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Posted

Oh, make no mistake, I am not bearish on the Macau casinos, and am not bearish on China long term either.  For a country of a billion and half people to experience in 30 years, what the West experienced in 200 years, all sorts of extreme phenomenon happen.  What has been going on is extraordinary, but for most entities grounded in Western framework, quite unpredictable.  For a North American investor, though, if you so chose, you don't really need to be involved in the game, which is a tough one to figure out.  There's a reason most of my friends in China chose not to preserve their wealth in the form of equities, but in real estate.  Because the equity game on the ground there is too hard for them too.

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Posted

Oh, make no mistake, I am not bearish on the Macau casinos, and am not bearish on China long term either.  For a country of a billion and half people to experience in 30 years, what the West experienced in 200 years, all sorts of extreme phenomenon happen.  What has been going on is extraordinary, but for most entities grounded in Western framework, quite unpredictable.  For a North American investor, though, if you so chose, you don't really need to be involved in the game, which is a tough one to figure out.  There's a reason most of my friends in China chose not to preserve their wealth in the form of equities, but in real estate.  Because the equity game on the ground there is too hard for them too.

 

As an American investor, a dozen "Chinese" investments over the course of 20 years may be enough to provide diversification & "juice" my portfolio.

 

If something is too difficult, take a pass.  If I don't like the "cut of their jib", I'll take a pass...I can look at 100 Chinese prospects and choose one.

 

An American investor has the advantage of being able to spread capital easily through many different countries.  For example, I have companies that are heavily concentrated in the USA, Canada, UK, Norway, China, Macau, Congo, Chile, Eritrea, Zimbabwe, Mexico, Greece, South Africa. 

 

I have also diversified to real estate, and physical possession of precious metals.

 

So being based in N. America is certainly an advantage!

Posted

http://www.wantchinatimes.com/news-subclass-cnt.aspx?id=20140224000086&cid=1203

 

I don't know the answer...anyone have it? If money printing is the answer China could certainly get on the printing press if they wanted....

 

 

Could?!  China is 12% of world GDP and accounted for 40-50% of world money creation in the last 3 years.  They have been on the printing press big time.  Why else do you think Central Bank reserves are so high?  (CBank reserves/global GDP matched only by 1920s US and 1980s Japan...)

Guest Dazel
Posted

http://www.forbes.com/sites/jackperkowski/2014/01/21/chinas-debt-how-serious-is-it/

 

yep could do more....you will see that china is well below the debt of the US and Germany....

 

two things missing.

 

1. U.S social security short fall-debt $20 trillion debt....Fannie and Freddie have more debt than the local chinese governments.

 

2. The U.S is not growing even with trillions per year in stimulus

 

the China growth rate along with their fiscal situation comparable to the rest of the world would allow them to continue to print enormous amounts of money...and they will...thats why they are buying up the worlds gold reserves with their $4 trillion in currency reserves.

 

dazel

Posted

I find this pretty concerning that China is devaluing the Yuan. Most expect that this is driven by the slowing economy, but my concern is that the US is tapering right now, which implies rising US rates and capital outflows from emerging markets, which should devalue the yuan anyways, but China doubling down on it, when really they should over time be raising the currency is very worrisome.

Posted

I find this pretty concerning that China is devaluing the Yuan. Most expect that this is driven by the slowing economy, but my concern is that the US is tapering right now, which implies rising US rates and capital outflows from emerging markets, which should devalue the yuan anyways, but China doubling down on it, when really they should over time be raising the currency is very worrisome.

In the short term this should lead to a pickup in economies that import goods from China?  I don't see how this smooth things out for the chinese longer term, but it seems good for the U.S. economy in the interim...

Posted
Cash and minimal exposure to commodities and commodity producing countries.

 

I agree but that might be a  little difficult given that you live in Canada like me  :P

 

 

Posted

Cash and minimal exposure to commodities and commodity producing countries.

 

I agree but that might be a  little difficult given that you live in Canada like me  :P

 

 

 

LOL -

Even though my earnings are in Canada most of my investments are in US and in USD. Tried to buy them while the US had been on sale over the last several years.

 

Will buy Canada when Canada is on sale.

Posted

Wow, Eric is posting a bearish article?  :o

Posted

I think it's going to blow.  I bought a lot of puts today.

 

Glad you're finally coming to the wet blanket party.  ;)

 

By the way, didn't you do something similar about this time last year?

Posted

I think it's going to blow.  I bought a lot of puts today.

 

Glad you're finally coming to the wet blanket party.  ;)

 

By the way, didn't you do something similar about this time last year?

 

Of and on I get these pangs of conscience.

 

This is just getting too much like Deja Vu all over again.

Posted

Let me try my hand...

 

When Yellowstone blows, it won't be a North American event!

 

Maybe I can write letters for hedge funds after all.

You should, Eric. After all, why stop at like $15 million? ;)

Posted

Thanks for those ideas DTEJD.  For some reason I didn't buy emperor when you mentioned it.  I can't even remember why now.  Also, regarding the junket thing, if I remember right emperor wasn't relying as much on the junkets as some of the others.

 

I own DSWL.  I don't think it's a fraud.  The thing I am concerned with is that their business isn't that good.  Instead of losing all your money in a flash the MOS could be eaten up with operating losses.  But I like net nets with a lot of excess cash/investments.

Posted

Nah!

 

Hey, I thought Gio recently admitted that perhaps the hedges were a mistake.  That was like the ultimate market top signal.

 

;D ;D ;D That would be epic if that actually happened. Just messing with ya, Gio!

 

Don't forget Hendry (who also thinks bitcoins are a good idea and was bearish for most of the entire time) also turned bullish pretty recently.

 

On another note, on my facebook page, a guy was bragging about his "50% gains in two months" and how he made 100% on facebook calls. I inquired about his longer term record...and was ignored.

Posted

Nah!

 

Hey, I thought Gio recently admitted that perhaps the hedges were a mistake.  That was like the ultimate market top signal.

 

;D ;D ;D That would be epic if that actually happened. Just messing with ya, Gio!

 

Don't forget Hendry (who also thinks bitcoins are a good idea and was bearish for most of the entire time) also turned bullish pretty recently.

 

On another note, on my facebook page, a guy was bragging about his "50% gains in two months" and how he made 100% on facebook calls. I inquired about his longer term record...and was ignored.

 

I find that to be a good technique for risk control.  Brag about your unbelievable returns if you've got them... then you'll be so terrified of having egg on your face that it forces to you gain some prudence and walk away while you are still ahead.  So that guy is doing the right thing to talk about 50% in two months -- it will be too humiliating to get wiped out after that, so he increases his chances of survival, ironically.

Posted

Or, if it does turn south, he might not just mention them (or lie). I don't think he'd lie about it but I could see him declining to discuss.

 

Not everyone is as honest and open as you are, Eric.

 

Oh, so I just checked and he goes on to say that he's not anticipating a "major correction like 2008". Close one!

Posted

^Why do you feel so, given that the US is trying to export more.

hmm I feel that the presence of cheap chinese goods helps hold down the cost and improve the (perception of?) standard of living in the U.S. 

 

The U.S. is always trying to export more, but as the domestic economy struggles to improve I think this may spur economic activity.  Rising tide lifting all the boats and such.

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