Sigmund,
I'm afraid a little more needs to firm up, before ANY conclusion can be reached on the Chinese currency, and Hong Kong stock market condition.
A VERY critical scenario has been playing out on the Hong Kong stock market, and very little here is being reported on this development. There is a significant effort on the part of "speculators" as they are termed by mainland China to short and drive down prices in the Hong Kong stock market.
If you remember back, China had resolved not to interfere in any substantial way with the affairs of the Hong Kong stock market. Well, those days are LONG gone, with China infusing a very large portion of all the US dollars they possess. This has begun to put a significant dent in the amount of US dollars held by China, so much that they have begun to play a cat & mouse game with the speculators.
In essence, the Chinese government is artifically changing the price on some stocks, then carefully monitoring exactly who is involved in trades that follow their actions. The idea is that since the identities of the "speculators" have to date remained unknown, they would catch the "thief" with their hand in the cookie jar.
Well ... they have begun to discover some very critical actions are taking place in the Hong Kong stock market. And, they have become very concerned with the consequences of the actions of the "speculators". So much so, that recently China has begun to publish exactly WHO the "speculators" are. You will be very hard pressed to get much information about this in English newspapers, because some of the "speculators" it turns out are brokerages from England and the Good ol US of A.
China is very pissed about this, and may take more drastic action than many would consider reasonable. I do not have a full understanding of possible retaliation, but a very good friend who reads the Chinese newspapers told me that this cat & mouse game has to reach a boil very soon, based on current valuations in the Hong Kong stock market. It will either pass, or it will blow up in a very bad way. There really is no middle ground as I understand it, so the outcome will be a major factor on our markets either way.
On the matter of Iran invading any neighboring country, I don't think so. If you call an action similar to Grenada or Panama an "invasion", then you very well may be correct. But, we do not have a Gulf War type of invasion to "look forward to", as some knuckle-heads would wish. I have no doubt that those that look forward to any such action have never had to see the results themselves, and lack a full and complete regard for the lives of other human beings.
I think I'll stick to a kindler, gentler style of wishful thinking for THQI.
Regards, JB
aC - Can you do us all a big favor? If you can read the Chinese newspapers, would you mind posting a summary of the current state of affairs concerning the "speculators" in the Hong Kong stock market? I would REALLY appreciate any input, thank you :o)
P.S. Thank you very much Winston, your guidance is appreciated! |
