China Soveriegn Wealth Fund Buys Shares

[moore_capital54]

http://news.businessweek.com/article.asp?documentKey=1376-LSVM136S972801-7JAC8PV0QM4LSNF8UN2RS01FO5

 

If you gentleman remember a few weeks back I was wondering why as a fiscal policy or QE the government could not just buy shares, what better way to stimulate capital investment. Looks like China figured this out and is doing so albeit with earned wealth and not printed money.

 

A government sponsored buyback is just that, those shares will rarely hit the market, and the sellers are not looking to reinvest in treasuries, they look for higher risk profile opportunities.

 

The US republican debate was abysmal last night, even Romney seems a little numb.

[TorontoRaptorsFan]

Surely you don't think Obama should be given another chance. What about a Romney-Christie ticket?

 

P.S. Keep up your great posts. I enjoy reading them

[moore_capital54]

Honestly, call me naive but I GENUINELY believe in the 9 9 9 plan, I have been advocating something along the lines of this for many years:

 

http://www.bloomberg.com/news/2011-10-12/cain-s-9-9-9-plan-raises-2-5-trillion-in-revenue-campaign-says.html

 

I wish Romney would implement such a plan, because I don't think cain stands a chance.

[biaggio]

so what do you think the U.S. government is buying with QEIII?

[moore_capital54]

Think? We know, they are buying long-dated treasuries and reinvesting mortgage interest into MBS. Do you really think its a coincidence the markets have bottomed the same week that the central bank restarted the printing press. This is part of the cycle and it was very predictable. Personally I am all for it, whatever it takes to get the confidence back in the markets.

 

 

[biaggio]

Think? We know, they are buying long-dated treasuries and reinvesting mortgage interest into MBS. Do you really think its a coincidence the markets have bottomed the same week that the central bank restarted the printing press. This is part of the cycle and it was very predictable. Personally I am all for it, whatever it takes to get the confidence back in the markets.

 

I was thinking this in August.

http://www.cornerofberkshireandfairfax.ca/forum/index.php?topic=4917" data-ipsquote-contentclass="forums_Topic" 51069#msg51069

 

Is there anything specifically we should do differently to maximize our return?

 

I think that buying undervalued high quality assets as is advocated here will work just fine.