09-19-2021, 08:01 AM
[quote pid='28737' dateline='1632050636']
My reading on RIO brought me to this issue as well. Some believe the housing weakness in China is more responsible for the iron ore price weakness than the climate change emissions reductions promise.
[/quote]
That sounds very plausible. Large financial meltdowns cause numerous large ripples. Among many other industries steel and copper demand would be affected for some time. Multiple mine slow downs in face of lower prices. Those mining shovels are connected directly to the power grid so if they slow down the local utility's earnings just dipped several percent. A single RIO mine might keep 100 CAT workers employed when it's booming. When we get reckless with finances in a major economy it just trickles all over the place and hurts people. Then we have an election and try some new tricks.
How was that for heading off on a tangent? A single economic powerhouse has a problem and people all over the globe can be affected. I don't miss recessons. I sure am glad the US has cancelled them from now on.
Seriously though, China can probably print their way out of this mostly. It's likely to cause them to interfere in markets more though. Just like we did during the GFC.
BTW, ALE, that one utility stock I trade is possibly hurt some by the China debacle as they supply the Minnesota iron ore miners.
My reading on RIO brought me to this issue as well. Some believe the housing weakness in China is more responsible for the iron ore price weakness than the climate change emissions reductions promise.
[/quote]
That sounds very plausible. Large financial meltdowns cause numerous large ripples. Among many other industries steel and copper demand would be affected for some time. Multiple mine slow downs in face of lower prices. Those mining shovels are connected directly to the power grid so if they slow down the local utility's earnings just dipped several percent. A single RIO mine might keep 100 CAT workers employed when it's booming. When we get reckless with finances in a major economy it just trickles all over the place and hurts people. Then we have an election and try some new tricks.
How was that for heading off on a tangent? A single economic powerhouse has a problem and people all over the globe can be affected. I don't miss recessons. I sure am glad the US has cancelled them from now on.
Seriously though, China can probably print their way out of this mostly. It's likely to cause them to interfere in markets more though. Just like we did during the GFC.BTW, ALE, that one utility stock I trade is possibly hurt some by the China debacle as they supply the Minnesota iron ore miners.