If anybody knew the answer to that question they would be wealthy.

When gold was $800-900 per troy oz I'd have bought it but gold is now $1298 an oz looks like a bubble too.

Same with silver (my prefered hedge) when it was $12 an oz I'd have loaded up on it (it is $19 an oz).

I reckon shares are the only thing things in comodities and utilities as even in a recession and super high inflation environment people still have to use these two things.

Whatever you do don't buy Euros and £ the Euro and £ and to some extent the $ (due to 1800bn of printing) the Euro is falling apart, the £ is going to be printed to hell and the PRC is secretly getting rid of its $.

My own personal hedges are investing in myself (I have enormous number of letters after my name these days) and buying small amounts of silver, I also have some Krugerands bought when gold was £312 an oz it is now £840oz

If it's a secret, how come you know about it.  

Hey Jake, Can't you see from Kennichi's avatar picture? He is the grandson of the Great Helmsman and privy to that sort of information.

[ Last edited by  geoduck at 13-5-2010 17:04 ]

Markets thats all, Gordon Brown announced his gold sale and gold dropped.

You announce a massive dumping of US treasures the price drops or worst case US defaults, it is less of a secret more two faced dealing and false accounting, so the PRC states 2 trillion USD on its balance sheets, yet in reality due to the massive infrastructure projects and central Asian projects this is considerably less.

The trick is for Hujintao to spend as much as those USD as possible without upsetting the markets as the only thing keeping the $ alive is Asia buying them up.

wao, smart. kennichi I guess you're a banker.
I nvr really knew that. Always thought China was crazy to buy up all those bubble notes.

Kennichi, it is great you bought gold and silver, but my guess is that you've lost money in the markets at some point.  Everyone always talks about their wins, and never their losses.

I never claimed to be a great investor, I saw them printing money and thought well you can't print gold..

The biggest lost though is lack of a day job, I was an accountant, but was made redundant last year and went on a bike trip, nobody is hiring and those jobs aren't coming back as they are being outsourcd so I'm stuck in a career hole.

I am glad that I short sale some Chinese real estate companies just before all of this happen...... but I totally forgot to sell a Chinese Iron Ore company and from a 40% profit to a 10+ loss.....

Personally saying I believe once the property market in China pops, everything will go down, perhaps causing the second dip in world markets. But I believe for the middle -  long term health of the economy the pop of the property bubble in China is all goods news, as average joes will finally be able to consume and afford a home.

I believe the property bubble is the biggest problem in China right now, its sucking so many peoples savings, and worst of all even older generations saving.... but unfortunately selling land is a big source of government revenue, unless the CCP changes the way for their members to climb up the CCP ladder, I doubt this will ever change.  

Letting the RMB appreciate is only good news for the Chinese citizens, I still have trouble understanding y the hard earn cash of those workers are being fuck up by the CCP by purchasing ever increasing worthless dollars, the argument that an appreciation is bad for business in China its quite ridiculous - IMO. Nor do I understand the Hawks from Washington, when they say that the undervaluation of the RMB is unfairly subsidizing the factories, when in reality the weak RMB is subsidizing the consumers in the US who is paying less for what they purchase, while the Chinese Citizens are fuck up with inflation thanks to the undervalue RMB because those fools in CCP actually believe what they are doing is good for the Chinese economy.  

Wen simply needs to step down and let Zhu come back.... The current Chinese leadership simply doesnt have the balls to do the right but painful thing like what Zhu did back in 1994 to the zombie SOE's, painful but right.

The Chinese have no choice but to buy US$ bonds and assets. Same with the Japanese in the 80s. They are stuffed with US$s. The US will always remind China before each T-Bill Auction to buy more and if they don't the US will stutter and not be able to afford any more Chinese goods. The Chinese have no choice as they want stability and full employment among its workforce. Such a huge population is hard to manage and CCP is fearful of unrest.

This is why the US$ will always be the dominant currency because whatever the US  buys they make the seller finance the purchase. The US$ is entrenched in everything. Anything that is of value is denominated in US$, all precious metals, commodities and oil. The US always want China to revalue its currency because by doing so, they actually cut down their debt with the Chinese, like getting a big discount on repayments of the T-bill coupon.

[ Last edited by  geoduck at 14-5-2010 21:54 ]

BTW, how did you "SHORT" Chinese Real Estates Companies? Where did you borrow the stock from????

sorry to hear that kennichi you lost your job, hope you can find one soon, even if it's not as an accountant, the finance jobs are starting to hire.
Shorting is mad hard. As someone pointed out, this estate bull could go on for another 5 yrs before it pops. Then you'd be fucked. It' s always nice to short the small companies that have gone up for shit reasons though I'd agree.

I guess you could alternatively short chinese estate companies that are listed on the NYSE, if that counts.

The same problem in China is very much with HK too that the gov relies on selling land for revenue. And those damned mainlanders who truck in loads of cash from god knows else hiking up all the prices in HK.

with the recent numbers that came out from China, I don't think inflation pressures will cause the yuan to be released. at least until they can secure their trade with partners nearby and rely less on the US.

Hey gangster, without the 'damned' Chinese bringing in truckloads of cash do you think HK will survive? There'll be less job opportunities and the economy will surely suffer. Our livelihood depends on this.

BTW, it's not easy to short Chinese property stocks on the NYSE. There is not as much liquidity in Chinese property stocks traded in New York and the shares are not fungible.

[ Last edited by  geoduck at 15-5-2010 09:00 ]

HK did just fine even when China was closed.  I am not to sure though how hk will do if China falls though.

HK always relied on China even from its inception in the 1842. The only time that HK was delinked from China was in the 2 decades after the CCP had taken over China. At that time, HK received an influx of refugees, mainly poor desolate people who had lost everything. Some Shanghainese industrialists set up factories in HK and made use of the cheap labour.. The major output was plastic flowers and hair pieces. There was a lot of poverty in the 50's and 60's and life was appalling so, pandaboy, if you think a factory job is considered doing fine, I rest my case.

In the early 70's it was property and stock market speculation and when that fizzled out after the crash of 1973, HK started to rely heavily on China again, tapping goods made in China. After President Nixon's historic visit to Bejing in 1972, the US had slowly opened up trade with China and yes, HK acted as the middleman. Gradually, this relationship with China got stronger and HK was used for raising capital for Chinese infrastructure projects. After Deng Xiao Peng created free trade economic zones in China in 1978, HK companies gradually used China as a manufacturing base, first in Shenzhen then in Dongguan. As a result, there was a lot of economic activity and more banks started opening in HK in the 80's and 90's.

Today, HK is not very effective as a middleman because China can deal directly with the US and other countries. The only thing HK has left is its legal infrastructure and banks which the Chinese still need. The only way for HK to prosper now is to rely on rich mainlanders who buy expensive properties, use HK's banks and go shopping for expensive brands, art and jewelry. In fact, the entire region relies on China in some way or other. Take Singapore for instance, their property boom was first fueled by rich Indonesians and Malaysians and now  mainly by the Chinese.

Think HK would collapse without China because the greatest property bubble is not China but HK itself. Don't think prime retail properties anywhere else in the world would cost US$150 per square foot to rent per month or a luxury residential properties selling for over US$10,000 per sq foot!

[ Last edited by  geoduck at 15-5-2010 13:00 ]

Ok Folks,
The world is in an overall period of inflation since the start of our lifetimes. This trend will likely continue till we die. China's inflation is greater than the average of the world - however, recently reported figures show the relative increases in consumer price indices are more comparable. All this should not be suprising or blown out of proportion, as it is fully expected in such a booming economy with increasing population, investments, government spending and an appreciating currency.

xiexie897, an appreciating currency would not create more inflation but check it. This is basic economics.......

Inflation ultimately results from demand exceeding supply within the Chinese economy. An increase in the value of the currency makes Chinese goods relatively more expensive and foreign-made goods relatively cheap. Thus demand for Chinese goods will fall, reducing demand and therefore inflation pressure in China.

[ Last edited by  geoduck at 15-5-2010 08:54 ]

I understand HK needs china for so much of its trade and tourism. I understand we need them to buy our electronics, eat at restaurants etc... But it's a double edged sword. I'm not sure if we really benefit from them pushing up all the housing prices and making Canton road shops a mainlander's playground.
the people who do benefit are the developers, brand names and the very wealthy investors. I'm sure some of the wealth eventually trickles down to the rest of society (though I'm not sure how). What's quite true though is that the younger generation can't afford to come out and buy their own properties, or have to get shitty ones. I feel like the middle and lower classes have more to lose than gain.

Of course, it is impossible, and wouldn't be fair, to only allow normal tourism and trade and ban all the property buying.

HK is a free place and it's market forces that dictates property prices. It's also an easy place to make money if you have the cash. Anyone can participate in the speculation of stocks and properties. It's a free for all. I advocate this but IMO and as mentioned above, HK is the bubble, much more so than China itself. If China was to allow anyone to freely punt on its property and stock markets, and allow the RMB to be easily purchased by foreigners on international markets, China would've collapsed long ago from the tide of speculation from all over the world. China is not a free market and it's self-preservation more than anything else. The day will come when China will open up but that could be a long time from now.

[ Last edited by  geoduck at 15-5-2010 14:25 ]

there's this stock EJ on the NYSE that I used to play with a bit back a couple yrs, I'm pretty sure you can short it. And you can look at its competitors for similar stocks