What the heck Happened to the Shanghai Market today.

[NW-Bound]

I lived in small towns my entire life...

Then why need the big city "stuff" now? Some Hong Kongers are paying $180/month to live in a 6' x 2.5' cage. Yes, a literal cage. What big city amenities can compensate for that?

Skip to 2:00 in the following video. This makes the tiny home movement in the US look so extravagant and luxurious.

 

[Mulligan]

Then why need the big city "stuff" now? Some Hong Kongers are paying $180/month to live in a 6' x 2.5' cage. Yes, a literal cage. What big city amenities can compensate for that?



Skip to 2:00 in the following video. This makes the tiny home movement in the US look so extravagant and luxurious.

That is absolutely crazy! I live in a 1500 sq. ft home by myself (which I think is on the small side). I guess there is 2 times a week I wish I was living in one of those cages....When I am vacuuming the house and when I am mowing the lawn!


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[Lakewood90712]

Looks like the Dow has gone skiing today (8-20-15) too

 

[NW-Bound]

Whoo Wee!

Are we having fun yet?

 

[mickeyd]

So, the personal savings of the Chinese population was piled up in these empty
high rises that were built and sold as investments, while much of the people
still live in squalor.

No Bogleheads in China?

 

[NW-Bound]

Not just real estate, but their stock market was also overpriced. I don't think Bogle would approve.

China has a real problem with their personal savings rate estimated as high as 40%, compared to less than 6% for the US. Too much money, too few places to put it. They were not allowed to invest overseas, else could buy up lots of cheaper foreign assets.

 

[Mulligan]

Not just real estate, but their stock market was also overpriced. I don't think Bogle would approve.

China has a real problem with their personal savings rate estimated as high as 40%, compared to less than 6% for the US. Too much money, too few places to put it. They were not allowed to invest overseas, else could buy up lots of cheaper foreign assets.

Well instead of buying stocks they could be buying living cages instead and be landlords.


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[NW-Bound]

Wow. If the Politburo happened to surf the Web and read this forum, they would invite you to be their financial advisor.

 

[Mulligan]

Wow. If the Politburo happened to surf the Web and read this forum, they would invite you to be their financial advisor.

Hey I am just a small town guy. Even poor people have plenty of space here. Those cages just blow my mind. If I didn't know it was true already, I would swear it was pure fiction from a movie!


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[Lakewood90712]

Not just real estate, but their stock market was also overpriced. I don't think Bogle would approve.

China has a real problem with their personal savings rate estimated as high as 40%, compared to less than 6% for the US. Too much money, too few places to put it. They were not allowed to invest overseas, else could buy up lots of cheaper foreign assets.

A savings rate like many on E-R . ORG ?

 

[NW-Bound]

If forum members appreciated the Paradox of Thrift, they would not make fun of the spendthrifts, whom we depend on to provide for our early retirement.

See: https://en.wikipedia.org/wiki/Paradox_of_thrift.

Note the following paragraph in the above Wiki article. This portion contains criticism of the Paradox.

the paradox assumes a closed economy in which savings are not invested abroad (to fund exports of local production abroad). Thus, while the paradox may hold at the global level, it need not hold at the local or national level: if one nation increases savings, this can be offset by trading partners consuming a greater amount relative to their own production, i.e., if the saving nation increases exports, and its partners increase imports. This criticism is not very controversial, and is generally accepted by Keynesian economists as well,[15] who refer to it as "exporting one's way out of a recession". They further note that this frequently occurs in concert with currency devaluation[16] (hence increasing exports and decreasing imports), and cannot work as a solution to a global problem, because the global economy is a closed system – not every nation can increase net exports.​

 

[bclover]

It got shanghaid !

That was funny.

 

[Lakewood90712]

I really like the 2 hour mid day trading break on the Shanghai exchange. Nothing like a good liquid lunch to get you going for a grueling second half.

? Did the NYSE ever have am and pm trading sessions ?

 

[I was misinformed]

You want too much! Coffee shops, restaurants, and grocery stores all stocked up just to serve a single customer, you?

An 18th century Chinese Emperor enjoyed the shopping experience
in a southern town so much he had a similar shopping street complete with
shopkeepers built in his own Summer Palace grounds in Beijing. I
visited the modern reconstruction several years ago and I recall
buying some ice cream from one of the shops...

From. https://en.m.wikipedia.org/wiki/Summer_palace.

Suzhou Street (苏州街; 蘇州街; Sūzhōujiē): In 1762, after returning from touring the Jiangnan region, the Qianlong Emperor ordered the construction of a shopping street resembling Shantang Street in Suzhou. The street was destroyed by the British and French in 1860 and was only restored in 1988.

 

[Lakewood90712]

Came across this on you tube, was a egghead economist ( oxymoron ? )talk from feb 2015. Kind of dry, only made it through the first speaker. Got an idea of where a lot of the US QE3 money ended up, and how it contributed to the housing bubble in China

Enjoy, better than a sleeping pill

 

[Lakewood90712]

Trading halt again. This time , " circuit breaker " tripped and all done for the day in the first 20 minutes. Me thinks It's going to be a long cold winter for the Shanghai exchange this year .

 

[NW-Bound]

Yes, Bloomberg says after their index dropped 7% right off bat, tripped circuit breaker, and traders went home after 29 minutes.

 

[hesperus]

Looks like another interesting day for the US markets ahead. With large cash positions held over from 2015, I'm continuing to buy on the way down

 

[ziggy29]

Looks like another interesting day for the US markets ahead. With large cash positions held over from 2015, I'm continuing to buy on the way down

I've been close to 60/40 and am fairly comfortable with that. I have an unusually high cash position for my age (I'm really more like 60/25/15 with about 15% cash) because I haven't seen enough value in stocks or bonds at current prices to entice me into buying more (Both seem at least fully valued to me if not higher). But yeah, if this carnage continues, I'll be using the cash to nibble on more securities on the way down. I might even be willing to go to 65/35 or even 70/30 for a while if prices fall enough to entice me.... but for now, staying the course and keeping an eye on the markets with my available portfolio cash. That all said, somewhere between 55-60% equities is still my long-term allocation.

I don't think it will be 2008 again, but this looks like it *could* be a significant speed bump that seems to be coming every 8 years. Fasten your seat belts; we're hitting turbulence.

 

[eytonxav]

I don't think it will be 2008 again, but this looks like it *could* be a significant speed bump that seems to be coming every 8 years. Fasten your seat belts; we're hitting turbulence.

Although my cash position is bigger than yours, I hope the landing gear does not fall off. Any how, I am going to wait a bit to see how this China syndrome plays out before buying.

 

[Theseus]

I don't think it will be 2008 again, but this looks like it *could* be a significant speed bump that seems to be coming every 8 years. Fasten your seat belts; we're hitting turbulence.

I don't do the short term trading like I did many years ago, but one habit still retained from that experience is to look at the stock futures in the early morning to get a feel for what the market might do on any given day. Looks like today may be a day for the doom & gloomers to feel like they are owed respect for being correct. Oh well, just another day...

 

[Senator]

I don't think it will be 2008 again, but this looks like it *could* be a significant speed bump that seems to be coming every 8 years. Fasten your seat belts; we're hitting turbulence.

George Soros thinks it will be 2008 again...
Soros: It's the 2008 crisis all over again

But have no fear, the Fed is going to raise rates right into the face of this thing. If you look at the 1930s, the Fed did exactly the same thing.

 

[mystang52]

I always thought the U.S. markets should have some sort of circuit breaker, as well. Considering the "hysteria" that often ensues in sharp market downturns, maybe a circuit breaker cooling off period would stabilize the markets a bit.
I'm generally against government interference in the free market. But so much of the stock market is run by automated trading maybe some tweaking is needed?

 

[MichaelB]

George Soros thinks it will be 2008 again...
Soros: It's the 2008 crisis all over again

But have no fear, the Fed is going to raise rates right into the face of this thing. If you look at the 1930s, the Fed did exactly the same thing.

The Soros remarks were given at a financial conference in Sri Lanka. While there is no transcript, the detail in the Bloomberg article reads

The current environment reminded him of the "crisis we had in 2008,"The Sunday Times in Sri Lanka reported on Thursday morning. "China has a major adjustment problem," he added, according to Bloomberg. "I would say it amounts to a crisis."

He did not say this is 2008 again. Actually, what is happening in China has little resemblance to the financial crisis of 2008, although it does make for scandalous headlines.

 

[meierlde]

I always thought the U.S. markets should have some sort of circuit breaker, as well. Considering the "hysteria" that often ensues in sharp market downturns, maybe a circuit breaker cooling off period would stabilize the markets a bit.
I'm generally against government interference in the free market. But so much of the stock market is run by automated trading maybe some tweaking is needed?

Interestingly some US markets do have circuit breakers, one example is the futures market where there are limits to the movement for the day, yeilding days that are limit up or limit down. Actually the stock market does have circuit breakers but they are very broad and have never been tripped. They come at 10% 20% and close for the day at 30%. The aim is to avoid things like oct 1987.