End of the China bull?

[notting]

What 6 year crashing are you talking about?

The original point being that people who have been betting against the Chinese market for the last 6 years have got it totally right whilst the rest of the worlds markets had stunning rallies.





I've showed it till June because at that point I felt and was saying in this forum it was no longer worth shorting as continuing to bet with a 6 year downtrend is pushing your luck. About 2 months ago I called it a buy as it broke through 2500. All I did was trash it till then.
The recent drop in fuel prices is also very helpful for this basket case.

The fuel usage is indicating they are not growing.

 

[DeepState]

The original point being that people who have been betting against the Chinese market for the last 6 years have got it totally right whilst the rest of the worlds markets had stunning rallies.



View attachment 60753

I've showed it till June because at that point I felt and was saying in this forum it was no longer worth shorting as continuing to bet with a 6 year downtrend is pushing your luck. About 2 months ago I called it a buy as it broke through 2500. All I did was trash it till then.
The recent drop in fuel prices is also very helpful for this basket case.

The fuel usage is indicating they are not growing.

Oh...so by crash, you didn't mean fall relative to cash. You meant fall relative to anything else that went up a lot more. Interesting. So Iron ore has boomed as because it has fallen less against the USD than the Argentinian Peso in the last three years or so. I see.

About two months ago you made a call to buy China equities. I'm always on the lookout for people with talent in the markets. So, I checked. Back as far as June, the most bullish comment about Chinese equities that had been made was that the market was being ramped....

"China opens up it's markets somewhat to the west, whilst ramping the crap out of stocks in the local communist controlled media.

Seems some may be wising up right now!!!"

- 9 Dec 2014 in this thread. Not quite two months ago. Not a BUY unless something in there is code for BUY.


About 2 Months ago is October. Let's allow Sept to November. This is all I could find on a forum-wide search:

"Yeah, the best place to be is IN commodities right about now!" - 15 October in (Commodities), not exactly a BUY on the Chinese market, particularly given the context that it wasn't in a China thread.

I must have missed it. Could you please point out where you changed your call on the Chinese market? Do you post as a different identity as well? A bullish alter-ego?

Thanks.

 

[notting]

Thanks.

Those comments I made were not in this thread. I can't be bothered going through it all. It's exactly as stated.

 

[notting]

China is a total basket case and the ramp they have done in the local media, whilst opening up the markets to foreign investment and the lower oil prices were reason enough to get long at 2500, not for very long as I indicated above. But it still could go higher on the back of lower oil.

 

[DeepState]

Those comments I made were not in this thread. I can't be bothered going through it all. It's exactly as stated.

It's lucky for you I have so much more time and could be bothered doing a forum wide search then, as outlined. Took about 3 minutes because I don't do it much. The outcome was exactly as stated. If you are disputing the truth of what I am saying, I will yield immediately to tangible and coherent data. In this context, that would be a clear statement saying Buy Chinese equities (against anything else) around about two months ago.

I predict a boom of unbalanced argument and historical revision relative to something else I have yet to idenfity at this time but can nominate upon request. I can also predict a total collapse of it. If you need confirmation of the success of that call, it can also be provided upon request.

Thanks. Consistency is important and, FWIW, your views save me searching out a bear case. You are nothing if not motivated for a negative view of a situation and a positive view of the accuracy of prognostications. Pretty balanced on the whole.

 

[tech/a]

It's lucky for you I have so much more time and could be bothered doing a forum wide search then, as outlined. Took about 3 minutes because I don't do it much. The outcome was exactly as stated. If you are disputing the truth of what I am saying, I will yield immediately to tangible and coherent data. In this context, that would be a clear statement saying Buy Chinese equities (against anything else) around about two months ago.

I predict a boom of unbalanced argument and historical revision relative to something else I have yet to idenfity at this time but can nominate upon request. I can also predict a total collapse of it. If you need confirmation of the success of that call, it can also be provided upon request.

Thanks. Consistency is important and, FWIW, your views save me searching out a bear case. You are nothing if not motivated for a negative view of a situation and a positive view of the accuracy of prognostications. Pretty balanced on the whole.

Were you head of the debating team in Uni?

 

[notting]

Believe me I don't feel lucky about you not finding those comments or chart posts.
I'm not hanging out here like some dim witted day trader looking to be validated about being right. Which when you understand trading is basically a death wish.

The motivation for being so negative on China for these past 6 years was to counter the absolute drivel in the media pretty much all over the world about the miracle of China.
When US 60 minutes finally did a story on the ghost towns about 18 months ago and then when Goldman Sachs basically started saying exactly what I had beens saying about China around 10 months ago, finally! I didn't feel the need to be so vocal about it.

The world was wising up!

I also said in this forum that when Xi got in it was the best thing that had happened for China for about 60 years.
So my views are softening but there is so much damage and back log of the greatest scam overbuild the world will ever see.
They have just been playing a game of how long can we keep this up for, for over a decade.
The thing finally started halting when babies where being taken into hospital last winter with respiratory problems due to the pollution.
The reason they signed the carbon reduction thing with the US wasn't because they suddenly feel responsible, it's simply because they will suffocate themselves if they don't and that they probably aren't going to be growing anyway so the pollution will naturally slow down.

 

[DeepState]

Believe me I don't feel lucky about you not finding those comments or chart posts.
I'm not hanging out here like some dim witted day trader looking to be validated about being right. Which when you understand trading is basically a death wish.

The motivation for being so negative on China for these past 6 years was to counter the absolute drivel in the media pretty much all over the world about the miracle of China.
When US 60 minutes finally did a story on the ghost towns about 18 months ago and then when Goldman Sachs basically started saying exactly what I had beens saying about China around 10 months ago, finally! I didn't feel the need to be so vocal about it.

The world was wising up!

I also said in this forum that when Xi got in it was the best thing that had happened for China for about 60 years.
So my views are softening but there is so much damage and back log of the greatest scam overbuild the world will ever see.
They have just been playing a game of how long can we keep this up for, for over a decade.
The thing finally started halting when babies where being taken into hospital last winter with respiratory problems due to the pollution.
The reason they signed the carbon reduction thing with the US wasn't because they suddenly feel responsible, it's simply because they will suffocate themselves if they don't and that they probably aren't going to be growing anyway so the pollution will naturally slow down.

It's alright, Notting. Just banter. Personally, I do appreciate your posts and I do read them with interest. They scare the **** out of me on first review each time, largely because what you say is largely plausible. I know they come from a pervasively pessimistic perspective relative to whatever might pass for a moderate viewpoint at the time. It's up to me to balance it out if it needs to be done.

Thanks.

 

[History Repeats]

Long China into 2015

 

[luutzu]

Believe me I don't feel lucky about you not finding those comments or chart posts.
I'm not hanging out here like some dim witted day trader looking to be validated about being right. Which when you understand trading is basically a death wish.

The motivation for being so negative on China for these past 6 years was to counter the absolute drivel in the media pretty much all over the world about the miracle of China.
When US 60 minutes finally did a story on the ghost towns about 18 months ago and then when Goldman Sachs basically started saying exactly what I had beens saying about China around 10 months ago, finally! I didn't feel the need to be so vocal about it.

The world was wising up!

I also said in this forum that when Xi got in it was the best thing that had happened for China for about 60 years.
So my views are softening but there is so much damage and back log of the greatest scam overbuild the world will ever see.
They have just been playing a game of how long can we keep this up for, for over a decade.
The thing finally started halting when babies where being taken into hospital last winter with respiratory problems due to the pollution.
The reason they signed the carbon reduction thing with the US wasn't because they suddenly feel responsible, it's simply because they will suffocate themselves if they don't and that they probably aren't going to be growing anyway so the pollution will naturally slow down.

Yea I saw a couple of doco around the same time. Looks scary.

So what's your thoughts on what would happen if the Chinese economy goes down the tube? Or goes the way of Russia?

I mean, corruptions and incompetence aside, a lot of their major projects and factories seems to mainly operate to keep workers employed. If those goes you'd get hundreds of millions without work and there would be a lot of social unrest. Then patriotism and nationalism might need to be turned up and who knows, start a war or two.

 

[notting]

One positive is that they have been kind of achieving the slowest crash I've ever seen.
They still have a few trillion reserves in international currencies and are able to run surplices off the back of massive slave labour forces.
It's a bit like a privately owned US prison that uses the prisoners to profit.
They have not been that concerned about everyone dying at around 50 or 60 from air pollutants causing cancers catching up with 'the people' down the track.
It's good economic policy in Communist Parties eyes.
The cheapest of pension schemes.
A most convenient truth.
Micro bullets that the media calls mystical Chinese mist of the peace loving land of the people.
The younger generation will not have to fund the oldies because they will all be dead.
However when babies started choking they realised they had taken it a bit far and people were getting a bit pissed off.
So their curbing it, a little, and boasting about that to 'the people' in the state controlled media.
The Chinese communist party have thousands and thousands of armed vehicles that have four machine gunners sitting out the top four corners to cover all directions. They roam the streets when there is any hint of unrest. The people are all brainwashed into thinking fringe issues are just Americans causing trouble.
In the end it's an information war.
In this globalised information age it will be harder for the Chinese propagandists to control the people.
But so far they are pulling it off.
They are not as concerned about shrinkage as the world thinks.
They are just trying to look like they are playing along, whilst lying through their teeth and steeling everything from developed countries.

 

[Ann]

G'day all, Happy New Year to you!

There has been some good action on the China Shanghai Composite Index. A good run upward has delivered it above the 3000 level. It is far too early to call a shape but if the price zig zags back and forth above the 3000 level it may form into a flag or pennant shape. That would leave it sitting on top of a nice long flagpole. If it does form a flag/pennant on a flagpole it is likely to be a fine strong move upward on a breakout.

Only the locals are permitted to buy into this index but a number of years back a few funds were invited into China to buy into the index for a short period of time. One of them was AMP and they floated a fund called AMP Capital China (AGF). This stock tends to mirror the China Shanghai Composite fairly closely for anyone wishing to catch any potential rises in the Chinese market. (Disclosure: Holding)


Now for the chart of the China Shanghai Composite Index...

 

[CanOz]

FXI is having a much tamer go trying to follow the Shanghai market....suspect its mostly H-Shares. You think there would be some good pairs trading between the mainland and the HK markets right now...

 

[Ann]

FXI is having a much tamer go trying to follow the Shanghai market....suspect its mostly H-Shares. You think there would be some good pairs trading between the mainland and the HK markets right now...

Very, very interesting chart CanOz, perhaps this may be a massive buying opportunity for future rises in this index!

 

[notting]

Shanghai has ditched its official economic growth target for 2015, becoming the first major city or province in China to abandon such metrics as government policy shifts towards a focus on growth quality over quantity.

The move signifies both a nationwide move to switch focus from hitting annual targets with some of the fastest growth rates in the world — now that those rates are waning — as well as an effort to de-link growth from promotions at the local level.

Growth in gross domestic product has long been a key metric to evaluate the performance of local officials, helping to determine whether they were promoted. But President Xi Jinping last year said that “we can no longer simply use GDP growth rates to decide who the [party] heroes are”.

At least 70 smaller cities and counties abandoned GDP targets last year, mostly in areas with high poverty rates and those with special agricultural or ecological value. - First ghost cities abandoned, basically
But the move by Shanghai — one of four Chinese megacities with province-level administrative status — marks the first such move by a highly developed urban area. At least two municipal districts in Shanghai had previously cancelled gross domestic product targets for 2015, the official Xinhua news agency reported.

Analysts say excessive focus on gross domestic product has contributed to environmental degradation and urban sprawl as officials encouraged heavy industry and bulldozed agricultural land to build housing developments.

I'm not bearish on China equities any more so just posting this regarding Ausi trade and Iron Ore bearishness etc.

 

[notting]

Even though China doesn't want deflation, loosing the communists slave labor force is out of the question

[video=youtube_share;zFwwperDhlg]http://youtu.be/zFwwperDhlg[/video]

Chinese police beat up teachers who went on strike on January 23. All teachers at Number Ten Middle School of Changheng Town of Xinxiang City, Henan province marched in the streets protesting under pay. Scores of police were dispatched to beat up the unarmed teachers. More than a dozen teachers were severely injured (as seen lying on the ground in this video). Three had bones broken.

 

[StockTrader010]

Also still bullish on Chinese stocks. Chinese governement limiting margin trading had only a limited effect. Equities seem to be coping with the shock quite well.

 

[Miner]

OMG - before you read this let me warn that what I read and reproducing is not written by me but collected information from advertisement of Motley Fool magazine . So do not shoot me. However if it is true then I will be utterly trouble like millions of Australians and business houses. So please DYOR. Regarding copy right - this information collected from public domain and no where copyright was mentioned in the body of advertisement.

Courtesy to Motley Fool :

The scale of China's construction boom is off the charts. The country used more cement between 2011 and 2013 than the U.S. did during the entire 20th century, and its voracious hunger for Aussie iron has rained cash on our country.

China devours two thirds of the world's seaborn iron ore. So goes its appetite, so goes the price of iron ore.


You can't get a read on how China is faring by focusing on government-published numbers, though. It's the worst-kept secret in finance that no one trusts those numbers.

Instead, you’ve got to do your own homework, get on the ground, and find independent sources to get a directional health of the economy's health. For example, inventories and accounts receivable are growing faster than sales at the Chinese consumer companies we're following -- a classic red flag of low-quality growth.

And then there's construction, which matters most to Australians. Once again, independent sources paint a darker tale. Chinese steel demand fell 3.4% in 2014, per the China Iron & Steel Association -- the first drop in 14 years. Also, Caterpillar expects the Chinese market to shrink in 2015. Neither surprises us given the vast multitude of idle projects (and Cats) that we spotted.


With this much idle machinery, it's no surprise that Caterpillar sees Chinese construction shrinking in 2015.
China has overbuilt.
Unconfirmed report says 28% of the homes in Beijing had not used electricity for six months. In New York, he reckons that number might be more like 4%. Meanwhile, researchers at China's South-western University of Finance and Economics found that 49 million (22%) of Chinese apartments sold in 2013 were vacant.
In theory, those homes will fill up as Chinese move from the country to the city. In reality, there are enough empty apartments in China to house 6 years' worth of urban migration. That's more than an entire year's worth of global iron ore demand going up in smoke.
Combine that lost confidence with the lack of long-term financing for projects in China (typical of most emerging economies) and it’s easy to see how the wheels of construction can so quickly grind to a halt.
All that’s troubling enough as is, but iron ore supply is also growing.

UBS forecasts that iron ore’s oversupply will 6X from 35 million this year to more than 200 million by 2018. The major miners are fixated on gaining market share, and they will, but at the expense of crushing the iron ore price for years to come.
Some analysts think higher-cost supply will come offline in response to lower prices. Again, in theory, that's true. In reality, miners have many motivations -- faith, hedges, survival, and politics -- that will inspire them to keep producing at a loss, ruining the party for everyone. And, speaking of oversupply now is a good time to zoom out and recall that the iron ore price has spent most of the past 15 years at much lower prices than today:

Growing supply and falling demand is a bad combination.

Even Rio and BHP will find this price environment a bumpy road . And mining services companies? They’re not only in the same boat -- they’re tied to the anchor.
Navigating Tough Times
A major slowdown in mining will have knock-on effects for the rest of the Australian economy. Higher unemployment, lower capital expenditures, and more sour loans are all on the cards


(will reproduce in iron ore thread)

 

[DeepState]

How likely is the Yuan peg to be lowered in the next year?
What are the trade-able consequences for this? Why?

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[DB008]

China's Solution to $3 Trillion Debt Is to Deal with It Later

(Bloomberg) -- China’s government has a creative solution to address repayment concerns hanging over more than $3 trillion in regional debt. It will deal with it later.

The Finance Ministry issued a 1 trillion yuan ($160 billion) quota for local governments to convert maturing high-cost debt into lower-yielding municipal notes to be repaid at a future date, according to a March 8 statement. Questions left unanswered include whether investors will be forced into the swap, how much transparency there will be over assets involved and whether the liabilities will strain the nation’s finances.

China’s bond risk rose the most in a month on March 9 even as debt-rating companies welcomed the government’s plan to address regional debt, which Mizuho Securities Asia Ltd. estimates may have reached 25 trillion yuan, bigger than German’s economy. The ministry’s 500 billion yuan municipal bond trial and the auction of 100 billion yuan of special bonds is insufficient to meet local-government financing vehicle debt due this year while funding budgets, Moody’s Investors Service said.

http://www.bloomberg.com/news/articles/2015-03-10/five-questions-on-3-trillion-local-debt-pile-plan-china-credit