Fukui-san Posted July 11, 2003 Report Share Posted July 11, 2003 Since "Asian Exotica" are such a popular topic of speculation here, I thought I'd provide a video of Ningbo, a city near Shanghai. Population 6 million. Representative of coastal China. Ningbo, China Video Requires MS MediaPlayer. It's a big file - requires highspeed internet download. And yes, there's even some "Asian Exotica" for the wannabe "Rice Daddys" on the board. Link to comment Share on other sites More sharing options...
mjkst27 Posted July 11, 2003 Report Share Posted July 11, 2003 Machinehead - my take on it is simply that I think the decade ahead will NOT be anything like the seventies. IMO there is way too much excess capacity out there in manufactured-goods-land to enable the sort of inflationary profit growth you describe. We're already seeing the squeeze - inputs like petroleum and natural gas getting and staying more expensive (and just wait till silver takes off ) yet no pricing power for the outputs because everybody and their brother all over the world is tooled up make just about anything you want. Not a recipe for rising profits or wages to this observer. The only way for companies to compete is to cut people or move offshore or both, which is not a good recipe for domestic economic health. While China and India will eventually be excellent world growth markets to sell into, for now they are tied directly to our fortunes. When the US swoons, so will they - their domestic economies aren't ready to spread their wings quite yet. I appreciate your long term forensic viewpoint. Do you see a cyclic economic recovery starting right now? I'm still waiting for the downturn to start, which I see as incipient right now, as the refi game dries up. The consumer is at full bore right now to my eye, and has only one direction to go, and that is toward thrift. That can't be good for stocks. I agree that a crash is unlikely. The stock market is way too politically visible, and will naturally be supported. But I don't think the "mutual fund crisis" can be written off. People will eventually sell their fidos for food and fuel. Link to comment Share on other sites More sharing options...
Fukui-san Posted July 11, 2003 Report Share Posted July 11, 2003 MachineHead. Good observation. Provides some balance and good historical perspective to the "lighting will strike 7 to 11 months" from now point of view. Probably also explains the prevalence of double tops and double bottoms. Link to comment Share on other sites More sharing options...
Fukui-san Posted July 11, 2003 Report Share Posted July 11, 2003 While China and India will eventually be excellent world growth markets to sell into, for now they are tied directly to our fortunes. When the US swoons, so will they - their domestic economies aren't ready to spread their wings quite yet. Personal experience? Have a look at the video I posted. The US economy going down the crapper would certainly cause major dislocations. But life would go on, as would trade. Especially within Asia. And Europe to a lesser degree. Link to comment Share on other sites More sharing options...
mjkst27 Posted July 11, 2003 Report Share Posted July 11, 2003 MachineHead. Good observation. Provides some balance and good historical perspective to the "lighting will strike 7 to 11 months" from now point of view. Probably also explains the prevalence of double tops and double bottoms. to be fair, hyper is not calling for a stock market crash in that timeframe. He could care less about the stock market. I'm sure he'd concede that a hyperinflationary runaway in the stock market is not out of the realm of possibility. He'd simply tell you that it won't stop the economy from locking up whenever the fractional reserve mechanism starts running in reverse. Link to comment Share on other sites More sharing options...
mjkst27 Posted July 11, 2003 Report Share Posted July 11, 2003 Personal experience? Have a look at the video I posted. The US economy going down the crapper would certainly cause major dislocations. But life would go on, as would trade. Especially within Asia. And Europe to a lesser degree. Never been to China. I have no doubts that the average Chinese wants and looks forward to one day having the best of everything, like the Americans have (rent, borrow?) today. But if the US trade deficit with China narrows significantly, the primary fuel (imported dollars) that China's banking system uses to pyramid debt upon is curtailed significantly as well. Not good news for China's economy, which is debt driven like everyone else's. Link to comment Share on other sites More sharing options...
RockLedge Posted July 11, 2003 Report Share Posted July 11, 2003 "What do the markets see that I don?t? That?s an impossible question to answer with any objectivity. After all, the ?truth? -- if there is such an animal in the macro debate -- is always in the eyes of the beholder. With all due respect to the loyal opposition, the bullish case for the economy does not exactly rest on the most credible of evidence. The key indicators that appear to be supportive of the so-called imminent upturn are largely ?soft? expectational data from tiny samples of economic actors. The widely followed purchasing managers? surveys of manufacturing and nonmanufacturing activity are cases in point; collectively, these surveys cover the sentiment of only 770 respondents -- 400 in manufacturing and 370 in nonmanufacturing. According to the US Census Bureau, in 1997 there were some 363,753 manufacturing firms in the US and some 6.0 million nonmanufacturing establishments. The manufacturing sample of purchasing managers is small, but nevertheless of acceptable statistical size. By contrast, the nonmanufacturing sample covers only 0.0001% of the full universe of companies -- a coverage ratio that wouldn?t make the first cut in an elementary statistics course. " Stephen Roach Link to comment Share on other sites More sharing options...
CMGI_FAN Posted July 11, 2003 Report Share Posted July 11, 2003 Since "Asian Exotica" are such a popular topic of speculation here, I thought I'd provide a video of Ningbo, a city near Shanghai. Population 6 million. Representative of coastal China. Ningbo, China Video Requires MS MediaPlayer. It's a big file - requires highspeed internet download. And yes, there's even some "Asian Exotica" for the wannabe "Rice Daddys" on the board. I'm downloading it now- even with a HS connection, it looks like it's gonna take about 2 hours to DL. Anyone else experiencing the same? Concerning China itself, everything I've read says that they have severe structural and infrastructure problems. Pollution is rampant, human waste disposal is at best medieval, and living conditions near major industrial centers are horrific. It's no wonder that most of the new strains of disease seem to originate there. Is this pretty much a fair assumption? Link to comment Share on other sites More sharing options...
DrStool Posted July 11, 2003 Author Report Share Posted July 11, 2003 Unlike the 70's, we remain in a fullblown mania where the public is still enamored of borrowing to consume and speculate. In the 70's credit was too expensive for that. As a society we are now about as fully invested as a society can get, with liquidity, sentiment, and credit conditions over the top. If the credit bubble stops churning out excess liquidity, as I think it is in the process of doing, the system will begin to contract in earnest. Stock prices will collapse. Not a matter of "if" in my mind, but when. As I pointed out last night, virtually no one is taking cogniznance of the fact that all classes of economic units are now being forced to consume principal out of necessity, because the excess liquididty in the system has made financing so cheap. It is now virtually impossible for the system to grow further because it cannot produce real returns. There is no incentive to invest, there is only incentive to borrow, spend, and speculate. Capitalists and governments are only too happy to oblige by supplying us with ever more stocks and bonds and options and futures and derivatives of every kind. It is free money to them. It will in the end be more than costly for the rest of us. It will be disastrous. Because there is nothing productive and useful, nothing of value, behind all this blizzard of paper. How many stories have we heard of homeowners refinancing in order to be able to live for another year. Take those stories and mulitply them by millions and think of them as they also apply to businesses and governments. No one is borrowing to invest any more. They are borrowing to buy groceries, pay the rent, and keep the electricity on for another month. At the end of the month they have nothing to show for it. The electricity is used up, the landlord is at the door, the cupboard is bare, and the money is gone. Link to comment Share on other sites More sharing options...
brian4 Posted July 11, 2003 Report Share Posted July 11, 2003 Well for a Bear today wasn't so bad. I got stopped out at the open and reloaded at the the close after the usual ramp. Had a real good day in futures an 8 point day which I'll take anytime. Futures was a walk in the park today the markets rose and fell in a predictable and uniform fashion. We had finished 5 waves down yesterday and are currently in the middle of the 3rd wave up-so sometime Monday maybe mid afternoon-whammo -as we go down again. MH that was a good piece but I have the same opinion as MJ on this one. History does always repeat and yes we never know WHEN. But I don't see anyway out of this box-too much overcapacity here and around the world and a tapped out consumer who just cannot continue to consume as they did before. J6P's debts won't go away nor will the goobermints or the states this current merger mania is just a desparate attempt by companies to stay alive by absorbing and then killing your competitor-but they too are doing it through debt that won't go away. To me the real villain of our fall from grace isn't the stock market or the politicos (who are as dumb today as they have always been) but rather the corporate giants who to get an edge gutted the manufacturing engine of the free world by moving everything off shore leaving America and Europe a hollowed out apple dependant on banana republics most of whom are hostile for our goods. What these false Gods are starting to realize is they killed the golden goose and all that "edge" they created means squat if they can't sell it to stay alive. What to me sums it up best is the recent Mr. Softy press release in which they said they are moving in a big way into India because a software engineer with the same education as those here cost 25k with few benefits instead of 150k and full benefits-what a patriotic bunch of p***ks-Trade Safe! Link to comment Share on other sites More sharing options...
DrStool Posted July 11, 2003 Author Report Share Posted July 11, 2003 I just got a a sample issue of Turov on timing from Dan Turov. I have asked his permission to post it for you all and willdo so if I hear back from him. In the meantime I responded to him thusly. Thanks Dan- Long term I'm wildly bearish. Seems to me we are merely ten years behind the Japanese, and following their model to the T, mistake by mistake by mistake. Unless an economy can earn real returns, which the Fed has made impossible by taking rates to zero, half the players all are forced to resort to wild speculation whcih always has disastrous results. The other half are forced to consume principal. If it goes on long enough most of these entities will disappear, or if they are individuals, be left destitute. In the short run I believe we are in the rigor mortis terminal blowoff phase of yet another Greasepan spnsored bubble. He will be remembered in history along with John Law as the greatest financial swindlers of all time. Our children and grandchildrene are being robbed of their futures. It's very sad. So we have no choice but to joke about it, I guess. Doc Link to comment Share on other sites More sharing options...
Guest Icky Twerp Posted July 11, 2003 Report Share Posted July 11, 2003 taking me a very l-o-n-g time to download also...either there's too many of us downloading at the same time, or... it must a CB Demille epic... Link to comment Share on other sites More sharing options...
CMGI_FAN Posted July 11, 2003 Report Share Posted July 11, 2003 taking me a very l-o-n-g time to download also...either there's too many of us downloading at the same time, or... it must a CB Demille epic... I think it'll take a little over 3 hours- I almost forgot it was loading- now an hour into it and I've got 30% of it. <_< Link to comment Share on other sites More sharing options...
Guest Posted July 11, 2003 Report Share Posted July 11, 2003 After the 1987 crash, I became very bearish. I thought it was the crack of doom for the world economy, much as the 1929 crash foreshadowed far grimmer events in 1931. Is it realistic to expect this historic event to repeat again, so soon? My best guess is that ......during 2005-2007...the economy turns grim again. ....... And possibly the gold market on the long side (driven by a coming "historic event" in the dollar). Anyway, these are just thoughts about the possible timing and vehicles for the next big shorting opportunity. An excerpt: it might be more appropriate to consider everything that has happened over the past 5 years or so to be a giant topping process and that the bear market actually lies in the future. Steve Saville I am guessing HypterTiger?s ?The END Of Game? may come true eventually. The historic events we observed in 1929-1932, 1973-1974, 1987, 2000-2002 has no match to the END GAME. Just like pre-shocks, the interval between each shock may be getting shorter and shorter, then KA-BOOM,, the main earthquake kicks in..... the only once for all. Link to comment Share on other sites More sharing options...
The brown one Posted July 11, 2003 Report Share Posted July 11, 2003 Yep,Doc absolutely bang on! IMO bears are not pessimists but realists with a sort of morality. Almost a sort of physicist who would think,if he were a stock physicist, the laws of nature can only be bent for so long before nature takes back what you took from her and with a vengeance! The FED and the Polits are convinced that they can bend the natural law to their liking for as long as it suits them--but can they?It's only a question of when not "if".Whether I can stay solvent that long,is another matter! Link to comment Share on other sites More sharing options...
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