Is China crashing?

[Naam]

China Vanke chair Wang Shi again warns of China housing bubble

" The average price of a home in China's 10 biggest cities, including Beijing and Shanghai, jumped 9.7 per cent from a year earlier to 17,202 yuan (HK$21,771) per square metre last month, up 1.1 per cent from April, SouFun said. The government called for higher down payments and interest rates for second-home mortgages in cities with "excessively fast" price gains and ordered stricter enforcement of taxes, in the latest measures announced at the beginning of March."

A Glut of Houses Hits Beijing Real Estate Market, Says Analyst.

Analysts are drawing comparisons between the possible trajectory of China’s housing market now to what Japan went through in the 1990s. In 1992 Japan saw the evaporation of 80 percent of the wealth in its real estate market, and the following year 21 banks declared $110 billion in bad debts, a third of it related to property. Housing prices were cut in half.

Gentlemen... take your pick!

[Naam]

"the bigger the housing bubble, the harder the fall” he said.

hats off for a true genius!

[Naam]

[trogers]

"the bigger the housing bubble, the harder the fall” he said.

hats off for a true genius!

Cow sense can be lacking from time to time, esp during formative years of bubbles. Recall the days of the Internet bubble and the financial crash of 2008? Geniuses were the ones who jumped off the game early.

[aussiebebe]

I don't have a clue whether China is crashing or not but I am aware that news reports are frequently based on so-called experts with little to no knowledge of how China works. I watched a CNN report about China and they didn't interview a single Chinese person. They found a local property expert (American expat) who spoke about the Chinese housing bubble as if the homes were in the US, oblivious to how the Chinese property taxation system works. If the producers had hired a translator, the probably would have received more accurate information for a laborer on one of the building sites.

[Naam]

"the bigger the housing bubble, the harder the fall” he said.

hats off for a true genius!

Cow sense can be lacking from time to time, esp during formative years of bubbles. Recall the days of the Internet bubble and the financial crash of 2008? Geniuses were the ones who jumped off the game early.

the warning from geniuses concerning a potential China crash will not help the average private investor. he can't jump off because he is not invested in China but a crash in China will most probably affect the value of his assets in a negarive way too, no matter in what country or asset class he is invested.

geniuses, as far as the internet bubble or the 2008 crash are concerned, were not those who jumped off early, they were just lucky. the real geniuses did not "jump on" in the first place.

[trogers]

"the bigger the housing bubble, the harder the fall” he said.

hats off for a true genius!

Cow sense can be lacking from time to time, esp during formative years of bubbles. Recall the days of the Internet bubble and the financial crash of 2008? Geniuses were the ones who jumped off the game early.

the warning from geniuses concerning a potential China crash will not help the average private investor. he can't jump off because he is not invested in China but a crash in China will most probably affect the value of his assets in a negarive way too, no matter in what country or asset class he is invested.

geniuses, as far as the internet bubble or the 2008 crash are concerned, were not those who jumped off early, they were just lucky. the real geniuses did not "jump on" in the first place.

Sorry to defer. Those who did not jump in are just neutrals, observers along the side. An investor who jumped in near the bottom of a propery cycle (like Warren Buffett) would still have to have jumped in. Like Warren had said, the time to get out is when the everyone else is rushing in. That's why he is a genius.

[Naam]

the warning from geniuses concerning a potential China crash will not help the average private investor. he can't jump off because he is not invested in China but a crash in China will most probably affect the value of his assets in a negarive way too, no matter in what country or asset class he is invested.

geniuses, as far as the internet bubble or the 2008 crash are concerned, were not those who jumped off early, they were just lucky. the real geniuses did not "jump on" in the first place.

Sorry to defer. Those who did not jump in are just neutrals, observers along the side. An investor who jumped in near the bottom of a propery cycle (like Warren Buffett) would still have to have jumped in. Like Warren had said, the time to get out is when the everyone else is rushing in. That's why he is a genius.

facts talk, bullsh.. walks

please elaborate why the genius' assets lost nearly half of their value during the 2008 crisis even till the end of 2009 when most other assets had already fully recovered and why it took four full years just to recover these losses.

[trogers]

the warning from geniuses concerning a potential China crash will not help the average private investor. he can't jump off because he is not invested in China but a crash in China will most probably affect the value of his assets in a negarive way too, no matter in what country or asset class he is invested.

geniuses, as far as the internet bubble or the 2008 crash are concerned, were not those who jumped off early, they were just lucky. the real geniuses did not "jump on" in the first place.

Sorry to defer. Those who did not jump in are just neutrals, observers along the side. An investor who jumped in near the bottom of a propery cycle (like Warren Buffett) would still have to have jumped in. Like Warren had said, the time to get out is when the everyone else is rushing in. That's why he is a genius.

facts talk, bullsh.. walks

please elaborate why the genius' assets lost nearly half of their value during the 2008 crisis even till the end of 2009 when most other assets had already fully recovered and why it took four full years just to recover these losses.

Berkshire Hathaway.jpg

His genius is not in the valuation of any particular asset at a point in time. His genius is in the difference between the price he acquired and the price he sold.

How many fund management received high valuations near a peak and then gone bust in a fall?

[trogers]

I don't have a clue whether China is crashing or not but I am aware that news reports are frequently based on so-called experts with little to no knowledge of how China works. I watched a CNN report about China and they didn't interview a single Chinese person. They found a local property expert (American expat) who spoke about the Chinese housing bubble as if the homes were in the US, oblivious to how the Chinese property taxation system works. If the producers had hired a translator, the probably would have received more accurate information for a laborer on one of the building sites.

Taxation on property probably adds little to the crisis at this stage. Here is a local chinese news clip with english translation that may provide you more accurate state of affairs in China:

[yoshiwara]

the warning from geniuses concerning a potential China crash will not help the average private investor. he can't jump off because he is not invested in China but a crash in China will most probably affect the value of his assets in a negarive way too, no matter in what country or asset class he is invested.

geniuses, as far as the internet bubble or the 2008 crash are concerned, were not those who jumped off early, they were just lucky. the real geniuses did not "jump on" in the first place.

Sorry to defer. Those who did not jump in are just neutrals, observers along the side. An investor who jumped in near the bottom of a propery cycle (like Warren Buffett) would still have to have jumped in. Like Warren had said, the time to get out is when the everyone else is rushing in. That's why he is a genius.

facts talk, bullsh.. walks

please elaborate why the genius' assets lost nearly half of their value during the 2008 crisis even till the end of 2009 when most other assets had already fully recovered and why it took four full years just to recover these losses.

Berkshire Hathaway.jpg

His genius is not in the valuation of any particular asset at a point in time. His genius is in the difference between the price he acquired and the price he sold.

How many fund management received high valuations near a peak and then gone bust in a fall?

That is not the key to what Buffet in particular is about.

[Chao Lao Beach]

This would = WW3

http://www.nationmultimedia.com/opinion/Prepare-for-a-new-gold-standard-30212197.html

[Naam]

His genius is not in the valuation of any particular asset at a point in time. His genius is in the difference between the price he acquired and the price he sold.

How many fund management received high valuations near a peak and then gone bust in a fall?

we were discussing an anal-yst's opinion about a potential property China crash.

you came up "genius Buffet knew when to get out".

i asked why did he lose half the value of his assets' value in 2008/2009 (by the way in 2000 he lost big too!) if he "knew when to get out".

now you are sidestepping and presenting the yada yada yakety-yak version "a genius knows to buy low and sell high" as well as an irrelevant question concerning "other fund managers".

oh well...

[midas]

is this good or bad...........?

Skyscraper Index Alert: 87% of World's Skyscrapers Being Built in China

Skyscraper City will be the world's tallest building if it is built according to plans (the other building is the Dubai tower). It will be built in record time, 4 months versus 410 days for the current record holder, the Empire State Building.

87% of skyscrapers being built in China, and 10 out of the 20 tallest buildings are in China. If all of the planned buildings are constructed, in the next 3 years, on average a skyscraper will be completed every 5 days. Five years from now, there will be more than 800 skyscrapers, 4 times the amount of skyscrapers currently in the U.S.

http://investinginchinesestocks.blogspot.com/2013/08/skyscraper-index-alert-87-of.html

Edited August 11, 2013 by midas

[Naam]

is this good or bad...........?

Skyscraper Index Alert: 87% of World's Skyscrapers Being Built in China

bad for the sky if scraped too much.

[trogers]

His genius is not in the valuation of any particular asset at a point in time. His genius is in the difference between the price he acquired and the price he sold.

How many fund management received high valuations near a peak and then gone bust in a fall?

we were discussing an anal-yst's opinion about a potential property China crash.

you came up "genius Buffet knew when to get out".

i asked why did he lose half the value of his assets' value in 2008/2009 (by the way in 2000 he lost big too!) if he "knew when to get out".

now you are sidestepping and presenting the yada yada yakety-yak version "a genius knows to buy low and sell high" as well as an irrelevant question concerning "other fund managers".

oh well...

I do not know if you are equating a fall in the values of held assets as a loss. One will only lose if one sold the assets at a loss.

If I buy a property and hold it through a few cycles, I will see falls and rises in valuations, but they will not mean a thing to me until I sell it at a particular price.

[jbrain]

is this good or bad...........?

Skyscraper Index Alert: 87% of World's Skyscrapers Being Built in China

Skyscraper City will be the world's tallest building if it is built according to plans (the other building is the Dubai tower). It will be built in record time, 4 months versus 410 days for the current record holder, the Empire State Building.

87% of skyscrapers being built in China, and 10 out of the 20 tallest buildings are in China. If all of the planned buildings are constructed, in the next 3 years, on average a skyscraper will be completed every 5 days. Five years from now, there will be more than 800 skyscrapers, 4 times the amount of skyscrapers currently in the U.S.

http://investinginchinesestocks.blogspot.com/2013/08/skyscraper-index-alert-87-of.html

They build them on the ground then pull them up, saves a lot of time and money on cranes.

[midas]

is this good or bad...........?

Skyscraper Index Alert: 87% of World's Skyscrapers Being Built in China

Skyscraper City will be the world's tallest building if it is built according to plans (the other building is the Dubai tower). It will be built in record time, 4 months versus 410 days for the current record holder, the Empire State Building.

87% of skyscrapers being built in China, and 10 out of the 20 tallest buildings are in China. If all of the planned buildings are constructed, in the next 3 years, on average a skyscraper will be completed every 5 days. Five years from now, there will be more than 800 skyscrapers, 4 times the amount of skyscrapers currently in the U.S.

http://investinginchinesestocks.blogspot.com/2013/08/skyscraper-index-alert-87-of.html

They build them on the ground then pull them up, saves a lot of time and money on cranes.

[Gumballl]

neversure your patriotism towards your country is admirable but you really should take off your rose tinted glasses

28% of Americans have no emergency savings

Nearly Half Of Americans Have Less Than $500 In Savings: Survey

Sad, and more than likely true. However, unlike other countries, credit is easily obtainable in the US, and with savings interest rates at an all-time low, there's no incentive to save cash in the bank. It would be worth less tomorrow than it is today.

[Naam]

His genius is not in the valuation of any particular asset at a point in time. His genius is in the difference between the price he acquired and the price he sold.

How many fund management received high valuations near a peak and then gone bust in a fall?

we were discussing an anal-yst's opinion about a potential property China crash.

you came up "genius Buffet knew when to get out".

i asked why did he lose half the value of his assets' value in 2008/2009 (by the way in 2000 he lost big too!) if he "knew when to get out".

now you are sidestepping and presenting the yada yada yakety-yak version "a genius knows to buy low and sell high" as well as an irrelevant question concerning "other fund managers".

oh well...

I do not know if you are equating a fall in the values of held assets as a loss. One will only lose if one sold the assets at a loss.

If I buy a property and hold it through a few cycles, I will see falls and rises in valuations, but they will not mean a thing to me until I sell it at a particular price.

we were discussing "geniuses who know when to get out". you mentioned one of these geniuses. i proved with facts that he obviously did not know when to get out.

personal opinion: the mantra "you only lose when you sell at a loss" is considered an utmost ridiculous one by an active investor who does not wait years betting on a potential value recovery which might or might not happen and twiddle his thumbs in the meanwhile.

case closed as far as i am concerned. perhaps we should discuss football teams such as Manchester United or Dynamo Moscow where your knowledge most probably supersedes mine (because i have no idea of football).

[jbrain]

His genius is not in the valuation of any particular asset at a point in time. His genius is in the difference between the price he acquired and the price he sold.

How many fund management received high valuations near a peak and then gone bust in a fall?

we were discussing an anal-yst's opinion about a potential property China crash.

you came up "genius Buffet knew when to get out".

i asked why did he lose half the value of his assets' value in 2008/2009 (by the way in 2000 he lost big too!) if he "knew when to get out".

now you are sidestepping and presenting the yada yada yakety-yak version "a genius knows to buy low and sell high" as well as an irrelevant question concerning "other fund managers".

oh well...

I do not know if you are equating a fall in the values of held assets as a loss. One will only lose if one sold the assets at a loss.

If I buy a property and hold it through a few cycles, I will see falls and rises in valuations, but they will not mean a thing to me until I sell it at a particular price.

we were discussing "geniuses who know when to get out". you mentioned one of these geniuses. i proved with facts that he obviously did not know when to get out.

personal opinion: the mantra "you only lose when you sell at a loss" is considered an utmost ridiculous one by an active investor who does not wait years betting on a potential value recovery which might or might not happen and twiddle his thumbs in the meanwhile.

case closed as far as i am concerned. perhaps we should discuss football teams such as Manchester United or Dynamo Moscow where your knowledge most probably supersedes mine (because i have no idea of football).

With all respect, but I think a bond investor and an equity investor use different strategy's

http://cornys-moneypage.blogspot.com/2010/05/how-to-earn-900-each-minute-with.html

A smart person came all the way from Omaha, Nebraska to offer Goldman Sachs 5 Billion US-$ in exchange of a favorable offer. He even gets the option for giving Goldman Sachs another 5 billion in exchange for these preferred stocks. These preferred stocks have been not only given to him and his company with a discounted price, they yield him each year with a 10% interest rate (or dividend).

10% from 5 Billion $ = 500 Million $ / 525.600 minutes (one year) = 951 $/minute

[Naam]

With all respect, but I think a bond investor and an equity investor use different strategy's

that might be true but is irrelevant to the former discussion.

[trogers]

His genius is not in the valuation of any particular asset at a point in time. His genius is in the difference between the price he acquired and the price he sold.

How many fund management received high valuations near a peak and then gone bust in a fall?

we were discussing an anal-yst's opinion about a potential property China crash.

you came up "genius Buffet knew when to get out".

i asked why did he lose half the value of his assets' value in 2008/2009 (by the way in 2000 he lost big too!) if he "knew when to get out".

now you are sidestepping and presenting the yada yada yakety-yak version "a genius knows to buy low and sell high" as well as an irrelevant question concerning "other fund managers".

oh well...

I do not know if you are equating a fall in the values of held assets as a loss. One will only lose if one sold the assets at a loss.

If I buy a property and hold it through a few cycles, I will see falls and rises in valuations, but they will not mean a thing to me until I sell it at a particular price.

we were discussing "geniuses who know when to get out". you mentioned one of these geniuses. i proved with facts that he obviously did not know when to get out.

personal opinion: the mantra "you only lose when you sell at a loss" is considered an utmost ridiculous one by an active investor who does not wait years betting on a potential value recovery which might or might not happen and twiddle his thumbs in the meanwhile.

case closed as far as i am concerned. perhaps we should discuss football teams such as Manchester United or Dynamo Moscow where your knowledge most probably supersedes mine (because i have no idea of football).

One, know your market, two, know at what point you are in the cycle, and three, know your time horizon.

I do not invest and twiddle my thumbs. I put out my hands and pick up my monthly income.

[Naam]

One, know your market, two, know at what point you are in the cycle, and three, know your time horizon.

[trogers]

This credit bubble in China is a chronic problem rather than an acute one. It’s going to be there for a period of years.

There is a cost and it’s going to manifest itself through, in the best scenario, substantially lower growth. In the worst case, it leads to more crisis-driven scenarios. In which case, China has so many weaknesses and so many fracture points that goodness knows how that could end up if you really start to see a systemic financial crisis. It’s simply too difficult to try to map out. You’re looking at capital flight, you’re looking at all sorts of worries about how that plays out. Again, it’s anybody’s guess.

http://www.theepochtimes.com/n3/238727-chinas-chronic-debt-problem-explained/

[NeverSure]

This credit bubble in China is a chronic problem rather than an acute one. It’s going to be there for a period of years.

There is a cost and it’s going to manifest itself through, in the best scenario, substantially lower growth. In the worst case, it leads to more crisis-driven scenarios. In which case, China has so many weaknesses and so many fracture points that goodness knows how that could end up if you really start to see a systemic financial crisis. It’s simply too difficult to try to map out. You’re looking at capital flight, you’re looking at all sorts of worries about how that plays out. Again, it’s anybody’s guess.

http://www.theepochtimes.com/n3/238727-chinas-chronic-debt-problem-explained/

Good article. Out take:

"Another point: China is the miracle economy, isn’t it? The answer is no, it’s not. So much of the recent growth has been built on debt. There is no secret formula: they borrowed excessively to get short term GDP figures."

[midas]

This credit bubble in China is a chronic problem rather than an acute one. It’s going to be there for a period of years.

There is a cost and it’s going to manifest itself through, in the best scenario, substantially lower growth. In the worst case, it leads to more crisis-driven scenarios. In which case, China has so many weaknesses and so many fracture points that goodness knows how that could end up if you really start to see a systemic financial crisis. It’s simply too difficult to try to map out. You’re looking at capital flight, you’re looking at all sorts of worries about how that plays out. Again, it’s anybody’s guess.

http://www.theepochtimes.com/n3/238727-chinas-chronic-debt-problem-explained/

Good article. Out take:

"Another point: China is the miracle economy, isn’t it? The answer is no, it’s not. So much of the recent growth has been built on debt. There is no secret formula: they borrowed excessively to get short term GDP figures."

yes good article but you have to concede there is no difference in this between China and USA? In fact one slight advantage China has is that it is not considered an " entitlement society " which America is very much turning into? At least in China, they have no expectations of " someone else " supporting you and they will work until they die if they have to.

.

[Naam]

Is China crashing?

nobody knows!

[lovetotravel]

yes good article but you have to concede there is no difference in this between China and USA? In fact one slight advantage China has is that it is not considered an " entitlement society " which America is very much turning into? At least in China, they have no expectations of " someone else " supporting you and they will work until they die if they have to.

.

I just saw a TV show on the problems China's aging population is having. As you know, here in Asia, children support their parents. With China's "one child" policy, men are now faced with the prospect of having to support not only their parents but also his wife's, and the children they have. Very daunting for a young man.

This show featured a park where older parents are out marketing their children, trying to find the best one and to help secure their future. It was crazy to watch. Questions about what do you do, who are your parents, etc. Reminded me of dating back in the US! 55555

[lovetotravel]

Another interesting article:

http://www.nytimes.com/2013/08/16/business/global/easy-credit-dries-up-crippling-chinese-cities.html

SHENMU, China — As the Chinese economy boomed, few cities soared faster or higher than Shenmu, a community of nearly 500,000 in northwestern China.

Top luxury clothing stores in this city’s downtown were recording as much as $500,000 a day in sales. Tables at the best restaurants had to be reserved weeks in advance. The new Fortune Garden Club for the city’s business elite made headlines by paying $1 million for a king-size mahogany bed, to be used by members and their companions.

But a painful credit crisis is now spreading across Shenmu and cities nearby, as thousands of businesses have closed, fleets of BMWs and Audis have been repossessed and street protests have erupted.

Now the leading purveyors of Western fashions are deserted, monthly sales at restaurants are down as much as 97 percent and the marble entrance to the Fortune Garden Club is shuttered. All but one of the city’s car dealerships have failed.

Doesn't sound good. And hard to know what's really going on due to the censorship of the news.