Some thoughts on US market and Chinese market direction (ZT)

Some thoughts on US market and Chinese market direction
来源: miat42 于 07-11-07 21:23:22
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First, I want to make clear that all I am doing is speculation because I have no ability to know the future. But in my view the following scenario is likely to happen.

1) US economy is getting weaker, probably worsen itself into a recession, if not, it\'s going to be a slow down at the least. In individual sectors such as financing/credit/mortgage and residential housing, they are going through a depression like slump. In the next 3 to 5 years, it\'s going to make US housing market remarkably inexpensive. In many locations, the price may get to 2002 level, if not 2000 level. That\'s cheap because if we factor in cost of inflation, all the bluff will have been completely blown away after this depression.

2) China is lagging US with a 36 months delay. Although China has made itself pretty strong by generating much self demand, it still heavily depends on exporting to US and wealthy European nations. Europe is lagging US by 12 to 18 months. It\'s reasonable to expect China to lag US by 36 months to start its own slow down. Please be careful of what I am trying to say. Please don\'t misunderstand me. I fully believe that China is going to continue rapid growth for the next 200 years. All I am saying here is a mid term slow down or recession. I don\'t mean a long term recession. No matter how much some people would like to believe that China\'s economy is independent, it is not. US trouble will sooner or later be felt in China.

Conclusion: Next 36 months is the window. Within that window, China\'s asset bubble and equity bubble may continue to bubble up. How much bigger? I don\'t know, nobody knows. Usually, before the bubble bust, like 1998 to 2001 period, US stock market had been very crazy. Therefore, next 36 months, Chinese market may offer non-shabby returns. However, the shoes will sooner or later drops. Like Greenspan said: Chinese market has fundamentally developed a bubble.... This window is the opportunity to reallocate your investment out of that market and into already depressed market to fully arbitrage this rare opportunity. The chances are, if FED is right, 36 months later, US may have reached its bottom of recession, and housing depression, and start a recovery process. While, by 24 months later, China may have reached its peak in its own bubble and start a dropping process.

Now, you see, as an investor, you will have a rare chance in life to see a epic high peak and an epic low bottom in two different nations across the Pacific ocean. If you are one of these who have ability to transfer funds, the opportunity is yours.

Wall Street inner investment circles have been seeing this arbitrage opportunities and planning to make a killings. I bet everybody in this board here may have the interest and wisdom to understand this opportunity.