Daniel K

S&P 500 and Apple Playing Out Bearish Patterns

Well, when you have 25B and you don't do a buyback or have a dividend and you are too big to be bought, then the stock will trade all over the place. Seriously, what's to push Apple up? The company is doing fantastically, yet only a dividend today can demand that investors pay attention. It is VERY frustrating to be an Apple shareholder, no doubt.

My own technical analysis says that the stock could trade as low as 78 in the near term, but not lose its long term upward trend. I expect it to drop towards 80. As to the above analysis,what would Mr. Bass say looking at the chart of the SPY on Feb 7, 2003. Looked sort of like what Apple looks like today.

Complicating the near term is that Apple has too many bulls and too few bears, like the market as a whole. Everyone is bullish and waiting for the Fed magic to work, and January to bring in new money. That's a serious problem. Yet the mortgage activity and the Obama excitement might overwhelm this negativity.

China: Market Is Down, but Good Inflation News

Here is an interesting related article: www.bloomberg.com/apps...

China: Market Is Down, but Good Inflation News

Michael,

How does what is going on in terms of currency valuations and inflation in the smaller Asian countries affect China's decisions? Emerging markets in general are finding their currencies under a bit of pressure as the price of oil affects their trade balances. You have suggested that China could be on the cusp of increasing the rate of revaluation upwards in order to fight inflation; can it do that if nearby countries' currencies are weakening? Vietnam of course has problems, but South Korea and Thailand and even India now seem to be fighting to keep their currencies from falling--after years of keeping them from rising. And I can't tell at all what's happening in Japan. Until recently I'd thought that the Asian currencies would rise together, in a coordinated fashion, in order to avoid a trade war.

China: Lots of Oil Price Speculation

Michael,

You've mentioned before that China may be at the point of letting Yuan rise to a greater degree. Perhaps a relaxation of price controls is part of an overall policy of increased liberalization?

In China Administrative Measures Trump Market Measures, For Now

This blog post even comes with witty comments, couplets, and retorts. Great.

China Increases Minimum Reserves by Another 1%

Michael,

Has the price of oil affected China's current account balance? If so, to what degree? As well, I've noticed that the Yen and the Yuan have made somewhat parallel moves on the dollar in the last couple years, if you measure from the bottom of each, and that the yuan has stregthened only about 6% on the yen. Do you expect them to move in tandem vs the dollar and Euro? Could this be part of a pan-Asian reval? On another question, what sort of confidence do you have regarding Chinese economic statistics? I'm not implying that they are good or bad here--I just have no way of knowing, so I am asking. I love your blog, by the way.

The Chinese Capital Outflow Paradox

Michael,

Another intriguing post. Look what is happening in Vietnam. For all its reserves, could the same happen in China? Why not? What's perceived as a strong currency can change quickly, as investors rush for the exits, as inflation creates a central bank reaction, which slows growth and kills leveraged players, and so on, as boom becomes bust. How is maintaining an artificially weak currency and thus printing too many yuan per dollar in the long term beneficial to the yuan? There are too many yuan; each buys less in real terms; it is a recipe for a currency crisis. Why is this incorrect?

A Run on Central Banks?

Powerful article, cleverly written.

China's Demographic Projections Have Trade Implications

Michael, on another subject: at some pt it's expected that China will have its own real estate/banking crisis. I think you've mentioned it yourself, but in any case it won't be surprising; unruly growth usually leads to bad loans in any country. Is it possible that current conditions' appearance are luring hot money into the country, which could skip out, or seek to, in a crisis, and what would be the ramifications?

China: Latest Indexes Indicate Inflation

Michael, I've read many of your articles before; are you teaching at Beida (spelling?)? What I don't get here is your recommendation to buy the B shares, combined with a gloomy view of inflation and Chinese banks. Most recessions in market economies in the recent past have been triggered by central bank reactions to inflation. In this case, a recession might cause many real estate loans to go sour. Why would a downturn bring an investor a positive return in 3 - 5 years? Why shouldn't an investor feel frightened of political and economic instability instead?