HaavBline

Comparing China and the Dry Baltic Index

Excellent Comments by huangtomas, MILESSFA, and Jeffery L. I had my suspisions about the validity of a correlation, and was thinking about it why I continue to read the comments, and Jeffery got to the key point before I did.

That is why one should always read the reader comments with the article.

41st Worst Monthly Jobs Report on Record... Yes 41st

Yes, percentage drop is what really counts, and it is good to put this data is the right perspective.

However, a check at the dates of the fourty worse job reports also reveals an important fact: The lastest one happened 28 years ago at 05/80 when there is a 0.48% drop.

Thinking from another angle, does this mean its only a early warning and much worst job reports are possibly and probably still ahead?

Microsoft: Headed for an Earnings Miss?

To hemje:

I think you have come to a wrong site. This site is 'seeking alpha', not wikipedia. Investors/speculators 'seek alpha' from maybes, possibilities, theories. You have to make your onw judgement.

Reverse Migration: Why Bulls Should Quit the China Shop

Author’s recommendation to short FXI for 1H09 may turn out to be correct. But his arguments regarding rural land reform seem flimsy.

Rural land reform will start next year, few details about execution is available so far. But one major objective of the policies is to improve the existing “corruption-ridden land-accumulation process” to give farmers a better deal in a land transaction. Prices of rural land transactions in the past are dictated by local officials, which FOR YEARS, has caused numerous and increasingly violent protest in rural areas. By contrast, “current unrest in the country’s industrial belts” becomes a problem only recently, as a result of export factory closings. The reform clearly gives the farmers a better deal.

The major risk of land reform for1H09, at worst, is confusion at the initial stage of implementation of the reform policies, not 800M landless jobless peasants as the author seemed to suggest. In any case, these are long term structural reforms that will bring more economic activities to the country side, bring improved urbanization process, but it is hard to see major negative impacts the land reform policy might have toward member companies in FXI before 1H09.

Chinese government is taking aggressive actions now to support the economic growth targets (8%) and the stock market. It seems not wise to go against a governments that has plenty of policy options and very well-stocked of ammunitions.

As for political risk, Bespoke (B.I.G..) provide some data in a recent article in this space. Almost all countries are suffering from worsening CDS spread, China’s about average in absolute value and in trend. Not a great factor to short FXI either.

Shrinking export, trade war, worst-then expected collapse of real estate value are major short term risks. But it has been reported that recent sinking export may partially due to credit availability problems for foreign importers which is relatively easy to address.

New Leveraged and Short Metals ETFs from ProShares

So ProShares is going to defend its terf of leveraged ETFs. Would be great if author follows with comparison against the Deutche Bank series of Double Leveraged commodity ETNs.

China Milk Crisis: Quality Is Everybody's Problem

To Asser:

You are talking sheer nonsense.

Quality can be achieved through good managerial control and process improvement. Good hiring and HR pratices are also critical. Many excellent products are and continue will be procured from China.

Is China Experiencing Dollar Outflows?

Chinese exporters do have competitors from other countries. Many of them already saw their currencies devalued substantially. South Korea, Vietnam, Thailand, India, Euro, among others have all had sinking currencies against the Dollar. In such an environment, China can not be expected to continue the RMB appreciation policy without pause.

Specifically Chinese trade with EU now slightly exceeds its trade with US, So it make most sense for China to maintain the RMB somewhere in the middle of fluctuations of Euro-Dollar trade. In the current environment, that means appreciation against the Euro while depreciation against the Dollar.

China Slowdown: A Drag on Global Growth

Considering US, EU, Japan and a bunch of other countries already are in recession NOW, I think the following title would be closer to the truth:

"Global Slowdown: A Drag on China Growth"

UltraShort ETFs: At a Tipping Point?

Some of the ProShare UltraShorts seem to have failed dramatically to track its index. Complare charts of XLE, DIG, and DUG, and you will see what I meant.

DUG seems to have failed miserably to track XLE trends since early October. I saw this pattern in some other Double Shorts ETFs also. What's going on?

Tin Makes a Comeback

Excellent article with interesting information not usually seen in most investment sites.

Unfortunately, JJT is a very thinly traded ETN. On any given day, there may be no trade at all! Does it track Tin spot prices reliably?

China’s $585 Billion Renovation

One of Author's recommendation: Guangshen Railway (NYSE: GSH) may not be such a good choice at all if you want to ride the China stimulus package. It may have been on of the better China play is the past, but I think it will face strong headwinds going forward.

Guangshen Railway serves the eastern flank of the Pearl River Delta, a region jammed pack of China's export manufacturers, is probably the hardest hit manufacturing base in China.

In addition, this stimulus package focus infrastructure development of rural and inland province which lags far behind the coastal provinces. Being the region benefits MOST in the last 30 years and already having some of the best infrastructures in China, the areas covered by Guangshen Railway is not likely to get a big share of stimulus money this time.

In fact, new trnasport infrastructure developments in the Pearl River Delta region connecting the eastern and western banks of the river delta may provide new competition to GSH.

China’s $585 Billion Renovation

huangtomas said: "Chinese central government has monopoly right to use the brand name "China". Any corporations have "China" in the name, they are all Chinese central-government-own...

This statement may or may not be true in CHINA. But it clearly is NOT TRUE from foreign investors' standpoint. Companies listed in foreign stock markets can freely pick their name. When China plays were HOT a few years ago, tiny companies that managed to listed in foreign markets loves to put CHINA in its name in order to enhance its IPO attractiveness,

One example off my head: China Medical Technologies (CMED), a NASDAQ listed small company registered in Caymen Islands. Or China Greentech (GRRF).

Don;t expect the Chinese Central goverment to bail you out if this small company gets in trouble.

China Gets It Right, But Hurts America

Good reasoning except for the final three paragraphs. I completely agree with canb888's comments. It is way premature to speculate that China even want to replace the Dollar as the world's reserve currency any time soon. The Chinese isn't even ready to make the RMB convertible, which turns out to be a very good decision for them. Fore the intermediate term (a decade or so), China will continue to support US Soverign Debts within reasonable bounds, because China needs a stable world economy to ensure its own long term growth and prosperity.

Long-time prominent China-basher Peteer Navarro made a sharp U-turn this week and has nothing but prose about China's stimulus package. He has a good analysis, follow this link:

China's "New Deal":
www.atimes.com/atimes/...

The Next Great Asian Bull

Stories about China that makes headlines in western media tells you very little about China. And even when the news tells you something useful, it usually gets misunderstood and misinterpreted by people who has minimal knowledge about the subject.

Chinese Bailout May Send U.S. Interest Rates Higher

I already own TBT for 3 weeks based on the very same rationale described by the author. However, I am not sure the scenario of higher long term Treasury rates will happen very quickly.

The global recession is in a early stage and US creditors are too scared to push the subject of credit worthyness of US soverign debt. China, Japan, Middle East and other creditors will have to paly their 'stakeholder' role and continue to buy Treasury debt at lousy risk/reward ratios for some time until global economy begins to recover. That is when Treasury rates will begin to rise.