The US plans to keep Santa busy, but in Europe the bearded one will probably hunker down with a vat of gluehwein in his home continent come Dec 25.
HSBC’s analysts expect export growth in China to slow from its current level of 13 percent to single digits over the next few months.
This is going to pile more woes on top of an already woeful manufacturing sector. With profit margins plunging, the Factory of the World is laying off staff and shutting down production at plants across south China.
Workers who felt they had won something with all the protests and walkouts and stoppages earlier this year are finding themselves on the street, partly victims of their own success, but mainly because of dwindling orders and rising raw materials costs.
Production bounced back after the 2009 meltdown but this time it is different. There will be no massive stimulus injection by Beijing and credit is tight. Plus, of course, the weak economies of Europe and the US are not exactly spending themselves to a standstill. In Europe’s case, debting themselves to a standstill would be more accurate, and there won’t be much good cheer unless you hold stocks in gluehwein makers.
This is all bad news for the shipping industry that is predicting weak container export volumes until well into the first quarter. Chinese New Year is too soon after calendar New Year, and with business drying up many factories have already been closed for two weeks. They will only open up again at the end of January.
No one in the cargo transport business is saying good things about 2012, which is worrying to the carriers and ports, and to the trade publications that depend on their advertising.
And yet the gloomy, “we’re all going to die” feeling in the container shipping industry appears to be at odds with both record November volumes at the port of Los Angeles, and with the expectations of US retailers that are predicting Christmas sales of above the 10-year average. Following November sales that increased by 4.5 percent year-on-year, a National Retail Federation survey found that shoppers still had plenty of holiday shopping left to do.
You have to wonder where all that inventory is coming from. Has it possibly been stored in a secret location way up north? The North Pole, for instance.
It is the only explanation that makes sense and confirms what our kids have known all along: Santa really IS real.