paulson is going to china to secure continued financing of the debt. you can bet him and his goldilock friends will be out of a job if the market isn't pumped up by election time. edit: paulson let it slip last year that he is watching or counting on rising equity prices to buffer the housing depreciation. the presidents working group on economic affairs events, probably had a few conversations over the weekend. What does cental bank intervention in the equity market look like? central bank intervention in currencies is the most amazing thing if you've traded it in fx. And currencies are a far larger market then equities. That same amount of muscle in equities would be pretty violent.
Itâs NOT A FREE MARKET, stupid!! :eek: Sorry guys But unfortunately thatâs the most fundamental reason why the Chinese market would not move along with the global markets.
Spoken by a man who knows what he is talking about. It was like the parting of the red seas, as I recall. The only thing I worry about is china flexing its muscles to make a point in the US equity market. They look at the same technicals too. Is there anyone here who knows anything about chinese intervention in the equity markets, particularly the futures? Anyone here have any connections or has heard any good rumors? Who do they use? (I doubt goldy)
Because China is a closed market. Try sell some Chinese stocks if you think it's too high and then you find out you can't even buy them in the first place.
Who cares about reasons? There really is no reason. Chinese stocks performed terribly from 2000 to 2006 when GDP and Chinese company profit growth kicked almost every other country's behind. No idea why the stocks were in an longterm down trend then, no idea why they continue to go parabolic now.
We Chinese also think the market is crasily high. But what can we do ? We can do nothing about it. We do not have a short sell mechanism for our stocks, we do not have stock index futures either, if you put money in banks, the inflation will eat you alive, if you want to invest in real estate, the house price has rocketed already, so if you want to confront inflation and hopefully make some money , you can only jump into the stock market buy some shares then cross your fingers praying you are not the last fool. You see, there are few alternatives for ordinary people in China.
The Chinese government has been doing a shit job by transforming most of the national income into US treasury bonds. Now we have above 1000 billions of USD at the cost of polluting our air, extinguishing our natural resources , overheating and losing control of our economy..... And then you guess what ? American just print more green backs, and all of a sudden central bankers in China found the 1000 billions of USD they thought they had earned began to vanish in an agonizing speed . And what makes it feel worse is that US Congress is pressing China to appreciate RMB more quickly. Can you imagine the big potato of a community borrow a huge amount of money from some poor neighbour and then press him to let you return less ? Chinese authority says they will not make the same mistake that Japanese made once in 1980s, but I am not optimistic on this issue.....
Interesting, the Americans are buying depreciating consumer goods. China is buying depreciating paper. If the US economy tanks, china loses twice, on export and on bonds. Is China more dependent on US growth than US on china growth. Is this a spiral to the ground for both? Who started this and who is trying to fix it? Is China manipulating the US or is the US manipulating china? I would like to know, a manipulator tends to fool himself.
actually i read somewhere one of the analyst reports that says what the chinese gov't does is call all the fund mgrs to a meeting & tell them they want done, & i would bet it gets done or else ...