consumption is boosting the services sector in the Chinese economy, offsetting a drop in manufacturing. Box office sales are also up 50% this year, while internet traffic through mobile devices has nearly doubled. Both railway and aviation passenger traffic are also on the rise, according to government data:

China

The next chart shows OPEC’s production breakdown for September, which reached a three-year high. Saudi Arabia and Iraq have led the charge in rising production growth over the last year, while Libya is the only member to see a discernible drop:

saudi and Iraq

Finally, the below graphic is an awesome summary of behavioral finance, highlighting various ways that our emotions get the better of us, causing us to make bad trading decisions:

cb

 

Bonus pie chart! Thanks for playing!

sky