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Strategies & Market Trends : HONG KONG -- Ignore unavailable to you. Want to Upgrade?

To: tom who wrote (2247)	9/1/1998 9:51:00 AM
From: Bosco	Read Replies (1) \| Respond to of 2951

G'day all - dear tom, you sez "... Sell!!!!" Too bad I ve neither long nor short position [no directly anyway] in HK Inc. While I agree with a lot of your analysis, I am not totally convinced of your conclusion either. I agree that an substantial portion of the underlying values [and valuations] of HK equities is the properties held. And indeed, HK govt has derived an substantial amount of revenues from her land sales. However, housing shortage is a real issue in HK. So, as there is a temporary halt of land sale and slowdown of development, coupled with a decline in price, supply and demand will catch up. Additionally, HK has been building a lot of infrastructures. Despite the new airport syndrome <g>, the new airport will enhance the import/export capacities. It is said that one can check the luggage in in central district and then take the high speed shuffle to the airport. How many airports in the world can do that? HK has been laying down hi speed highways connecting the region as well as making fast connection to China proper. These are valuable real estate [not unlike the highway system built in the US back in the 50s in terms of potentials.] To make a leap of judgement <g>, HK will be the bridgehead for China, it seems to me that thinking HK Inc is merely a parcel of prime RE in the heart of downtown district misses the point that the activities associated with the area best, Bosco

To: tom who wrote (2247)	9/1/1998 11:20:00 AM
From: Ron Bower	Read Replies (1) \| Respond to of 2951

Tom, To add to Bosco's comments. I do have investments in Hong Kong and also disagree with your conclusions. The property markets in Honk Kong are a reflection of the business economy, not 'THE business economy'. Hong Kong is a center for international commerce in Asia and a conduit to China, but it is also an industrial and transportation center. The growth in the various business sectors over the last few years has caused the increase in real estate values. The decline Asia's economy has caused a reduction. I don't understand how lower real estate values means the $HK should be devalued. One has nothing to do with the other. If you were to say that the HK economy would be in the tank for the next few years and foreign exchange reserves would decline, then I could understand, but the real estate values have nothing to do with the HKMA reserves that back the $HK. It's not just the infrastructure improvements that Bosco mentions, recent reports indicate that tourism is increasing, exports and commerce are doing very well, confidence is coming back to Hong Kong. They are a long way from recovery, but HK has a history of succeeding over adversity. They won't lay down, they'll come out swinging as the recent HKMA actions indicate. While the other countries were being mauled by the hedge funds, HK has stood up to them and if the economy continues to strengthen, the hedge funds will be taking a bath. Don't count HK or China out. IMO it's the place to be buying. FWIW, Ron