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Post by glennkoks on Jan 23, 2024 0:19:58 GMT
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Post by glennkoks on Jan 23, 2024 15:24:05 GMT
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Post by walnut on Jan 23, 2024 16:51:10 GMT
US economy is fairly weak. We are getting multiple calls every day from truck brokers, they don't call much when things are ok. When the US economy is weak, heavily leveraged China has big problems. But a quick look at China's stock indexes indicates bigger long-term structural problems.
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CHINA
Jan 24, 2024 13:25:52 GMT
Post by blustnmtn on Jan 24, 2024 13:25:52 GMT
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Post by walnut on Jan 24, 2024 14:33:06 GMT
It seems kinda like they are trying to get a technical bounce off the double bottom low on the Hang Seng, they just revisited a low that they had hit about a year and a half ago. I was looking at that low the other day and thinking - if that support fails, look out below. They were probably thinking the same thing. The Shanghai Index is below 2016 prices. From a value of the business equity perspective, the whole thing was apparently for nothing, and adjusted for inflation, they lost money. |
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Post by glennkoks on Jan 31, 2024 13:32:28 GMT
Well the selloff has continued and those free market capitalists are considering placing curbs on selling. I'm sure that is an effective strategy. The Chinese market is testing 10 year lows...
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Post by glennkoks on Jan 31, 2024 13:41:30 GMT
Political and social ramifications?
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Post by missouriboy on Feb 1, 2024 0:02:43 GMT
Nobody wants one billion condos in China at anywhere near what they cost. The capital that went into their construction, is largely lost to other areas of the economy.
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Post by glennkoks on Feb 1, 2024 0:49:16 GMT
I don't know if anyone knows how many vacant condos there are in China. Estimates are anywhere from 65 - 80 million. How long does it take for that size of a bubble to work itself out? How long of an economic recovery is it for many of the middle class who have pooled their life savings and invested in these homes? Has the one child policy pretty much guaranteed that these homes will never be lived in?
Perhaps I need to invest in demolition and recycling companies in China?
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Post by glennkoks on Feb 1, 2024 1:43:39 GMT
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Post by walnut on Feb 1, 2024 3:00:59 GMT
Care for a trip to China? Seems like now is as good a time as any...
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Post by glennkoks on Feb 3, 2024 15:34:43 GMT
For those of you who are interested in China and have a lot of extra time I recommend two YouTubers. China Update and SerpentZA. China Update is a daily nuts and bolts vlog focused on the Chinese economy and geopolitical events. Tony is a Kiwi who lives in China and is married to a Chinese national. His style is more traditional in the mold of Walter Cronkite and he can be a little dry.
Serpentza is an interesting guy as well. A native South African who left his home because he did not like the direction his nation was heading. He lived in China for 14 years and is also married to a Chinese national. His videos are more of a personal experience about his time in China and dealings with the Chinese government. If you get the time browse through his videos to get a western view on developments in China.
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Post by glennkoks on Feb 5, 2024 1:53:30 GMT
Probably the most detailed video of the Ghost Cities in China
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Post by missouriboy on Feb 12, 2024 4:31:31 GMT
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Post by duwayne on Feb 12, 2024 16:36:48 GMT
I don’t think the total number of empty homes is a useful indicator of how long it will take for China to work their way out of the housing bubble.
An employee in China receives a paycheck with deductions much like the US. But around the year 2000, there was an additional deduction, the specifics of which varies by geographical area, which is called a housing account. Both the employer and employee are required to contribute.
The money in this account, like an IRA, cannot be withdrawn prior to retirement except for specific purposes. In this case you can only withdraw to invest in housing.
The intent was to help (incentivize) people to buy their own home. This created a huge demand for houses. Now over 90% of Chinese own their own homes compared to 65% in the US.
But this also created a huge bubble which you are well aware of, bigger than the US sub-prime bubble. People bought more than 1 house (condo) on speculation rather than leave the money in their account unusable for other purposes until years in the future.
This led to an enormous level of now-empty sub-standard homes. Dirt floors, no-central heating, no place for appliances, was typical of homes built in the 1980’s. These homes will never be lived in again. New homes have been built which are below the standards people are now looking for and can afford and these newer, never lived in, low quality houses sit empty. A significant portion of the empty housing is undesired housing.
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