@Brad_Setser: Chinese investment has stalled...

Chinese investment has stalled out in the third quarter. Real estate investment continues to fall, and infrastructure and manufacturing investment have stopped growing .... with one notable exception: autos

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Autos are an interesting sector for the global economy because the incremental Chinese production since 2018 has basically come from exports -- the domestic market has been around 25m cars for a while

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Vehicle exports will top 7.5m cars/ tracks this year -- and are on trajectory to reach 8-9m next year (massive scale) ... with a strong contribution from EVs and pug in hybrids in 2025

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ICEs and EVs/ NEVs are basically splitting the domestic market (ICE sales have stabilized at around 12m cars), which means a lot of China's 20-25m in EV production capacity is available for export

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The swing in China's net exports of autos is massive -- and so big that it should on its own lead the IMF to question its view that China's external surplus is only modest in size and not a major global policy concern ...

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And China's auto imports have basically fallen in 1/2 since 2021, and will be down to 0.5m cars this year (tiny v a domestic market of 25m cars). This chart alone explains much of Germany's current malaise ...

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Personally don't see how more balance can be brought into global trade by adjusting sectoral Chinese policies alone (China isn't going to stop adding auto export capacity ... )

But I gather @IMFNews isn't convinced (yet) that the exchange rate needs to play a role

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