Black Monday

[Joshuatree]

Thanks for sharing.Curious why u bailed out of oil,everything I've read suggests the oil price continuing to rise is a very low risk strategy.Or is it because of ESG (environmental,social,governenc e) reasons?

[Bobdn]

I still own oil through Vanguard's VDE (dominated by Chevron and Exxon) and have the oil services ETF OIH plus exposure through Smartshares ASR which contains all of the Australian producers.

There is very little oil exposure now in the major indexes so I decided to bump my exposure up a bit through these ETFs. Overall it's only a small part of my portfolio. I wish now it had been a bigger part :)

[Bjauck]

I think the Australian in question showed some taste and didn't visit them. He did visit an awful lot of eateries though. And every pre-Covid case seems to visit a chemist despite claiming they're not ill. I thought it sounded strange too until I realised that I also visit pharmacies more frequently when travelling or away. When away I usually or more often eat at cafes or restaurants and don’t go to supermarkets. However I may need elastoplast/ sun lotion/ mouthwash/ floss / sunglasses / travel sickness medication etc.

[Bjauck]

I think the Australian in question showed some taste and didn't visit them. He did visit an awful lot of eateries though. And every pre-Covid case seems to visit a chemist despite claiming they're not ill. At first, I thought it sounded strange too. Certainly when I am away from home, I usually or more often eat at cafes or restaurants and don’t go to supermarkets. However I do go to chemists quite frequently (maybe once a fortnight or every three weeks on average) at home if not for myself, maybe to pick a prescription or other items for family members. However in addition I may visit a pharmacy if I need elastoplast/ sun lotion/ mouthwash/ floss / sunglasses / analgesics/ travel sickness medication etc. when away instead of getting them at the supermarket..

[Habits]

https://navellier.com/wp-content/uploads/2021/06/Market-Podcast-June-30-2021.m4a

A must listen podcast.... US ten year treasury yields are falling, how come when the spectre of inflation is rising. Apparently there is a scramble to lock in yields before negative US interest rates happen under MMT. Is -ve interest possible when the economy is cooking... well Louis is right most times, if not more, and always seems to know what is happening beforehand

[JBmurc]

https://navellier.com/wp-content/uploads/2021/06/Market-Podcast-June-30-2021.m4a

A must listen podcast.... US ten year treasury yields are falling, how come when the spectre of inflation is rising. Apparently there is a scramble to lock in yields before negative US interest rates happen under MMT. Is -ve interest possible when the economy is cooking... well Louis is right most times, if not more, and always seems to know what is happening beforehand

And this is why Central banks really want digital only currencies ...so they can implement Negative rates directly to our accounts(will be yet another TAX).. and we won't have the ability to redeem and keep our funds in hard currency ..

Interest rates can't be allowed to rise just look at the debt the reserve currency of the world has https://www.usdebtclock.org/

$401Billion interest cost on net debt !! $150 Trillion Unfunded Liabilities .... No way the FED will do anything more than a token rise which will be remove in time to go Negative

[Joshuatree]

Thanks for that.Its a bit like the concept of infinity,hard to fathom.

[Biscuit]

And this is why Central banks really want digital only currencies ...so they can implement Negative rates directly to our accounts(will be yet another TAX).. and we won't have the ability to redeem and keep our funds in hard currency ..

Interest rates can't be allowed to rise just look at the debt the reserve currency of the world has https://www.usdebtclock.org/

$401Billion interest cost on net debt !! $150 Trillion Unfunded Liabilities .... No way the FED will do anything more than a token rise which will be remove in time to go Negative


Sure, they want to avoid raising interest rates, they want us to believe inflation is under control, and they will talk and talk and talk to reduce inflation expectations, but ultimately if inflation expectations start to take hold, there will be one choice: raise interest rates to curb inflation or stand aside and watch inflation expectations wreck the economy.

[bull....]

nz the worst market in the world this year still for performance. hence my focus on off-shore this year mainly europe and the US also the asx. guess nz will have its day again probably not this year though.

things might even get worse i see the US has threatened nz with sanctions for human trafficking. in case you think nz no way , nz is one of the worst places for labour trafficking

The Biden administration on Thursday designated 17 countries as not doing enough to combat human trafficking and warned them of potential US sanctions

The administration also called out several US allies and friends, including Israel, New Zealand, Norway, Portugal and Turkey, for backsliding in their efforts

https://www.nzherald.co.nz/nz/human-trafficking-us-slams-nz-for-weak-child-sex-response/M6D4TMPO3KVCN6LX7MBVXM6ZXQ/


bitcoin still in the range 30k - 40 k waiting for the woosh , might happen before my post posts lol anyway back to the US

[Entrep]

bitcoin still in the range 30k - 40 k waiting for the woosh

woosh up or down?

[Hoop]

https://navellier.com/wp-content/uploads/2021/06/Market-Podcast-June-30-2021.m4a

A must listen podcast.... US ten year treasury yields are falling, how come when the spectre of inflation is rising. Apparently there is a scramble to lock in yields before negative US interest rates happen under MMT. Is -ve interest possible when the economy is cooking... well Louis is right most times, if not more, and always seems to know what is happening beforehand

Looking back in History Yes it's possible

Up until late 1970's - onward, Interest rates and Inflation did not correlate very well..After late 1970's to 2020 interest rates v inflation correlated highly significantly. Why? I suspect it all had to do with the adoption of Monetary Policy..Recently we are seeing Central banks adopting new tools, so, yes it's possible that lower interest rate (at the short term anyway)/higher inflation era can now exist.

This is important for the Stock Market as many "expert" commentators suggest interest rates is the primary driver (not realising or not old enough to remember they weren't before the 1980's) In my opinion it is best to describe interest rates as quasi-drivers to the Share Market which have worked very well over the last 40 years. Apart from the buyers and sellers, the theoretical primary driver of the Stock market is inflation, which has been seen as taking a backseat during the recent low interest/low inflation era ..

[Rawz]

Just found myself talking to the wifey about how we need to buy a new fridge asap before prices go up.
Wow the whole inflation threat/issue/thing really hit home after that conversation.

[bull....]

looks like the whole inflation thing is really transitory , was just telling the wifey the real fear is the 10yr is at new lows. i mean it was at new highs just the other month and now we are at new lows this year talk about confusing , bit like the wifey some days. bet the rbnz is confused too , just like those economists changing there views nearly as frequently as there undie's these days.

Stocks, Futures Fall, Bonds Rise on Growth Concern: Markets Wrap
https://www.bloomberg.com/news/articles/2021-07-07/asia-eyes-steady-open-bonds-up-amid-taper-debate-markets-wrap?srnd=premium-asia

waiting for the woosh still

[Joshuatree]

A triple leverage short contract on the s&p 500 .40,000 upside calls on something that's been going down all year.A big bet. SPXU etf,
Bitcoin down 6%
KWEB etf internet stocks of China, large trades last few days of put activity
Broad market selling on CNBC tonite

[Joshuatree]

A triple leverage short contract on the s&p 500 .40,000 upside calls on something that's been going down all year.A big bet. SPXU etf,
Bitcoin down 6%
KWEB etf internet stocks of China, large trades last few days of put activity
Broad market selling on CNBC tonite

[Panda-NZ-]

looks like the whole inflation thing is really transitory , was just telling the wifey the real fear is the 10yr is at new lows. i mean it was at new highs just the other month and now we are at new lows this year talk about confusing , bit like the wifey some days. bet the rbnz is confused too , just like those economists changing there views nearly as frequently as there undie's these days.


Tech will dominate if 10 year yields drop again.

they will become monoliths. when does microsoft et al. start their own country?

[bull....]

Tech will dominate if 10 year yields drop again.

they will become monoliths. when does microsoft et al. start their own country?

yep the flight to big tech , now seen as the safety trade. see the DJT the trannies index has broken its uptrend from march 2020? wow often followed in the really old days as a leading indicator

[JohnnyTheHorse]

When QQQ is at daily overbought levels and making new highs day after day, it's always a good signal to place hedges with UVXY.

[clearasmud]

S&p and Dow Jones at New highs.
Looks like the bears are going to lose.
Ha ha optimism trumps pessimism again.

[Habits]

Four-day week business pioneer frustrated by slow uptake, Holidays Act law
https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12456727

Wins top prize for most stupid person trying to not look really dumb

[JohnnyTheHorse]

Beats on inflation estimates:

Qtr: 1.3%
Annual: 3.3%

Annualise that quarter and it's 5.2%

https://www.stats.govt.nz/information-releases/consumers-price-index-june-2021-quarter

With increasing rates we should watch for pressure on rate sensitive sectors (REITs & bond proxy companies).

[causecelebre]

Beats on inflation estimates:

Qtr: 1.3%
Annual: 3.3%

Annualise that quarter and it's 5.2%

https://www.stats.govt.nz/information-releases/consumers-price-index-june-2021-quarter

With increasing rates we should watch for pressure on rate sensitive sectors (REITs & bond proxy companies).

Well there you go 3.3%

[Habits]

Four-day week business pioneer frustrated by slow uptake, Holidays Act law
https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12456727

Wins top prize for most stupid person trying to not look really dumb

The success of Iceland's 'four-day week' trial is greatly overstated
https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12458403

Working 20 percent less equals less output.... funny that

[ratkin]

The success of Iceland's 'four-day week' trial is greatly overstated
https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12458403

Working 20 percent less equals less output.... funny that

Four day week hardly new. Was common in the Netherlands when I was there in the early Nineties. Worked great.
Three ways of doing it

1) Company works Four days but increases the length of each workday to compensate
2) Company works Four days, cutting weekly hours, but works harder
3) Company has staff working Four day rosters but operates for Five or Six days.

Way I see it option One and Three are fine. Option Two is problematic as it implies workers were not productive before the change. A good company should always be running smoothly, so like you say a cut in hours should lead to less output.

Having experienced working a Four day week (option 1). I found it great, the extra day off each week made such a difference. Felt much more like life revolved around leisure than revolved around work.

[Ggcc]

Four day week hardly new. Was common in the Netherlands when I was there in the early Nineties. Worked great.
Three ways of doing it

1) Company works Four days but increases the length of each workday to compensate
2) Company works Four days, cutting weekly hours, but works harder
3) Company has staff working Four day rosters but operates for Five or Six days.

Way I see it option One and Three are fine. Option Two is problematic as it implies workers were not productive before the change. A good company should always be running smoothly, so like you say a cut in hours should lead to less output.

Having experienced working a Four day week (option 1). I found it great, the extra day off each week made such a difference. Felt much more like life revolved around leisure than revolved around work.
Explain this to my accountant that works all week and half day Saturday and half day Sunday. All the partners at her firm work that many hours, so that staff get the 4-5 day week. Another way how to do it I suppose. Work the owners to death.

[dobby41]

The success of Iceland's 'four-day week' trial is greatly overstated
https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12458403

Working 20 percent less equals less output.... funny that

Seems to work well for Perpetual Guardian - they are happy with the experiment and continuing it.
They found that efficiency and output increased.

[Zaphod]

Seems to work well for Perpetual Guardian - they are happy with the experiment and continuing it.
They found that efficiency and output increased.

One company, in a very specific high-skilled field, with the study conducted over a mere eight week period; colour me highly skeptical.

[bull....]

yep the flight to big tech , now seen as the safety trade. see the DJT the trannies index has broken its uptrend from march 2020? wow often followed in the really old days as a leading indicator

those 10yr bonds really spooking people now. the growth on trade is getting pummelled. be interesting in hindsight to see if the bond market is right and growth slows/stalls at some stage.
Then we have RBNZ will they follow the very hawkish NZ banks in the face of whats happening off-shore? or will the nz bank economists have to change there position again after being ultra bearish and going to ultra hawkish all in the last year?

anyway the growth on index the russell has been going sideways since feb , the tranny has broken its uptrend and the dow has been going sideways for a few mths as well ... peak growth ? anyway index's look oversold intraday now

[Raz]

One company, in a very specific high-skilled field, with the study conducted over a mere eight week period; colour me highly skeptical.

Yes, ask the clients what they think about it. Know of numerous case of unsatisfactory service from them.

[BlackPeter]

Doppelgänger - tried to delete, but apparently is some sort of Zombie - attachments can't be deleted.

I do love this forum ...

[BlackPeter]

Fear in the markets starting to run high (well, low - but low is in this case high ...);

12758

The only question is - is this the beginning of the end, or is this just a case of "buy when others are fearful"?

Anyway - I am an optimist :):

[bull....]

those 10yr bonds really spooking people now. the growth on trade is getting pummelled. be interesting in hindsight to see if the bond market is right and growth slows/stalls at some stage.
Then we have RBNZ will they follow the very hawkish NZ banks in the face of whats happening off-shore? or will the nz bank economists have to change there position again after being ultra bearish and going to ultra hawkish all in the last year?

anyway the growth on index the russell has been going sideways since feb , the tranny has broken its uptrend and the dow has been going sideways for a few mths as well ... peak growth ? anyway index's look oversold intraday now

nice bounce on the dow intra day from oversold levels yesterday. looks like bitcoin breaking down from its consolidation.

[bull....]

those 10yr bonds really spooking people now. the growth on trade is getting pummelled. be interesting in hindsight to see if the bond market is right and growth slows/stalls at some stage.
Then we have RBNZ will they follow the very hawkish NZ banks in the face of whats happening off-shore? or will the nz bank economists have to change there position again after being ultra bearish and going to ultra hawkish all in the last year?

anyway the growth on index the russell has been going sideways since feb , the tranny has broken its uptrend and the dow has been going sideways for a few mths as well ... peak growth ? anyway index's look oversold intraday now

nice bounce on the dow intra day from oversold levels yesterday. looks like bitcoin breaking down from its consolidation.

[bull....]

anyway index's look oversold intraday now

nice bounce this morning on the dow. should be able to bank a few big mac's soon

[Bobdn]

https://www.youtube.com/watch?v=tC58Ee075Sw

Tom Lee predicts an everything rally.

Man, 2021 has been great so far. Not for NZ share market investors, of course, at the index level. NZG down 5 per cent ytd. USF? Up 21 per cent ytd.

Stay diversified people lol.

[bull....]

https://www.youtube.com/watch?v=tC58Ee075Sw

Tom Lee predicts an everything rally.

Man, 2021 has been great so far. Not for NZ share market investors, of course, at the index level. NZG down 5 per cent ytd. USF? Up 21 per cent ytd.

Stay diversified people lol.

NZX been a dud market this year , apart from the odd share. havent changed my view it will remain that way for the immediate future esp with ORR and the Reserve Bank of Aoteroa New Zealand lol raising rates tomorrow. banks already doing a good job of slowing the property market with there pre-emptive hikes and reaping massive margins in the process will all contribute to a slowing in GDP next year thanks to the over sized contribution housing provides to NZ GDP. Currency markets reflect the view in my opinion of a slow down later next year otherwise the dollar would be at 75c usd in a rising int rate environment

[Bobdn]

And there goes the NZD. Our Boy in the Bubble economy is just that vulnerable: one Covid case and all hell breaks lose.

[winner69]

And there goes the NZD. Our Boy in the Bubble economy is is just that vulnerable: one Covid case and all hell breaks lose.

And no OCR cuts tomorrow as well

[JohnnyTheHorse]

And no OCR cuts tomorrow as well

Adrian will be thrilled to finally have a good excuse.

[Dlownz]

Adrian will be thrilled to finally have a good excuse.
That rise is happening regardless
If he has pencilled in the 50bsp rise maybe he will change that to 25
But its going up anyway

[bull....]

nz markets getting savaged on 1 case , imagine what happen on 100 cases

[calledone]

nz markets getting savaged on 1 case , imagine what happen on 100 cases

It's most likely going to be level 4 lockdown and market seems to be moving in that direction. So 1 or 100 cases may not make a big difference unless the level 4 lockdown goes beyond 2 weeks.

[Sideshow Bob]

nz markets getting savaged on 1 case , imagine what happen on 100 cases

Probably on what the possible lockdown reaction will be to that 1 case - I've heard North Island level 4 for a week and South Island level 2.

[JohnnyTheHorse]

nz markets getting savaged on 1 case , imagine what happen on 100 cases

More cases = more stimmy for the markets.

[Greekwatchdog]

I wonder if this may change Orr's tack tomorrow on interest rates...

[bull....]

level 4 on the way nth island ?

[nztx]

CINDY on the Silly Box now :


All of NZ - Level 4 AKL & COROMANDEL - 7 Days

Everyone else Level 4 for at least 3 Days



Start 11.59 pm tonight


Robertson bringing out the Support Wheelbarrow after Cindy finishes squawking .. ;)

[Waltzing]

well Hawk on the wing tomorrow might give some opportunities.

[nztx]

well Hawk on the wing tomorrow might give some opportunities.


been a long wait, my friend .. ;)

so bad in fact - far off jobs were looking to need a look in for pickings .. :)

[Zaphod]

CINDY on the Silly Box now :


All of NZ - Level 4 AKL & COROMANDEL - 7 Days

Everyone else Level 4 for at least 3 Days



Start 11.59 pm tonight


Robertson bringing out the Support Wheelbarrow after Cindy finishes squawking .. ;)

Commercial tenants already emailing me for lease reductions. Let the fun times roll, yet again.

[bull....]

US markets having a reasonable risk of day today on bad retail sales , NZD getting thumped big time , NZ in lockdown , ORR ( RBNZ ) rate decision today be an interesting day in the NZ market might have to stay up and watch the action.

NZX current trading range 12814 - 12580
bigger range 12814 - 12090

negative divergences long term charts on an RSI indicator

[ratkin]

US markets having a reasonable risk of day today on bad retail sales , NZD getting thumped big time , NZ in lockdown , ORR ( RBNZ ) rate decision today be an interesting day in the NZ market might have to stay up and watch the action.

NZX current trading range 12814 - 12580
bigger range 12814 - 12090

negative divergences long term charts on an RSI indicator

According to ASB the rate rise unlikely to happen now, even though it is needed. Gives them an excuse to bottle it

[bull....]

no rate hike today by the rbnz and futures are now pricing in only 1 now for the rest of the year. think those banks might have to start dropping there mortgage rates again

[Mista_Trix]

As someone trying to buy a home. The move of no-move is super frustrating, may the hot prices continue.

[Bobdn]

Will be interesting to see how low the NZD goes. If oil and other commodities hold up, we could see some spectacular imported inflation.

[mcdongle]

On the radio this morning Orr said 2% for rates which means a home loan rate of about 5%

[Entrep]

Market appears to be off to the races again. Expecting more gains next week, post-Powell.

[JBmurc]

Market appears to be off to the races again. Expecting more gains next week, post-Powell.
For the month of August we've made 10 new intraday, all-time highs in the SPX... this hasn't happened in the month of August since 1987. The record number of intraday, all-time highs in the month of August is 11... which happened in 1929.

[Bobdn]

1929...yes it all feels crazy and I think that no amount of diversification (unless one is mostly in cash) will help when the balloon goes up but each "episode" is different so who knows. I was watching Tom Lee on CNBC just a few minutes ago on a Fast Money special. Very good as always. He thinks markets are going to be "in great shape" in 12 months but things are going to be volatile in the meantime.

I'm still not leaving the party lol and will brace myself for the inevitable feeling you get in the pit of the stomach when you suffer losses. You think you're ready for it but nothing can actually prepare you for it and then you play the game of "if I had sold last week I could have bought a [insert high priced consumer item from new OLED TV to new Honda Jet depending how much you've got invested]. That game never gets old!

The Tom Lee clip has been posted on Youtube.

https://www.youtube.com/watch?v=qXPWawbP-VY

[Grimy]

. That game never gets old!


You've got that summed up perfectly!

[FTG]

For the month of August we've made 10 new intraday, all-time highs in the SPX... this hasn't happened in the month of August since 1987. The record number of intraday, all-time highs in the month of August is 11... which happened in 1929.

Possibly another canary in the mine?

And here goes another one. Short Interest on the S & P 500 now at record lows.
Coupled with retail investors now holding the highest level in history of leveraged long positions.
12892

[JBmurc]

Possibly another canary in the mine?

And here goes another one. Short Interest on the S & P 500 now at record lows.
Coupled with retail investors now holding the highest level in history of leveraged long positions.
12892

Yes thinking once again to push funds across to SHORT the SP500 --BBUS .... certainly pre OCT ... everything is lining up to see a major correction

[clearasmud]

The obvious reason why shorts are so low is that they've already been burned to ashes.

[clearasmud]

Yes thinking once again to push funds across to SHORT the SP500 --BBUS .... certainly pre OCT ... everything is lining up to see a major correction

I'm thinking small correction. The trend up has been very strong.

[bull....]

Possibly another canary in the mine?

And here goes another one. Short Interest on the S & P 500 now at record lows.
Coupled with retail investors now holding the highest level in history of leveraged long positions.
12892

the bullish case is

maybe the highest leverage because credit is more readily available now.
short interest is low because they get burnt all the time.
companies are doing record buybacks and the US banks just got approval to start there buybacks
there still printing 120 billion of cash per mth which some of is going into the market
even tom lee was saying on another clip that he see's a melt up of everything heading into the seasonally great end of year.

but one day the bear case will win , maybe when there is an alternative

[JBmurc]

I'm thinking small correction. The trend up has been very strong.

we will see ...how long can the FED keep kicking the can down the road with ongoing TAPER talk ...while the FED balance sheet explodes .. Leader of the free word needs to be in treatment ... Afghan mistake ..many more nations moving away from the US dollar ..

[clearasmud]

I see it as "all noise".

[Entrep]

I haven't really followed NZX of late but noticed all my shares are down today. Anything up?

[winner69]

I haven't really followed NZX of late but noticed all my shares are down today. Anything up?

Probably tremendous GDP number …..economy on fire June quarter

But more likely following US down after lower than expected CPI

[Entrep]

For what it's worth I think the Evergrande stuff is totally overblown.

[Panda-NZ-]

Our strong economy is all over international media:

https://www.cnbc.com/2021/09/16/new-zealand-economy-surges-in-the-second-quarter-beats-expectations-.html
https://www.reuters.com/article/newzealand-economy-gdp/update-2-new-zealands-economy-surges-in-q2-supporting-rate-hike-call-idUSL1N2QH35X

[stoploss]

GDP number was higher today and bond yields spiked higher . Still have to get on top of Covid in Auckland but the market has priced in interest rate increases from the Central bank.

[Ggcc]

I haven't really followed NZX of late but noticed all my shares are down today. Anything up?
Most of mine went up today or stayed steady. Slow and steady wins the race

[Panda-NZ-]

Good time to be in power companies?

I'm dividend harvesting currently but wonder how rate rises will affect their underlying value.
When the OCR was 3% it didn't seem to hurt though ..

[BlackPeter]

Good time to be in power companies?

I'm dividend harvesting currently but wonder how rate rises will affect their underlying value.

When the OCR was 3% it didn't seem to hurt though ..

Not so sure ...

Power companies are seen as quasi bonds ... though expected to deliver a bit higher return than say BBB bonds.

Most power companies have at current a dividend yield of around (or slightly above) 3%.

If OCR goes up to 3% (I doubt though, it will anytime soon), than BBB bonds will pay at least 4.5 to 5%;

Which means that Power companies either need to increase their dividends by something like 50% (but where to take from) or the SP's will drop accordingly (to something like 2/3rd of todays).

I guess you are right - this will not hurt the power companies, but it might make a difference to the invested capital of the owners :):

[Balance]

For what it's worth I think the Evergrande stuff is totally overblown.

Agreed.

To put Evergrande’s $300 billion debts in perspective, it’s the equivalent of a group in NZ defaulting on $4.5 billion* of debts. Will that being NZ financial institutions & investors collapsing?

* NZ’s GDP is 1.47% of that of China’s in 2020.

[BlackPeter]

Agreed.

To put Evergrande’s $300 billion debts in perspective, it’s the equivalent of a group in NZ defaulting on $4.5 billion* of debts. Will that being NZ financial institutions & investors collapsing?

* NZ’s GDP is 1.47% of that of China’s in 2020.

True, might be however only the tip of the iceberg.

Lots of property speculation going on in China and an enormous amount of unfinished and not anymore wanted apartment buildings ... some town quarters seem to look a little bit like Ireland after the GFC.

Agree however - not that likely to bring the Chinese economy to a grinding halt, but it might be a bit more than an inconsequential scratch ...

[Balance]

True, might be however only the tip of the iceberg.

Lots of property speculation going on in China and an enormous amount of unfinished and not anymore wanted apartment buildings ... some town quarters seem to look a little bit like Ireland after the GFC.

Agree however - not that likely to bring the Chinese economy to a grinding halt, but it might be a bit more than an inconsequential scratch ...

It will impact but nothing like what some of the Western commentators are describing as China's Lehman moment. Laughable.

[bull....]

This year’s Santa Rally could be a particularly cheerful season for investors in S&P/ASX 200 Index (https://www.fool.com.au/latest-asx-200-chart-price-news/) (ASX: XJO) shares.
There are predictions that there will be an $84 billion-plus spending spree leading up to Christmas and into early 2022!
This bullish prediction is made by high profile Bell Potter trader, Richard Coppleson. He added up all the dividends, cash takeover bids and off-market buybacks to get to that staggering cash pile

https://www.fool.com.au/2021/09/16/this-years-asx-200-santa-rally-to-get-a-whopping-84bn-cash-boost/

[Panda-NZ-]

Good time to swap into AUD and buy shares through the ASX, even of nz companies.

$0.97/1.

[Panda-NZ-]

Senate Republicans may want to rig the market again so they can insider trade.:

https://edition.cnn.com/2021/09/08/business/debt-ceiling-default-explained/index.html

Potential black swan in a US debt default.

[bull....]

Senate Republicans may want to rig the market again so they can insider trade.:

https://edition.cnn.com/2021/09/08/business/debt-ceiling-default-explained/index.html

Potential black swan in a US debt default.

since democrats have a majority they can pass the increase in the debt ceiling by them-selves if they wish.

[bull....]

hang seng getting a downside pounding today on the evergrande senario .... guess with china on holiday they woory about it on there return

[Pumps]

Are we heading for another recession/depression?

[nztx]

hang seng getting a downside pounding today on the evergrande senario .... guess with china on holiday they woory about it on there return

Indeed - from Barrons:


It’s Crunchtime for Evergrande. The Market Is Worried.

It’s looking pretty bleak out there.

China Evergrande’s ever-worsening situation and the property developer’s slide toward possible collapse had, before Monday, failed to affect global markets. That could be about to change.

Europe’s major indexes were feeling the pressure early on Monday and Dow futures were more than 500 points lower. Closer to the source of the problem, Hong Kong stocks, and property stocks in particular, tumbled on Monday. But it didn’t end there, as banks and insurers were also dragged into the selloff.

Thin trading may be contributing to the selloff—there are holidays in Japan, China and South Korea. China’s two-day holiday, in the midst of all this, complicates the issue or adds to the drama depending on your viewpoint.

That’s not to say the impact won’t be felt across the Western world—BlackRock, UBS, and HSBC are among the largest holders of Evergrande’s bonds. A downturn in China’s economy would also have major implications across the world, particularly for commodities.

It’s also just too early to say at this point. Chinese authorities have already warned banks that the property giant, which owes more than $300 billion, won’t be able to pay debt obligations due Monday, but the real test comes later this week.

Interest payments on two Evergrande notes are due Thursday, the day China also returns from holiday. That will be crunchtime.

[Jaa]

Read about a scenario where China mostly bails out the Chinese Yuan debt holders of Evergrande while mostly stiffing the USD denominated debt holders.

Would fit Xi's world view but the backlash could cause further instability and trade disruption.

[bull....]

Read about a scenario where China mostly bails out the Chinese Yuan debt holders of Evergrande while mostly stiffing the USD denominated debt holders.

Would fit Xi's world view but the backlash could cause further instability and trade disruption.

good point , maybe the ccp want to crash the markets , anyway pretty ugly day on the markets

[Ricky-bobby]

Going to be interesting to see how markets react… further decline? I bet there will be nervous holders who find similarities to 2008…

[alokdhir]

Maybe time to come back to the stability and defensiveness of NZX . CCP doesn't care about stock markets and its investors as they are mainly seen as speculators and well off people who it wants to be seen as hurting to get general masses popularity

Moreover NZX is the only market which has consolidated for YTD and now ready to move up ....maybe this will help it get foreign capital for 5-10% gains in next 6 months

[JohnnyTheHorse]

I'm not so sure if any of the narratives (Evergrande etc) are actually influencing this in any meaningful way. I think it's just technical driven after a great run. I have personally been watching for US markets to consolidate for a few months now. They have had zero monthly consolidation in almost a years time! It would take SPY to drop below the monthly EMA12 at ~4000 (a further ~8%) for me to start seeing red flags. It can drop to this point and still be a monthly bull flag, leading to continuation of the trend.

Still too much cash on the sidelines waiting to buy dips.

[JohnnyTheHorse]

Another thing I have been watching and monitoring is correlations between the NZX and SPY. The NZX has had a very weak year compared to SPY, so I'm watching to see if this weakness is increased with SPY consolidation or whether we see overseas money flow back into the NZX.

[Entrep]

I'm not so sure if any of the narratives (Evergrande etc) are actually influencing this in any meaningful way. I think it's just technical driven after a great run. I have personally been watching for US markets to consolidate for a few months now. They have had zero monthly consolidation in almost a years time! It would take SPY to drop below the monthly EMA12 at ~4000 (a further ~8%) for me to start seeing red flags. It can drop to this point and still be a monthly bull flag, leading to continuation of the trend.

Still too much cash on the sidelines waiting to buy dips.

Yes it' a great excuse for a breather. Will be looking for any bargains.

[Tomtom]

For what it's worth I think the Evergrande stuff is totally overblown. Concur but it does seem like these Chinese construction companies are built on shifting sands. Investors have a lot of inventory, there is a lot of partially finished dwellings on the books and Chinas population is peaking.

Demography is destiny.

[bull....]

i dont think the evergrande thing is over blown , contagion risk is the biggie and property makes up 25% of china's GDP. so if the sector tanks and china experiences a sharp slow down that will have world wide implications.

anyway im guessing the ccp will manage the default and save the world

[Getty]

Are we heading for another recession/depression?

Yes Pumps, its time for some dumps.

[alokdhir]

i dont think the evergrande thing is over blown , contagion risk is the biggie and property makes up 25% of china's GDP. so if the sector tanks and china experiences a sharp slow down that will have world wide implications.

anyway im guessing the ccp will manage the default and save the world

I am in two minds if CCP will try to save world markets , local speculators or being perceived as rich people saviour to local population . But they do will try to save the financial markets and overall economy ...they have to do a very tight rope walking as situation can easily go out of hand worldwide . But CCP has absolute power unlike rest of the world leaders so they are most well placed to get the best possible outcome for themselves out of this " Golden opportunity " offered to them by pyramidically balanced speculative apartment market of China ...it was in the making for many many years ...works well in rising markets but moment slight trouble comes then it collapses like subprime mortgage fiasco ...its almost similar in China ...all over leveraged as all thought property never fails

[alokdhir]

Black Tuesday or Black week ?? This time action seems more real then lockdown announcement ...So may get good bargains ...How long to wait ??

[Jaa]

Thursday is the day we will know if they won't pay the USD holders. Then they have 30 days to remedy the breach. ie 30 days of brinkmanship and instability. Long way to go yet.

For those who say Evergrande doesn't matter, just look at the share price falls of BHP and RIO.

China's property market and that in much of Asia has been a giant bubble for years. So many stranded assets. Fine while your economy can grow into them.

Here's another possible scenario, Chinese investors facing margin calls sell crypto assets and wait for it even.... NZ and Aus property.

[alokdhir]

Thursday is the day we will know if they won't pay the USD holders. Then they have 30 days to remedy the breach. ie 30 days of brinkmanship and instability. Long way to go yet.

For those who say Evergrande doesn't matter, just look at the share price falls of BHP and RIO.

China's property market and that in much of Asia has been a giant bubble for years. So many stranded assets. Fine while your economy can grow into them.

Here's another possible scenario, Chinese investors facing margin calls sell crypto assets and wait for it even.... NZ and Aus property.

All your possible scenarios possible depending upon the severity of the cut thus the margin calls ...All Chinese HNI are more leveraged into property then stocks as they consider property safer ...but when the time comes they may need to liquidate stocks too . Also they have leveraged investments in property stocks as proxy of property investment and they are collapsing ....may lead to some margin calls . Let Shanghai open after mid autumn festival then u will see real impact ...at present only Hang Seng bearing the brunt . Crypto surely will follow but overseas property will be last resort as its not easy now to buy overseas property for resident Chinese .

[bull....]

thursday morning also fed meeting outcome and any news on there tapering. anyway oversold bounce occurring now in after hrs futures

[Jaa]

Seems to be an awful lot of articles saying Evergrande is NOT a contagion event and will cause only minor ripples. Or in S&P's language which predicts a default:


S&P Global Ratings on Monday said a default by Evergrande would cause more than mere ripples in financial markets, but would be unlikely to lead to a tidal wave of defaults.

Even Andrew Left, a short trader who warned about Evergrande's troubles 10yrs ago, got sued for it and banned from trading in HK for 10yrs reckons the CCP will just clean it but that we won't notice them doing it.

Evergrande’s potential debt blowup is ‘not a contagion’ event for the stock market, says the man who said the firm was insolvent 10 years ago (https://www.marketwatch.com/story/evergrandes-potential-debt-blowup-is-not-a-contagion-event-for-the-stock-market-says-the-man-who-said-the-firm-was-insolvent-10-years-ago-11632165402?mod=home-page)

[Balance]

Thursday is the day we will know if they won't pay the USD holders. Then they have 30 days to remedy the breach. ie 30 days of brinkmanship and instability. Long way to go yet.

For those who say Evergrande doesn't matter, just look at the share price falls of BHP and RIO.

China's property market and that in much of Asia has been a giant bubble for years. So many stranded assets. Fine while your economy can grow into them.

Here's another possible scenario, Chinese investors facing margin calls sell crypto assets and wait for it even.... NZ and Aus property.

RIO & BHP are adversely impacted by the 60% collapse in iron ore price in the last 2 months.

Shows what happens when the dragon decides to teach Australia a lesson?

[Jaa]

RIO & BHP are adversely impacted by the 60% collapse in iron ore price in the last 2 months.

Shows what happens when the dragon decides to teach Australia a lesson?

Not a great way to win friends or influence people though is it?

Or more specifically to get favourable long term supply contracts.

[Balance]

Not a great way to win friends or influence people though is it?

Or more specifically to get favourable long term supply contracts.

Unfortunately Australia at this point needs China from a trade perspective more than China needs Australia.

Trade wars benefit no one.

[Tomtom]

For those who say Evergrande doesn't matter, just look at the share price falls of BHP and RIO. Raw materials collapse likely has more to do with the Chinese slowing commodity production to meet environmental and clean air goals. Prices for steel products have went stratospheric:
https://fred.stlouisfed.org/series/WPU101707

China don't want to do our dirty work any more.

[Balance]

Raw materials collapse likely has more to do with the Chinese slowing commodity production to meet environmental and clean air goals. Prices for steel products have went stratospheric:
https://fred.stlouisfed.org/series/WPU101707

China don't want to do our dirty work any more.

Yup - the Western world keeps pointing the finger at China for carbon emissions but is perfectly happy for China to produce the goodies as cheaply as possible for them to buy. And in the case of the US, with unlimited printed money.

[Tomtom]

It's actually an exciting time for China. By deflating this housing bubble and cleaning up industry they are actually chartering a path to the next stage of their economic development.

The only thing I'm worried about with China is their demographic challenges. Chinese women are only having abou 1.18 children each (officially 1.3) and with peak population next year (according to state media) they are in a precarious situation where in 60-80 years they may have half the population which is an extremely steep decline.

[littletramp]

Will the NZ stockmarket get any sort of "filip" when the bonus bond money is released in November? Where will those savers put that money- maybe $1.3 billion?

[alokdhir]

Yup - the Western world keeps pointing the finger at China for carbon emissions but is perfectly happy for China to produce the goodies as cheaply as possible for them to buy. And in the case of the US, with unlimited printed money.

All go thru the process of development ...China is at some stage of development where they now have some luxury of choice ...they didn't 25 years back ...but then there will be some like Vietnam , India etc who will pick up the slack . As morals and principles are not important when tummy is empty . Western world devises rules about climate change and what not sitting in air conditioned rooms and all luxuries around ...which dont mean a damn to third world leaders who are actually concerned about feeding his poor masses . China started as the factory of the world now progressed to consumer of the world . They may stop adding to world climate woes by reducing factory emissions etc but they will be adding to it by following the foot steps of the west by becoming big consumers . Conspicuous Consumption is a thing to see in modern China .

Unlimited printed money of US comes from its exploits of 2nd world war victory . USA was the only country which won that war ...world is still paying for it . Military might due to technological advantage gives them that luxury of unlimited printing power of money as all lap up their dollar denominated bonds as safe haven as USA strongest militarily and so on .

China is following USA footsteps in all ways and closing the gap in most too ..militarily too ...to the big discomfort of USA .

When the time comes for showdown USA will use any of the many reasons it has to do that ...but real reason will be threat to its way of life based on being No1 militarily . US way of life ...based on consumption beyond means of all its citizens is supported only due to its military might thus demand for its unlimited supply of treasury paper .

[Balance]

It's actually an exciting time for China. By deflating this housing bubble and cleaning up industry they are actually chartering a path to the next stage of their economic development.

The only thing I'm worried about with China is their demographic challenges. Chinese women are only having abou 1.18 children each (officially 1.3) and with peak population next year (according to state media) they are in a precarious situation where in 60-80 years they may have half the population which is an extremely steep decline.

Will be like Japan where AI technology & robots will take up the slack.

[Tomtom]

Will be like Japan where AI technology & robots will take up the slack. Possibly, the demographic decline will actually be steeper than Japans and per capita they aren't nearly as wealthy. By 2050 the global population will also start to decline.

I seriously think we'll see a war to attract working age population to industrialised countries with aging/declining populations like Italy and Germany, Japan has already started down that path. English speaking countries seem to face less of a challenge currently.

[BlackPeter]

Possibly, the demographic decline will actually be steeper than Japans and per capita they aren't nearly as wealthy. By 2050 the global population will also start to decline.

I seriously think we'll see a war to attract working age population to industrialised countries with aging/declining populations like Italy and Germany, Japan has already started down that path. English speaking countries seem to face less of a challenge currently.

Plenty young people from poorer EU countries (like e.g. Spain, Rumania, Poland) in Germany ... and on top of that plenty of young refugees from the Near East and Africa. I don't think that they will have too many problems to keep their workforce running.

It is closed countries like NZ who will have to compete a bit harder for young people, but it appears our politicians don't understand the problem yet.

[Timesurfer]

We have a severe labour shortage now. Showing up in the planning / H&S type white collar roles without going into the blue collar and trades that are short handed.

[bull....]

plenty of young willing labour from the island's who want to live and work in NZ and there coming in NOV thanks to the govt relaxing immigration criteria

[Ggcc]

We have a severe labour shortage now. Showing up in the planning / H&S type white collar roles without going into the blue collar and trades that are short handed.
Not a severe labour shortage. We have a shortage of people who don’t want to work for minimum wage. Let’s face it, you can earn $22.50 at a supermarket, but start by getting $20.50 to wipe someone’s backside. Businesses can afford to pay more, but that needs to get passed onto their customers, which is not a good look for the retirement sector….. I am for paying them more and passing it in to the customer.

[Tomtom]

Plenty young people from poorer EU countries (like e.g. Spain, Rumania, Poland) in Germany ... and on top of that plenty of young refugees from the Near East and Africa. I don't think that they will have too many problems to keep their workforce running. Eastern and Southern Europe are suffering among the fastest aging and declining populations of any region in Europe. Unfortunately it still isn't nearly enough workers to slow the decline in more industrialised countries like Germany or Italy:
https://www.bloomberg.com/news/articles/2021-08-24/labor-agency-chief-says-germany-needs-more-immigrants

Demography is destiny. Just be glad we live in a country that has, and appears to retain, the ability to attract immigrants. Even if we lack the houses and infrastructure to grow our population.

[Tomtom]

Let’s face it, you can earn $22.50 at a supermarket, but start by getting $20.50 to wipe someone’s backside. I doubt that I could survive on those wages either. New Zealand is a very expensive country to live in at the moment.

[Panda-NZ-]

Plenty young people from poorer EU countries (like e.g. Spain, Rumania, Poland) in Germany ... and on top of that plenty of young refugees from the Near East and Africa. I don't think that they will have too many problems to keep their workforce running.

It is closed countries like NZ who will have to compete a bit harder for young people, but it appears our politicians don't understand the problem yet.

I wouldn't underestimate the abilities of other countries to drive them away.

UK has recently announced increased taxes on professionals and most workers.

[Ggcc]

I doubt that I could survive on those wages either. New Zealand is a very expensive country to live in at the moment.
I agree, but if we paid all staff fair ($30) the average cost of basics would need about roughly a minimum of 30% rise in all goods and services at the bottom scale. Ie cafes, takeaways, restaurants and so on.

[Mista_Trix]

Which ironically is a subsidy on the rich. We wont pay you well as we cant afford our lifestyles if we all do... but you can keep living hand to mouth, because, well, lattes.

[Jaa]

It's actually an exciting time for China. By deflating this housing bubble and cleaning up industry they are actually chartering a path to the next stage of their economic development.

The only thing I'm worried about with China is their demographic challenges. Chinese women are only having abou 1.18 children each (officially 1.3) and with peak population next year (according to state media) they are in a precarious situation where in 60-80 years they may have half the population which is an extremely steep decline.

Interesting discussion.

The CCP and thus China prioritises internal stability at all costs. So while changing economic models may well be exciting and beneficial in the long term, just like in NZ it will and is leaving many people behind.

Without political freedoms, people rely on the promise of a better life via increasing property values, stock prices, employment prospects etc. This is why the government has always bailed out any major failures. Xi probably should let Evergrande fail but will he take the risk?

This is also why you see so many laughable attacks on foreigners from Chinese diplomats like the Australia nonsense Balance proudly talks about. They are for internal consumption as it gives people someone other than the CCP to blame. Obviously history tells us this strategy is also full of risks!

For one it causes individuals and countries to take a harder line on China and decrease their ability to provide that increasing standard of living. Amazon's crackdown (https://www.theverge.com/2021/9/17/22680269/amazon-ban-chinese-brands-review-abuse-fraud-policy) on Chinese sellers with fake reviews is a small example.

[Balance]

https://www.reuters.com/world/china/china-evergrande-inches-close-default-deadline-investors-wait-2021-09-21/

Evergrande to make interest payment on 23 Sept.

[Waltzing]

EVG too big to fall over after all. Central bank stepping in , so much for the idea of them letting the chip fall where they may.

Sounds like are not going to let the it run it course after all.

[Balance]

https://www.scmp.com/comment/opinion/world/article/3149284/australias-war-posturing-against-china-out-tune-region-and

Past the point of no return between China & Australia?

[Balance]

https://johnmenadue.com/history-is-repeating-itself-billy-hughes-on-japan-and-now-scott-morrison-on-china/

History repeating itself - Australia making huge miscalculation with China.

[Panda-NZ-]

https://www.reuters.com/world/us/us-house-vote-tuesday-fund-govt-through-dec-3-raise-debt-limit-2021-09-21/

Your move Republican/united russia senators.

[nztx]

https://www.reuters.com/world/china/china-evergrande-inches-close-default-deadline-investors-wait-2021-09-21/

Evergrande to make interest payment on 23 Sept.


Evergrande is possibly a good indicator of the extent of potentially toxic, wounded and not far off
unrecoverable terminal lending which persists in the Chinese goldfish bowl .. plenty of previous warnings
on what lurks within the depths of their financial system IMO ;)

[kiora]

Kick the ball down the road
https://asia.nikkei.com/Business/Markets/China-debt-crunch/BlackRock-UBS-and-HSBC-Evergrande-bond-holdings-rise

[Panda-NZ-]

Fedex drops 10% due to labour shortage..

NZ business take note, Time for the country to automate and lift the woeful productivity we have here.

[Tomtom]

Without political freedoms, people rely on the promise of a better life via increasing property values, stock prices, employment prospects etc. This is why the government has always bailed out any major failures. Xi probably should let Evergrande fail but will he take the risk?
...
For one it causes individuals and countries to take a harder line on China and decrease their ability to provide that increasing standard of living. The Evergrande question is more complex than just bail out or fail. Reasonably PBOC might offer funding to other property developers to pick up those assets and just let everyone else take a very substantial haircut. Everyone is on notice now though that the speculative era in property is ending (as Xi Jinping told them would happen five years ago.)

Regarding quality of life and the push for Chinese consumption, this also comes at an interesting time. Across the world for four decades a substantial number of workers in the global workforce. There has been some really interesting work by Juselius and Takats who suggest this workforce-age effect has knocked about 3% p.a. off global inflation but they suggest historic evidence is that inflation will actually increase inflation by nearly the same amount absent further offset. Basically you have a higher number of consumers relying on a reduced workforce to provide goods and services. If true you'd expect to see labour markets get really tight and start to push inflation along.


Fedex drops 10% due to labour shortage..

NZ business take note, Time for the country to automate and lift the woeful productivity we have here.
:scared:

[BlackPeter]

Evergrande is possibly a good indicator of the extent of potentially toxic, wounded and not far off
unrecoverable terminal lending which persists in the Chinese goldfish bowl .. plenty of previous warnings
on what lurks within the depths of their financial system IMO ;)

I don't think that there is anything special about the Chinese system in that regard. Remember that the US had their Evergrande (aka Lehman Brothers) already 15 years ago - and they could not have handled the economic fallout at that stage worse than they did, even if they would have tried. It was America causing the GFC in 2007 / 2008.

Since that time nobody (neither the Americans nor the Chinese nor anybody else running big economies) seems to have learned from that last big crash ... Accelerated debt accumulation combined with money printing is speeding up - all over the world.

So, yes, I agree - we are likely to approach at some stage the next big (or even bigger) crash than the GFC, but I don't think there is any merit in blaming whoever provides the last straw to break the camels back. This is not a problem with the Chinese system, this is a problem with the world wide economic system and the prevalence of greed over caution and decency - everywhere where it matters.

[winner69]

Evergrande must be OK …BlackRock been buying in lately

No worries

[Balance]

Western economists, analysts & media have been blowing the trumpet of economic doom on China for the last 20 years!

The Chinese economic walls have not crumbled, and instead it's the US which provided the economic doom in 2008!

Why?

Simple - China is a centralised planned economy backed up by trillions of dollars of reserves, and real savings by the Chinese population. Huge cushions there to engineer soft landings.

Don’t forget that China (along with Germany) is one of the key countries to bail the world out of the Asian Financial Crisis & Global Financial Crisis.

It’s the US & Western economies where the next financial crisis will emerge imo - economies built on printed money created out of thin air.

[alokdhir]

Western economists, analysts & media have been blowing the trumpet of economic doom on China for the last 20 years!

The Chinese economic walls have not crumbled, and instead it's the US which provided the economic doom in 2008!

Why?

Simple - China is a centralised planned economy backed up by trillions of dollars of reserves, and real savings by the Chinese population. Huge cushions there to engineer soft landings.

Don’t forget that China (along with Germany) is one of the key countries to bail the world out of the Asian Financial Crisis & Global Financial Crisis.

It’s the US & Western economies where the next financial crisis will emerge imo - economies built on printed money created out of thin air.

Its not just thin air mate ...its based on technological advantage ...Just for example ...Only two OS available in world for all the mobiles of the world and both come from USA . China has labour and hardware but no software so could not compete on cell phone front with Apple etc as Google wont supply OS to very nice phones of Huawei ...previously a world leader company now almost in oblivion due to technological disadvantage .

So IMO China still needs USA more then people think . Also China is the biggest holder of useless paper bonds u refer to ...as that was part of the quid pro quo to let the factories running and workers getting wages .

Also how much immigration happens into China and how much outside and to where ...mostly western countries for reasons well known .

If big businesses can get threatened like Alibaba and Tencent bringing their stock investors to tears not because companies not doing well but suddenly regulatory risks become too hot to handle ...such things dont happen in western world ...IMO

So its not as simple as it seems ...both have flaws and advantages and both need each other for world to function well .

When one starts thinking in a dominant manner or only for their own benefit ...this balance of give and take breaks and both loose big along with World economy

[Balance]

Its not just thin air mate ...its based on technological advantage ...Just for example ...Only two OS available in world for all the mobiles of the world and both come from USA . China has labour and hardware but no software so could not compete on cell phone front with Apple etc as Google wont supply OS to very nice phones of Huawei ...previously a world leader company now almost in oblivion due to technological disadvantage .

So IMO China still needs USA more then people think . Also China is the biggest holder of useless paper bonds u refer to ...as that was part of the quid pro quo to let the factories running and workers getting wages .

Also how much immigration happens into China and how much outside and to where ...mostly western countries for reasons well known .

If big businesses can get threatened like Alibaba and Tencent bringing their stock investors to tears not because companies not doing well but suddenly regulatory risks become too hot to handle ...such things dont happen in western world ...IMO

So its not as simple as it seems ...both have flaws and advantages and both need each other for world to function well .

When one starts thinking in a dominant manner or only for their own benefit ...this balance of give and take breaks and both loose big along with World economy

I am not debating the relative merits of Western vs Chinese economies at all.

I am simply pointing out why Evergrande & China will not be the catalyst for the next financial meltdown or crisis.

[alokdhir]

I am not debating the relative merits of Western vs Chinese economies at all.

I am simply pointing out why Evergrande & China will not be the catalyst for the next financial meltdown or crisis.

That part I fully agree ...for many reasons but mainly China CCP wont let anything happen which tarnishes image in their opinion ...So stopping ANT IPO is ok but letting big companies default may not be as that may show Chinese economy not doing as well as being shown etc

[Balance]

That part I fully agree ...for many reasons but mainly China CCP wont let anything happen which tarnishes image in their opinion ...So stopping ANT IPO is ok but letting big companies default may not be as that may show Chinese economy not doing as well as being shown etc

https://www.nzherald.co.nz/business/evergrande-and-the-end-of-chinas-build-build-build-model/MRT6FT73WV44XARTMKJ3WO4KPU/

paywalled

This is a good read if you can access it.

Pertinent excerpt : "Ultimately, the fate of such bonds, and almost all other offshoots from the malaise in Chinese property, depends on Beijing. The Chinese state owns almost all of the country's large financial institutions, meaning that if Beijing orders them to bail out Evergrande or other distressed property companies, they will follow orders.

In some overseas markets the idea that Evergrande's distress may presage a "Lehman moment" — recalling the chaos that followed the collapse of US investment bank Lehman Brothers 13 years ago — has gained traction. But given Beijing's influence and vested interests, the analogy does not easily fit.

"Unless China's regulators seriously mismanage the situation, a systemic crisis in the country's financial sector is not on the cards," says He Wei, an analyst at Gavekal, a research company.

Indeed, the main cause of Evergrande's crisis and the downturn in the broader property sector is Beijing itself. The "three red lines" that the Xi government announced last year stipulate that developers must keep debt levels within reasonable bounds."

[alokdhir]

https://www.nzherald.co.nz/business/evergrande-and-the-end-of-chinas-build-build-build-model/MRT6FT73WV44XARTMKJ3WO4KPU/

paywalled

This is a good read if you can access it.

Pertinent excerpt : "Ultimately, the fate of such bonds, and almost all other offshoots from the malaise in Chinese property, depends on Beijing. The Chinese state owns almost all of the country's large financial institutions, meaning that if Beijing orders them to bail out Evergrande or other distressed property companies, they will follow orders.

In some overseas markets the idea that Evergrande's distress may presage a "Lehman moment" — recalling the chaos that followed the collapse of US investment bank Lehman Brothers 13 years ago — has gained traction. But given Beijing's influence and vested interests, the analogy does not easily fit.

"Unless China's regulators seriously mismanage the situation, a systemic crisis in the country's financial sector is not on the cards," says He Wei, an analyst at Gavekal, a research company.

Indeed, the main cause of Evergrande's crisis and the downturn in the broader property sector is Beijing itself. The "three red lines" that the Xi government announced last year stipulate that developers must keep debt levels within reasonable bounds."

Fully agree . Beijing is Omnipotent and has absolute power over all matters and they think much beyond business even in business matters .

Secondly in hindsight and maybe for future even western bosses will not let Lehman type dominos effect downfalls happen ...maybe more controlled falls or corrections as they have also realised collateral damage is just too much . That can be seen from unprecedented responses of western central banks to covid crisis . Market meltdown lasted exactly few weeks as they just wont let that happen anymore ...it damages the psyche of investors so much that it takes years to build confidence back to get the economies running Normally .

Every time a mistake catches up with any central bank ...they just throw more money at it as its just not feasible to let borrowers suffer as whole world is living on borrowing ...Poor future generations ...only way out of this debt fuelled consumption cycle in which whole world is participating is long years of high INFLATION to trivialise the debt amounts . Here also governments cant let Inflation effect poor so asset prices which poor dont or wont cry about keep inflating . We are in a very messy financial quicksand in the whole world

[Panda-NZ-]

We can all become Japan - 300% debt to gdp.

Their mistake was not letting in a moderate amount of inflation though. Theres no reason inflation should be below 2%.

[Balance]

The rich gets ever richer and the poor gets ever more marginalised.

Not much one can do but to take care of one’s own.

[alokdhir]

The rich gets ever richer and the poor gets ever more marginalised.

Not much one can do but to take care of one’s own.

What u say is true and that has its own terrible repercussions ...to which Chinese CCP has woken up and trying to placate poor . They of all fully know the power of poor people rising . Poor need to be included in some sort of development hope to keep them in control .

NZ example of poor rising is our Gangs and their untouchability already by any authority ....Covid rules for them not or wont be enforced ...Wanaka couple or individual rule breakers will be prosecuted ...thats the power of poor coming together .

[Rawz]

Isn't inflation a tax on the rich? Or tax on their cash? Tax on corporations holding cash.

If you are on the lower end of the pay scale your wage will follow the minimum wage which will follow inflation. So if you live paycheck to paycheck a 3% inflation rate shouldnt be a worry.

But if you are a billionaire or Apple/Google and have tons of cash in bank accounts earning 0.5% then you getting taxed 2.5% to help the rest of the world pay their debts.

[mondograss]

Isn't inflation a tax on the rich? Or tax on their cash? Tax on corporations holding cash.

If you are on the lower end of the pay scale your wage will follow the minimum wage which will follow inflation. So if you live paycheck to paycheck a 3% inflation rate shouldnt be a worry.

But if you are a billionaire or Apple/Google and have tons of cash in bank accounts earning 0.5% then you getting taxed 2.5% to help the rest of the world pay their debts.

Minimum wage only follows inflation if the govt of the day wants it to. Which often they do not. And I suspect the average billionaire keeps very little cash (proportionately) in a savings account.

[Rawz]

Minimum wage only follows inflation if the govt of the day wants it to. Which often they do not. And I suspect the average billionaire keeps very little cash (proportionately) in a savings account.

Google tells me there is $6.6 trillion US$ CASH in the world. That's the cash I'm talking about that will be taxed by inflation. Even my high growth kiwisaver option sometimes has cash. Everyone pays a bit I guess

[Balance]

Isn't inflation a tax on the rich? Or tax on their cash? Tax on corporations holding cash.

If you are on the lower end of the pay scale your wage will follow the minimum wage which will follow inflation. So if you live paycheck to paycheck a 3% inflation rate shouldnt be a worry.

But if you are a billionaire or Apple/Google and have tons of cash in bank accounts earning 0.5% then you getting taxed 2.5% to help the rest of the world pay their debts.

The rich can invest in inflation proofing their money.

The poor cannot keep up with inflation driving up costs, especially housing.

Sad state of affairs.

[JohnnyTheHorse]

The rich can invest in inflation proofing their money.

The poor cannot keep up with inflation driving up costs, especially housing.

Sad state of affairs.

Very sad.

I can only hope that many here realise how they've been favoured and give back (via charity etc) if they have the means.

[Tomtom]

Every time a mistake catches up with any central bank ...they just throw more money at it... They have that option because China has been producing far more than they consume which keeps global interests rates unusually low. However I do not believe that scenario will persist much longer, you'll see Chinese consumption increase as they enter this next phase of economic development and Chinese productivity will fall as it's workforce rapidly ages.

[clearasmud]

Interesting, but plenty of automation this decade which is also deflationary

[Panda-NZ-]

They have that option because China has been producing far more than they consume which keeps global interests rates unusually low. However I do not believe that scenario will persist much longer, you'll see Chinese consumption increase as they enter this next phase of economic development and Chinese productivity will fall as it's workforce rapidly ages.

However half of the american economy is also broken particuarly in the southern states.

California has to carry and lift up the corpse of their conservatism.

[Jaa]

https://www.nzherald.co.nz/business/evergrande-and-the-end-of-chinas-build-build-build-model/MRT6FT73WV44XARTMKJ3WO4KPU/

paywalled

"Unless China's regulators seriously mismanage the situation, a systemic crisis in the country's financial sector is not on the cards," says He Wei, an analyst at Gavekal, a research company.

Indeed, the main cause of Evergrande's crisis and the downturn in the broader property sector is Beijing itself. The "three red lines" that the Xi government announced last year stipulate that developers must keep debt levels within reasonable bounds."

So no need to worry because Xi will act against his own three red lines from last year and save the day?

Surely its as likely a few bankruptcies and fire sales are an intended or at least acceptable consequence of those three red lines?

[Balance]

So no need to worry because Xi will act against his own three red lines from last year and save the day?

Surely its as likely a few bankruptcies and fire sales are an intended or at least acceptable consequence of those three red lines?

Put it this way - as the article highlighted, almost all of the major China lending banks are owned by the government.

In the event of default, the banks will end up owning the companies. So the government will in effect own the companies at loan values - ie. bye bye equity & billionaires. Right up Xi’s playbook?

[nztx]

We can all become Japan - 300% debt to gdp.

Their mistake was not letting in a moderate amount of inflation though. Theres no reason inflation should be below 2%.


Has Robertson managed to reach that milestone for us yet - or a few more lockdowns needed ? ;)

[Panda-NZ-]

The credit rating is a good metric .

NZ: AAA/AA+
Japan: A

[Jaa]

Put it this way - as the article highlighted, almost all of the major China lending banks are owned by the government.

In the event of default, the banks will end up owning the companies. So the government will in effect own the companies at loan values - ie. bye bye equity & billionaires. Right up Xi’s playbook?

Agreed. That part makes sense. Praiseworthy even.

What then happens then to the debt holders and the smalltime Evergrande "wealth management" investors protesting at the HQ? My guess of paying the Yuan holders and stiffing the USD holders is looking right so far.

The contagion risk comes from Chinese investors losing faith in property all at once and especially in unbuilt apartments, necessitating fire sales by other developers and thus a downward spiral. That's the tightrope especially as:


Real estate products and services account for 29% of GDP. Ireland and Spain may have touched those levels before the [global financial crisis]; the U.S. at the peak was 15%.
Why the Evergrande Crisis Will Ripple Throughout China’s Economy, (https://www.marketwatch.com/articles/chinas-housing-boom-is-running-out-of-steam-harvard-economist-rogoff-says-where-the-risks-are-with-evergrande-51632342007)

[Tomtom]

However half of the american economy is also broken particuarly in the southern states. California has to carry and lift up the corpse of their conservatism. Yes, again across western countries you'll see consumption sustained or increased with population growth but most of that growth is in people beyond retirement age.

It'll probably make investing a lot more challenging than the last few decades. It's taken almost no cognitive ability to invest at a reasonable return, even if you knew nothing about investing you could just buy property and wait. In a rising rate environment suddenly you really have to earn your returns.

[Jaa]

USD interest payment missed, they have 30 days to remedy the breach.

Employees also not paid at China Evergrande Nw Egy Vhc Grp Ltd. Popping of the EV bubble as well?

[nztx]

USD interest payment missed, they have 30 days to remedy the breach.

Employees also not paid at China Evergrande Nw Egy Vhc Grp Ltd. Popping of the EV bubble as well?

but wait - Barrons now come out with this:


Evergrande is facing another $47.5 million payment on its debt next week

heaped on top of the $83.5 million offshore bondholder interest suggested to be unpaid


Guess that's what happens when there's too much surplus loot to invest & rates are so attractive,
nothing like tossing a pile down a black hole, and then fire another pile in, in the hope that
all of it "Grandely" resurfaces mysteriously back out soon after and everything is sweet for Ever after ;)

This year's large bonuses may be starting to look kaput in a few American Fund Investment Offices ;)

The way things are going, it's looking like burnt eggs for some Bonds investors hoping for a top chinese
breakfast out of the kitchen IMO and a case of "we got your money, we not pay any interest & not a
thing you can do about it" ;)

or maybe something like this -

"Would you like a fine haircut instead of breakfast ? - We can make it look like you have no hair at all" ;)

[bull....]

evergrande contagion is the elephant in the room

A Look Inside The $52 Trillion Bubble That Has "Hijacked China's Economy
https://www.zerohedge.com/markets/look-inside-52-trillion-bubble-has-hijacked-chinas-economy

[Old mate]

Unreal bull. Some pretty amazing stats in there.

[ronaldson]

I suggest you google an interview carried on Australia's ABC Television 5 days ago between journalist and presenter Stan Grant and a certain Victor Gao, VP of The Centre for China and Globalisation, a professor at Suzhou University and former translator for Chinese Leader Deng Xiaoping. 11 minutes that should be compulsory viewing - took less than 50 words to threaten Australia with nuclear attack! Make of it what you will but my take is that these are very dangerous people.

[dobby41]

I suggest you google an interview carried on Australia's ABC Television 5 days ago between journalist and presenter Stan Grant and a certain Victor Gao, VP of The Centre for China and Globalisation, a professor at Suzhou University and former translator for Chinese Leader Deng Xiaoping. 11 minutes that should be compulsory viewing - took less than 50 words to threaten Australia with nuclear attack! Make of it what you will but my take is that these are very dangerous people.

The only country that has made a nuclear attack is the US.
I don't like warmongering from anyone but the US has perpetuated more wars than anyone.

[Rawz]

I don't like warmongering from anyone but the US has perpetuated more wars than anyone.

Lol are you sure about that? Or are you talking post WW2?

[Panda-NZ-]

US and Australia will have up to 1B climate refugees showing up soon.

In 2040... the world environment will be different with Millenials in charge.

Boomers sadly have a terrible record on starting conflicts and then losing.

[Panda-NZ-]

In saying that a diplomatic coalition should be launched against china, which isn't a democracy, and the US should never have left the TPPA.

[dobby41]

Lol are you sure about that? Or are you talking post WW2?

Yip, post WW2 (I should have made my thinking clear there, sorry) when the US saw themselves as the world policeman - or was that bully boy?

[Gunner]

Lol are you sure about that? Or are you talking post WW2?

Thanks for clarifying. Those Roman's were very war hungry.

[Panda-NZ-]

Thanks for clarifying. Those Roman's were very war hungry.

Nonetheless a superior civilisation to it's christian successors.

[jonu]

Yip, post WW2 (I should have made my thinking clear there, sorry) when the US saw themselves as the world policeman - or was that bully boy?

While the US and the Allies in general made mistakes post WW2, you perhaps should show a little gratitude for them standing up at least partially to Stalin. The Cold War was thing in case you've forgotten.
How quickly we forget. Unfortunately Eastern Europe bore the brunt of the UK being broke and exhausted, and the US being cautious in not over extending themselves in Europe. Stalin hoovered up and enslaved the spoils.

[BlackPeter]

The only country that has made a nuclear attack is the US.
I don't like warmongering from anyone but the US has perpetuated more wars than anyone.

You are right with the nuclear attack. Related to starting the most wars - it appears that Britain started some more wars in its history than the US did (some unconfirmed internet source says 110, but I didn't re-count), but admittedly, they do have as well a longer history.

[Panda-NZ-]

The US invaded Canada and Mexico if we want to go further back.

[Panda-NZ-]

You are right with the nuclear attack. Related to starting the most wars - it appears that Britain started some more wars in its history than the US did (some unconfirmed internet source says 110, but I didn't re-count), but admittedly, they do have as well a longer history.

Unfortunately not when it counted (vs germany).

NZ took rather a leading position at the time.

"NZ's government (unlike Britain) was quick to condemn German rearmament, Japanese expansion in China and Italy's conquests of abyssinia. Savage criticised Britain's appeasement policies at the conference, saying "Is your policy peace at any price; if it is so I cannot accept it". Anthony Eden replied "No, not at any price, but peace at almost any price", to which Savage replied: "You can pay too high a price even for peace". Britain, Australia, Canada and the opposition National party were critical of Savage for his stance".

The US was in a similar mindset back then. The world needs the US to be world police I think but not to overdo it, and have a plan to actually win.

[dreamcatcher]

You are right with the nuclear attack. Related to starting the most wars - it appears that Britain started some more wars in its history than the US did (some unconfirmed internet source says 110, but I didn't re-count), but admittedly, they do have as well a longer history.

Believe 100 wars during Victoria's reign ..........

[dobby41]

The US invaded Canada and Mexico if we want to go further back.

I had been thinking more 20th century onwards.
Also not necessarily started but waded in or helped (often via the CIA)
Like Grenada
Dominican Republic
Haiti
Cambodia
Korea
Vietnam
Russian Civil War
Mexico
The American Indian Wars were still going in the early 20th century
Nicaragua
Cuba
Lao
Lebanon
Panama
Gulf War
Afghanistan
Somalia

[Valuegrowth]

https://awealthofcommonsense.com/2020/01/the-relationship-between-war-the-stock-market/

The Relationship Between War & The Stock Market

https://www.ramseysolutions.com/retirement/stock-market-crash (https://www.ramseysolutions.com/retirement/stock-market-crash)

Will the Stock Market Crash in 2021?

[winner69]

Have a few Fed guys been day trading on their own behalf

Naughty

[Valuegrowth]

Gas prices are hitting all time high. Another headwind for the world economy.

https://www.theguardian.com/business/live/2021/sep/28/uk-fuel-crisis-health-services-companies-petrol-diesel-brent-crude-80-dollars-stock-markets-ftse-business-live

[BlackPeter]

Gas prices are hitting all time high. Another headwind for the world economy.

https://www.theguardian.com/business/live/2021/sep/28/uk-fuel-crisis-health-services-companies-petrol-diesel-brent-crude-80-dollars-stock-markets-ftse-business-live

Fuel shortages and prices in the UK have nothing to do with world energy prices but all with BREXIT.

Problem is that the Brits got rid of the people who were driving their trucks - you see, they didn't had a Britisch accent, and now nobody is able to supply their petrol stations. Bunch of racist idiots.

Good to see the Brits start to pay for their hard right policies. Long may they bleed.

World economy will be fine, not everybody is as stupid as the Brits.

[dobby41]

Gas prices are hitting all time high. Another headwind for the world economy.

https://www.theguardian.com/business/live/2021/sep/28/uk-fuel-crisis-health-services-companies-petrol-diesel-brent-crude-80-dollars-stock-markets-ftse-business-live

What did that article have to do with global fuel prices?
Did you post the wrong link?

[Hoop]

Black Wednesday methinks :>((

[Ricky-bobby]

We will end up in the same state… no new gas resources and no oil refinery…

[kiora]

Black Wednesday methinks :>((

That is highly likely to happen. The markets seem to be focusing on the negatives and run out of puff.

[FTG]

Black Wednesday methinks :>((

Wed US time? I hope not Hoop, would be good to have a bit more time to organise positions accordingly.:)

In saying that, I'll stick my neck way out here and say that IMHO there is a 80% chance that we have now seen the high in the S & P 500 for the year. ATH of 4545.85 printed on 2/9/21. What is quite compelling for me from a TA perspective is the LARGE expanding triangle (over 2 years in size) which emanated in Jan 2018. This triangle was a near perfect example of how an expanding triangle should behave. Being so broad (in value & time) it very much demonstrated the range of conflicting market "emotions" one should see across its different legs. Despair, Europhia, Fear, Greed, Confidence & Confusion.

This triangle projected a breakout terminal target of 4595. Assuming that the ATH high above was THE high for this Bull run cycle , then a miss by just 1% would be "poetry in motion" IMO.

What happens next some may ask? There is a risk of me getting ahead of myself and potentially being viewed as alarmist. However I have genuine intent to encourage some here to at least consider to "expect the unexpected", and be in a strong position rather than a weak & over-exposed one.

A quick recap. Triangle formations are a consolidation move in an overall trend. In this case a multi-year bull trend. So the huge thrust to the upside (in this case doubling the S & P from March 2020) was a continuation of the trend that preceded the triangle, and hence despite it being quite awe inspiring, was actually mainly to be expected. Yes i get it, always easier to say with the benefit of some hindsight!

However, if I'm correct and the thrust has ended, then the longer-term trend has terminated. And with the corrective move prior to the thrust (everything bubble?) being a very large & dynamic expanding triangle this signals potential BIG danger immediately ahead. The dramatic part of my call is I would be suggesting an eventual target of circa 2800 on the S & P. This would mean an impending 35% correction from the ATH. The gravitational forces from the middle zone of the preceding Expanding Triangle are in this case VERY strong, and hence increase the probability of this taking a relatively short period of time (less than 4 months in duration in this case). The next downwards move (from whenever it is finally confirmed to have commenced) has quite a chance of being swift, awe-inspiring and quite damaging to the Bulls.

It may be time to fasten the seat belts for a wild ride team!

IF I'm correct, then for those of us you can get in the right position, some amazing opportunities may actually be on offer (short side, then eventually on the buy side).

[BlackPeter]

Black Wednesday methinks :>((

Republicans trying to shut down government.

https://www.nytimes.com/2021/09/27/us/politics/republicans-block-government-funding-bill-debt-limit.html

13007

This probably does not help market sentiment.

Just the usual political posturing and the typical irresponsible behaviour of the Republican party putting damage to the government over benefit to their people ... I never can understand that anybody can be dumb enough to support these idiots, but hey - they must be Americans, aren't they?

[Hoop]

Republicans trying to shut down government.

https://www.nytimes.com/2021/09/27/us/politics/republicans-block-government-funding-bill-debt-limit.html

13007

This probably does not help market sentiment.

Just the usual political posturing and the typical irresponsible behaviour of the Republican party putting damage to the government over benefit to their people ... I never can understand that anybody can be dumb enough to support these idiots, but hey - they must be Americans, aren't they?
Yep..happens every year..one of the few chances the opposition gets to have any sort of control to negotiate something they want....kinda like blackmail..eh..
I hear rumours that the large US fund managers are holding back a tad in their buying..probably the bull market is the victim of its own success and the fund companies could be smelling the current "time for a correctional breather" sentiment..who knows...Usually a market correction is a slow down of available money..so there is a self fulfilling prophesy element to all this...plus...the market has been ignoring its own fact it is and has been for a while now significantly overvalued...that tends to give nervous investors the jitters every time the market pauses.


Wed US time? I hope not Hoop, would be good to have a bit more time to organise positions accordingly.:)....

.
I actually meant today will be a bad day on the NZX..Originally thought about -1.5% not the current -0.4%..might still happen when the Aussie market opens..On the charts the rapid price rising stocks look to be bending over FBU MFT while some others have produced trading range channels SPK FPH with potential for bearish double top patterns to form..This may keep the NZX "soft" for the short term

[Hoop]

Plus...September 30th is not far away..This is the time fund managers make their reports look good..eh

[Panda-NZ-]

Just the usual political posturing and the typical irresponsible behaviour of the Republican party putting damage to the government over benefit to their people ... I never can understand that anybody can be dumb enough to support these idiots, but hey - they must be Americans, aren't they?

They take instructions from the russian govt.

Notice how they rarely criticise putin these days.

[bull....]

considering sept is traditionally the worst mth seasonally for markets in history it is performing according to plan

[Rawz]

They take instructions from the russian govt.

Notice how they rarely criticise putin these days.

That's because China is the new Russia

[Panda-NZ-]

Russia doesn't have an economy.

China would be more affected by a worldwide depression caused by US debt default.

[dobby41]

That's because China is the new Russia

But with a lot more money than Russia had.
Russia always seemed to have potential that was never realised.

[Norwest]

Great post FTG and yes lots of people were watching that triangle pattern...


Russia doesn't have an economy.

The russian economy will be doing great with their Oil and Gas sales to Europe now.

[Tomtom]

Fuel shortages and prices in the UK have nothing to do with world energy prices but all with BREXIT. Driver shortages pre-date Brexit but have worsened since. All the same I'm glad to see them stop exploiting those poor Eastern European workers. Hopefully those left behind get treated better: https://www.bbc.com/news/56846637

The whole thing is rediculous, across the EU there is a worker shortage due to ageing populations. Every country should be fighting tooth and nail to get workers to move there, integrate, find employment, settle down and start a family.

[Panda-NZ-]

Driver shortages pre-date Brexit but have worsened since. All the same I'm glad to see them stop exploiting those poor Eastern European workers. Hopefully those left behind get treated better: https://www.bbc.com/news/56846637

The whole thing is rediculous, across the EU there is a worker shortage due to ageing populations. Every country should be fighting tooth and nail to get workers to move there, integrate, find employment, settle down and start a family.

Migrants will require pensions, their kids schools and new infrastructure.

The solution is to end aging and thus limit the need for both pensions and healthcare and eventually schools.

[Balance]

https://www.reuters.com/world/china/china-asking-state-backed-firms-pick-up-evergrande-assets-sources-2021-09-28/

As expected, Evergrande being bailed out Air NZ style.

[Tomtom]

https://www.reuters.com/world/china/china-asking-state-backed-firms-pick-up-evergrande-assets-sources-2021-09-28/

As expected, Evergrande being bailed out Air NZ style. More akin to Bear Stearns except they are only taking a slice so far.

The Chinese government have intervened now via a local government bank for a $1.5bn slice of Evergrande assets as well. However as part of the agreement have been directed to use all funds to complete the 1.6m pre-sold properties under construction and pay suppliers but not repay bondholders, accounts are being actively monitored to ensure this happens. It's appears to me it's being wound down and bondholders are going to end up fighting over the burned out shell of a company.

Attention is now moving to other highly leveraged Chinese developers.

[bull....]

sept lived up to its reputation as the worst mth of the year for stock returns now lets see how oct goes the month with the most market crashes in history :scared: probably just a coincidence its oct


U.S. stocks pulled back on Thursday as Wall Street wrapped up its worst month of the year on a sour note

https://www.cnbc.com/2021/09/29/stock-market-futures-open-to-close-newshtml.html

[bull....]

looks like a bidding war coming on due to energy crunch developing , will drive prices much higher

China Orders Top Energy Firms to Secure Supplies at All Costs
https://www.bloomberg.com/news/articles/2021-09-30/china-orders-top-energy-firms-to-secure-supplies-at-all-costs?srnd=premium-asia

[Panda-NZ-]

Nuclear energy should be part of the mix, Germany made an unwise move trying to scrap it.

Plus $1T worldwide should be put into fusion given its potential benefits

[Jaa]

looks like a bidding war coming on due to energy crunch developing , will drive prices much higher

China Orders Top Energy Firms to Secure Supplies at All Costs
https://www.bloomberg.com/news/articles/2021-09-30/china-orders-top-energy-firms-to-secure-supplies-at-all-costs?srnd=premium-asia

If only they hadn't bullied and threatened the world's second biggest exporter of coal with nuclear attack huh?

If anyone is interested in how China really works at the top levels and how dynastic the Communist Party has become with its red princelings, I recommend reading Red Roulette by Desmond Shum or watching an interview with him like this one (https://www.youtube.com/watch?v=q5pQNdh1NN4) or if you prefer extra drama, the 60 minutes Australia interview (https://www.youtube.com/watch?v=bOtVMFPjNUA).

[BlackPeter]

Nuclear energy should be part of the mix, Germany made an unwise move trying to scrap it.



I guess its all about risks, and investors should understand this concept.

Ask the people who used to live next to Chernobyl, Fukushima or Three Mile Island whether it was a great idea to build a nuclear reactor close to their home ... well, this is the ones who are still alive.

Accidents do happen and risks and reactors do blow up - and in the case of a nuclear reactor the outcome of it blowing up is pretty unsatisfactory for anybody living close by (note: in the case of Chernobyl "close" was some thousand km for people living in the wrong direction - under the wind and having rain after the accident).

[Panda-NZ-]

Deaths in nuclear vs coal/natural gas is very clearly in favour of nuclear.

[Mista_Trix]

Nuclear energy should be part of the mix, Germany made an unwise move trying to scrap it.

Plus $1T worldwide should be put into fusion given its potential benefits

Plus anyone who played Sim City 2000 knows Fusion was always the best bet for the city you were building. So it's got that going for it :-S

[Rawz]

Plus anyone who played Sim City 2000 knows Fusion was always the best bet for the city you were building. So it's got that going for it :-S

That’s true. Nobody can deny that

[BlackPeter]

Deaths in nuclear vs coal/natural gas is very clearly in favour of nuclear.

Well, yes - at this stage. I guess the problem with nuclear is that one accident (and we have seen, they can and do happen) can quite easily make vast areas for many years to come uninhabitable, which may or may not be a good thing :p;

[Snoopy]

Nuclear energy should be part of the mix, Germany made an unwise move trying to scrap it.


Jantar from the 'Power Shares thread post 484
"Nuclear would be good for NZ if the units can be made small enough at an economy of scale. Westinghouse were working on a 360 MW unit which would have been a perfect size for us, but although it was supposed to licenced for production in 2010, it just quietly was dropped. The modern 1000 MW+ units are not suitable for NZ as we would not be able to provide both the base demand and the spinning reserve they would require."

From the Genesis Energy Thread PSE wrote:
"Nuclear power is a bad idea for NZ because one power station would be too large for our grid too handle, the largest should be around 250MW, that's why there are four 250MW rankine units at Huntly......"

Jantar on post 1553 of the Genesis Energy thread replied
"This is the number 1 reason why nukes are not suitable for NZ. The smallest economically commercial reactors are currently around 1000 MW with the most economic units around 1200 MW. Candu do have some smaller units like those at Darlington (880 MW and Bruce B (820 MW). However these are economic in that they produce weapons grade plutonium as well as electricity."

"The problem with large units is that as NZ is a stand-alone country, with no links to other generation sources, we must carry 100% of the reserve requirement for our grid internally. That means that for a single 1000 MW nuke we would also need 1000 MW of fast acting partially loaded spinning reserve (PLSR) that could fully replace the lost energy of a tripping in less than 6 seconds. To manage that we would need over 3000 MW of fast reacting hydro or gas fired peaker plant in the same island as the nuke. We do not have sufficient demand to maintain that 24/7."

"Smaller nuke plants are available, but these are generally for a specific purpose such as submarine propulsion, and not for commercial electricity production. Thorium reactors are being developed that may suit us sometime in the future."

The other issue not covered by Jantar is where you would build such a station and where you would put the waste? Building a Nuclear Power station around the 'ring of fire' is a hazardous exercise. They say Northland is the least earthquake prone region. But how that site would fit in with balancing other power stations I do not know. Then there is still the problem of finding somewhere stable underground to store the nuclear waste. There might be NIMBY issues with that.

SNOOPY

[McPussPuss]

Poland has very recently announced nuclear SMR's to replace coal power plants.

https://www.powermag.com/smrs-may-replace-polish-coal-ge-hitachi-in-fuel-supply-pact/

New SMR technology is very impressive and a lot safer than systems developed over 50 years ago.

https://nuclear.gepower.com/build-a-plant/products/nuclear-power-plants-overview/bwrx-300

As the reality of reducing dependence on fossil fuels becomes clear through energy shortages, technology like this is going to in big demand.

[Snoopy]

Poland has very recently announced nuclear SMR's to replace coal power plants.

https://www.powermag.com/smrs-may-replace-polish-coal-ge-hitachi-in-fuel-supply-pact/


"KGHM said the agreement involves development and construction of at least four SMRs (Small Modular Reactors)', with the option of up to 12, for total installed generation capacity of about 1,000 MW.:

Four reactors with a generation capacity of 1,000 MW add sup to 250MW each. That is certainly the size range that might be of interest to a country like NZ.

SNOOPY

[Onion]

Then there is still the problem of finding somewhere stable underground to store the nuclear waste. There might be NIMBY issues with that.

Australia has plenty of space and few earthquakes

[BlackPeter]

Poland has very recently announced nuclear SMR's to replace coal power plants.

https://www.powermag.com/smrs-may-replace-polish-coal-ge-hitachi-in-fuel-supply-pact/

New SMR technology is very impressive and a lot safer than systems developed over 50 years ago.

https://nuclear.gepower.com/build-a-plant/products/nuclear-power-plants-overview/bwrx-300

As the reality of reducing dependence on fossil fuels becomes clear through energy shortages, technology like this is going to in big demand.

Oh dear - they said 50 years ago as well that nuclear reactors are safe. They have been wrong.

Quite funny that people who fight against a vaccine because it might have unknown long term effects are quite happy to advocate for an energy supply we know is unsafe and where we know that the waste will be dangerous for the next hand full of 100000 years.

How do they call this condition?

[BlackPeter]

Australia has plenty of space and few earthquakes

One earthquake might be enough. Oops - wasn't there just one in Melbourne?

Half-life of plutonium is something like 25,000 years. Quite a long time to keep any nuclear waste safe ... and after that time it is still radioactive, just only half as active.

Lucky us our forebears didn't pollute the planet in the stone age with plutonium, isn't it? We wouldn't be around if they would have done that.

Why are people so keen to pollute it now for future generations?

[FTG]

Can we get this thread back on subject please folks? Perhaps take the Nuclear stuff to another thread/forum.

[Panda-NZ-]

Power grids should shut down known bitcoin mining servers. Should resolve this 'energy crisis'.

[causecelebre]

Power grids should shut down known bitcoin mining servers. Should resolve this 'energy crisis'.

....Easy to point the finger at energy consumer on the 'fringe. While we are at it we can turn off video streaming services (30 mins 'flix equivalent to driving 6.4km, according to the Shift Project though that is under dispute, of course), and Google search engine....:) To be fair ASIC mining is pretty energy intense by comparison

[Panda-NZ-]

Bitcoin mining has no practical use and is being used to launder money.

Its a disgrace to humanity.

[causecelebre]

Bitcoin mining has no practical use and is being used to launder money.

Its a disgrace to humanity.

Not a HODLR then?

[peat]

Can we get this thread back on subject please folks? Perhaps take the Nuclear stuff to another thread/forum.

lol
you dont think nuclear stuff is Black Monday enough ?

[FTG]

lol
you dont think nuclear stuff is Black Monday enough ?

Hahaha, True!

But I would have thought more of the nuclear weapon sort of stuff rather than discussion about the pro's & con's of various nuclear energy options.

[RTM]

Can we get this thread back on subject please folks? Perhaps take the Nuclear stuff to another thread/forum.

Let me try. So with COVID-19 getting out of control and the implications that has for the financial performance of our country, I steeled myself for a solid drop in the value of my portfolio, all the time remembering what happened last year. Had another cup of coffee and checked just after lunch. Guess what...up by 5ishK.
Makes no sense at all to me.

[Panda-NZ-]

You need something to do in lockdown... buy shares and property.

[Bjauck]

Let me try. So with COVID-19 getting out of control and the implications that has for the financial performance of our country, I steeled myself for a solid drop in the value of my portfolio, all the time remembering what happened last year. Had another cup of coffee and checked just after lunch. Guess what...up by 5ishK.
Makes no sense at all to me. The all Ords is up about 4%; DAX is up about 10%; DJ is up about 18% since immediately prior to Covid. NZX50 (a gross index including gross dividends) is up 11%. Arguably the Aussies, Germans and Americans have had a tougher time (so far) from Covid too.

The FTSE100 is down about 5% but the Brits have had a hard Brexit to contend with too.

[Joshuatree]

Evangrande has been suspended
USA govt impasse
Inflation rising
Int rates heading up

Perfect storm for energy crunches (China right now!!)globally and coal,gas,oil becoming very expensive.THIS is going to be a huge handbrake,choker imo.

Over priced stocks at high p e
China /Taiwan hostilities
Covid
Etc etc lots of volatility ahead imo,I'm selectively selling off some of my stocks.But I also need cash for an out of mkt investment.

[Joshuatree]

Nearly every USA correction has been preceded by a spike in oil.But who really knows,not me.But pruning out the weaker stocks in one's portfolio and having some quality value stocks with good yields and plenty of cash on the side to pick up bargains ,says he hopefully.

[winner69]

Inflation is a reality

Whittaker’s Chocolate going up in price

[Joshuatree]

And the slabs have been getting smaller.:sleep:

[Joshuatree]

Yeah ,Cereal pkts etc etc.
The world has got it ass about face.Get rid of the carbon economy AFTER the green economy has been completed!

[Panda-NZ-]

S&P 500 premarket up 1% (cnn forecast).

Americans let the elites get away with rather a lot. so valuations may be justified I think and more gains are possible.
It's what jesus would have wanted.

[BlackPeter]

S&P 500 premarket up 1%.

Americans let the elites get away with rather a lot. so valuations may be justified I think and more gains are possible.
It's what jesus would have wanted.

I suppose you refer to "grow with the pound"?

But than, didn't he talk as well about the rich man's problems to get into heaven ... :confused: ?

[Panda-NZ-]

I suppose you refer to "grow with the pound"?

But than, didn't he talk as well about the rich man's problems to get into heaven ... :confused: ?

In their mind no.

Their whole life is spent on this one book, only to pull out the verses they want, and ignore the ones that don't suit.

[FTG]

Evangrande has been suspended
USA govt impasse
Inflation rising
Int rates heading up

Perfect storm for energy crunches (China right now!!)globally and coal,gas,oil becoming very expensive.THIS is going to be a huge handbrake,choker imo.

Over priced stocks at high p e
China /Taiwan hostilities
Covid
Etc etc lots of volatility ahead imo,I'm selectively selling off some of my stocks.But I also need cash for an out of mkt investment.

One could probably say it every week, but I reckon this week or next will give us a good indication to which way the medium term trend will head.
Key support just below on the S & P 500 at 4230 and resistance above at 4450. Which way will it break? Only time will tell.

[FTG]

One could probably say it every week, but I reckon this week or next will give us a good indication to which way the medium term trend will head.
Key support just below on the S & P 500 at 4230 and resistance above at 4450. Which way will it break? Only time will tell.

As an aside, and following on from my comment last week, here's some more poetry in motion for you....

On the Log charts, the ATH (2/9: 4540) is pretty much a perfect fib 1.618 extension of the "Covid crash leg" off the 23/3/20 low!
Another reason for me that the current ATH certainly should earn some respect.

[winner69]

Bloodbath on the markets coming this way

Covid, stagflation, China blah blah blah ….AND THE OCTOBER EFFECT

Be careful out there


https://www.news.com.au/finance/economy/world-economy/stagflation-is-here-world-economy-at-risk-from-multiple-crises/news-story/04da089f8df5907f812c4355835914ec

[bull....]

OCR rate rise tomorrow in NZ ,

with auckland in a lockdown level 3 for the rest of the year , easy in my opinion as infection rates will climb now like nsw etc be interesting what they say on future rate hikes now that we know covid elimination strategy is of the table in NZ

[couta1]

Bloodbath on the markets coming this way

Covid, stagflation, China blah blah blah ….AND THE OCTOBER EFFECT

Be careful out there


https://www.news.com.au/finance/economy/world-economy/stagflation-is-here-world-economy-at-risk-from-multiple-crises/news-story/04da089f8df5907f812c4355835914ec Just sit tight and do nothing.

[alokdhir]

Just sit tight and do nothing.

Or can buy more FPH around $ 30 ...cant go wrong in the medium term

[bull....]

Just sit tight and do nothing.

if your a aucklander that is your life unless your into picnics

[bull....]

Bloodbath on the markets coming this way

Covid, stagflation, China blah blah blah ….AND THE OCTOBER EFFECT

Be careful out there


https://www.news.com.au/finance/economy/world-economy/stagflation-is-here-world-economy-at-risk-from-multiple-crises/news-story/04da089f8df5907f812c4355835914ec

dont forgot to add the emerging energy crisis , will push prices for everything thru the roof

[peat]

As an aside, and following on from my comment last week, here's some more poetry in motion for you....

On the Log charts, the ATH (2/9: 4540) is pretty much a perfect fib 1.618 extension of the "Covid crash leg" off the 23/3/20 low!
Another reason for me that the current ATH certainly should earn some respect.

I dont see that FTG

I see the 161 extension at 4077 and the recent high 4550 at the 200% extension (which is not usually referred to as having any significance)
13033

drawing fibs is of course a personal thing so happy to see how you did it.

[bull....]

the evergrande contagion is spreading

Chinese property developer Fantasia misses debt payments
https://www.straitstimes.com/business/property/chinese-property-developer-fantasia-misses-debt-payments

[RTM]

Let me try. So with COVID-19 getting out of control and the implications that has for the financial performance of our country, I steeled myself for a solid drop in the value of my portfolio, all the time remembering what happened last year. Had another cup of coffee and checked just after lunch. Guess what...up by 5ishK.
Makes no sense at all to me.

Ah...that's better..down 6.3K. Happy now, Yikes !
https://www.sharetrader.co.nz/images/smilies/w00t.gif

[FTG]

I dont see that FTG

I see the 161 extension at 4077 and the recent high 4550 at the 200% extension (which is not usually referred to as having any significance)
13033

drawing fibs is of course a personal thing so happy to see how you did it.


On the logarithmic chart Peat. :)

[alokdhir]

OCR hike chances are bright as per analysts ...98% chance of 0.25% hike ....But IMO its wrong move as morale of people and businesses already at lowest level ...SO postponing it by another 1-3 months maybe more prudent

[sb9]

OCR hike chances are bright as per analysts ...98% chance of 0.25% hike ....But IMO its wrong move as morale of people and businesses already at lowest level ...SO postponing it by another 1-3 months maybe more prudent

And he has exactly done that, lifting rate by 0.25% to 0.50%

[winner69]

And he has exactly done that, lifting rate by 0.25% to 0.50%

And adrian seems rather nervous about about rising inflationary pressures. .........rates pushing higher more quickly than many might’ve thought.

He seems to be implying the potential for disruption is getting worse by the day. At very least, uncertainty is rampant.

[alokdhir]

And adrian seems rather nervous about about rising inflationary pressures. .........rates pushing higher more quickly than many might’ve thought.

He seems to be implying the potential for disruption is getting worse by the day. At very least, uncertainty is rampant.

U cant solve disruptive inflation by raising rates ...He is trying to control what is beyond his control ...only adding further misery of higher rates at a very wrong time for NZ

[winner69]

U cant solve disruptive inflation by raising rates ...He is trying to control what is beyond his control ...only adding further misery of higher rates at a very wrong time for NZ

ANZ took 2 minutes to raise floating rate to 4.44%

That's quite high ...and could hurt a few

[sb9]

ANZ took 2 minutes to raise floating rate to 4.44%

That's quite high ...and could hurt a few

Could well be start of property market turning a corner...

[dobby41]

ANZ took 2 minutes to raise floating rate to 4.44%

That's quite high ...and could hurt a few

They should have made hay while the sun shone - maybe not load up with as much debt.

[Getty]

ANZ took 2 minutes to raise floating rate to 4.44%

That's quite high ...and could hurt a few

That will bring a wry smile to those who averaged mortgage rates of 6.9% from 1985 to 2021, and those who paid up to 22% in the 1980.s.

Huge upside awaits.

[winner69]

That will bring a wry smile to those who averaged mortgage rates of 6.9% from 1985 to 2021, and those who paid up to 22% in the 1980.s.

Huge upside awaits.

No no - mine was 28.5% pa

[Getty]

You always go in big winner! lol