And even though we have previously reported [6]on the woes ailing the world's largest seller of bulldozers, excavators and wheel loaders, such focus was primarily targeted in the offshore markets, and especially China (the abysmal European market needs no mention). So maybe the time has come to shift attention to the US, where as Caterpillar just reported, not only are all foreign markets still trending at several impacted levels, but where US machine retail sales just saw the biggest tumble in three years, falling 18% Y/Y: the most since early 2010. What is more disturbing is that CAT equipment is used in far-broader economic activities than merely housing, and likely is a far more accurate indicator of true industrial end-demand than any other number cherry-picked by the government.
[7]
Whether one can extrapolate general trends in the US economy based on how Caterpiller is doing in its North American market, is an open-ended (rhetorical) question which we leave to readers.
However, maybe a far better question is whether CAT NA sales is the same true proxy for the state of the US economy, as electric consumption - that Achilles heel of Chinese economic data manipulation - is to China.
Compare and contrast the chart above, with the chart below, showing the collapse in Chinese electricity consumption.
[8]
If the answer is yes, and if indeed both the US and Chinese economies are now operating at a true level not seen since 2010, then just how bad is the rest of the world, if somehow the US continues to be perceived as the cleanest dirty shirt while the world's fastest marginal growing economy is in fact, crashing to earth?
