Yes Virginia...It's a Bubble...

[jk]

Re: Yes Virginia...It's a Bubble...

Presumably by crashing the US$. LOL

From a while back on this same thread
http://www.itulip.com/forums/showthr...145#post275145

as usual it is capital flows, not trade flows, which determine value in these situations.

[santafe2]

Re: Yes Virginia...It's a Bubble...

Buick followed up last year's Avenir with another interesting design exercise for this year's Detroit show:

http://www.buick.com/avista-concept-coupe.html

A Model S for the ICE crowd?

[GRG55]

Re: Yes Virginia...It's a Bubble...

A Model S for the ICE crowd?

Differences:

- It's a 2-door.
- Less likely to go up in flames in the event of a collision
- Gets pretty well the same range in winter as it does in summer, while keeping windshield ice free, occupants warm, and no need to conserve propulsion energy by restricting windshield wiper and headlight usage.
- If they put it in production likely 2/3 the price
- Always the potential for a next-gen Volt drivetrain in it (and STILL 2/3 the price).

[santafe2]

Re: Yes Virginia...It's a Bubble...

Differences:

- It's a 2-door.
- Less likely to go up in flames in the event of a collision
- Gets pretty well the same range in winter as it does in summer, while keeping windshield ice free, occupants warm, and no need to conserve propulsion energy by restricting windshield wiper and headlight usage.
- If they put it in production likely 2/3 the price
- Always the potential for a next-gen Volt drivetrain in it (and STILL 2/3 the price).

Logical arguments GRG but this might be their image problem.

[GRG55]

Re: Yes Virginia...It's a Bubble...

Logical arguments GRG but this might be their image problem.

Image problems are overcome only if there's a real commitment. Let's see how Chipotle fares with that problem

When I was growing up Buicks were always seen in my neighbourhood as upscale luxury cars, a cut above Oldsmobiles, but less pretentious and more uniquely styled than a Cadillac. Buick has some history to fall back on and can use some evocative cars such as the Roadmaster and the Riviera - the 1960's Bill Mitchell creations, not the garbage that Roger Smith was responsible for overseeing. If there is an image problem for Buick it stems back to that truly unfortunate era in GM's history which produced some gawdawful vehicles in every Division.

[lakedaemonian]

Re: Yes Virginia...It's a Bubble...

Image problems are overcome only if there's a real commitment. Let's see how Chipotle fares with that problem

When I was growing up Buicks were always seen in my neighbourhood as upscale luxury cars, a cut above Oldsmobiles, but less pretentious and more uniquely styled than a Cadillac. Buick has some history to fall back on and can use some evocative cars such as the Roadmaster and the Riviera - the 1960's Bill Mitchell creations, not the garbage that Roger Smith was responsible for overseeing. If there is an image problem for Buick it stems back to that truly unfortunate era in GM's history which produced some gawdawful vehicles in every Division.

Im pretty sure I've heard Buick is a well regarded brand in China.

[jk]

Re: Yes Virginia...It's a Bubble...

i think cadillac has rebooted its brand over the last several years. it used be said that the age of the average cadillac owner was somewhere between 70 and dead. i don't think that's true anymore.

[thriftyandboringinohio]

Re: Yes Virginia...It's a Bubble...

i think cadillac has rebooted its brand over the last several years. it used be said that the age of the average cadillac owner was somewhere between 70 and dead. i don't think that's true anymore.

For a little while I worked at a top-tier industrial design firm, and they had worked with Cadillac on interior design, specifically the ergonomics.
The human factors specialist I worked with told me that the central issue for Cadillac ergonomics was that even the first time buyers were elderly.
He said they worked the shape of the doors and seats so that the driver and passenger can stand at the open door, lean just a bit, and then collapse into the seats.
They did thousands of hours of anthropometry and human factors work so that Cadillac interiors were easy to operate by people who are weak and do not move well.
Ease of entry; easy to grasp control knobs; easy to read displays; stuff like that.

[Polish_Silver]

Yuan over valued?

One of the other things I have posted a few times in the past is my firm belief that, contrary to popular political opinion in the USA, the Chinese currency is OVERvalued, and if it was allowed to free float it would decline, not rise, against the US$. ..

Stan thinks China has overcapacity, and is headed for a recession. That is a different question than "is the Yuan over valued?"

For example, the USA had excess capacity in 1929, and the result was deflation (ie, currency appreciation)

It is easy to devalue a currency by printing more of it. It is difficult to keep it over valued, because market forces would do arbitrage deals

taking advantage of the difference between the "official" value and the "market" value.

The relative values of Yuan and Dollar might have changed over the last few years, and certainly could change again. If the Tigers are removing pegs now, it
may be because they could easily "peg down" but "pegging up" is just too damn expensive.

Real estate bubbles are typical of a country with a trade surplus (eg 1980's japan). The trade surplus creates "high powered money", which typically starts at home, but
may even end up on the debtor side of things, thanks to leveraged international banking!

[GRG55]

Re: Yes Virginia...It's a Bubble...

i think cadillac has rebooted its brand over the last several years. it used be said that the age of the average cadillac owner was somewhere between 70 and dead. i don't think that's true anymore.

For a little while I worked at a top-tier industrial design firm, and they had worked with Cadillac on interior design, specifically the ergonomics.

The human factors specialist I worked with told me that the central issue for Cadillac ergonomics was that even the first time buyers were elderly.
He said they worked the shape of the doors and seats so that the driver and passenger can stand at the open door, lean just a bit, and then collapse into the seats.
They did thousands of hours of anthropometry and human factors work so that Cadillac interiors were easy to operate by people who are weak and do not move well.
Ease of entry; easy to grasp control knobs; easy to read displays; stuff like that.

A few months back got to drive a friend's Caddie CTS-V sedan - a good old American 6.2 litre V-8 engine (with supercharger), paddle shifters and an extraordinarily well done real-world road suspension. Blasted along one of the curvy highways that follows the foothills near the bunker (a favourite local route for the road bikers). That ain't no car for a 70+ grandfather! Basically a Corvette in sedan clothing and without all the creaking, groaning and suspension thumping the plastic fantastic is famous for.

And easier to get into and out of than a 'Vette too.

[touchring]

Re: Yes Virginia...It's a Bubble...

Im pretty sure I've heard Buick is a well regarded brand in China.

I sat in a Buick in China 10 years ago, it was the first time I heard of this car brand but it looks luxurious along the lines of the Lexus LS400.

[GRG55]

Re: Yes Virginia...It's a Bubble...

as usual it is capital flows, not trade flows, which determine value in these situations.

Hedge Fund That Called Subprime Crisis Urges 50% Yuan Drop

January 19, 2016

Mark Hart, the hedge fund manager whose bets against U.S. subprime mortgages and European sovereign debt proved prescient, said China should weaken its currency by more than 50 percent this year.
A one-off devaluation would allow policy makers to “draw a line in the sand” at a more appropriate level for the yuan, easing pressure on China’s foreign-exchange reserves and removing an incentive for capital outflows, according to Hart, who’s been betting against the currency since at least 2011. China should devalue before its $3.3 trillion hoard of reserves shrinks much further, he said, because the country can still convince markets it’s acting from a position of strength...

...Hart, whose prescription clashes with consensus forecasts for the yuan and recent comments from senior government officials, said China would be justified in weakening the currency after central banks in Europe and Japan fueled declines in their exchange rates to stoke economic growth in recent years. Such a move would likely come as a surprise to global investors, who were rattled by a drop of less than 3 percent in the yuan last August.

China’s current approach to managing the currency’s decline has been costly. Foreign-exchange reserves dropped by a record $513 billion last year as the central bank intervened to ease the currency’s slide, while an estimated $843 billion of capital flowed out of China in the 11 months through November as some investors sought to get in front of further yuan weakness.
Aside from intervention, policy makers have moved to curb bearish bets against the yuan and tighten restrictions on the flow of money across the country’s borders. Those measures have fueled doubts among global investors about the ruling Communist Party’s commitment to give markets a central role in the world’s second-largest economy and make the yuan an international currency.

“They’re trying to drive a car with one foot on the brake,” said Hart, who estimates the People’s Bank of China spent more than $100 billion supporting the yuan in onshore and offshore markets during the first 12 days of January. “If China were to devalue to a level that wasn’t actually a true equilibrium they will get run over pretty quickly, they will blow through FX reserves, and then they will lose face because they’ll be forced to devalue.”...

[ProdigyofZen]

Re: Yes Virginia...It's a Bubble...

“They’re trying to drive a car with one foot on the brake,” said Hart, who estimates the People’s Bank of China spent more than $100 billion supporting the yuan in onshore and offshore markets during the first 12 days of January. “If China were to devalue to a level that wasn’t actually a true equilibrium they will get run over pretty quickly, they will blow through FX reserves, and then they will lose face because they’ll be forced to devalue.”..

Working on starting my fund to make this exact bet. I just don't want a large devaluation to occur before that time.

Another small devaluation may occur right after Chinese New Year, February 8.

[thriftyandboringinohio]

Re: Yes Virginia...It's a Bubble...

...Basically a Corvette in sedan clothing...

GRG55, isn't that the approach for the Nissan Maxima / Datsun 810 -to put the top Z car power train in a luxury sedan?
It's worked pretty well for Nissan, should work for GM too.

[touchring]

Re: Yes Virginia...It's a Bubble...

Working on starting my fund to make this exact bet. I just don't want a large devaluation to occur before that time.

Another small devaluation may occur right after Chinese New Year, February 8.

The Chinese would definitely like a big devaluation which I don't doubt that it would happen, but I'm not sure how they will do that without infuriating the other countries as even without a devaluation, Chinese manufacturers are taking away marketshare from American and European counterparts at an increasing pace.

The Chinese are either buying over small foreign companies or masquerading as a European or Japanese company, you won't know the company is Chinese owned from the name of the company or by looking at their website.

I've recently switched my main component supplier from a Canadian to a HK company with a European name. The Hong Kong company was started by French people and got acquired by the Chinese, they still have French engineers working for them and made great products at low cost. Their customer support based in HK is in fact better than the Canadian company. A lot of such small acquisition is going on and they don't get published on MSM like when Lenovo took over the ThinkPad brand or with the recent Haier buying over GE appliances.