Join Early Retirement Today
Reply
 
Thread Tools Display Modes
Dow up on news from China?
Old 03-05-2013, 09:39 AM   #1
Recycles dryer sheets
ducky911's Avatar
 
Join Date: May 2010
Posts: 497
Dow up on news from China?

Hi,

Did everyone miss the 60 min show about china's housing bubble? Pretty scary stuff...whole cities new but vacant...high rise apartments, malls..the works vacant.

Bob
__________________
You've got to ask yourself one question: Do I feel lucky? Well, do ya, punk?
Retired July '11 investments in very low cost index and mutual funds, balance once a year at best.
ducky911 is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 03-05-2013, 09:42 AM   #2
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
ziggy29's Avatar
 
Join Date: Oct 2005
Location: North Oregon Coast
Posts: 16,483
I suspect this is not news to Mr. Market and, if it is a factor in future economic expectations, it has already been priced into it.
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
ziggy29 is offline   Reply With Quote
Old 03-05-2013, 09:42 AM   #3
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
REWahoo's Avatar
 
Join Date: Jun 2002
Location: Texas: No Country for Old Men
Posts: 50,000
Here's a video link: China's real estate bubble - 60 Minutes - CBS News
__________________
Numbers is hard
REWahoo is offline   Reply With Quote
Old 03-05-2013, 09:57 AM   #4
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Lsbcal's Avatar
 
Join Date: May 2006
Location: west coast, hi there!
Posts: 8,797
The pictures were quite remarkable to me. This is not really new news but the scale of the problems is pretty amazing when shown on TV.

I notice that China only accounts for 4.5% of my broad index fund International Fund (VEU). But will this slow moving train wreck affect other markets?

It will probably cause the families who bought up the apartments to cut back on consumption as they appreciate that their investments will not pan out. This could then reduce China's willingness to import and open up their markets as the leadership tries to patch things up. It could cause a huge upheaval in the country which could lead towards more democracy or the opposite. Who really knows?

Don't quite understand the premise of the OP's thoughts on the Dow. Our recent market strengths have little to do with China I would think.
Lsbcal is offline   Reply With Quote
Old 03-05-2013, 10:18 AM   #5
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
ziggy29's Avatar
 
Join Date: Oct 2005
Location: North Oregon Coast
Posts: 16,483
Quote:
Originally Posted by Lsbcal View Post
Don't quite understand the premise of the OP's thoughts on the Dow. Our recent market strengths have little to do with China I would think.
If anything, I'd think the market would worry about this, not celebrate it. More and more of the economic growth in the major corporations that make up the US large cap market are more and more dependent on growth in emerging markets. The earnings growth Wall Street demands is sure as hell isn't coming from the US or most of the EU.
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
ziggy29 is offline   Reply With Quote
Old 03-05-2013, 10:32 AM   #6
Recycles dryer sheets
 
Join Date: Sep 2012
Posts: 62
Dow is up on on the news that Dow will be up tomorrow. It is called "inflating the bubble", i.e. when people invest because they are afraid to miss the opportunity to invest. At that point people don't care about China, and other minor nuances, like earnings, economy, etc.
hsv_climber is offline   Reply With Quote
Old 03-05-2013, 10:34 AM   #7
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
ziggy29's Avatar
 
Join Date: Oct 2005
Location: North Oregon Coast
Posts: 16,483
Quote:
Originally Posted by hsv_climber View Post
Dow is up on on the news that Dow will be up tomorrow. It is called "inflating the bubble", i.e. when people invest because they are afraid to miss the opportunity to invest.
Yes, when there is "irrational exuberance (think stocks in 1998 or housing in 2006), people can spin almost everything into a bullish interpretation, and when there is extreme fear and blood in the streets (late 2008/early 2009), those same events are explained in very bearish terms.

In the end, it usually pays to be a contrarian!
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
ziggy29 is offline   Reply With Quote
Old 03-05-2013, 10:46 AM   #8
gone traveling
 
Join Date: Sep 2003
Location: DFW
Posts: 7,586
Just goes to show how irrational mr market is and why nobody can predict what the market will do
eytonxav is offline   Reply With Quote
Old 03-05-2013, 11:29 AM   #9
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
donheff's Avatar
 
Join Date: Feb 2006
Location: Washington, DC
Posts: 11,313
Quote:
Originally Posted by ziggy29 View Post
If anything, I'd think the market would worry about this, not celebrate it. More and more of the economic growth in the major corporations that make up the US large cap market are more and more dependent on growth in emerging markets. The earnings growth Wall Street demands is sure as hell isn't coming from the US or most of the EU.
+1 It was a pretty scary view -- miles and miles of empty condos, people fighting to invest in vacant real estate. Wow. Every time I hear about the Chinese eating our lunch I think about the paper USSR tiger of the late 20th century. Russia made it's transition without a lot of the global economic horror stories we entertained while the walls were coming down. But if China implodes -- it is Katy bar the door.
__________________
Idleness is fatal only to the mediocre -- Albert Camus
donheff is offline   Reply With Quote
Old 03-05-2013, 11:50 AM   #10
Thinks s/he gets paid by the post
 
Join Date: Feb 2012
Posts: 1,495
Weren't we worried Japan was going to own us in the eighties?
H2ODude is offline   Reply With Quote
Old 03-05-2013, 06:56 PM   #11
Thinks s/he gets paid by the post
 
Join Date: Jan 2005
Posts: 3,525
I saw it and could not believe what I was seeing. I have never heard of whole cities, shopping malls and apartments being built and no one lives there. It made me extremely nervous. We live in a global society and if their house of cards fall down, I could definitely see it affecting our stock market.
Dreamer is offline   Reply With Quote
Old 03-06-2013, 03:06 AM   #12
Thinks s/he gets paid by the post
 
Join Date: Jan 2010
Location: dubuque
Posts: 1,163
I read somewhere that the prices of scrap metals as copper, brass, and steel are all at the level they are now because of the demand in china. all these components to construction have risen dramatically in the last few years because of china's bubble. It was a scary thing to see and what was scarier yet in the interview the real estate person said the average daily wage was about 2 dollars and that the people buying these apartments could not afford to live in them.
frank is offline   Reply With Quote
Old 03-06-2013, 06:27 AM   #13
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
pb4uski's Avatar
 
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 36,204
Quote:
Originally Posted by Dreamer View Post
I saw it and could not believe what I was seeing. I have never heard of whole cities, shopping malls and apartments being built and no one lives there. It made me extremely nervous. We live in a global society and if their house of cards fall down, I could definitely see it affecting our stock market.
+1 But I'm not sure how much of an impact the house of cards falling down on the other side of the world would have on us - some for sure but how much I can't fathom.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.

Retired Jan 2012 at age 56
pb4uski is offline   Reply With Quote
Old 03-06-2013, 06:53 AM   #14
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
donheff's Avatar
 
Join Date: Feb 2006
Location: Washington, DC
Posts: 11,313
Quote:
Originally Posted by pb4uski View Post
+1 But I'm not sure how much of an impact the house of cards falling down on the other side of the world would have on us - some for sure but how much I can't fathom.
My take too. A little, a lot? Who the F knows. But those ghost towns are eerie. The Chinese middle class apparently have no place they can invest their earnings other than a volatile Chinese stock market that scares them and real estate that they should be more scared of but are not. Go figure.
__________________
Idleness is fatal only to the mediocre -- Albert Camus
donheff is offline   Reply With Quote
Old 03-06-2013, 09:13 AM   #15
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Lsbcal's Avatar
 
Join Date: May 2006
Location: west coast, hi there!
Posts: 8,797
There are some "Web Extras" from 60 Minutes towards the bottom of this link: China's real estate bubble - 60 Minutes - CBS News

Those shorts are good viewing too.
Lsbcal is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


» Quick Links

 
All times are GMT -6. The time now is 09:18 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2024, vBulletin Solutions, Inc.