Sunday, December 12, 2010
...And, on Asia slowing.
We dug through some global economic data and noticed some worrying trends in Asia. The inventory-to-shipments (I/S) ratios for Korea and Taiwan have been on a steady rise since early this year. Korea’s I/S ratio is now at the highest level since March 2009 as inventories surged to two-year highs. In Taiwan, the I/S ratio is hovering near one-year highs and inventories are also near-two year highs. Given that both these countries are export-intensive, it makes us worry about global demand and the lofty GDP forecasts penciled in for 2011 by analysts (currently at 4.2% for real GDP in 2011) --- Op Cit