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Yes Virginia...It's a Bubble...

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  • #76
    Re: Yes Virginia...It's a Bubble...

    given the coming demographic problems, perhaps the empty cities are full of nursing homes.

    Comment


    • #77
      Re: Yes Virginia...It's a Bubble...

      Originally posted by jk View Post
      i think i would have highlighted this sentence:
      That elastic band tied to the brick on the tabletop got stretched a bit more this morning...
      CHINA: INTEREST RATES RISE BY 25 BASE POINTS

      14:51 05 APR 2011

      (AGI) Beijing - China's central bank raised interest rates by 25 base points on one-year deposits and loans, to 3,25 and 6,31%. It represents the fourth increase this year and will be effective from tomorrow. It was decided in order to bring inflation back under control, after it rose by 4.9% in February, which was well above the government target of 4%. . .

      Comment


      • #78
        Re: Yes Virginia...It's a Bubble...

        Originally posted by GRG55 View Post
        That elastic band tied to the brick on the tabletop got stretched a bit more this morning...
        CHINA: INTEREST RATES RISE BY 25 BASE POINTS

        14:51 05 APR 2011

        (AGI) Beijing - China's central bank raised interest rates by 25 base points on one-year deposits and loans, to 3,25 and 6,31%. It represents the fourth increase this year and will be effective from tomorrow. It was decided in order to bring inflation back under control, after it rose by 4.9% in February, which was well above the government target of 4%. . .

        I've been tempted:

        http://online.wsj.com/article/SB1000...812076888.html

        Do You Need a Chinese Bank Account?

        • By BRETT ARENDS


        We're perfectly happy eating in a Chinese restaurant. But will we start banking in a Chinese bank?
        It's not as crazy as it sounds. As The Wall Street Journal's Lingling Wei reported Wednesday, the Bank of China here in the U.S. has started allowing American customers to open an account and to invest up to $4,000 per day—and a total of $20,000 a year—in Chinese yuan, or renminbi. Until now, you had few options to hold money in yuan, which is a "closed" currency managed, and protected, by Beijing.

        Brett Arends explains why he thinks opening a Chinese Bank Account isn't as crazy as it sounds for American investors.


        The bank has three U.S. branches—two in New York, and one in Los Angeles. You'll have to fill out paperwork to open an account and provide two forms of ID. And there's a minimum deposit of $500.
        Is this a good idea? You may wonder why anyone would do this. Investing in Chinese currency may sound like something best left to speculators.
        But in reality this may be no more exotic than, say, Peking duck. Holding some of your money in Chinese currency—as part of a diversified portfolio, as they say—might be a very sensible move for all of us.



        AFP/Getty Images China solidified its financial might in 2010, becoming the world's second-largest economy.

        Why? Five reasons.

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        • #79
          Re: Yes Virginia...It's a Bubble...

          Originally posted by Jay View Post
          I've been tempted:

          Do You Need a Chinese Bank Account?

          ...
          I have been using the Singapore Dollar, which is quite easy to buy and sell, as a proxy for the yuan...

          Comment


          • #80
            Re: Yes Virginia...It's a Bubble...

            Originally posted by Jay View Post
            I've been tempted:

            http://online.wsj.com/article/SB1000...812076888.html

            Do You Need a Chinese Bank Account?
            Why? Five reasons.
            wouldnt one be better served by putting ones money into CEF ?

            or is this one now nearing bubble land too?

            Today 5d 1m 3m 1y 5y 10y

            52wk high: 23.46
            52wk low: 14.03
            EPS: N/A
            PE: N/A
            Dividend: 0.01
            Yield: 0.044783
            Market Cap: 5.34 b
            Volume: 626.35 k

            Comment


            • #81
              Re: Yes Virginia...It's a Bubble...

              Just be careful to watch the premium over NAV if one decides to buy or sell CEF [and sister closed-end fund GTU].

              Comment


              • #82
                Re: Yes Virginia...It's a Bubble...

                Originally posted by GRG55 View Post
                Just be careful to watch the premium over NAV if one decides to buy or sell CEF [and sister closed-end fund GTU].
                cef's premium is very low right now [around 4% and change last i looked], and gtu's even lower. [cef is issuing more shares to buy more bullion. that lowers the premium.]

                Comment


                • #83
                  Re: Yes Virginia...It's a Bubble...

                  Originally posted by lektrode View Post
                  wouldnt one be better served by putting ones money into CEF ?
                  Reasonable diversification is a good hedge for the unforeseen. The right foreign currencies are a very smart play in my mind. G, how do you play the the Singapore Dollar?

                  Comment


                  • #84
                    Re: Yes Virginia...It's a Bubble...

                    Originally posted by Jay
                    Just remember: China is the roach motel of money: it goes in, but it doesn't come out.

                    Originally posted by jk
                    cef's premium is very low right now [around 4% and change last i looked], and gtu's even lower. [cef is issuing more shares to buy more bullion. that lowers the premium.]
                    I don't follow these at all, but normally I'd expect premiums to decrease with rapid underlying price increases but then increase as money flows increase/price increases level off/reverse.

                    The net effect is to then force you to either buy high or pay a high premium.

                    Is this a wrong understanding?

                    Comment


                    • #85
                      Re: Yes Virginia...It's a Bubble...

                      Originally posted by c1ue View Post
                      Just remember: China is the roach motel of money: it goes in, but it doesn't come out.
                      The main reason I haven't pulled the trigger...

                      Comment


                      • #86
                        Re: Yes Virginia...It's a Bubble...

                        Does not CEF price change on supply and demand? Being 50/50 gold/silver esp at a premium under 4% earlier this AM seems to make CEF more compelling-especially with long awaited breakout of gold this AM.

                        On a tech chart basis, CEF fell back to its daily trend line at low 22. Upper targets are 25 and 28 in next six months. I like that upper target better than slv at 45.

                        Comment


                        • #87
                          Re: Yes Virginia...It's a Bubble...

                          Originally posted by c1ue View Post
                          Just remember: China is the roach motel of money: it goes in, but it doesn't come out.



                          I don't follow these at all, but normally I'd expect premiums to decrease with rapid underlying price increases but then increase as money flows increase/price increases level off/reverse.

                          The net effect is to then force you to either buy high or pay a high premium.

                          Is this a wrong understanding?
                          the premium tends to expand as metal prices rise, and contracts on sell-offs. the current situation with cef is rare- they're issuing new stock in order to buy more bullion. the increase in supply lowers the premium.

                          btw, the premium is also a reflection of the different tax status- cef is NOT an etf, it's a closed end mutual fund for tax purposes, and thus eligible for capital gains treatment. [but there's a special form, passive foreign investment form, to file in the first year you hold it, iirc, in order to do this.]

                          Comment


                          • #88
                            Re: Yes Virginia...It's a Bubble...

                            Chairman of Wisdom Tree tells it like it is on CNBC- gotta love this guy
                            http://www.cnbc.com/id/42432108

                            Comment


                            • #89
                              Re: Yes Virginia...It's a Bubble...

                              Originally posted by jpetr48 View Post
                              Does not CEF price change on supply and demand?

                              ...
                              To some degree. As jk mentioned, CEF is issuing new units, and this has depressed the premium.

                              Originally posted by jpetr48 View Post
                              ...Being 50/50 gold/silver esp at a premium under 4% earlier this AM seems to make CEF more compelling-especially with long awaited breakout of gold this AM.

                              ...
                              More compelling than what? Gold alone?

                              Silver has always struck me as driven more by the euphoria of abundant liquidity and expected consequent economic expansion, versus gold which is ultimately a vote of "no confidence"...
                              Last edited by GRG55; 04-05-11, 08:48 PM.

                              Comment


                              • #90
                                Re: Yes Virginia...It's a Bubble...

                                Another dot to connect. This is something the Japanese used to do all the time back in the 1980s. Initially it was in the belief that they had the negotiating advantage and could force desperate suppliers to keep cutting price and terms, but later it was because their own bubble economy had blown up...by then most North American suppliers had already weaned themselves off their overdependence on Japanese customers.

                                My guess is that a somewhat similar cycle has been repeating, but at a faster pace compared to three decades ago.

                                A contract is a contract. Maybe...
                                AMSC warns of Q4 loss as top customer refuses shipments

                                Tue Apr 5, 2011 6:34pm EDT


                                April 5 (Reuters) - American Superconductor Corp , which makes electrical systems for wind farms, said it will post a loss in the fourth quarter, as a slowdown in China's wind power market forced its top customer to refuse shipments.

                                Shares of AMSC tumbled about 50 percent in after-market trade, after China's Sinovel Wind , the world's third-largest wind turbine maker, refused to accept contracted shipments of some wind turbine components.

                                AMSC also said it is reviewing its books after Sinovel failed to pay for certain contracted shipments worth about $56 million, which it has already accounted for...

                                ...China's wind turbine sector, a stable source of growth for AMSC, experienced explosive growth in the past few years aided by hefty government subsidies. However, it is expected to be flat in 2011.

                                "They (AMSC) are still going to have to remain very focused on China, but obviously they are going to continue to diversify to more components with this market slowing down so significantly," Gleacher & Co analyst John Hardy told Reuters.

                                AMSC has been trying to diversify its customer base away from Sinovel, which accounts for about 75 percent of its revenue, through new wind turbine orders and emerging power grid opportunities...

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