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Daily Archives: September 22, 2009

Michael Pettis on China

Michael Pettis, former investment banker, now professor at Peking University in China, talks about his view on China-US trade relations, China’s growth model and possibility of China diversifying away from the US dollar.

If you don’t know who Michael Pettis is, read my previous post on him.

(click on the graph for the video; source: FT)

Economic recovery is under way

Equity market may be overpriced, and is due for a correction in the near term. But the big-picture direction for the economy is on the way up.  This trend is very clear if you look at the Conference Board’s Leading Economic Indicator, LEI. 

LEI and GDP growth are highly correlated, with correlation ratio near 80%.