Is "Something Happening Here?"

[Kathianne]

http://money.cnn.com/2015/07/09/news/economy/warning-sign-latin-america-economy/index.html


The next domino to fall: Latin America By Patrick Gillespie (http://money.cnn.com/author/patrick-gillespie/index.html) @CNNMoney (https://twitter.com/intent/user?screen_name=CNNMoney)

Greece needs a bailout and China stock market is in meltdown mode (http://money.cnn.com/2015/07/07/investing/china-stocks-shanghai-crash/index.html?iid=SF_River). But the global economy has another rising red flag: Latin America.


Every major Latin American economy is slowing down or shrinking. The World Bank predicts this will be Latin America's worst year of growth since the financial crisis. As if that's not dire enough, the world's two worst performing stock markets are in the region as well.

And things could get even uglier later this year for Latin America, a region which is double the economic size of India.

"The weakness in Latin America is reflecting the weaker global outlook," says Win Thin, senior economist at Brown Brothers Harriman.

...

http://i2.cdn.turner.com/money/dam/assets/150708115232-latin-americas-economic-chart-780x439.jpg

[SassyLady]

Yes.

This is way off base....but worth considering. When the majority of your population is either being murdered by cartels or leaving the country, there's not much reason, or resources, to maintain the GDP.

[indago]

This was yesterday...

http://i60.tinypic.com/90zo0m.jpg

We'll see what happens today...

[Kathianne]

This was yesterday...

http://i60.tinypic.com/90zo0m.jpg

We'll see what happens today...

Most markets today so far closed up. Futures are up.

[Kathianne]

Yes.

This is way off base....but worth considering. When the majority of your population is either being murdered by cartels or leaving the country, there's not much reason, or resources, to maintain the GDP.

It's difficult to say to what extent the relationship with China is a correlation or a cause. The CNN article points out some correlations, the following comes close to describing a 'colonial relationship':

http://www.bbc.com/news/world-33424532


...

Unequal relationship

"The imbalanced South American commodity-for-manufactures relationship with China has long caused some in the region to worry about a repeat of historical raw material 'dependency' relations," says Matt Ferchen who is a resident scholar at the Carnegie-Tsinghua Center for Global Policy.

While that leaves commodity-rich countries vulnerable when China's growth slows, countries further north have a slightly different relationship.

"In Mexico, the anxiety has been more focused on the trade imbalance and the challenge posed by China's manufacturing and export prowess to the American market," says Mr Ferchen.

In 2014, for every product Mexico exported to China, it imported 11 times that from the Asian giant.

"China has not only been a competitor, but an outright winner," says Prof Adrian Hearn, from the University of Melbourne. "China is able to out-price and outcompete Mexican businesses in just about every sector."

...

[tailfins]

http://money.cnn.com/2015/07/09/news/economy/warning-sign-latin-america-economy/index.html

That something is called socialism.

[fj1200]

That something is called socialism.

That doesn't explain 6.1% growth five years ago unless you're that socialism has increased since then.