Singapore GDP Implodes 11.5% in Quarter 1

I am somehow trying to twist this data out of Singapore as a semi-green shoot. I'll use the always ready bull excuse of "it can't get worse!" and then sprinkle in "it's backwards looking." Otherwise I'd be worried that this data confirms the Baltic Dry Index situation and says global trade is just a disaster - remember Singapore is a centerpiece for global shipping. [Mar 26: WSJ - Singapore's Boomtown Dream Gets Hazy]

But as we know, in this market where "beliefs / thesis" matter more than facts (at least the last 6 weeks), and the "all knowing Oracle like nature" of markets tell us things the human eye could never undersatnd- the stock market of Singapore is flying.

It takes real effort to drop 11.5% in GDP. If I were Singapore I'd suggest the "paper prosperity program" - it fixes everything. Just print oodles of currency, shuffle it in all directions and your -11.5% turns into -4%. Problem solved; someone send Greenspan over there to teach then how easy this can be fixed - there is no reason for this needless suffering. Paper it over.

Via FT.com

• Singapore’s trade-dependent economy contracted by a record 11.5 per cent in the first three months of 2009 from a year ago as non-oil exports fell 17 per cent in March, the 11th consecutive monthly decline.
• The-sharper-than-expected deterioration in the economy’s performance forced the government to cut its full-year GDP forecast from minus 6 per cent to minus 9 per cent, which would make it Singapore’s worst postwar recession and Asia’s worst economic performer this year. The economy contracted 4.2 per cent in the fourth quarter of 2008.
• Previously, the worst downturn in Singapore occurred in 2001 when the economy contracted by 2.4 per cent due to the bursting of the global technology bubble.
  
• Lee Kuan Yew, Singapore’s elder statesman, recently said that it could take as long as six years before the economy makes a firm recovery.

I wonder what Paul Volcker, America's elder statesman would say if you asked him off record. I doubt "in 6 months" or "1st quarter 2010" would be either of the two options. Hopefully, when Obama makes a trip to Singapore he does not take an iPod as a gift but instead brings them a currency printing press and that act alone should cut the time to recovery by half - see we just saved Singapore 3 years of pain. Magic.

• The latest data revealed the plunge in exports is slowing from a 35 per cent drop in January and 24 per cent in February. (2nd derivate improvement = less bad than horrid = green shoots emerging)
  
• But there are worries that the continued weakness in the US economy will hurt exports for the rest of the year. (ummmmm.... continued weakness in US economy? Have their policy makers NOT been watching CNBC? Recovery in 6 months anyone?)
• However, some economists argue that the dire figures for the first quarter suggest the economy has bottomed out and might start recovering or at least stabilise as the pace in the decline in exports slows. (Boo Yah! That's the spirit! "Can't get worse!")

To conclude

• Lee Hsien Loong, the prime minister, said: “The crisis will eventually pass, but we will not be back to the situation before 2007. This is therefore an opportune time for the government to review our policies and strategies.”

I am aghast that the citizens of Singapore are allowed to hear such commentary from heads of state. Apparently, unlike Tom Cruise - said citizens can indeed handle the truth.

[Aug 11, 2008: Singapore Exports to Decline as Asia Braces for Deeper Slowdown]