Mixed Signals in China's Recovery

FINANCE
Mixed Signals in China's Recovery

China's industrial profits declined for the fourth consecutive month, dropping 7.3% in November year-on-year, reflecting continued pressure on corporate earnings despite Beijing's stimulus efforts. While less severe than October’s 10% drop and September’s 27.1% plunge, the figures highlight lingering challenges in China’s disinflationary environment, according to UOB’s Suan Teck Kin.

Industrial profits fell 4.7% from January to November compared to the previous year, with notable declines in mining (-13.2%) and manufacturing (-4.6%), though utilities posted a 10.9% profit rise. Foreign-invested firms saw profits dip slightly by 0.8% during this period.

Stimulus measures, including monetary easing, have yet to meaningfully revive key sectors, as weak consumer demand and a prolonged property downturn weigh on the economy. Recent data show mixed signals: manufacturing activity reached a five-month high in November, but consumer inflation and retail sales disappointed. The World Bank revised China’s 2024 growth forecast to 4.9%, citing policy adjustments, but warned that subdued confidence and the struggling property market remain significant headwinds.

NATURAL GAS
Trump Era Fuels Natural Gas Boom

Under the incoming Trump administration, America’s natural-gas industry is set for a significant transformation, shifting focus from extraction to building critical infrastructure. Toby Rice, CEO of EQT, the largest U.S. gas producer, champions a new mantra: “Build, Baby, Build.”

After years of regulatory barriers and low prices squeezing profits, the industry anticipates growth driven by a White House promising expedited approvals for liquefied natural gas (LNG) facilities and pipelines. Already the world’s top LNG exporter, the U.S. plans to launch multiple projects starting next year, with additional expansions slated through 2028.

While the Biden administration emphasized clean energy and warned of the environmental risks of unchecked exports, Rice and industry advocates argue that expanded LNG production can replace Russian gas in Europe and curb global coal dependence. Despite fears of overbuilding and potential market saturation, proponents highlight growing global demand as a chance for U.S. leadership in energy innovation.

With shifting political priorities and evolving market trends, America’s natural-gas sector is poised for considerable expansion. However, debates persist over its environmental footprint and economic implications, marking a pivotal moment for the industry and its role in global energy markets.

FINANCE
Financial Skills Boost Brain Health

Managing finances can benefit both your brain health and your wallet. A study by Binghamton University and the University of Alabama found a link between math skills and financial management. Using advanced imaging, researchers showed that regions of the brain tied to verbal retrieval were positively associated with financial ability. Practicing arithmetic and financial tasks may sharpen cognitive functions and reduce errors, says study co-author Ian McDonough.

Mental exercises like learning new skills, engaging in challenging activities, and maintaining healthy habits—such as proper sleep and diet—also contribute to brain sharpness and financial literacy. However, over-reliance on technology for budgeting or expense tracking may hinder cognitive engagement. McDonough warns that “use it or lose it” applies to brain health, emphasizing active financial skill practice.

Since financial errors can signal cognitive decline, staying mentally active and monitoring behavior is essential, especially as elderly adults are vulnerable to fraud. Balancing your budget ensures long-term financial and cognitive well-being.

DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.