Hi Carranza2, <<The American consumer is not leading US out of the recession. The retailers (except for Wal-Mart) did not do well this Christmas>>
I figured that …
Message 16069928
“The manufacturing boss-execs in HK (factories in China, markets in US, Europe and Japan) are now uniformly saying "I have never seen it this bad before". A large LCD maker boss said to me: "no orders placed in May".
Message 16243010
“A friend of mine in the toys manufacturing business is having the worst time in 10 years. Another in textile manufacturing (NAV of around USD 100mm) is looking to relocate home from Hong Kong to Shanghai, shutting down 6 plants in ex-China locations (Thailand, Sri Lanka, South Africa, Mexico, Philippines) due to the worst business environment since 1991. These folks report a 30% decline in orders, and more alarmingly, that the US buyers (large outfits, like Gap, etc) are, instead of payment by Letters of Credit, demanding and getting goods on consignment, shifting their own intolerable debt crunch on to the manufacturers, who in turn are cutting output and volume to shrink their own respective balance sheet and output.
These folks are reporting US orders are falling much faster and deeper than European orders.
My Taiwan friends are reporting massive quantities (“all along the main streets”) street light pole and curbside posters and billboards advertising apartments and commercial properties for sale. The burning of buildings for insurance claim is ramping up.”
… And agree …
<<This is the best thing to do when cluelessnes sets in … The ex-market maker has all his millions in USD fixed deposits, and is cutting back on spending in line with reduced interest income.
Smart, smart, smart guy.>>
… but note …
Message 16243010
“How to protect NAV without a lot of dancing through the long, short, equity, bond, currency markets? I haven't a clue, and on this, I am not kidding. I do know gold is being sold on the market at cost of mining”
… because there could, praise whomever make it happen, an possibly dizzying upside …
… and, remain …
“Frankly, I do not see anything on the horizon that would prevent a slippery slide to disasters, deluge, depression and dissolution. At least not today”
Chugs, Jay
P.s. My wife and I went around town for dinner with friends, followed by a walk-around the bar/restaurant district, ending up at the bar in Mandarin Oriental Hotel in heart of CBD. The restaurant occupancy was dismal compared to past years, and the party at Mandarin was tame. The thought I keep puzzling over, ‘what will cause a turn-around’, has a familiar and recurring theme, ‘we need an abracadabra’.
The only abracadabra I can think of that would be of significant and sufficient momentum is really cheap assets of all classes in all territories, people willing to do hard work for a honest pay, small governments, low taxes, savings, capital formation, sustainable spending, prudent investment, conservative balance sheets, transparent reporting, peace, et cetera.
So, conclusion, the process of abracadabra requires pain, or something we have not thought of yet. |
