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End of the China bull?

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The debt burden lies on the individual property owners who are required to provide much higher deposits/upfront collateral and will not be pressured to sell.
They will just pay off their underwater property forever.
Something they probably intended to do anyway.
The problems are for the leveraged developers and their lenders.
The problem with that is that property development makes up for over 40% of economic activity in China!!!
 
Listen to the full interview.
The last half becomes relevant for share trading!!!!

[video]http://www.abc.net.au/news/2014-06-04/tiananmen-square-25-years/5495226?section=australianetworknews[/video]

Wondering why the bond market is so strong whilst the share market is so strong?
China is bailing out of itself!!
 
Myth confirmed - bull bubble popped! Fall-out??

HONG KONG (MarketWatch) ”” Amid ongoing central government curbs, China’s property market is cooling off dramatically despite the onset of the sector’s traditionally “hot season,” as both land sales and transaction values plunged in May across 300 major Chinese cities.

Total land sales fell to 1,767 transactions in May in 300 Chinese cities, down 45% from a year ago and 19% lower than in the previous month, according to a survey published Friday on China’s leading real estate website Soufun.com.

In the same month, the total transaction value for land sales dropped 38% year-on-year, marking a 30% drop from April, to 13.75 billion yuan ($2.2 billion).

“May is traditionally the hot season, but China’s property market has cooled further, “ Soufun said, adding that property developers remain in “wait-and-see” mode.

Several Chinese cities even recorded no land sales at all. Hangzhou, the affluent capital of the eastern province of Zhejiang, has offered no land for sale in its main city zone to residential developers since March, possibly under pressure from the central government to reduce real-estate inventories, according to Soufun.

Jinan, the capital of the eastern province of Shandong, also saw no land sales during May, as developers turn cautious amid tougher market conditions, according to a report by Jinan-based Life Daily, a local-government-run newspaper.
Click to expand...

http://www.marketwatch.com/story/chinas-real-estate-market-sees-land-sales-plunge-2014-06-09
 
It seems some wise people don't trust the value of the Chinese Yuan as it's likely not worth as much as the paper it's written on. So they have been asking for metals like copper and iron ore as collateral. Well The Chinese have a way around that too -

http://www.cnbc.com/id/101752322

Chen Jihong, founder of aluminium producer Dezheng Resources, was detained by Chinese authorities several weeks ago in connection with a different investigation in another province, people familiar with the matter in Qingdao said. His disappearance caused banks to check their exposure to his firm, and suspect that the same metal had been pledged multiple times by one or more of its subsidiaries.

The case highlights what bankers do not know about their clients in China.
Click to expand...
 
It will end when the dollar bubble bursts. Throw in peak oil with this and then we have a depression.

China is largely export driven and when the U.S is not doing well, it's going to hurt the Chinese and commodity exporting nations like Australia and Canada.

http://www.usdebtclock.org/




This a good documentary on the U.S debt. It's bit old, but it tells the story well.
 
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Catch a glimpse of how China's Communist dictators raise people out of poverty and miraculously lift them into a middle class of consumers that will transform the economy -

 
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China is slowly showing it's hand pretending it is an investigation as lying is getting harder.

$15 Billion of Loans Backed by Fake Gold Trades
“copper and aluminum stockpiles may have been pledged multiple times as collateral for loans.
Chinese government to rein in credit by raising borrowing costs in recent years created a surge in commodities financing deals that Goldman Sachs Group Inc. estimates to be worth as much as $160 billion.”
Click to expand...

http://www.bloomberg.com/news/2014-06-26/china-finds-15b-of-loans-backed-by-falsified-gold-trades.html
 
So all the gold and copper that everyone thought available is not even there..bodes well for commodities
 
If you follow the arguments of Political "realists" like John Mearsheimer, you'd just hope China doesn't rise too much or too quickly... You'd hope it would just chug along, maybe crashes now and then... just surviving.

According to political strategists, if China [or any power] were to rise at the rate it has, there will be wars with its neighbours, wars with the US.

Wars because for China to ensure its security and free access to the seas, it must try to push American power and influence further back and away from the Pacific. To do that, it must first befriend or otherwise influence its neighbours to the East China sea (Japan, S.Korea, Taiwan) and the South China Sea (Vietnam, Phillipines etc.) and thereby have control of the seas its trade and military must go through.

With the recent push to claim 90% of the South China Seas and disputed islands and air space with Japan etc., I don't think China is playing its card right.

So if you think long term, you'd want a China bear, not a raging bull.

A raging China bull will results in a militarily powerful China, one that for simple national security reason, must try to control the seas leading to the Pacific... and if it has enough gun power behind that necessity, it's going to clash and that's not going to be good for anyone.
 
CanOz said:
And this is relevant how?

On topic, the slowdown is becoming more and more obvious at the ports, airports, train stations...
Click to expand...
Yeah I've been saying it's going to fall over may be Port Headland has had no such slowdown. They will speed things up to survive till the thing is literally falling over. Perhaps the tipping point has been reached, if there is a real slow down not just a sentimental one based on 60 minutes reports that woke people up to the property farce a while back.

Sincerely China is the most evil regime the world has ever had to cope with. Far worse than Nazis far more murderous, with relentless torture, re education camps, slavery, human organ harvesting, animal cruelty and on and on. They are much more sneaky about it and will not invade or attack until they are sure they will succeed unlike the Nazis.

It's relevant as it's bringing attention to the dangers of foreigners doing business with China.
How they target foreigners when it comes to so called clampdown down on corruption, after steeling foreign technology and pretty much everything else they can get their hands on.
The link is an example of how the Chinese girl friend was obviously nothing of the sort and used to bring down this foreigner and this company.
 
notting said:
Sincerely China is the most evil regime the world has ever had to cope with.
Click to expand...

That's a bit much.
You should read into how European colonises other continents; how the US expand from their East Coast to California; how there's no more Aborigines in Tasmania; what Imperial Britain, Spain, Japan did to China... and we all have some idea of what Nazi Germany did to Europe and Russia and the Jews there.

The unfortunate thing for China is its political system meant it also does harm to its people and ultimately itself too.

Xi is saying he want to clean up corruption in China. If he's genuine he hasn't read history...

From my knowledge, the first guy that tried that was Lord Shang of the Ch'in around 300BC - he got torn, literally, to five pieces soon after the King, and his patron, died.

The other one was the last Emperor of the Ming - seeing his empire weakened through corruption, leading to civil unrest and external threats, particularly the Manchu... he tried to curb graft and corruption, collect proper taxes to the state and not to tax collectors' pockets... trying to strengthen China again...

End game was the Manchu walk into Beijing, get rid of the Li Royal family but otherwise kept all other Ming lower level officials and structure in place.

And of course the second-last Qing Emperor of China [Puyi's Uncle] - who tried to rebuild the Navy, the army etc... the dude died at 36 under suspicious circumstances.

-------

MacroEconomically, politically speaking, there is a limit to China's rise, to its potential.
Its political structure will mean continual social unrest;
Its large but aging population will probably mean some economic decline and possible social unrest resulting from its lack of social safety nets, pension plans, healthcare systems etc.

Its lack of IP, patent law and enforcements meant there's little incentives for Chinese entrepreneurs and inventors and investors doing R&D - this will mean it's just a place for cheap labour. And a labour, manufacturing intensive economy known for cheap knock offs and poor quality goods, poisonous food... cannot become rich enough to rule the world.


I heard from some lecture that "Japan got rich before it got old; China will get old before it get rich."

Ask any older Australians who hasn't gotten rich how their kids are treating them. Or how the welfare system see their years of service and contribution to society are valued when they can no longer keep on contributing.


Militarily, economically, China is not as rich or as strong as it and the world thought... yet it already starts to flex its military muscles and upset pretty much all its neighbours except for maybe Russia. Driving them into each others and Uncle Sam's arms.

Its leadership should do what Mearsheimer suggests and practice better hypocrisy like the United States. You know, make friends, speak of peace to the world, fund more Hollywood movies by Michael Bay showing off the second aircraft carrier fighting against sea monsters or something.

----

I think investors, particularly Australian with regards to the resources stocks, put too much emphasis on the rise of China as a requirement for Australian prosperity.

Australia has done pretty well long before the China boom.
 
luutzu said:
That's a bit much.
You should read into how European colonises other continents; how the US expand from their East Coast to California; how there's no more Aborigines in Tasmania; what Imperial Britain, Spain, Japan did to China... and we all have some idea of what Nazi Germany did to Europe and Russia and the Jews there.

The unfortunate thing for China is its political system meant it also does harm to its people and ultimately itself too.

Xi is saying he want to clean up corruption in China. If he's genuine he hasn't read history...

From my knowledge, the first guy that tried that was Lord Shang of the Ch'in around 300BC - he got torn, literally, to five pieces soon after the King, and his patron, died.

The other one was the last Emperor of the Ming - seeing his empire weakened through corruption, leading to civil unrest and external threats, particularly the Manchu... he tried to curb graft and corruption, collect proper taxes to the state and not to tax collectors' pockets... trying to strengthen China again...

End game was the Manchu walk into Beijing, get rid of the Li Royal family but otherwise kept all other Ming lower level officials and structure in place.

And of course the second-last Qing Emperor of China [Puyi's Uncle] - who tried to rebuild the Navy, the army etc... the dude died at 36 under suspicious circumstances.

-------

MacroEconomically, politically speaking, there is a limit to China's rise, to its potential.
Its political structure will mean continual social unrest;
Its large but aging population will probably mean some economic decline and possible social unrest resulting from its lack of social safety nets, pension plans, healthcare systems etc.

Its lack of IP, patent law and enforcements meant there's little incentives for Chinese entrepreneurs and inventors and investors doing R&D - this will mean it's just a place for cheap labour. And a labour, manufacturing intensive economy known for cheap knock offs and poor quality goods, poisonous food... cannot become rich enough to rule the world.


I heard from some lecture that "Japan got rich before it got old; China will get old before it get rich."

Ask any older Australians who hasn't gotten rich how their kids are treating them. Or how the welfare system see their years of service and contribution to society are valued when they can no longer keep on contributing.


Militarily, economically, China is not as rich or as strong as it and the world thought... yet it already starts to flex its military muscles and upset pretty much all its neighbours except for maybe Russia. Driving them into each others and Uncle Sam's arms.

Its leadership should do what Mearsheimer suggests and practice better hypocrisy like the United States. You know, make friends, speak of peace to the world, fund more Hollywood movies by Michael Bay showing off the second aircraft carrier fighting against sea monsters or something.

----

I think investors, particularly Australian with regards to the resources stocks, put too much emphasis on the rise of China as a requirement for Australian prosperity.

Australia has done pretty well long before the China boom.
Click to expand...

Very, very well said. A great delight to read after a long day.

Cheers to you
 
I find it odd that this is not being covered in our media.
That should concern all Australians.

Hong Kong Streets.JPG

https://twitter.com/JigmeUgen/status/484032540194639873?utm_source=fb&utm_medium=fb&utm_campaign=rosetangy&utm_content=484033487674953728

Hong Kong Streets 01.JPG

https://twitter.com/hashtag/OccupyCentral?src=hash
 
luutzu said:
That's a bit much.
Click to expand...

No it's not nearly enough.
The Nazis did not do this to their own people, neither did Stalin. It's on a scale the world has never seen and it's done for profit and political suppression. This is just one issue.

Read this book - “Bloody Harvest: The killing of Falun Gong for their organs,”

“What we’ve got here is a new, shocking, different form of evil,” said Matas (Canadian minister) “The Chinese Communist party. On Torture killing and organ harvesting of their own people for political reasons and profit.
 
notting said:
No it's not nearly enough.
The Nazis did not do this to their own people, neither did Stalin. It's on a scale the world has never seen and it's done for profit and political suppression. This is just one issue.

Read this book - “Bloody Harvest: The killing of Falun Gong for their organs,”

“What we’ve got here is a new, shocking, different form of evil,” said Matas (Canadian minister) “The Chinese Communist party. On Torture killing and organ harvesting of their own people for political reasons and profit.
Click to expand...

The world is cruel.

That's not to excuse the Chinese or anyone, but if you give anyone absolute power, even some power, and chances are they'll abuse it and kill every opposition. They don't have to be Chinese to abuse it.

Look at Stalin and his suppression, Hitler and just about every other authoritarian regime.

Throughout history, probably the only people who didn't abuse their absolute power (on their own people) were Cincinatus (Roman Republic), maybe the emperor Augustus, Claudius, Marcus Aurelius; in China: Duke Chou (1000BC ?) and Zhuge Liang (220 CE).

I only know of one instance where a group of people led a successful revolution, gained all the power, and set about establishing a new country where the power are given back to the people - the United States of America.

China is unlucky, so are many other other countries and people who had fought for independence and liberty.

So the comrades are doing what any unchecked power would do - knock heads. And just because most of those heads are also Chinese, it doesn't make them any more or less evil if others knock some other race's heads.
-----

I heard somewhere there's around 25 protests a day in China.
So any coverage by western media is a rare thing.

------

With regards to China's economy:

A youtube discussion from Uni of California TV (UCTV) with some strategist makes interesting reading. He goes:

1. Before 2008, China's strategy was of 'peaceful rise' - just keep making money, get rich and not upset the neighbourhood.

2. Since then, that very smart grand strategy was pushed aside by new fractions within the party and replaced with one that is more militarily assertive - pushing for claims everywhere.

The result of this is that weaker neighbours got scared and make alliances. They trade more with each other and buy less Chinese goods.

An example he gave was Huawei being banned by just about every country from selling their products - under national security issues; or refuse import of Chinese solar panels under guise of anti-dumping laws. The Mongolian open up their mines for tender and JV with anyone but the Chinese.


As an investor, the rise of China is not a good thing. You'd of course hope it doesn't collapse and bring the world markets (and hundreds of millions of already poor Chinese) with it, but as long as it doesn't collapse, a plateuing China is a safer and more profitable outcome as it will strengthen the weaker Asian states, and those states will more likely buy more from freedom loving countries like Australia rather than enriching an unfriendly giant.

And we as Australian, we get to sell to both a developing China that still need to feed and house its billion people AND also sell to faster growing Asian neighbours.

----

So how are the other countries trying to benefit from China? By not covering or caring about its abuse on its own people. It's a good thing for outside powers because an unstable China mean a weak China, and a weak China mean the rich Chinese will diversify and invest and deposit or lend their monies with other countries.

All these civil unrest and fights with its neighbours is like a dream come true for the great powers.

I think you like China more than it or you think.
 

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