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A Bird's Eye View Blog

Fireside Charts: Consumer Debt Skyrockets in China and Unprofitable IPOs Party Like it's 1999

By:BCM Investment Team | Date:Sep27, 2019 | Category: Equity, Economics, Market Highlights, Fireside Charts

Goldman Sachs analysts anticipate that less than 25% of companies going public in 2019 will net any income this year, and are expected to produce the lowest profits since the dot-com era two decades ago—despite raising a record amount of cash from their IPOs. Could a little Y2K-era anxiety be in order as well? Shale-oil output is on the rise in the top five U.S. basins as well completions tick up and more DUCs are brought online in the weeks following the attack in Saudi Arabia. Could this be a sign that the U.S. is inching more towards energy independence? And finally, short-term consumer loans have skyrocketed (and continue to grow exponentially) in China since 2005. The world's second-largest economy is already expanding at its slowest pace in roughly 25 years—could this accumulating debt be another bad omen for future economic growth? 

1. What happens when the music stops?


Source: Gavekal, as of 9/26/19



2. We have written about the DUCs phenomena several times. The U.S. has over 7,000 drilled but uncompleted wells that can bring new supply on line quickly if the price is "right." Has the attack in Saudi Arabia made the U.S. more energy independent?


Source: WSJ Daily Shot, as of 9/26/19



3. Perhaps this is why I keep feeling this market is like 1999...


Source: Bloomberg, as of 9/25/19



4. Three of the five largest economies are the most vulnerable to the trade war...


Source: Deutsche Bank Research, as of 9/26/19



5. Does China have its own burgeoning credit crisis?


 Source: The Wall Street Journal, as of 9/26/19



6. And now for something completely different:


 Source: WSJ Daily Shot, as of 9/26/19



7. A look at the world's carbon emissions:


Source: WSJ Daily Shot, as of 9/24/19



8. Thank you Greta Thunberg...


Source: The Economist, as of 9/5/19



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Disclosure: The charts and info-graphics contained in this blog are typically based on data obtained from 3rd parties and are believed to be accurate. The commentary included is the opinion of the author and subject to change at any time. Any reference to specific securities or investments are for illustrative purposes only and are not intended as investment advice nor are a recommendation to take any action. Individual securities mentioned may be held in client accounts.