Here's East Bay in CA where my folks live where things went up a few hundred $K so far this year on average. Note, this is considered the cheaper part of the Bay Area.
Yeah, I'm sure he's happy as hell right now with a big "I told you so" after he went to trial in that case and lost. Jim Chanos is short that sector, too, I think. He's been screaming about the reliance on the real estate sector for the Chinese economy and been warning about it for about a decade. I saw him getting interviewed a bit earlier today. Good interview. Unfortunately the market came back a bit towards the end of the day.
The sell off was inevitable and US banks have very limited exposure to China so I'm not worried about a 2008 style collapse. But the Chinese dominos have been falling for a while now and Xi is really starting to behave like an old school CCP ruler. So I'm starting to believe that China might be ready to start strategically nationalizing some businesses. Housing and construction are so core to the Chinese economy that I could see China just outright taking over parts of the industry as a way to protect themselves. These companies (and local governments) have been allowed to run wild for decades now and at some point they need to step in and do something. The prudent thing would be to figure out how to gently unwind these companies and move to modern systems of taxation instead of relying on land sales to fund the government. But I could see Xi just nationalizing everything instead. He can basically destroy all of these companies and then buy them out for pennies on the dollar while eliminating potential rivals.
china implemented the "3 red lines" knowing full well evergrande wouldn't be able to comply, instead of gradually tightening borrowing restrictions. imo they are prepared to let evergrande default, then try to prevent contagion with the banks after that.
https://www.usatoday.com/videos/new...ildings-demolished-simultaneously/5664058001/ china being china. "safety reasons". i am sure.
I've been watching a lot of yt on China's situation. Their real estate is bigly f'ed up. First off, the 40% tax rate all goes to the national level. All that corrupt bureacracy and waste focused on the highest level...must be great to be a national party leader, like Sen. Simena boosting her net worth to a million once she "made it". So the state (provincial?) and local levels are like how do we make money...what's in it for me? What they did was to incorporate their land holdings then run it off like a debit card. This preserved their finances and debt obligations but also ran up a large real estate market that hinged upon continuously escalating real estate prices. Another fact is that a Chinese citizens aren't heavy consumers. They dump most of their savings into real estate. There is a large group that owns 2nd and even 3rd properties. With speculation rampant, they jump on speculative bids where online flash sales can prompt people to bid on down payments up to 30% of the total cost housing. It also skews their GDP growth to real estate over consumption. If China's GDP drops 1%, the world economy supposedly will dip .25% That's why you see all these ghost towns. Just like Japan and to some extent here pre-08, they have an uncontrollable housing bubble. What's noteworthy is that those incomplete buildings are wholly owned, it's just these construction companies bailed on the investors and homeowners. I can't imagine that happening across America, but it's something no level of China's bureacracy wants to fix. So you get **** like Evergrande, which is more and more mimicking Japan's zombie banks. The only silver lining of hope is that China's Central bank has more powers than any other large national bank. It's just that I don't think they'll use that authority in a way that will solve things or function as a clearinghouse for insolvency. Any of that would indicate a problem that needs to fix, something that happened under the All Knowing Government's watch. Furthermore, such an orderly resolution would mean an immediate hit to short term national growth. Can't even round up all those deadbeat property developers for the firing squad/organ harvest. Too rich and connected to fail.
The red lines were put in to deflate the bubble, bailing out evergrande sends the opposite signal to property investors, lenders, local govs, etc if they think ccp is backstopping the property market the way the fed backstops the stock market.
If there's a real crash, what's on ppl's shopping lists? Saas, social media im monitoring - team/twlo/path/crwd/net/ping/okta/pins/zm/twtr/meli. Any favs out of the bunch?
the chart shows a graphical depiction of the tailwind pushing APPS upward 20dma has protruded up thru 50dma trading action has cleared the 100dma hurdle in view of this, w APPS trading just below 65, placed an order to sell this bullish PUT spread, using Oct 22 expiration bto 62 PUT, sto 67 PUT for a credit of $2.45, defining my max risk to be $2.55
made a bet on FDX, who reports after market closing today. it has a bad chart, an ~ 18% drop since the Jun ERS, YTD, it has fallen ~ 14% it is near the bottom, as suggest by the several doji recently, my bet is that the ERS will be the impetus for a trend reversal sold a bullish 10-pt PUT spread, using Oct-29 expiration bto 245 PUt, sto 255 PUT---collecting a premium of $4.70, defining my max risk of $5.30
i got it wrong. FDX had a revenue beat , but missed on the EPS. in after--hours trading, it is down ~ 6 glad that i had constructed a spread, as it allows me to define my max loss
that is after the dust is settled; after the contagion fear emanating from Evergrande has subsided the market digests the news from the Fed meeting tomorrow the political squabble over increasing the debt ceiling has been settled
Lee is damn-near a perma-bull on everything. Bitcoin $100k, market always goes up, etc. Generally speaking, he's been right lately, but a nuclear holocaust could be going on outside and he'll still be talking up bitcoin and the S&P 500 "just after we're done with this nuclear winter"...
At least he's consistent. When Lee says it's time to sell, **** must really be hitting the fan, I will consider selling then lol. I've seen some longer interviews with him, his firm really does consider a lot of macro factors which he gets into indepth, but cnbc format doesn't have time for such detail.
started very small positions in twlo/okta/pins. valuations be damned; feeling the fomo lol. treating this as long term investments, small positions so i won't feel pressure to sell if there's a dip.
earlier this AM, USA time, it was reported that the PBOC had injected $19 B Yuan of liquidity into the Chinese economy
@adoo do you think CPNG is close to bottoming? Opportunity for rebound? IPO lock-up over. Softbank sold 57m shares on 14 Sep. The big problem - Softbank holds another 570m shares... who knows if/when they will sell more. Haven't done extensive DD on this, but seems ok, analysts have $45pt. They do e-commerce in korea but are more amazon-like than SE in the sense that they do their own logistics. They also do food delivery and streaming.
can't tell. but if i had to make a trade on CPNG, i'd eneter only if this takes place 2 consecutive trading days closing above the most recent down trend line (the purple line pointing down to bottom right) should this happen, it could be an ascending triangle
