The Great Fall of China

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wazza
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The Great Fall of China

Post by wazza » August 25, 2015, 2:42 am

Not a bad summary of yesterdays Black Monday

took 2 years off my retirement plan :shock: :evil: :evil:

http://www.news.com.au/finance/markets/ ... 7497169731

:cry: :cry: :cry:



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pomps
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The Great Fall of China

Post by pomps » August 25, 2015, 3:25 am

Definitely not looking good for around the world,convert to Gold as longterm investment :-k

Am sure you have a few years before retirement and shares to be viewed as longterm,do not panic just yet 8)
Still a safer bet than ufun tokens ;)

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JimboPSM
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The Great Fall of China

Post by JimboPSM » August 25, 2015, 8:25 am

I just checked the Shanghai Composite and found that, despite all the hysteria, at its close last night it was still up 46% year on year – see red rectangle in Bloomberg chart below:
The last year has seen a fairly large bubble in the Chinese stock market and it is going through a painful market correction.

For those in the west who may be unfamiliar with what is happening in China, it is simply the result of a rather weird economic system that China has copied from the west called capitalism :-k

The only real surprise is that anyone with a knowledge of capitalism, a functioning brain and critical thinking skills should be surprised when capital markets undergo corrections and bubbles burst.

Sadly, most of the financial media appear to be blithely unaware of how capitalism actually works, which is why pretty well all of them have their panties in a bunch :crying:


China does have problems as it comes to terms with only having growth in the high single figures instead of low to mid teens, however it is long, long way from being the end of the world.

I don't view the recent moves by the Chinese authorities as being any worse than QE from western countries (which, as we have seen, royally screwed many Asian economies as that money flooded into Asia fuelling rampant inflation).
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Disgusted that the UK is “governed” by a squalid bunch of economically illiterate, self-serving, sleazy and corrupt neo-fascists.

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MrFixer
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The Great Fall of China

Post by MrFixer » August 25, 2015, 8:27 am

Useful to refer back to this thread: http://www.udonmap.com/udonthaniforum/c ... 35686.html

I am back in China in a couple of weeks and expect to see yet more falsified data at the companies I will visit. Its SOP.
China has been successfully pulling the wool over Western economists' eyes for some years, but they are increasingly struggling to continue the fiction.
I have been in and out of China a lot on business over more than a decade and most of the Chinese I speak with (company owners and directors) now have zero confidence in the economic competence of the government. In most cases government economic data has be subject to so much fraud and manipulation that it is worthless. There has been massive over-investment on the back of unsustainable debt. Production costs are shooting up (by 9% over 2014) and across the nation almost 50% of provincial budgets come from asset sales (mostly land sales to developers - cooling off very rapidly).
At BEST anticipate zero growth/stagnation for some years..

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MrFixer
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The Great Fall of China

Post by MrFixer » August 25, 2015, 8:33 am

"For those in the west who may be unfamiliar with what is happening in China, it is simply the result of a rather weird economic system that China has copied from the west called capitalism"

If only that were true.

Jing Jing
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The Great Fall of China

Post by Jing Jing » August 25, 2015, 9:03 am

This is more than the fall of China. Most of the worlds central banks have been involved in a giant Ponzi scheme. They printed paper currency in the hope of stimulating growth. Guess what? It didn't work now what went up has to come back down. :pirate:

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The Great Fall of China

Post by papafarang » August 25, 2015, 9:18 am

it's all a gamble, and bubbles always burst , lucky ones got out quick, long term players sit it out, speculators get shafted.
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The Great Fall of China

Post by Jing Jing » August 25, 2015, 9:31 am

This is from an article on the China economic myth:

"China is not a clone-in-the-making of America’s $18 trillion consume till you drop economy—-even if that model were stable and sustainable, which it is not. China is actually sui generis—–a historical freak accident that has no destination other than a crash landing".
JimboPSM wrote:rather weird economic system
"They have not created any of the rudiments of viable capitalism. There are no honest financial markets, no genuinely solvent banks, no market driven allocation of capital and no financial discipline which comes from the right to fail as well as succeed."

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The Great Fall of China

Post by DRILLER » August 25, 2015, 6:54 pm

yet another example of debt death.

all that investment in non performing assets & unbale to service the debt means that china is no different to any other death by debt economy.

bankrupticies & write downs will result then after a few years its back to the orgy of debt.
temptation is a .....

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The Great Fall of China

Post by Jing Jing » August 25, 2015, 8:02 pm

Another down day on the SHI -244

The stock market investor in China is very different from investors in the UK or US.where professional manage accounts.

"There are an estimated 90 million "retail" investors in China — normal folks who own shares. Credit Suisse reckons an incredible 80% of urban Chinese households have invested in equity, putting about 30% of their collective cash into stocks."

Yes the PBOC can print more yuan but they would need to find a way to sell bonds.

Read more: http://uk.businessinsider.com/statistic ... z3jpZS7RId

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The Great Fall of China

Post by parrot » August 26, 2015, 3:58 am

So many good articles to read about China.........lots of info to digest for those interested. One comment I came across today that was interesting: One five-hundredths, or 0.2% of GDP in the US is generated by exports to China.
One other, unrelated to China but related to general economic health (in the US)......gas prices in Texas now in the $2.20's range.......some counties closer to $2 even. That's a lot of extra cash in people's pockets.
I looked out our apartment window in Houston today........thunderstorms, but no indications of doom or gloom or fiscal calamity.

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The Great Fall of China

Post by mickojak » August 26, 2015, 4:28 am

A little tip.

Whenever governments try to stop a share market fall, sell the ---- out of it, because it never works and shows that the government is worried.
Markets are bigger than any government, much, much bigger.

When the Chinese government announce measures to prop up the market a couple of weeks ago, I went short the Shanghai Index and will stay that way for a couple of months at least.
China is a new market and does not know that this is normal behavior.
The fastest way to end this is to let it go and sort itself out.
Mick

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