BAGS: The Chinese disaster
After the fall on Thursday, with losses of more than 1% indexes have recovered Friday by reference in almost equal for the week and respecting the spirit of the script in place that will impress both with other violent expansion , is bursting with attempts failed, and finally with the outbreak that will truly devastating when nobody expects it. The
there will give the super-bubble burst of the Chinese, came to attract the attention of finance - listen, listen-at Goldman Sachs who has finally sounded the alarm. Better late than never. Certainly the figures are now feeling at all, apart from +170% in the last 12 months:
- the capitalization of Shanghai surpassed that of all other Asian stock markets combined, including Japan which is the second stock exchange in the world;
- the Shanghai index has quadrupled in less than 2 years;
- the price earnings ratios (for what they can claims the official figures) are more than 40-50;
- in April alone were opened new accounts for 4.8 million more shares of the last two years combined.
Even the Chinese authorities continue to say that there is a bubble, and the frantic race to enrich the stock market has affected even the poorest, who are selling the bike and the bowl of rice just to buy shares. But authorities still do not do anything really effective to prevent this collective suicide. E 'unthinkable that some adjustments to the rates or reserve requirements to curb the phenomenon of this magnitude, on the other hand even the closing of the market for several years, the only solution, it is conceivable despite the communist dictatorship. So, sooner or later there will be a colossal disaster that will cause suicide and despair for millions of hapless Chinese guy, in addition to impact all global stock markets. On 27 February there was a false alarm of a fall of 10% then quickly recovered, and today we are at 33% from levels pre February 27. When the bubble burst I expect losses in the order of 80% and after years of stagnation (like Japan). The case of China will law of the great stock market crash in history. Welcome to the club!
The week ends with the 11.5: Dow at 13,326 (+0.5%) SP500 in 1505 (+0%) NASDAQ in 2562 (-0.4%) Nasdaq100 in 1910 (+0.2%) Russell 2000 - Transport 0.4% -0.1% Utilities -0.1% +0.1% semiconductor broker-dealer Banks -1.2% -0.2%. The titles ranged upward on the NYSE on Thursday between the minimum to 700 and the maximum at 2500 on Friday. The relationship between put and call drops from 0.75 to 0.68. The volatility index (VIX) stopped at 12.95. The Nikkey rises to 17,550 (+0.8%), always filled the bubble in Europe with the DAX in 7480 (-0.4%), the CAC in 6050 (-0.3%), the Footsie in 6565 (-0.8%), Italy at the without the slightest hope to Intel Corp 43,590 (-0.9%) and Mibtel to 33,824 (-0.8%). superbubbles in China continues the spectacular +7%, Brazil 0.6% and India down (-1 %) and Russia 4%. Location
After the fall on Thursday, with losses of more than 1% indexes have recovered Friday by reference in almost equal for the week and respecting the spirit of the script in place that will impress both with other violent expansion , is bursting with attempts failed, and finally with the outbreak that will truly devastating when nobody expects it. The
there will give the super-bubble burst of the Chinese, came to attract the attention of finance - listen, listen-at Goldman Sachs who has finally sounded the alarm. Better late than never. Certainly the figures are now feeling at all, apart from +170% in the last 12 months:
- the capitalization of Shanghai surpassed that of all other Asian stock markets combined, including Japan which is the second stock exchange in the world;
- the Shanghai index has quadrupled in less than 2 years;
- the price earnings ratios (for what they can claims the official figures) are more than 40-50;
- in April alone were opened new accounts for 4.8 million more shares of the last two years combined.
Even the Chinese authorities continue to say that there is a bubble, and the frantic race to enrich the stock market has affected even the poorest, who are selling the bike and the bowl of rice just to buy shares. But authorities still do not do anything really effective to prevent this collective suicide. E 'unthinkable that some adjustments to the rates or reserve requirements to curb the phenomenon of this magnitude, on the other hand even the closing of the market for several years, the only solution, it is conceivable despite the communist dictatorship. So, sooner or later there will be a colossal disaster that will cause suicide and despair for millions of hapless Chinese guy, in addition to impact all global stock markets. On 27 February there was a false alarm of a fall of 10% then quickly recovered, and today we are at 33% from levels pre February 27. When the bubble burst I expect losses in the order of 80% and after years of stagnation (like Japan). The case of China will law of the great stock market crash in history. Welcome to the club!
The week ends with the 11.5: Dow at 13,326 (+0.5%) SP500 in 1505 (+0%) NASDAQ in 2562 (-0.4%) Nasdaq100 in 1910 (+0.2%) Russell 2000 - Transport 0.4% -0.1% Utilities -0.1% +0.1% semiconductor broker-dealer Banks -1.2% -0.2%. The titles ranged upward on the NYSE on Thursday between the minimum to 700 and the maximum at 2500 on Friday. The relationship between put and call drops from 0.75 to 0.68. The volatility index (VIX) stopped at 12.95. The Nikkey rises to 17,550 (+0.8%), always filled the bubble in Europe with the DAX in 7480 (-0.4%), the CAC in 6050 (-0.3%), the Footsie in 6565 (-0.8%), Italy at the without the slightest hope to Intel Corp 43,590 (-0.9%) and Mibtel to 33,824 (-0.8%). superbubbles in China continues the spectacular +7%, Brazil 0.6% and India down (-1 %) and Russia 4%. Location
long-term overall decline in the medium term
Location: Side
asset position: buying put spreads composite maturity. May 18
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