new piece by Andy Xie on China...

[nero3]

Re: new piece by Andy Xie on China...

Some googling will help.

http://www.reuters.com/article/compa...mbol=600900.SS

HONG KONG, July 9 (Reuters) - Power output by Huaneng Power (0902.HK) (HNP.N), China's biggest power provider, fell 5.84 percent in the first half of 2009 from a year earlier, on the back of weakening power demand amid the global economic downturn, the company said on Thursday.
Huaneng Power (600011.SS) produced 86.107 billion kilowatt hours in the first half of the year, it said in a statement.
New generating units put into operation continuously led to the decline in the average utilisation hours of power generation in most of the regions where it operates, the firm said.
But the declines in China's power generation have been narrowing in the past several months after near double-digit falls late last year, as consumption gradually picked up, thanks to Beijing's economic stimulus policies.
Yangtze Electric Power Co (600900.SS), operator of the country's largest hydropower project, the Three Gorges Dam, said on Wednesday its power output in the first half of the year edged up 0.7 percent from a year earlier. [ID:nSHA86473]. (Reporting by Sui-Lee Wee; Editing by Clarence Fernandez)

HNP should do very well, even if power generation is down, if coal prices stay low, that company don't benefit from the commodity boom similar to an airline company or chip producer. It is an interesting company. The reason it have went "flat since 2004" is the start of the commodity bubble.

[jk]

Re: new piece by Andy Xie on China...

to think that there is a volker-ish tightening anywhere in the foreseeable future is imo foolish. any coupling between dollar strength and chinese bubble-burst will occur in the other direction: a bust in china will send money scurrying towards the dollar.

[touchring]

Re: new piece by Andy Xie on China...

to think that there is a volker-ish tightening anywhere in the foreseeable future is imo foolish. any coupling between dollar strength and chinese bubble-burst will occur in the other direction: a bust in china will send money scurrying towards the dollar.

yes, but what will cause the bust in china. another lehman like event that jeopardizes trade?

[nero3]

Re: new piece by Andy Xie on China...

to think that there is a volker-ish tightening anywhere in the foreseeable future is imo foolish. any coupling between dollar strength and chinese bubble-burst will occur in the other direction: a bust in china will send money scurrying towards the dollar.

If you think like 1929 =2000, and 2009 = 1938, then there will be an inflationary pump priming boom that's a mixture of monetized debt, as during WW2 to keep yields down while there is huge increase in public debt to offset less private debt as in the 1940-1950 era. When the private debt deflated through a nominal GDP growing very fast in comparison to private debt (because of all the inflation), the cycle of more private leverage can once again begin.

However the CRB have already increased 3,5 times since the peak in the stock market, the same as in other inflationary periods (as in 65-82, or 29-50), while the dollar is hovering around 78. Could be a sign things will turn, and the dollar get stronger, however, given the positions of guys like Warren Buffet, I think it's a dangerous bet to make.

[jk]

Re: new piece by Andy Xie on China...

yes, but what will cause the bust in china. another lehman like event that jeopardizes trade?

beats me. what burst the housing bubble? exhaustion? also, earlier posts in this thread raise the question as to whether there's any chinese growth outside financial and real estate markets. if the authorities decide to turn off the tap to kill speculation, they could take down the financial markets and start capital moving away from em's. maybe nothing will burst the china bubble. i'm just saying that expecting a big tightening from the fed is ridiculous. the fed caused the 80's recession deliberately by tightening after a dozen years of being accomodative. the fed contributed to this collapse by being so accomodative for so long that the economy essentially exploded.

[touchring]

Re: new piece by Andy Xie on China...

beats me. what burst the housing bubble? exhaustion? also, earlier posts in this thread raise the question as to whether there's any chinese growth outside financial and real estate markets. if the authorities decide to turn off the tap to kill speculation, they could take down the financial markets and start capital moving away from em's. maybe nothing will burst the china bubble. i'm just saying that expecting a big tightening from the fed is ridiculous. the fed caused the 80's recession deliberately by tightening after a dozen years of being accomodative. the fed contributed to this collapse by being so accomodative for so long that the economy essentially exploded.

financial and real estate is killing manufacturing. would you want to earn 5 cent margin on plastic goods, or earn millions by speculating in real estate. So many china managers and probably even bank moneys have absconded with company money dumped into houses and stocks.

[nero3]

Re: new piece by Andy Xie on China...

http://finance.yahoo.com/echarts?s=BRK-A#chart1:symbol=brk-a;range=my;compare=ief+000001.ss+^ixic;indicator=s ma(200)+volume;charttype=line;crosshair=cross;ohlc values=0;logscale=on;source=undefined

The red one is treasuries, and the green one the shanghai index. Note that the shanghai follows treasuries inversely, not the US stock market.

From the other tread I posted this with more:
http://www.itulip.com/forums/showthr...t=11142&page=2

China bubble, or treasury bubble. If treasuries goes bust, China will gain big. If China blow up, perhaps treasuries will gain. This is a dilemma. Where is the bubble? Was China just overheating after catching up with other emerging market's, while treasuries really have been a bubble?

[santafe2]

Re: new piece by Andy Xie on China...

The good thing about First is that their technology have a lower cost and provides higher profit margins than what any other maker in the industry have.

True, it should serve them well for a while.

On the contrary solar peaked before the US economy hit a recession in nov 2007.

Solar stocks peaked at the same time. Almost all peaked at the end of 2007. There are 100 others but ESLR is a classic example.

[nero3]

Re: new piece by Andy Xie on China...

That's it. That they did not join in on the oil bubble, makes me think that solar could be good, even if oil prices are not very high, after all, these companies have been making money and a lot of it, before oil went above 70 dollars.

[nero3]

Re: new piece by Andy Xie on China...

This is good stuff:

http://www.youtube.com/watch?v=dUnK-xvLW6E

If you are impatient, go directly to 26 min and 56 seconds. There is a caller there, a Chinese-American that is asking Peter Schiff critical questions about his new China funds and about China. Schiff is so smooth talking, but in my opinion he is making a fool of himself.

[bobola]

Re: new piece by Andy Xie on China...

The Chinese love to gamble, but gambling is illegal in mainland China.

So why not gamble on a hot stock market..??..;

http://chinese-school.netfirms.com/casinos.html

[nero3]

Re: new piece by Andy Xie on China...

Yes sure. But Schiff is really avoiding that guy, the intelligent Chinese-American caller. The idea with China, as I think is that it's a bubble, but likely to go higher, because bubbles usually go on much longer than people think they can. What worries me about Schiff is the way he present his stuff. He is right on trend, but still, I wonder if he will be able to say to his clients to take the money and run when Gold finally get's to a full blown bubble, and starts getting as volatile like how it was in 1980.


I suspect he will stand out as foolish then as those who never got out of the NASDAQ (because they was in love with their own hype).

[metalman]

Re: new piece by Andy Xie on China...

Yes sure. But Schiff is really avoiding that guy, the intelligent Chinese-American caller.

The idea with China, as I think is that it's a bubble,...

you and everyone else...

but likely to go higher, because bubbles usually go on much longer than people think they can.

brilliant. greenspan called china a bubble in 2007 ej said no. now 2 rys later ej says yes... but your record is way better than ejs' so i'm all ears. longer still you say?

What worries me about Schiff is the way he present his stuff.

schiff's lost 70% of his clients' money. who cares what he says.

He is right on trend, but still, I wonder if he will be able to say to his clients to take the money and run when Gold finally get's to a full blown bubble, and starts getting as volatile like how it was in 1980.

right on the trend? he got his ass handed to him in 2008 when the dollar rallied. don't you think guys like me who bought gold at $270 here at itulip in 2001 and were talked out of selling it for 8 yrs will do better than schiff's sorry clients?

I suspect he will stand out as foolish then as those who never got out of the NASDAQ (because they was in love with their own hype).

who do you trust to tell you when it's time to sell gold?

A glutton for punishment holds gold through a period of positive real and falling nominal interest rates, and a strengthening currency, such as occurred from 1980 to 2001. Conversely an investor will not be disappointed by holding gold through a period of negative real and rising nominal interest rates, and weakening currencies, such as from 1973 to 1980, and since 2001 until the meltdown in September 2008. Gold outperformed stocks during both periods.

One factor is universal among critics of gold investing: they don’t own any. They feel silly for not buying gold at low prices, or for buying in at a low price then selling too early in, say, 2006 when a legion of bonehead analysts wrote that gold was a bubble, and I told them otherwise. Now they are afraid to buy at current prices.

Some day it will be time to say goodbye to gold, as it was in 1980. I am certain that by that time, when we are on the downward slope of the adoption curve, many will cling to their gold investments like housing investors did in 2006 after we told them housing had topped, and stock mutual fund investors after we’d warned them in December 2007, and tech stock investors all the way back in March 2000 when we warned that the stock market bubble was over.

sounds good to me!

[touchring]

Re: new piece by Andy Xie on China...

Yes sure. But Schiff is really avoiding that guy, the intelligent Chinese-American caller. The idea with China, as I think is that it's a bubble, but likely to go higher, because bubbles usually go on much longer than people think they can.

This happens in a market and partially democratic economy like the US or Japan. Remember, China is not a market economy and the number one goal of the communist party is not to make money, but to remain in power. Making money is secondary.

Remember what the Chinese state workers did to the factory manager who wants to lay them off? In other countries, this would be called murder.

If the bubble bursts big time, resulting in a bank run, China will need to send in troops with assault weapons to guard banks and government offices in Beijing and Shanghai. If there are clashes, the aftermath will be catastrophic.

[nero3]

Re: new piece by Andy Xie on China...

This happens in a market and partially democratic economy like the US or Japan. Remember, China is not a market economy and the number one goal of the communist party is not to make money, but to remain in power. Making money is secondary.

Remember what the Chinese state workers did to the factory manager who wants to lay them off? In other countries, this would be called murder.

If the bubble bursts big time, resulting in a bank run, China will need to send in troops with assault weapons to guard banks and government offices in Beijing and Shanghai. If there are clashes, the aftermath will be catastrophic.

One thing to keep in mind, is that even China seems chaotic, just think of how long things that might seemed unsustainable went on and went on in other countries.