British investors may be forgiven for not noticing, but the world economy is actually performing quite well at the moment.
The Chinese numbers are always open to some doubt but, at least officially, the current reading is just under 7%. The US meanwhile, grew at an annualised 3% in the third quarter of this year. And the European Union grew at a healthy-enough 2.5% inside the Eurozone.
Outside, in scarcely-relevant post-Brexit Britain, it was a different story of course, as the effects of the Brexit devaluation have now come through in the latest inflation figures and the Bank of England has reluctantly been forced to respond by putting up interest rates. In turn, the housing market, that mainstay of artificially-boosted middle class wealth, is starting to slow, and things look bleak.
But for the UK’s investors, especially those that are already in the market, the outlook isn’t necessarily all bad.
At a conference held by specialist metals consultant CRU this week in London, the view put forward was that zinc might top out early next year, but that the outlook for nickel and especially copper is very good.
That’s nothing to do with the UK economy, of course, but everything to do with that wider pattern of global growth.
The burgeoning Chinese economy continues to suck in copper in massive quantities as industrialisation continues and, increasingly now, the middle classes support rising consumption of the metal in consumer goods and higher quality housing.
But with China the story of economic growth in the twenty-first century is less likely to be centred around the middle classes as it was for Europe and the US in the twentieth century. China approaches growth from a different perspective.
For a start, there’s the hackneyed view that the Chinese always plan everything strategically and take the long view - true, up to a point, and one reason why the Chinese were willing to pay over the odds for metals and mining assets at the height of the last boom.
It’s also why BHP Billiton reckons the One-Road, One-Belt strategy will increase global steel demand by an additional 150 mln tonnes.
But another reason the Chinese have been willing to pay over the odds is that the validity of western contract law is a matter of perspective there too. In a country where power resides in state-controlled industrial monoliths and not much of substance is actually truly owned by anyone, someone else’s signature on a piece of paper relating to assets that no-one owns bears little meaning.
Expensive lawyers can go to work for you if you were dispossessed of your asset in Indonesia, as Churchill Mining was some years ago, or in Portugal, as Murchison United was some years before that, or in Venezuela and Bolivia, where a host of miners have come a cropper over the years, or even in Russia, where the long arm of international law at least sees fit to reach into the murky world of Russian oligarchy.
But Russia needs the west to buy its oil. The west, on the other hand, needs China to make its cheap consumer goods and buy its expensive ones.
So China still manages to work the world in a different way to everyone else: in spite of all the bluster of President Putin and President Mugabe and the now late President Chavez, it’s really the only country left in the world which can make any claim to stand outside American and European financial hegemony.
Ironically, its huge reserves of US dollars help in that. And that’s not the only hedge the Chinese have against any stacking of the economic system against them.
There’s also gold. It’s routinely argued that in emerging markets the middle classes buy gold until they feel secure enough to invest in more sophisticated financial instruments. But with these instruments often conceived of and controlled by American and European interests, the incentives are less clear in China, where nationalism is rife. Chinese gold consumption increased by nearly 15.5% in 2017, with gold bars the favoured form of investment.
The Chinese will continue to buy dollars and they will continue to buy gold. But what they are really buying is influence.
At the moment though, no-one seems to mind. For one thing, attention is elsewhere: the western world’s moral compass going haywire as a fragmenting media indulges in frenzy after frenzy in desperate attempts to remain relevant. But for another, if the Chinese purchase of influence is also underpinning global growth, and in the absence of any alternative, it’s a price worth paying.