Headlines increasingly showing Chinese slowdown

Because i'm thinking alot about the slowdown in China, i pay extra attention to the headlines about the 2nd largest economy in the world. Recently they are increasingly worrysome. I haven't been able to come up with a good strategy to approach this weakness. But i already wanted to share some of the recent articles that are making me think hard about trading ideas.

Some articles may need some explanation. For example that Mercedes is selling it's cars at a discount may appear to be especially bad news to Mercedes but it is also a sign that they need to do this to keep demand up. The same thing with Prada and then there is the Goldman and Sachs article, they are missing out on IPO's over there. Now, thing is they have a reputation for being on the right side of deals, they reveal in the article that they are largely staying out of the Chinese IPO market because of the risk of underwriting. Meaning they are stuck with shares. Including the massive fees this tends to be a very profitable business but they are deeming this risk so severe that they are forgoing them.

http://www.bloomberg.com/news/2011-12-16/china-s-stocks-head-for-biggest-weekly-drop-in-17-months-on-export-outlook.html

http://www.bloomberg.com/news/2011-12-16/mercedes-leads-luxury-car-discounts-in-china.html

http://www.bloomberg.com/news/2011-12-16/prada-poised-to-extend-slump-as-china-s-shoppers-cut-back-spending-retail.html

http://mpettis.com/2011/12/how-do-we-know-that-china-is-overinvesting/

http://www.forbes.com/sites/china/2011/05/20/chinas-auto-industry-shows-signs-of-impending-gridlock/

http://www.bloomberg.com/news/2011-12-13/goldman-cautious-on-china-deals-losing-out-on-busiest-ipo-market.html

Category: bubble , china , economy , overinvesting , slowdown , slump , stalling