The present stock market optimism is based on a very benign view of the world. The US economy continues to add jobs, although not as many as it should. Greece’s negotiations with its private creditors are going well and they will work out a deal to avoid default. Or at least that is what we are told to say nothing about increasing problems in Portugal and Spain. The emerging markets have been growing rapidly with Egypt up 25%, Hungary up 21% and Turkey up 21%. Perhaps surprising considering Egypt’s political upheaval, Hungary’s debt levels and Turkey’s double digit inflation.

But the best news is from China, where the official Purchasing Managers’ Index (PMI) was 50.5 in January, beating analysts’ expectations of 49.5. Of course the government figures were contradicted by a private-sector version of the survey put out by HSBC. Its number was 48.8 which indicates a slight contraction and was unchanged from December. What is more interesting than the Chinese government’s PMI fudge is that the statistics bureau decided not to publish figures on investment and other activity in January due to “distortions related to the national week-long holiday.” Were they that bad?

Despite all of these encouraging numbers demonstrating an improving picture for the global economy; it might be a good idea to look a little deeper into the earnings reports for the 4^th quarter. Since the crash of 2008 the developing world has experienced slow or no growth. The recovery was helped by the massive stimulus in China and insanely accommodative central banks in developed countries. This wall of money helped China and most emerging markets achieve robust growth while the developed world stagnated.

It was not only the emerging market economies, especially those in Asia, which grew. Many of the US’s largest companies grew with them. Although their revenue growth in Europe and the US remained anemic, many of them racked up double digit growth in Asia and other developing markets. This has gone on quarter after quarter until now. Apparently in this reporting season there are definite signs that things are changing.

Siemens the giant German industrial company makes everything from wind turbines to medical diagnostic equipment. Considering the problems in Europe, it would be considered natural if Siemens’ sales slowed, but the problem was not in Europe. New orders from China slowed by 16%. While Siemens’ chief financial officer, Joe Kaeser, acknowledged that “there had been a “clear slowdown” in China”, he was quick to reassure investors that things “in China could actually brighten in the second half.”

Siemens was not the only large company to experience problems in Asia. Eaton, the US manufacturer of industrial equipment and components for trucks and aircraft had problems too. Their sales have been hit by the slowdown in Chinese construction. Eaton’s CEO, Sandy Cutler, was not fazed. He told analysts that he still expected economic growth would still be faster in emerging economies such as China and India.

The American manufacturer 3M had similar problems. Its chief executive said: “Our China team anticipates continued below-trend growth in the first half of 2012.” United Technologies, the manufacturer of Otis elevators had the same experience for its sales in China, which slowed by 7% in the fourth quarter. While the Swedish-Swiss power and automation company ABB’s orders dropped 5% due to weaker demand for its power systems in China.

The problems are not limited to manufacturing companies. The largest US chemical company DuPont also had issues. Their sales in the Asia-Pacific region fell by 23% in the fourth quarter of 2011. The management of UPS ascribed the slower global growth to Europe, but also acknowledged that Asia-to-U.S. package volume slipped 3% and that it had reduced its Asia-to-U.S. capacity by about 10% because of the lower demand.

Certain parts of the automotive sector have also been hit by a slowdown in Asia. The commercial vehicles group, Volvo, warned last summer that Chinese demand for construction equipment fell, but of course they assured investors that it was just ‘temporary’. Ford experienced declining sales in both Europe and Asia as did Johnson Controls Inc, a US auto parts manufacturer.

Not all car companies had problems. Luxury brands like BMW and Volkswagen’s Audi had record breaking sales. Like the 35% rise in gambling revenues in Macau, these sales might represent instability and corruption. But even these might have problems. Wynn Macau just reported slower growth.

One US company, Caterpillar, also saw a drop in sales in China, but the stock still has risen 20% in January. Part of the expectation is Caterpillar can profit from sales in the US although those are still only 50% of their peak in 2006. The other bright spot for the company are sales to mining companies who look forward to booming demand for their commodities in, you guessed it, China.