A couple of significant news items on CNBC tonight
IMF Cuts Global Growth Forecast for 2015
"The International Monetary Fund (IMF) trimmed its global growth forecast for 2015-16, cautioning that the boost from lower crude oilprices would be offset by dimmer economic prospects for China, Russia, the euro area, Japan and oil producers."
"In its World Economic Outlook (WEO) Update published on Tuesday, the IMF projected the world economy would expand by 3.5 percent this year and 3.7 percent next year, picking up from 3.3 percent in 2014 but lower than its previous estimates. In October, it predicted global growth for this year and next at 3.8 and 4 percent, respectively."
"China's economy grew at its slowest pace in 24 years in 2014, official data showed on Tuesday, undershooting the government's target for the first time since 1998."
"Gross domestic product (GDP) expanded 7.4 percent from 7.7 percent in 2013. Government targets have been for a print of "around 7.5 percent."
"Growth in the world's second biggest economy has not fallen below 7.6 percent since 1990, when it grew 3.8 percent as a result of international sanctions in the wake of the Tiannanmen Square massacre."
This news just continues to confirm that both China and many other areas of the world are struggling. We already know that Japan and the EU are. Russia is in serious contraction and Greece is unsettled leading into its election.
The IMF and World Bank have had to cut growth forecasts repeatedly. The IMF and the BIS have issued multiple warnings in 2014 that at the same time the world is battling deflationary forces, QE policies have created potential "asset bubbles" in various financial markets. Markets have started off the year in very volatile fashion and we have already seen one central bank (SNB) throw in the towel trying to manage its currency. Oil and other commodities (like copper) have crashed in price suggesting global demand is falling.
There are a lot articles appearing on the internet once again in alternative media sources warning of a severe crisis this year. We will just continue to follow events here and see if things calm down and stabilize or get worse. It's important to stay tuned to events in times like these. Tomorrow a new interview by Nomi Prins.
It is pretty obvious that we have a lot to keep an eye on in 2015
Added note: We will put this in the "you can't make this stuff up" department.
Tonight on the same web site (CNBC) that runs the article we linked above "Chinese Economy Grows at Slowest Pace in 24 Years" is another story on this GDP news with this headline "Asian Stocks Higher after China beats GDP Estimate".
You ask, did China beat expectations or fall below expectations? I guess it depends on which "expectations" you use to write the article. In one article it talks about how GDP came in below the government forecast made earlier in the year. In the other article it talks about how China's GDP came in above "forecasts by analysts." Just to add a little more humor, the first (more negative article) quotes GDP for 2014 at 7.4%. The second (more positive article) quotes GDP at 7.3%. Again, you can't make this stuff up.
This is a perfect example of how the same information (nearly) can be spun in media articles differently depending on what the writer wants to project. We will just link both articles here and let readers decide for themselves. Our intent here is to have a true "no spin zone" to borrow a popular phrase.