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Old 01-27-2011, 09:27 AM   #41
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Smart people, but not immune to the typical pressures of politically powerful vested interests. Case in point . . .

China has an inflation problem. But in the face of an inflation threat, the central bank is expanding the monetary base. Why? Because the nation's large exporters don't want the currency to appreciate. So China is printing Yuan, and buying dollars to maintain a stable exchange rate. To try to offset the inflationary impacts of loose monetary policy on an accelerating economy, China is resorting, unsuccessfully, to credit and price controls. Which is what the U.S. tried, unsuccessfully, in the 1970's. What's the likelihood that China's experience will be different from ours?

My guess is that one of two things happen in the next decade. An exogenous shock knocks the economy back and, thereby, tames the inflation problem. Or inflation becomes bad enough that a Chinese Paul Volker steps forward and takes away the punch bowl.
I deal with imported Chinese wood products and have watched this play out for years. Production costs keep rising and currency exchange rates changing but our prices are actually lower than they were six years ago. If prices rise too high such that their exports fall off then the government steps in and gives the manufacturers rebates on their corporate taxes dues. In early 2008 there were no rebates and then they went as high as 8% late 2009 and are now back down to 4%. They are definitely juggling a lot of balls so I hoped they've learned well.
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Old 01-27-2011, 09:28 AM   #42
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Old 01-27-2011, 10:12 AM   #43
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Dex, if you keep crying "WOLF" eventually a wolf will show up.
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Old 01-27-2011, 11:00 AM   #44
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Years ago I thought China was a train wreck in the making but have changed my opinions recently. I used to think there was no way the Communist Chinese would be able to run a pseudo capitalistic economy without running the train off the rails but they are smart and have done a pretty damn good job so far. Sure, they've had some problems and they're going to have some more serious problems going forward but, all in all, they've continued to surprise me. If they do screw up now that would certainly not be helpful to us or the global economy.
I worked in HK and had dealings on the mainland. It is an interesting story. They've done the heavy lifting so far. Now the challenges begin. They provided work and raised many out of poverty but can they keep that going? Their success in creating a middle class will put pressures on the government to get rid of corruption - a very big problem. Read the recent articles about Singapore and how they have dealt with it. Also, cracks in the idea of central planning are showing - caused by their economic slowdown.

Ghost towns of China: Satellite images show cities lying completely deserted | Mail Online

It should be an interesting story to watch unfold.
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Old 01-27-2011, 11:07 AM   #45
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Dex, if you keep crying "WOLF" eventually a wolf will show up.
At which point he will become a CNN talking head and milk the situation for at least 4-5 years based on having made the correct call.
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Old 01-27-2011, 11:09 AM   #46
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At which point he will become a CNN talking head and milk the situation for at least 4-5 years based on having made the correct call.
Heh, he's been real quiet about his last call.
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Old 01-27-2011, 12:06 PM   #47
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Heh, he's been real quiet about his last call.
I recall that some of the folks arguing the case for impending doom and going "all cash" were pretty quiet through 2007 and perhaps even into early 2008 as well, but were quick to return with a heaping dose of "I told you so" after Lehman imploded...
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Old 01-27-2011, 12:26 PM   #48
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I worked in HK and had dealings on the mainland. It is an interesting story. They've done the heavy lifting so far. Now the challenges begin. They provided work and raised many out of poverty but can they keep that going? Their success in creating a middle class will put pressures on the government to get rid of corruption - a very big problem. Read the recent articles about Singapore and how they have dealt with it. Also, cracks in the idea of central planning are showing - caused by their economic slowdown.

Ghost towns of China: Satellite images show cities lying completely deserted | Mail Online

It should be an interesting story to watch unfold.
Very interesting, I didn't know about all those ghost cities. In a true free market all that excess property would help bring their real estate prices more in line with reality. Of course it looks like the central planners put all this development in less than desirable areas and thereby negated that effect.
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Old 01-27-2011, 12:35 PM   #49
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I recall that some of the folks arguing the case for impending doom and going "all cash" were pretty quiet through 2007 and perhaps even into early 2008 as well, but were quick to return with a heaping dose of "I told you so" after Lehman imploded...
And most of them kept saying things would keep getting worse for an entire year after we passed the bottom. Not surprisingly, they've once again disappeared.

That's not the track record of someone who's thoughtful prediction has proven correct, that is the track record of a broken clock.
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Old 01-27-2011, 03:08 PM   #50
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I recall that some of the folks arguing the case for impending doom and going "all cash" were pretty quiet through 2007 and perhaps even into early 2008 as well, but were quick to return with a heaping dose of "I told you so" after Lehman imploded...
Everything would be nice and quiet if the Bollinger bands routine wasn't constantly being posted. What's the old saying "don't wish for something, you may get it"
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Old 01-27-2011, 03:46 PM   #51
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Hey, Dex has his methods and y'all have yours. Personally, I'm with him in anticipating bad things happening in the economy. I just don't believe these guys (Bernanke, Geithner, etc) are smart enough to continue balancing the ball on their nose without dropping it at some point. I don't buy into the bands and charts and such so much, but to each his own. I was over 50% in cash before the 2008 crash, mostly through extenuating circumstances, but the half of my net worth that was in cash is still worth more than the half that was in the market. That's with me being FIRE and not adding anything.

The rampant glee and "I told you so" attitude in this thread and in the general investing public has me leaning more to cashing out my existing 50% in equities than it does to jumping back in full force. This sounds an awful lot like the way people were jumping down the throats of posters who were warning us about the market back in 2007. And there are obviously a lot more market timers here than we tend to admit to.

Dex, feel free to keep posting your opinions. Just like everyone else here, they're worth what they cost.
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Old 01-27-2011, 03:51 PM   #52
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Just like everyone else here, they're worth what they cost.
Some folks have better track records than others. And if there is any positive value to be had from an opinion forum, one has to try to separate the wheat from the chaff.
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Old 01-27-2011, 04:55 PM   #53
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The rampant glee and "I told you so" attitude in this thread and in the general investing public has me leaning more to cashing out my existing 50% in equities than it does to jumping back in full force. This sounds an awful lot like the way people were jumping down the throats of posters who were warning us about the market back in 2007. And there are obviously a lot more market timers here than we tend to admit to.

Dex, feel free to keep posting your opinions. Just like everyone else here, they're worth what they cost.
First of all, no one suggested he wasn't free to post opinions, so please don't mistake disagreement or even criticism with censorship. That's a common mistake people make when defending what they perceive to be unpopular arguments. Critical response to someone's arguments is NOT censorship, folks, and is NOT an attempt to force someone to shut up.

Secondly, you make it sound like it's only the "anti market-timers" doing the I told you so routine. Have you already forgotten late 2008 and early 2009 when some of the seers of doom came back to exact revenge on folks whose 401Ks became 201Ks?

And finally, I don't know many people who are "raging bulls" who see explosive growth ahead -- just that there may be enough in the long run that they don't feel confident in going 100% defensive at this point or at any other point. Considering all the "expert" money managers whose calls are so regularly bad (to be fair, some are a bit better but none are what I'd call a "long term guru"), tuning out the noise and keeping with a steady plan at least avoids worst-case outcomes.
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Old 01-27-2011, 05:06 PM   #54
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Ziggy, this is not directed at you personally, but at the idea that someone should welcome what is called criticism but is most often just carping.

Realistically, a person would have to be masochistic to keep posting getting the "criticism" that Dex has seen here. Why do it? Should he care if we lose all our money?

Like I said to one poster who likes to demand what he calls evidence "sorry pal, but I pass". It is a disease of white middle class American men to think that they should be free "criticize" like this and still expect a continuance of any interaction.

Sometimes the most critical people produce the fewest helpful ideas (often enough no ideas at all), other than that whatever their target says is wrong.They make great candidates for the ignore function.

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Old 01-27-2011, 05:22 PM   #55
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Old 01-27-2011, 06:32 PM   #56
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Hey, Dex has his methods and y'all have yours.
I'm not sure which method has the better track record-- asset allocation or going to 100% cash, but I haven't had to spend every waking moment keeping an eye on the market.

Maybe I'll have to spend more time on the Passion Savings website.
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Old 01-27-2011, 07:26 PM   #57
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Ziggy, this is not directed at you personally, but at the idea that someone should welcome what is called criticism but is most often just carping.

Realistically, a person would have to be masochistic to keep posting getting the "criticism" that Dex has seen here. Why do it? Should he care if we lose all our money?

Like I said to one poster who likes to demand what he calls evidence "sorry pal, but I pass". It is a disease of white middle class American men to think that they should be free "criticize" like this and still expect a continuance of any interaction.

Sometimes the most critical people produce the fewest helpful ideas (often enough no ideas at all), other than that whatever their target says is wrong.They make great candidates for the ignore function.

Ha
Here are my thoughts about 'carping' in general.
- three of the people that posted here are on my ignore list, so I don't see their posts.
- 'carping' is more a refection on that person than on the OP.
- some people think they are funnier than they actually are - their posts might help them in some way.
- some have personality disorders but, I read their posts anyway.

What is negative about this that it might inhibit some people from posting.

You can find out a lot about a person from their relation with money. Discussions about it can elicit some emotional responses.

Everyone can tell a good post from a bad one. A good one gives a rational for their position. A bad one just makes a judgment.
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Old 02-04-2011, 10:12 AM   #58
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if you keep crying "WOLF" eventually a wolf will show up.
Chased by a bear.

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