Digging Through China's Macro Data

Chen Jianguang says a rise in electricity was mainly due to hot weather and a favorable year-on-year comparison, while industrial production was slowed by floods, and the drop in fixed asset investment is being affected by the collapse in Liaoning.

In contrast, with the exception of Liaoning Province, other provinces this year, investment in fixed assets in the local government fiscal stimulus force in the background, growth has rebounded. From a national point of view the overall situation, Liaoning abnormal sample data disturb the overall trend in other provinces, excluding Liaoning Province sharply negative growth, investment in fixed assets in the second quarter (except Liaoning Province) remained relatively stable, from this perspective, fixed asset investment data, or in the role of steady growth measures, there are signs of stabilization.

As said here many times, if Liaoning is a nisolated case then lean bullish on China. If it is a harbinger, look out.

Finally, Chen claims some of the slowdown in credit is due to debt-for-equity swaps:

In addition, the July credit data is also worth attention. July of RMB loans increased by 463.6 billion yuan, up by 1.01 trillion yuan less. Among them, non-financial enterprises and government agencies and organizations loans decreased $ 2.6 billion in the household sector loans increased 457.5 billion yuan. If you press this data, the current real economy is almost no demand for credit indicates that economic activity is very weak. But in fact, I believe that the interpretation of the data need to consider the credit impact of government debt replacement, replacement of government debt this year, more than 5 trillion, trillion 4000-5000 average there, and the monthly amount of displacement fluctuations. Taking into account local government debt exchange on monthly credit data, expected in July as credit conditions will not necessarily show negative growth is so negative.

Caijing: 沈建光：中国宏观数据“打架”之谜

Another article looks at declining investment versus rising PMI. In notes the divergence between the PMIs for large firms (red) and SMEs (blue)

It also shows SME confidence still weak:

The conclusion is the economy remains weak:

If the above inference holds true, then the supply contraction force pushing up the growth rate of added value of industrial enterprises above designated size statistics show, we observed production data being exaggerated. This means that the current strong above scale industrial added value increased speed may also overestimate the overall state of the economy. in other words, the decline of investment data do reflect the weak demand for the real economy, and we observed production data may be some exaggeration. it is possible that economic production and demand data partly due to deviation. "Shun said.

Caijing: 投资不断下滑与生产逆势走高 谁才是中国经济的真相？