By Chris Sorensen - Tuesday, February 12, 2013 - 0 Comments
Why some experts believe this is the start of a once-in-a-generation boom
Ralph Acampora has nearly 50 years of experience as a stock market technician—someone who attempts to predict future stock movements by studying their historical patterns. But he says he learned one of his most important lessons not by poring over data on a powerful computer, but while eating dinner 43 years ago at Delmonico’s, a Lower Manhattan institution that traces its roots to 1827. He was seated next to a 70-year-old named Kenneth Ward, then one of the oldest market technicians on Wall Street.
Acampora, a founding member of the Market Technicians Association, asked Ward which 20th-century market had been most difficult to grasp, saying he figured it must have been the crash of 1929. But Ward replied in a gravelly voice, “Naw kid, that was a lay-up. Don’t get me wrong. We lost a lot of money, but the most difficult market I ever worked was in the 1960s.” Acampora was perplexed. Other than the “flash crash” of 1962, the Dow Jones Industrial Average—an index that tracks 30 U.S. blue chip companies—spent the rest of the decade marching to new heights. “I said, ‘But Mr. Ward, the market was going up.’ And he said, ‘It sure did, young man, but it rolled over everybody. And that’s because nobody believed it.’ ” Continue…
By Jason Kirby - Thursday, April 8, 2010 at 11:30 AM - 5 Comments
Beijing has halted land sales in a bid to cool the housing market
In the incestuous world of Chinese state-owned enterprises, there’s clearly not much stock put in clever brand marketing. Hence names like China Aerospace Industry Corp. and China Ocean Shipping—monikers that dryly convey what they do. Or used to do. Those government-owned companies and others have plunged into the red hot Chinese real estate development market. Now a bubble of epic proportions seems to be forming, and Beijing is desperately trying to rein it in.
Earlier this month ofﬁcials ordered 78 state-owned enterprises to get out of the real estate game by April. Beijing has also put new rules in place requiring hefty down payments of 50 per cent for land developers. Last week the central government went so far as to temporarily halt all sales of residential land. The moves come as speculators continue to drive property values up at double digit rates in many big cities, even as tens of thousands of homes and whole apartment buildings sit empty. Houses in Shanghai now cost 90 times more than average incomes.
The $586 billion in stimulus spending Beijing injected into the domestic economy is one reason for the bubble. But the situation has been made worse since local governments, and by extension many state-run companies, now rely heavily on property sales for revenues. In fact, many local politicians are desperate to keep the boom going.
“[Beijing] has tried using standard policies like increasing taxes on land transfers to cool down the real estate markets and it didn’t work,” says Terry Sicular, an economist at the University of Western Ontario who studies China. “Now they’re trying to restrict the amount of development. It may be effective for a short time, but it doesn’t fix the underlying problems.” And that could make an already dangerous bubble even worse. M