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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: smolejv@gmx.net who wrote (23585)	9/26/2002 12:49:39 AM
From: TobagoJack	Read Replies (1) \| Respond to of 74559

Hi DJ, <<US whole-sale banking = x * LTCM>> Not to worry, for Sir Maestro will save the day. In Hong Kong, Money Rock/Freedom Mountain, when the going gets real tough, the previously tough cries out for INTERVENTION, and given that our government is still rich, they respond, to save the rich, and allow the masses to squeak by. Here is a deal J6P could soon appreciate and ask Congress to emulate: scmp.com QUOTE Thursday, September 26, 2002 We'll force up flat prices: Leung NG KANG-CHUNG The government has indicated it plans to intervene in the property market to try to push up prices in an effort to drag Hong Kong out of its economic slump. It is understood major options under consideration range from suspending the sale of Housing Authority flats and restricting land supply, to reducing stamp duty and boosting tax concessions. The Housing, Planning and Lands Bureau is expected to release a report into how to arrest the market's decline - which has seen prices hit 10-year lows - as early as next month. Financial Secretary Antony Leung Kam-chung, speaking at the Forbes Global CEO conference at the Grand Hyatt yesterday, said Chief Executive Tung Chee-hwa was studying ways to boost prices. Mr Leung said: "It is rather difficult for the government to push up the market. But there are some measures we can take and the chief executive is thinking about this. "Right now we are on the downward trend. I think there will be a lot more short-term pressure." Suggestions of a fresh round of intervention in the property market emerged on Tuesday night after Mr Tung said at the same conference that he hoped to "help push [the market] up a bit". Mr Leung blamed plunging flat prices for Hong Kong having experienced deflation for 46 straight months. He said flat prices had dropped by 65 per cent from their peak in 1997. Credit-rating agency Standard & Poor's on Tuesday predicted home prices could decline by another five to 10 per cent over the next 12 months. The projections are in contrast with comments by property tycoon Li Ka-shing who said on Monday he believed prices had bottomed out. Fellow tycoon Stanley Ho Hung-sun also said last night he thought prices had hit bottom. The Hong Kong economy has shrunk by 12 per cent over the past 4.5 years, and half of that has been caused by falling property prices, according to official estimates. At a Forbes panel discussion, Mr Tung said the government was looking at ways to stabilise the market and "if possible to help push it up a bit". "We have the intention. We have the desire to do this. Now the question is to find the right way of doing it," said Mr Tung, who conceded previous measures had not been successful. The government last year banned the sale of Housing Authority flats for 10 months. Sales were restricted to 9,000 new Home Ownership Scheme flats a year after the ban was lifted in July. Secretary for Housing, Planning and Lands Michael Suen Ming-yeung said the government was aware of public concern over falling property prices. "We are seeing if we can [complete the study] to announce the government views on housing policies as soon as possible," said Mr Suen in a TVB interview last night. News of fresh intervention was welcomed by the property sector, although critics warned the move could distort the free market. Real Estate Developers' Association secretary-general Louis Loong Hon-biu said: "The government finally knows that stabilising the property market is stabilising the economy. "Hong Kong has over one million property owners. If they see the values of properties keep falling, they will not want to spend and this will result in a fall in domestic consumption." But legislator Frederick Fung Kin-kee, of the Association for Democracy and People's Livelihood, condemned the government for intervening in the market. "It will distort the operation of the market and give false hope to home-buyers," he said. Housing expert Dr Yip Ngai-ming, an assistant professor at City University, urged the Housing Authority to scrap its programme to sell 25,000 public rental flats a year to existing tenants. "The scheme discourages well-off tenants from going to buy homes in the private market." However, authority member and property consultant Michael Choi Ngai-min doubted if further government intervention could work, because of the gloomy economic outlook. He also said scrapping the sale of public housing flats might not be much help because public tenants might not be able to afford private units. UNQUOTE Chugs, Jay