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[tpaulbeaumont] 04/1/2012 08:05

China finds $84bn local government debt irregularities

[tpaulbeaumont] 22/12/2011 16:41

Running out of steam

Dec 22nd 2011, 0:04 by The World In 2012

Asia's seemingly relentless economic rise is still not inevitable

LIKE most of the 30 years that preceded it, 2012 will be punctuated by statistical evidence of Asia's growing weight in the world economy and by the West's relative decline. Sober Asian policymakers, however, worry. In the short term, they know that the region would be badly hit by another severe downturn in the West. This short-term vulnerability to the rich world's economic woes is a symptom of a longer-term worry: a failure in many countries in Asia to progress from growth fuelled by resources and cheap labour to growth driven by higher productivity. As wages rise manufacturers often find themselves unable to compete in export markets with lower-cost producers elsewhere; yet they still find themselves behind the advanced economies in higher-value products. This is the middle-income trap which saw, for example, South Africa and Brazil languish for decades in what the World Bank call the "middle income" range (about $1,000 to $12,000 gross national income per person measured in 2010 money).









Id go so far as to say its a certainty theyll suffer a middle income 'trap'

[tpaulbeaumont] 21/12/2011 09:49

'China's economy is very fragile and deceptively robust: I characterized it as a "Michael Jackson economy" kept functioning by doses of artificial stimulants, which postpone the ultimate adjustment, but which make that reckoning all the more harrowing when it comes–as it must. There have been other advocates of this view, notably short sellers like Jim Chanos, but until relatively recently the consensus was that China would slow gently, and experience a "soft landing".'

[tpaulbeaumont] 15/12/2011 14:54

China's epic hangover begins

China's credit bubble has finally popped. The property market is swinging wildly from boom to bust, the cautionary exhibit of a BRIC's dream that is at last coming down to earth with a thud.

Chinese stocks are flashing warning signs. The Shanghai index has fallen 30pc since May. It is off 60pc from its peak in 2008, as much in real terms as Wall Street from 1929 to 1933.

By Ambrose Evans-Pritchard, International business editor
10:20PM GMT 14 Dec 2011

[tpaulbeaumont] 12/12/2011 11:55

China's mysterious November iron ore imports
Posted by Kate Mackenzie on Dec 12 09:55.

In November, China's PMIs signalled contraction, house prices fell in most cities, and inflation fell sharply. Trade, we learned over the weekend, is down down down. And as the FT notes, prices of petrochemicals, especially naphtha, are falling in a way not seen since the 2008.

And yet, as Bloomberg reports, demand for iron ore imports surged in November having plunged in October.

[tpaulbeaumont] 26/11/2011 15:06

According to Steve Keen, in 2000 Ozzie mortgage debt was c.10% of GDP, today its 100%, which almost fully accounts for all the house price gains over the last 11 years.

[tpaulbeaumont] 26/11/2011 15:01

Although Ozzie RE has declined in the last 12 months its still over-valued against historic price-to-renst and incomes by 53% and 38%, respectively.






Anecdotal evidence tells me Singapore's figures may not be correct, they may be underestimating the recent froth/rises.

[tpaulbeaumont] 26/11/2011 10:26

Lang's assessment that the regime is bankrupt was based on five conjectures.

Firstly, that the regime's debt sits at about 36 trillion yuan (US$5.68 trillion). This calculation is arrived at by adding up Chinese local government debt (between 16 trillion and 19.5 trillion yuan, or US$2.5 trillion and US$3 trillion), and the debt owed by state-owned enterprises (another 16 trillion, he said). But with interest of two trillion per year, he thinks things will unravel quickly.

Secondly, that the regime's officially published inflation rate of 6.2 percent is fabricated. The real inflation rate is 16 percent, according to Lang.

Thirdly, that there is serious excess capacity in the economy, and that private consumption is only 30 percent of economic activity. Lang said that beginning this July, the Purchasing Managers Index, a measure of the manufacturing industry, plunged to a new low of 50.7. This is an indication, in his view, that China's economy is in recession.

Fourthly, that the regime's officially published GDP of 9 percent is also fabricated. According to Lang's data, China's GDP has decreased 10 percent. He said that the bloated figures come from the dramatic increase in infrastructure construction, including real estate development, railways, and highways each year (accounting for up to 70 percent of GDP in 2010).

Fifthly, that taxes are too high. Last year, the taxes on Chinese businesses (including direct and indirect taxes) were at 70 percent of earnings. The individual tax rate sits at 51.6 percent, Lang said.

Once the "economic tsunami" starts, the regime will lose credibility and China will become the poorest country in the world, Lang said.

[tpaulbeaumont] 24/11/2011 23:34

Chanos and Hendry have been vocal bears on China, and OZ (and Japan), as OZ is also a good proxy for many other 'risk' trades, for example if you want a $1 Billion copper short, you cant, however you can easily work $1 Billion short AUD without too much slippage.

[tpaulbeaumont] 24/11/2011 23:32

A thread for anything Aussie that may offer a look, idea or reason for or against its economic and financial strength.







SPOT AUDUSD





10YEAR AUSTRALIAN GOVERNMENT BOND YIELD





Theres no denying the fact Australia has (and currently still is, just about) booming thanks to the demand for its commods from Chinas industrial boom.

As China faces down the possibility of one day having to stop official record-busting stimulus, let alone the consequences of frivolous shadow banking, growing discontent at financial inequality within the rural poor etc, growth will likely taper off, leaving Australia with huge over-capacity.

Equities have been relatively soft in recent months, the AUD peaked against the USD at a little over 1.1050 and the real estate market is one of the most over-valued according to a number of measures, not least of which is historic price-to-rent ratios.






ASIA stocks -
ASIA FX -

The masses have never thirsted after truth. They turn aside from evidence that is not to their taste, preferring to deify error, if error seduce them. Whoever can supply them with illusions is easily their master; whoever attempts to destroy their illusions is always their victim.

Gustave Le Bon
- The Crowd: A Study of the Popular Mind, p. 110

[corrientes] 15/9/2011 20:45

20m @11.1 g/t gold and 17m @6.8 g/t gold and richer intersections within these two drills at Glenburgh, which is getting better and better. Don't say you weren't told about this new gold province owned by AU:GCY.

I was fortunate enough to be a shareholder in the Canadian Aurelian Resources, which made the best gold discovery anywhere in the last decade, before being taken over a couple of years ago or so.

This one can't be as good, but has got massive potential. DYOR of course.

[corrientes] 08/9/2011 08:32

GCY anyone ?

[chopsy] 06/1/2011 16:16

That's right, 9am. And, if one can stay up late enough, they open at 1am GMT. The fact that they close for lunch shouldn't worry us.

See also energyi's thread on Noble (NOBG), dont much like the chart there, it seems to restart each year so we currently have threee days trading spread across the page.

GLA

[chopsy] 06/1/2011 16:05

See, on the contrary, the singapore stock exchange is still open to about 9am our time. That's convenient for opening/closing positions in the morning.

[chopsy] 06/1/2011 15:35

OK, sorry for hijacking this thread of mine, this is now a far east/aus watchlist. If there is anything you want adding, don't hesitiate to ask. Noble is recovering well, and I have high hopes for some swing trading here. MEO is an old friend, always worth keeping an eye on. Santos will come good in a big way, in due course. IHMO, DYOR

[aspex] 16/9/2010 09:31

R How did it go?

[aspex] 12/8/2010 10:07

R any news?

[recruiter] 06/8/2010 07:29

thanks aspex

[aspex] 06/8/2010 07:19

R,
Let us know how you go

[aspex] 05/8/2010 07:21

Provided you have not resided in Australia in the previous 10 years you do not need to declare income from outside Australia for a period of 5 years from taking residence. Note however it applies to couples jointly so if only one person is disqualified the other partner is also disqualified.
Phone the Australian Tax Dept and they will point you in the right direction.
It is even better for me as a citizen of New Zealand because since there is completely free comings and goings, they cannot determine a date of entry for me so my exemption goes for as long as the concession exists or death.
However as I do not wish to leave NZ even to benefit by a substantial amount I will pass up the offer.

[recruiter] 05/8/2010 03:55

Hi aspex - do tell me more as Noooooo ! I am not taking advantage of this ! I recently transferred my pension & got whacked with tax....
so what's this holiday all about, as I have some shares I still own in the UK.

Thanks

[aspex] 05/8/2010 03:17

Congratulations on picking Oz.
Nice place to spend my holidays.
I hope you are taking advantage of the 5 year holiday on income from overseas based investment income.

[recruiter] 05/8/2010 02:21

Christ, just found this post by accident.
Well for everyone that responded (hmmmm), just to let you know I am in Perth & have been here since early 2009 & loving it.