2/16/15

Global trends


China’s imports plunged, a sign of a weak economy. Many times we wrote China cannot grow rapidly with a centralized government. This is exactly what is happening. China is growing slowly. The outcome is that its GDP per capita, close to $8,000 (less than Botswana’s GDP per capita) will continue to remain at the levels typical of an underdeveloped country.
Europe is in shambles and things will get worse. The solution is for each country to go back to its own currency and keep the Euro for trading among EU members.
The situation in China and in Europe and the obsession of the administration for redistribution rather than growth (as the Europeans) will continue to depress the global economy.
These forces will cause inflation to decline. Good news for bonds. Bad news for  commodities. Good news for stocks.
More details in The Peter Dag Portfolio on www.peterdag.com

George Dagnino, PhD
Editor
The Peter Dag portfolio
Since 1977

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