Hello, View fans! Here are your morning links.
China decides to let some of its economic statistics show something other than spectacular, cartoonish growth.
Just about every piece of economic data that comes out of China should be viewed with great skepticism. Generally the government shows people whatever numbers it wants them to see. So it’s anyone’s guess what it means when we see a news report about China’s Purchasing Managers’ Index that says this: “A Chinese manufacturing gauge fell to a six-month low in January as output and orders slowed, adding to signs that government efforts to rein in excessive credit will cool growth in the world’s second-largest economy.” This could mean things are merely slowing down. Or maybe they’re getting a lot worse fast. Take your pick.
Dr. Doom talks turmoil, perfect storms, the Fragile Five, etc.
Nouriel Roubini has a good primer about what ails emerging markets after the Federal Reserve’s decision to start cutting back on bond purchases. It’s especially good reading for anyone who hasn’t been paying much attention to what’s been happening in India, Indonesia, Brazil, Turkey and South Africa and wants to get up to speed: “The short-run policy tradeoffs that many of these countries face -- damned if they tighten monetary and fiscal policy fast enough, and damned if they do not -- remain ugly. The external risks and internal macroeconomic and structural vulnerabilities that they face will continue to cloud their immediate outlook. The next year or two will be a bumpy ride for many emerging markets, before more stable and market-oriented governments implement sounder policies.”
One more goodbye to Ben Bernanke now that his Fed term is over.
This comes from Stanford University economics professor John Taylor, who recently was getting so many requests from reporters for quotes about monetary policy during Bernanke’s tenure that he decided to sum up his thoughts in a blog post for everyone to see. Here’s what Taylor said about quantitative easing: “The economy has grown slowly with QE compared with past recoveries without QE and far short of the Fed’s predictions. Many argue that QE has not reduced unemployment, but has diminished the Fed’s independence and credibility, offsetting the effects of adopting a numerical inflation target. Now, only a year after the latest round of QE began, the Fed is struggling with how to unwind it, just as many had warned.”
Italy’s Intesa Sanpaolo SpA may set up an internal “bad bank.”
This probably has more to do with public relations than anything else. The strategy would be to encourage investors to focus on Intesa’s strengths -- and create the impression that the bank’s nonperforming loans are under control, even though they haven’t left the bank’s balance sheet. The Financial Times says the move is triggering a debate in Italy about whether the whole country needs a state-sponsored bad bank.
The fluffy feline Internet sensation with the scowling face, who once served as the chief executive officer of Buzzfeed and also held the world record for the cat with the longest fur, has died. He was 2 years old. “Although his life was short, Colonel Meow was well on his way to achieving world domination,” writes Laura Moss of Mother Nature News. Buzzfeed paid tribute.
(Jonathan Weil is a Bloomberg View columnist. Follow him on Twitter.)
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