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Kay/NC
Honored Advisor

What in the world...?

...is going to go wrong next?

First, half of the Chinese stock exchange halts trading, hopingbto stsunch the gush of blood there. Big investors are being restrained from selling this morning...middle class investors are taking a beating worthy of Bernie Madoff. Is the house of cards starting to tumble?

Our own stock market and the major airline shutdown yesterday due to cyber-glitches are certainly worrisome signals that there is a gremlin in the works, playing havoc. Was the shutdown the problem, or the protective measure designed to limit greater damage?

I wonder what storyline we will be fed. You guys are deep thinkers...what do you think is up?
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5 Replies
BA Deere
Honored Advisor

Re: What in the world...?

I don`t know what happened in might be a conspiracy involving Chinese hackers or it might be as Forrest Gump said "Crap happens".   The thing is the markets are run purely on confidence these days, so if it is some sort of hackers, don`t expect to be told the truth about it.

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Packard27
Senior Contributor

Re: What in the world...?

From a macro economics (i.e. big picture) perspective, it is probably never prudent to put too much of your own money into any country, market, or culture that has no history for respecting and/or protecting personal property rights [Notably, personal property rights and human rights in this instance can be mutually exclusive concepts.]. Owners of capital need assurance that what is rightfully theirs today cannot then be arbitrarily taken away from them tomorrow on the whim of some self serving government potentate. 

 

What matters most here is that the government and its established rule of law will always attempt to play the honest & impartial broker for all private business deals while enforcing previously agreed upon contracts.

 

Okay, so knowing the Chi Coms and how they conduct business as we all do, does everyone feel much better now?

 

Deo confidimus, everyone else, however...

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BA Deere
Honored Advisor

Re: What in the world...?

7% growth in China and they are teetering on depression and their stock market about to collapse...this country ocaasional quarter of negative growth, but usually 1-2% growth and our stock market recently hit all time highs.   Isn`t the stock market suposed to be a barometer of growth and future growth?

 

 

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Packard27
Senior Contributor

Re: What in the world...?

BA,

When it comes to China, like doing business in the old Soviet Union (or new Russia), the straight forward answer to your question is a very strong and unequivocal, "who knows?"

 

Buyer beware

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k-289
Senior Advisor

Re: What in the world...?

Chinese folks are in the USA loading up on commercial and residental properties - interesting , although Japan did the same in the 70's and remarketed a some time later when the gush wore off with major discounts --- Buy the rumor -sell the fact still has merit---      

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