Chinese Opera....Greek Drama Pales in Comparision

when you've taken the land away from the people who live on it, and provided something else for them to buy - you can called it forced capitalism.

but again - no-one mentions this trend and requirement for a roof when talking of the chinese economy.

you can't bunk with relatives forever.

 

China is going the way Japanese did in 1991.

Their GDP is actually growing somewhere in the 3-4% region, just look at the latest energy consumption growth figures which have only increased 0.8% in the last quarter.

PMI has also been in a downtrend past half year.

their stock market is finally going into a tailspin

despite all that, they are out in force buying up everything overseas, just like the Japanese did before Japan crumbled in 1991

 

one of the reasons why they want to buy overseas is because of volatility in their stock market [ which is still up about 100% in a yr!!]. High volatility is part of the game in developing markets; lots of money to be made or lost in very short amounts of time ; and also being a commy/authoritarian state- the govt can do pretty much anything they want with no public consultation and takes effect almost immediately.
contrast that to say Australian real estate- stable, no big volatility, proven long term performer, consistent and stable politics and government laws etc...

 

Except...
a difference in population by a factor of about 7
Much of the population still transitioning from rural to urban economy
Far more heterogeneous culture
Very different demographics
Central controlled government compared to liberal democracy
Access to internal and external energy sources through pipelines etc
An expanding military
etc, etc, etc

 

Interesting reading on the Shanghai Composite Index, up around 150% for the year and then down 30%.



China has been here before though

 

How's this Chinese stock chart...10% per day

 

10% a day is their cap on stock price movements. Markets over there are very leveraged and also very shady with lots of funding from shadow banking sources. they even have website that give you instant loans for leveraging into stocks.

The stock chart above is very typical for IPOs and other tech stocks doing PE multiples which would make any value investor cringe.

There is a huge divergence between aggregate company earnings which are shrinking and stock prices which have gone up to unsustainable levels. this gap has to close at some stage, and with the slowing economy, it is most likely stock prices will adjust downwards.

 

Interesting read to date.

Is China's lack of transparency assisting or hindering them.

 

Assists short term investors and politicians. Dissuades long term institutional investors.

 

Watch China....the Australian property market go to a new level if money leaves the sharemarket.....in particular Brissie and Melbourne Outer....

This does not bode well for OZ economically....but the silver lining is potentially lower interest rates.

 

greece is history and china is mystery

 

Yep, I agree. I'm quite sure money is gonna leave the shanghai and shenzhen bourse and they will look for safe non volatile and more transparent assets...like Australian real estate.

 

The Chinese investors are already hitting Brisbane CBD; I can only see this ramping up further in coming months.

 

Australian property will likely correct if the china stock crash contagion spreads to the chinese developers. They are going to have problems getting further funding from bond issues to continue buying and building in australia. Many could go bankrupt like the recent Kaisa case which was a big default on bonds they listed in the US market.

Chinese retail investors with margin accounts will also also feel the pain and wont be buying overseas anytime soon. more than a thousand stocks have been halted this week so there wont be any of that money flowing out of China either.

Compound that with the AUD downtrend and likely further pullback in the commodity sector affecting the local stock market here. Not a pretty picture.

 

Within the last 16 hours,more then 1300 companies have halted trading within Mainland China which equals about 40% of the value on the mainland,that's when everyone becomes vulnerable to other higher up the money chain who will determine what's left on the table as some investors wait years for what's about to happen over the next 16 weeks,and who comes out the other end with 20cents left in the back pocket,all the margin calls are long gone the next stage ,starts,.

http://www.bloomberg.com/news/artic...-hit-2-2-trillion-as-state-intervention-fails

 

This is true. I'm seeing more falun gong protesters outside king George square bus station...just like what used to happen in Melbourne 5 -7 years back...

 

Isn't a lot of the money here dirty? Can it even be safely brought home? If the whole point in the first place was to smuggle it out, I would think they'd want to keep it here.

 

A very informative article on the goings on with the Chinese Stock markets from Mark Beetson a Professor of International Politics at Uni of WA.

Hopefully none of it happens. It appears to indicate a takeover of the current CCP could possibly happen if things get real bad there.

http://propertyupdate.com.au/youre-...BlitzRss&utm_campaign=michaelsblogrecentposts

 

It's happening according to this article.

http://news.domain.com.au/domain/re...o-australian-real-estate-20150708-gi7hcv.html

 

TWELVE TIMES the GDP of Greece wiped off the Shanghai Composite in one week

Greece who?