There does seem to be more and more of these scares. Is there a limit to how much China can control its economy?
Could China do a Japan?
There is probably money to be made here, but I doubt its in Aussie housing.
Had dinner with someone who does due diligence on projects with view to investing and she is not all that worried about this. She says it is seasonal. Everyone is chasing money in the run-up to CNY.
I guess we'll see after CNY if she is right.
I am getting about three blind calls a day from banks wanting me to invest in project finance. My friend says that as long as I don't go for anything paying more than 12% I am totally safe. Riskier projects are paying in excess of 20%. She also says stay away from resi projects. Commercial real estate and mining is OK though.
Not that I have any intention of investing. I can get mortgage bond products in the US with 13% forward yield that are selling at 20% below book value and have upside.
The other thing to note is that the yield curve is quite seriously inverted. Short-term rates are much higher than long-term rates, which would support the seasonality thesis.
Had dinner with someone who does due diligence on projects with view to investing and she is not all that worried about this. She says it is seasonal. Everyone is chasing money in the run-up to CNY.
I guess we'll see after CNY if she is right.
I am getting about three blind calls a day from banks wanting me to invest in project finance. My friend says that as long as I don't go for anything paying more than 12% I am totally safe. Riskier projects are paying in excess of 20%. She also says stay away from resi projects. Commercial real estate and mining is OK though.
Not that I have any intention of investing. I can get mortgage bond products in the US with 13% forward yield that are selling at 20% below book value and have upside.
The other thing to note is that the yield curve is quite seriously inverted. Short-term rates are much higher than long-term rates, which would support the seasonality thesis.
Do you have an escape plan - just in case?
Whenever you have an argument with someone, there comes a moment where you must ask yourself, whatever your political persuasion, 'am I the Nazi?'
My friend says that as long as I don't go for anything paying more than 12% I am totally safe. Riskier projects are paying in excess of 20%.
does your friend tell you it's possible for you to walk on water as well? Because of they do you should totally do it.
Quote:
Not that I have any intention of investing. I can get mortgage bond products in the US with 13% forward yield that are selling at 20% below book value and have upside.
Cool story bro - thanks so much for sharing your ability to broker exclusive top rate deals on an anonymous chat forum!
"It were not best that we should all think alike; it is difference of opinion that makes horse races." - Mark Twain on why he avoids discussing house prices over at MacroBusiness. "Buy land, they're not making any more of it." - Georgist Land Tax proponent Mark Twain laughing in his grave at humourless idiots like skamy that continually use this quip to justify housing bubbles.
Had dinner with someone who does due diligence on projects with view to investing and she is not all that worried about this. She says it is seasonal.
No, it's not seasonal. The figures I saw state the cash creation has been slowed down greatly by the central bank. Prior to the GFC the cash creation increase 11% pa. With as much as 16% pa post GFC. Last 12 months has seen about 5.7% which is the lowest ever. This sort of rate would be necessary to truly float the Yuan, meaning the world traders will hold reserves. This is mostly likely a requirement of the states that are via agreement increasing the amount of Yuan retained as official reserves. I'd be careful sticking your financial head out in China too far.
But it is likely to cause a credit crunch in China of the first order.
The seasonal effect is greater amounts of cash are usually circulated around Chinese New Year which tapers off for the rest of the year.
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