Thailand

marc26 · #1 15-03-2006, 21:22

i was sitting on the desk the other day and heard yet another story of china, something becoming the biggest something in china, and it donned on me, china is the new dot.com
remember when someone would just throw a dot.com at the end of their name and the stock flew.
i bet, and will be betting, in the future you will see a slow down in this china madness.
dont take that to mean that i dont think china is a huge force in the world's economy, i just think people will become smarter and more selective of what to pick and choose in concerns for china

LivinLOS · #2 15-03-2006, 21:39

I agree that china evaluations are over the top.. In the same way HK equity is overvalued in a knock on effect IMHO and the problems and issues with China developing are huge..

That said China is HUGE and china is becoming capitalist and bringing 1/5th of the world population with it.. It is going to radically change the worlds economics.

I am really curious about China lately.. Would love to spend 6 months in Shanghai in the next year or two.

Izzy · #3 15-03-2006, 21:52

I agree...in my eyes China is living off the fat of American consumerism (altho obviously other countries play a part too)....and American consumers while seemingly have an unquenchable thirst for products have to slow down at some point, with negative savings rate and housing equity slowing down in not just the US but many countries that have been buying cheap China goods. Right now America and China need each other to keep their economies going along, one without the other will just implode. I read a report from Morgan Stanley mentioning that Chinese save over a 1/3rd of their annual income while Americans now save -1.5% or so...if China is to survive without America it will need its own people to start spending more of their own cash to pick up the short fall. If China really made an effort to bring the majority of its people up in living standards however price of world commodities would rocket even more due to the strains on demand.

Like all bubbles they can last longer than you expect, right now things seem at a tipping point as the major world economies have to try and find a sustainable trade equilibrium. I think the western standard of living will drop a lot and the developing nations standard will rise a little.

Then again, im a big pessamist on the whole situation!

I always find stories like this disturbing also:

http://money.cnn.com/2006/03/14/news...tune/index.htm

marc26 · #4 15-03-2006, 23:21

Quote:

Originally Posted by LivinLOS

I agree that china evaluations are over the top.. In the same way HK equity is overvalued in a knock on effect IMHO and the problems and issues with China developing are huge..

That said China is HUGE and china is becoming capitalist and bringing 1/5th of the world population with it.. It is going to radically change the worlds economics.

I am really curious about China lately.. Would love to spend 6 months in Shanghai in the next year or two.

i love my job, but i was looking on bloomberg yesterday and there was a job in shanghai perfect for me.
sort of liasion between china and US. knowing people ont he buy side.
tempting.........but id be a dope to give up this job

marc26 · #5 15-03-2006, 23:23

Quote:

Originally Posted by LivinLOS

I agree that china evaluations are over the top.. In the same way HK equity is overvalued in a knock on effect IMHO and the problems and issues with China developing are huge..

That said China is HUGE and china is becoming capitalist and bringing 1/5th of the world population with it.. It is going to radically change the worlds economics.

I am really curious about China lately.. Would love to spend 6 months in Shanghai in the next year or two.

again, i wasnt discounting china's impact. but something just clicked that image of dot.com
somethign was mentioned as china's version of coke, or something like that

just made me think of the dot.com era

jimholio · #6 16-03-2006, 01:18

Perhaps a good time for some forex trading.

LivinLOS · #7 16-03-2006, 09:44

Izzy, you have the same sort of opinions as mine.. Though I think the hard landing is much much more likely than the soft one, if you think your a pessamist then we should talk one day, you will seem like the happy one I guess as I see the house of cards decidedly shaky.

What people forget about Chine though is even with its enourmous exports to the US it has a huge population just becoming consumers that they can focus on.. They need America less than America needs them (to keep lending it money).. Also personal savings are good for an economy in thier state, savings can be used for future investment and future growth.. I think 2050 will see China as either 'a' or 'the' dominant super power. That equals a lot of turmoil as no one likessliding down the rankings.

For now buy silver, gold, uranium, and commodity baskets.

swiftdave · #8 16-03-2006, 10:35

I put China in the same position as Japan after the Second World War. Fledgling capatalist learning to manufacture cheap goods. But even now the quality is coming up. I don't think that the bubble is bursting any time soon.

Coolhand · #9 16-03-2006, 10:52

Quote:

Originally Posted by marc26

i bet, and will be betting, in the future you will see a slow down in this china madness.
dont take that to mean that i dont think china is a huge force in the world's economy, i just think people will become smarter and more selective of what to pick and choose in concerns for china

It is already happening in some areas, the project I am involved in for one. In 2000, the Chinese got a very good deal to buy 3.5m tonnes of gas per annum from Australia. They thought this was great, and they planned to build lots of gas importing terminals around the coast. The Chinese government then said 1 importing terminal per coastal province (total 15). In 2004, they secured another contract to import gas from Indonesia. Since then they cannot secure any more gas, at the prices they want, so the big plan has stalled at two importing terminals and 5 ships. I hope it stays that way, and they don't secure any more contracts until 2008, I am having enough problems finding places to train my chinese seafarers as it is.

LivinLOS · #10 16-03-2006, 11:55

The amazing thing is the rate of change since Mao and the purges through to the new leap forward and this current blended communist capitalism..

I have been reading lots on China lately.. Would really like something covering contemporary Chinese history (last 75 years) thats not too dry to knderstand more..

Finished River Town but getting stuck on Soul Mountain (my books) and yesteray got caught up with another financial crash book (Long Term Capital Management) which is much easier to get through than Soul Mountain.

Warrior · #11 16-03-2006, 18:11

Quote:

Originally Posted by LivinLOS

Izzy, you have the same sort of opinions as mine.. Though I think the hard landing is much much more likely than the soft one, if you think your a pessamist then we should talk one day, you will seem like the happy one I guess as I see the house of cards decidedly shaky.

What people forget about Chine though is even with its enourmous exports to the US it has a huge population just becoming consumers that they can focus on.. They need America less than America needs them (to keep lending it money).. Also personal savings are good for an economy in thier state, savings can be used for future investment and future growth.. I think 2050 will see China as either 'a' or 'the' dominant super power. That equals a lot of turmoil as no one likessliding down the rankings.

For now buy silver, gold, uranium, and commodity baskets.

The hard landing is something that I fear too - and I have said that before, it seems more likely to happen than a soft landing.

I was just reading a story on China in The Economist, it mentioned the fact that all the wealth in China is going to only a small part of it´s population. 800 million living outside the big cities and the coastal areas are not taking part in the big-money-earning, but are currently feeling the pain from the collaps of the security of communism, e.g. health care, jobsecurity.
That seems to be a threat to China´s stability. Short term I guess, longer term, that´s a HUGE market.

shark1963 · #12 17-03-2006, 02:37

Quote:

Originally Posted by LivinLOS

What people forget about Chine though is even with its enourmous exports to the US it has a huge population just becoming consumers that they can focus on.. They need America less than America needs them (to keep lending it money).. Also personal savings are good for an economy in thier state, savings can be used for future investment and future growth.. I think 2050 will see China as either 'a' or 'the' dominant super power. That equals a lot of turmoil as no one likessliding down the rankings.

For now buy silver, gold, uranium, and commodity baskets.

I absoultly agree in that point but dont see them at 1. place. And also think The US wont be it anymore long before 2050. So i see Russia 1st, china 2nd. US maybe 3rd, but i would ot bet on it if they can hold even 3. place , depending whats going on in europe and India. But i am also sure the landscape of europe will not be the same as now. Europe will be much bigger, and i have the fantasy how big it could become. Just my opinion.Maybe some will laugh about my idea, but could anybody expect 15 years ago what has happened until now.

LivinLOS · #13 17-03-2006, 09:27

Russia seems to have to many problems with its break up and seperate states.. I think Russia is out of the superpower game and economically not got the potential of the Chinese..

As pointed out though the gulf between the Shanghia earners and the peasantry is huge.. Its a country with massive cultural restrictions that it has to change or overcome, massive polution and environmental issues.. I dont think thier ascendancy is going to be smooth.

shark1963 · #14 17-03-2006, 21:59

I dont agree LiL that Russia is out of superpower game. There are some points which china is far away or doesn´t have. Forst of all you have to see the already existing relationship between europe an Russia, wich results in more investions from europe in russia or FSU countrys. I see in this context also the FSU Country like Ukraina and kasachstan as well. But the most important advantage to china are of course the resources, and the land size itself. Most of the resources are either not explored or with bad equipment or bad condition. They could increase the oil or gas exploration easy. Then as well the mentality of the russians is much different to the chinese. The chinese are good business people in trading, but i am not sure if they are also good in science and industrial cases. And one important point imho is ,the relationship between the countries ( i mean there are already about 3 million russians living in germany) , so i expect their will be more interesst from this people doing business with their old country instead of china. But all we can do now are speculations and we will finally see it in 15-20 years where it will might go. But i am sure the US economy gets big problems in the next 5-10 years and will not longer stay no.1.