rlirph's Comments

Why Krugman Is Wrong About the Yuan

Fri, 20 Nov 2009 16:47:30 -0500

We have gone through almost forty years of twin deficits(fiscal and trade). We were 'brain washed' that we can have better living standards via free trades. Free trade does not work; 'managed trade' does. Look at all the up and coming economic power in Asia. No country has our free trade policy. We want more and cheaper goods to the detriment of our future...

Dollar/Yuan Peg Means China Gains on All Fronts

Fri, 20 Nov 2009 04:10:43 -0500

If free trade is beneficial to our country why are we running trade deficits for most of the past forty years? Haven't we learned from the past forty years trading with Asian countries? What economic benefits do you get from them? Are the benefits worth putting our fellow Americans on the street?

What we need is controlled trade, a practice done well by Japan and China. Do what other people do to you. It is time for us to close our doors to the Chinese products...

This is not an anti-Chinese comment as I am Chinese. I just like to play on a level field.

A US Expat Living in Guangzhou...

China and Its Predatory Currency Policy

Wed, 11 Nov 2009 20:50:32 -0500

Each country has its own best interests in its policies. It is great to see the China government has finally done something good for its own citizens, that is improving their quality of lives, even though they are still decades behind us. You can sense that their people are happier now than ten years ago. Can you say the same thing about us? We are facing the same old problems when I was in college forty years ago - twin deficits - fiscal and trade deficits. We are unwilling to have fiscal discipline (government and citizens) and unwilling to sacrifice (like drive a smaller car or to save) that has led us to our present situation. Unfortunately we have forty years to create the problems. The problems will not go over overnight...

A US Expat Living In Guangzhou

China's Influence in Cars Running Deeper, Wider

Thu, 29 Oct 2009 00:30:38 -0400

When you refer to Chinese being innovative you must be referring to other Chinese living outside China, not the 1.3 billion Chinese I meet every day in the past three year.

China is a country based on Communism, a country that teaches its citizens to listen and obey. That is why most Chinese listen to their teachers and elders without questioning. The college graduates are knowledgeable and intelligent, but lack independent thinking. Please name one innovation accepted worldwide that China has in the past twenty years.

Remember this country has a culture that is proud in 'copying'. They consider 'stealing' as smart business. In fact if one reads the Chinese law, selling pirated CD and software is only illegal when the retailer has 5000 or more copies in his possession. This is a country where the government condones dishonesty. How else can you explain now the central government has given approval to all the state owned enterprises not to honor their losses in derivatives?

BTW this is not a China bashing comment as I have enjoyed living here in the past and will live here for the foreseeable future. I am speaking as I see it...

- A US Expat Living In GZ

On Oct 28 04:06 PM Alphameister wrote:

> Some people seem to think that ingenuity is unique to the American
> DNA. Creativity will be found wherever men are free. The Chinese
> economy has the rough spots to be found in any economy new to the
> free market, but it also has a population willing to work hard and
> to innovate in search of the rewards that capitalism can bring.

Hong Kong Real Estate Requires 40% Down

Mon, 26 Oct 2009 12:06:35 -0400

One should not confuse with Hong Kong and mainland because they are governed by two different governments. This year HK real estate has gone up more than 30% because of the low interest rate as the authority is flushing the market with liquidity. Earlier this year HSBC was making mortgages at 1.25% interest rate. At this low rate all residential properties can be bought at current rate and one can still enjoy positive cash flow! In China the government has set the 30 year mortgage rate to 4.7%.

Can China Sustain 8% Growth?

Fri, 23 Oct 2009 11:18:18 -0400

1) I do not trust accountants in China any more of our Big 4.
2) Your question is moot. If you genuinely think the Chinese products are tainted go back to your house and throw those poisonous products away. See how empty your house is!
3) No. Planet earth does not have resources to supply another billion people to a US standard of living. It just mean there are some of us will have a lower standard of living.
4) Chinese government's genocide is no greater than the European
killing off our native Americans.
5) Yes. I think we Americans are stupid and short sighted enough that we believe in free trade while running billions of trade deficits years after years. Our twin deficit(fiscal/trade) started when I was in college. Now I am near retirement.
6) Countries in Latin America could have come up years before China can but did not. Wonder why? There is no comparison between China and India. By the way have you ever visited China or India. When you have we can talk.

Finally stop bashing China for our problems. That is irresponsible! Next thing you can going to blame the banks for all the credit cards you run up!

- A US Expat Living In GZ

On Oct 23 10:47 AM Tom B wrote:

> Through 3 years: probably.
> Through 5 years: conceivably
> Through 10 years: bubble bursts-- just like "dot-coms"; Japan in
> the 1980's; Banks in the "2000's"".
>
> Think about it: 1) Do you trust their accountants? 2) Do you trust
> their poison/contaminated/da... products? 3) Does planet Earth have
> the resources to lift another billion plus people to a US standard
> of living? 4) Do you think the people will tolerate the Govt's continued
> genocide forever? 5) Do you think the US will buy into the poisonous
> concept of "free trade", without any checks and balances, forever?
> 6) What about Latin America--closer; better trained workers. What
> about India? Better trained workers; everyone speaks English already;
> FUNCTIONAL democratic Government.

How to Deal with Corruption in China

Thu, 08 Oct 2009 09:10:58 -0400

It is easy to view corruption in China in the same sense as other westerners. Unlike the US China has a one party system. There are different factions fighting each other for power and territory within the party. In other countries you get loyalty when you empower some one. In China the loyalty comes when you give power and authority (hence corruption). In other words it is the corruption that holds different government officials together. For this reason it will be many years before the country will ever get rid of corruption.

In the case of Huang Guangyu, he does not become the richest man in China at one time without having friends at the highest level of the central government. When his friends loses in power struggle he will be swept away just like any disfavored politician. In China he's accused of committing commercial crimes (insider trading). Does anyone knows the exact definition of 'money laundering' in China? If you ask me to wire money to your friends in the US I can be guilty of money laundering because the money is not mine. However, the government only allows Chinese citizens to send no more than US$50K a year. If one is a US expat like me there is no allowance. In other word you can bring all the US cash in and once it is converted to RMB I cannot send it out of the country. However, legally I can carry up to US$10K every time when I leave the country.

China Mobile Should Have a Head Start in E-Reader Race

Tue, 06 Oct 2009 09:13:15 -0400

China Mobile does not have stock symbol of CHU. CHU is China Unicom, the carrier now sells Apple iPhone.

Is Obama Mimicking 'W.' on Trade?

Mon, 21 Sep 2009 04:07:46 -0400

I always think that our government was stupid in allowing imports at the expense of losing jobs and industries. We either wise up that free trade does not work unless the countries involved are genuinely free to trade.

We as citizens are committing suicides by allowing all these imports into US. I have been living in China half time for almost four years now. I do not see that China has foreign ownership in telecoms, energy, minerals industries. The foreign bank and financial presence is so small that it is insignificant.

- A Chinese American Expat Living In GZ

Floating Rate Mortgage in Hong Kong Is Setting Up a U.S. Style Housing Market Crash

Thu, 17 Sep 2009 06:38:44 -0400

If Andy Xie is the stock analyst at one of the US brokerage company you can forget about his comment. His remarks are generally there to attract news coverage, thereby increasing his reputation.

You have to follow the historic HK real estate prices. Even right now at less than 1% mortgage rate many units are still being sold at 50% less than what it was in 1997. Definitely the prices will drop 50% if mortgage rate goes up from 1% to say 6%.

China to Buy Up to $50 Billion in IMF SDRs

Sat, 05 Sep 2009 03:53:24 -0400

Note that China is not using its US dollar holdings to fund their $50 billion purchase. Any significance on this?

China’s Exports Recovery - We Don't Buy It

Thu, 13 Aug 2009 10:55:21 -0400

China should send every US citizens a stimulus check! With the money we can buy more Made-In-China products...

LDK Widens Quarterly Loss as Chinese Solar Co. Posts Negative 90% Gross Margin

Thu, 13 Aug 2009 10:53:25 -0400

How do you reduce liabilities by replacing short term loans with long term loans? Is this Chinese accounting?

China: Beware Bubble 2.0

Fri, 07 Aug 2009 01:14:12 -0400

I for one agree with with doubleshortetf. There are too many "experts" here and else where who claim to be China experts but they have not spent sufficient time in the country. Many are confused with A shares, B shares, H shares.

I just like to point out the fact that China government is the biggest landlord in the country. In spite of all they say, please understand that land auctions bring in lots of money each year to the government coffers. The government may say and act half-heartedly about high real estate prices. In reality it is against their interests that real estate prices collapse or remain low. Just look at how Hong Kong government maintains high real estate prices and you will see how China government will act in the future.

US Expat Living In GZ...

On Aug 06 07:36 PM johnqh wrote:

> doubleshortetf:
>
> It seems that you like to copy and paste in a lot of Chinese threads.
> I would just like to point that out because I have seen your exact
> same post before.

Alarming China Statistic of the Day

Wed, 05 Aug 2009 17:00:43 -0400

Once again we make references to China using our US standards. Chinese real estate and stock market are highly speculative and volatile. It is not unusual to see prices go up 20% in one month. It is also not unusual to see prices come down just as fast. One cannot compare China market using US guideline.

As to why housing prices in China in general will go up? That is because the China government is the biggest landlord in the country. When the country taken over by the Communist Party all land except the ones used by ordinary peasants returns to the government. All the money in those outrageous land prices go straight to the local government coffers.

If you are the biggest landlord why would you implement measures to have affordable housing? For those who are interested in this subject just examine the government policies of Hong Kong under British rule will tell you what China government will do regarding real estate in teh future.

Massive Underlying Risk for Chinese Market Buyers

Wed, 05 Aug 2009 14:18:00 -0400

I am another "dumb ignorant Chinese retail investor".

Many people seems to forget that China market runs ahead of the US market in timing. It peaked in October, 2007 and crashed in November 2008 and lost 73% of its value. Just because the market went up 100% this year means you still lost 36% of your investment in the past two years.

Large caps stocks in China are mostly SOE(state owned enterprises). Their profits are determined by action of the government, not by the market. Just look at the pricing history of China Mobile and you will have a better understanding of the Chinese market. Most US investors stay away from SOE because they are not market driven. I suggest that your money should only be put in SOE because when the company is majority owned by the State the government will not enact actions which may jeopardize their own pocket book.

Asset bubbles are created by governments (US & China). Follow the money flow and you will know when to get in and to get out of the market.

The Other Imminent China Bubble

Mon, 27 Jul 2009 03:23:50 -0400

We won't. That is why they call us "The Ugly Americans'.

On Jul 26 12:35 PM Observer45 wrote:

> The trouble with many is that they know a little and they talk like
> that is all to know. They hardly travel outside the country or read
> outside their narrow field and much less, understand very little
> of what is happening around in the world. The biggest mistake is
> that they try and read the world from their narrow perspective and
> in consequence, even when they mean good, they screw up.
>
> Before the financial collapse, we were actively bashing China, human
> rights, trade balance, undervalued Yuan, etc. Now that things are
> pretty much up in smoke at home, we are still passively bashing them.
> This time, overheating economy, Shanghai market bubble, pollution,
> etc. At first, it is they will not succeed, now it is they will not
> sustain! When are we going to stop all this and look at ourselves
> in the mirror?

Why I'm Buying Morgan Stanley China A-Share Fund

Tue, 21 Apr 2009 20:47:34 -0400

As of today the A shares in general trades at a 37% premium to its underlying H shares. This is reflected in looking at the Hang Seng China AH Premium Index. The underlying stock is identical except one is listed in China while the other one is listed in Hong Kong.

Because the China's market is closed to outsiders (including Hong Kong residents) stock prices in that market can be different than the same stock listed in Hong Kong. With the eventual opening up of China's financial market who will be willing to pay this 37% premium?

An US expat living in Guanghzou...

China's GDP Growth Muted - If You Believe the Numbers

Thu, 16 Apr 2009 09:15:19 -0400

Many Americans are ignorant and scared of the "new" China. Few of them write about China without ever being there. As a US expat living in Guangzhou for three years I am amused by their posts - half truths and half ignorance.

China has made tremendous economic progress in the past twenty years but still remains poor. The country is full of corruption, probably no more than our politicians. The country has been misallocated capital; the statistics are most likely not precise; the health system is non-existent. However one can see the current government is trying to do its parts to improve, unlike the current state of affairs in California.

It will be another twenty years before China ever coming to be a major economic power but it is coming...

China Real Estate Investing Stands to Benefit from Stimulus Package

Wed, 08 Apr 2009 10:31:32 -0400

Are you referring to the rate of return? Here in Guangzhou you can reasonably expect a realistic 4-5% annual return on your investment. In China tenants also pay for the association fees and all their utilities as well.

On Apr 08 07:21 AM Phiota wrote:

> As an expat living in China what worries me (from purchasing real
> estate directly or purchasing a real estate fund) is the ratio between
> residential rental rates and purchase cost in China. It is much
> higher ratio then what is in the US or rest of the world.
>
> John

Is China Today the U.S. of 1929?

Tue, 31 Mar 2009 01:04:21 -0400

China is in a much better economic shape than any other country because it has a US$2 trillion foreign reserves and their household saving rate is a whopping 40%. Traditionally Chinese have been poor for a long time. If they see every one in the world is suffering there will be much less social unrest.

I do not think China wants to be a world power at this time, because there are consequences when one is a leader. What the country wants is not to lose value of their US treasury holdings. After all the country had invested billions in Wall Street firms and saw their money went down the drain quickly.

A US Expat Living in Guangzhou

On Mar 30 11:33 PM @TexasER wrote:

> China is in serious trouble. The government constantly faces social
> unrest and that will only rise along with unemployment.
>
> They just blocked YouTube again. They can underwrite the world economy,
> but YouTube makes them cry.
>
> And they're the next world power?

C-Trip Could Be Worth the Long Haul

Thu, 05 Mar 2009 10:16:10 -0500

In China Expedia owns Elong.net. Ctrip has been distancing itself over Elong for the past several years.

My concern is that management also owns Home Inn (HMIN) on the side. In China where there is little transparency one is not sure where the money goes...

Time to Buy China, Copper, the Canadian Dollar and Oil

Thu, 05 Mar 2009 09:34:45 -0500

I agree that China is one of the very few countries that I would invest my money. The reason is simple. They are sitting on US$2 trillion of our money. When that kind of reserves and a household saving rate of 40% the government has many options.

As a US expat living in GZ I cannot buy Chinese stocks legally. But I can invest in over 400+ mutual funds which in general will smooth out the ride. No one knows for sure where the bottom is. China stock market started its decline 12 months before the US market. I believe that the Chinese stock market will recover before the US stock market.

Will China Continue to Buy U.S. Debt?

Thu, 26 Feb 2009 09:54:17 -0500

China will continue to buy US Treasuries because there is no other viable alternative.

They cannot just spend all their trade surpluses buying mining interests in Australia. China may be able to recycle some of their dollars into future oil contracts with Russia/Brasil.

In spite of all the fuss the US dollars appreciated 14% against a basket of world currencies in 2007. That is a much better return than investing in JP Morgan, Citibank or Black Rock. Or they can lose more money betting against the Australia dollars...

Chinese Real Estate Is in the Headlines Again

Tue, 24 Feb 2009 11:41:07 -0500

There will be no Chinese boycott of US Treasury - simply because China has fes options left on their foreign currency reserves.

China has been investing in overseas companies with disastrous results. Ping On Insurance lost US$1.3 billion in the Belgium Fortress Investments. They would be lucky if they get back 10% of their investment. That investment lasted about a year. Investments in US companies such as Morgan Stanley and Black Rock met with similar fate (losing only two thirds of their investments so far).

China cannot buy gold because the annual worldwide gold production can be bought with just one month China's trade surplus.

In 2008 the US dollar has gained 14% against a worldwide currency basket. China being the largest holder of US Treasury cannot afford not to buy US Treasury notes regardless how unpleasant Mr. Geithner is.

-From a US expat living in GZ

Now China seems to find a good way to recycle the US dollars by giving them to Russia/Brasil in exchange for future oil shipment. They are now shopping for more metal resources buying throughout the world. That is a brilliant strategy.

America Frets About the Economy as China Buys 'Stuff'

Mon, 23 Feb 2009 09:50:28 -0500

China's pension system is on a sounder footing than our social security system. At least you can see money actually was transferred into a trust fund. All we have is an IOU from our Treasury Department. If I have a choice I would like to be a pensioner in China than collecting soon-to-disappear social security.

-From A US Expat In Guangzhou

On Feb 22 06:05 PM Sober Realist wrote:

> It's funny what unpredictable twists and turns occur in history.
> While it may appear to many that China is sitting pretty, they have
> a lot to worry about.
> Statistics from China's regime are as untrustworthy as our government's.
> So when the CCP reports "4.2% unemployment rate on registered
(urban)
> workers for the end of 2008, as reported by Xinhua News Agency on
> Jan. 21, 2009.", don't believe it. Experts believe the total unemployment
> for urban and rural workers is around 25%. China's growth rate is
> also most likely well under the 6% figure touted by the regime as
> a "critical threshold required to absorb incoming young workers and
> maintain sufficient jobs for the workforce in general."
> What's this adds up to is that the financial crisis is hitting China
> from the bottom up.
> How long will the tens of millions of destitute Chinese migrant workers,
> who were the lifeblood of China's once humming factories, stay patient?
>
>
> China's Demographic Time Bomb:
>
> A recent study by the Institute of Economic Affairs found that "of
> all the pensions systems we studied, China’s was possibly the most
> complex, the most inequitable (relatively rich urban dwellers receive
> very generous pensions from age 50, poor rural workers receive nothing),
> entirely inflexible (people cannot transfer benefits between regions)
> and riddled with corruption – entirely unsuited to meet the oncoming
> crisis."
> China's one child policy has created a demographic time bomb consisting
> of "4-2-1 problem, one child supports two parents and four grandparents."
> "Even if China’s economy continues to grow rapidly, its per capita
> income will still be a fraction of ours during the demographic transformation
> – China will grow old before growing rich. China’s high savings rate
> has often been commented on – this is not surprising given its rapidly
> ageing population."
>
>
>
>
>
>
>
>

The Differences Between Chinese and U.S. Economic Recoveries

Mon, 16 Feb 2009 11:20:36 -0500

FYI the government does own stocks in many companies. That is because the country started out as a communist country, in which the government owns everything.

It is true that the government does try to interfere with the free market with its own political and economic objectives. That is no different that the $787 billion stimulus package that our government just approved. It is not true if you imply that the government trades in and out of stocks to move the market higher. What the government does is to instruct the social security fund to buy more stocks when the market is down. Hey that is much better that our social security system because all we have is IOU's from the US Treasury.

I have lived in the US most of my life and now live in China for two years now. The government they have now is more sensitive to people than our government. When the Sichuan earthquake hit last May the Premiere was in the disaster area in seven hours. Where was our President when New Orleans was flooded? I was moved to see their Premiere worked day and night for one full week urging the soldiers(they were the only relief workers) to work harder and faster. This government has learned from the US that you need good PR to win people's hearts.

A US Expat in Guangzhou

On Feb 15 01:26 PM Aalan wrote:

> Comment stream has gone in a different direction from the headline--that's
> where I want to check in.
>
> Signals from China are mixed. The SSE index is one indicator, but
> since the government controls the bulk of stock shares, the prices
> can be easily manipulated. Therefore, I wouldn't rely on that alone.
>
>
> Areas that were booming with the export economy are in a serious
> slump, but that's not the whole story either. I like the author's
> approach of looking at resource utilization, commodities and energy,
> as a more persuasive indicator of the overall economic trend.

China Economic Growth: Worse Than Expected

Fri, 23 Jan 2009 05:37:23 -0500

Just your information the 4th quarter GDP grew at 6.8%. For the 2008 year the GDP grew at 9% nationwide and 10.1% in Guangdong Province (Southern part of China).

You are correct in stating that 7.5%-8% in GDP growth is what the Chinese government likes to minimize social unrest.

The best way to help China is for the US to get out its recession as soon as possible.

11 Reasons Why It's Time to Invest in China and 5 Ways to Play It

Thu, 15 Jan 2009 09:01:17 -0500

Most people forget that China lives on exports. When the economy of US and Europe declines China has farther to drop.

As to the Chinese shares selling at 8x earnings we have to deal with transparency and accuracy. In addition analysts here and in the US are alike - look at how much cheaper US stocks are now - but they have not marked down the more realistic earnings. When one factors in the 'real' earnings stocks in US and China are no longer cheap. I like to see specific examples to show how many company's earnings are increasing and not decreasing.

Because the Chinese have traditionally saved 40% of their income when the economy contracts the consumers are the first one to defer buying. Just look at their automobile sales in 2008. The sales figure has hit a wall long before the US did.

Locals so far are somewhat optimistic because they still have jobs. When more jobs are eliminated in Southern China (called Pearl Delta, the Shenzhen-Guangzhou-Zhu... triangle) which is happening now those optimism will fade fast.

Hong Kong's 8% Mantra

Thu, 08 Jan 2009 07:17:41 -0500

The truth is that many Chinese workers are already laid off. All you have to look is the number of passengers processed through the Guangzhou Central Rail Station every day. The outflow (migrant workers going home) started earlier and more people are going home at this time this year compared to previous years. While most people including myself speculate many workers will not return because their factories will be closed. Having a small business in the Guangzhou-Dongguan-She... area all I have to say is that sales fell by half in November and another 30% in December. Without considering November and December our 2008 sales was 18% ahead of last year.

On Jan 07 09:34 PM User 333239 wrote:

> "I think that the implications of less than 8% growth are too scary
> to contemplate for most Chinese."
>
> Or maybe most Chinese know their economy better than you do and are
> more confident, based on a 30 year growth rate that has not been
> matched in modern history.