Make No Doubt About It - Chinese And Global Manufacturing Are Slumping!

Posted yesterday: China's Steel Industry Slows Down

On CNBC news, Chinese Industry Slumps as PMI Hits Record Low

• The downturn in China's manufacturing sector gathered pace last month as falls in new orders and production drove the official purchasing managers' index (PMI) to a record low
  
  The index, which is based on a survey of industrial firms across China, fell to 38.8 in November from 44.6 in October, the China Federation of Logistics and Purchasing (CFLP) said on Monday.
  
  The index is designed to give a timely snapshot of the state of the manufacturing sector, which has been a major driver of China's headlong economic growth in recent years.
  
  A reading over 50 indicates an expansion of activity in the manufacturing sector, while one below 50 suggests a
  deterioration.
  
  "November's PMI shows that the Chinese economy is slowing down at an accelerating rate. The signs of economic contraction are more evident," said Zhang Liqun, a government economist who comments on the survey for the logistics federation.
  
  Zhang said the government had taken many aggressive steps to counter the slowdown, but these would take time to have an impact.
  
  "China's economy will bounce back to a comparatively high growth rate in the spring of 2009 as the effects of the various measures show through," he added.

And Dr. Marc Faber says that China's stimulus package won't work. See video clip here: http://www.cnbc.com/id/15840232?video=945548876

And the manufacturing slowdown is not only a Chinese problem!

On Bloomberg news: U.S. Economy: Manufacturing Shrinks Most in 26 Years

• Dec. 1 (Bloomberg) -- American manufacturing contracted in November at the steepest rate in 26 years, leading Europe and Asia into an industrial slump as a recession that began in the U.S. in December 2007 spread around the globe.
  
  The Institute for Supply Management’s factory index dropped to 36.2, below economists’ forecasts, and its gauge of raw- material costs plunged to the least in six decades, intensifying concern over deflation. The Tempe, Arizona-based group’s report came as factory indexes in China, the U.K., euro area, and Russia all fell to record lows.
  
  The U.S. entered a recession a year ago this month, according to a declaration today by the National Bureau of Economic Research panel that dates American business cycles. The economic slowdown and decline in inflation are putting pressure on policy makers to keep lowering interest rates and boost stimulus plans.
  
  “This downturn in the global economy is probably more synchronized than we have ever seen,” said Jonathan Basile, an economist at Credit Suisse Holdings in New York. Policy makers should “open the flood gates” for more action, he said.
  
  Stocks worldwide tumbled and yields on U.S. Treasury securities fell to the lowest ever on concern a lack of financing will stunt consumer and business spending.
  
  The ISM index was projected to drop to 37, according to the median of 61 economists’ forecasts in a Bloomberg News survey. Estimates ranged from 33.5 to 40. A reading of 50 is the dividing line between expansion and contraction.

And the possible suggestion is that..

• “The U.S. manufacturing report made it clear it’s going to take a while before we get out of this recession,” Mamoru Shimode, chief equity strategist at Deutsche Bank AG, said in an interview with Bloomberg Television. “The stronger yen will directly hit Japanese manufacturers’ earnings, and their stocks are likely to lead declines in the Tokyo market today.” (Source: here )