Investing for the future was never easier, the QE world made it simple
Younger people jump through hoops to climb the property ladder
Across the board, data suggests that it is becoming increasingly impossible to buy a house in America.
According to the National Association of Realtors’ affordability index throughout 2023, it become increasingly difficult for families to be eligible for the qualifying income to buy a home.
In Oct. 2023, the latest set of data, the median family income in the U.S. was just over $99,000 while the qualifying earnings for a home needed to exceed $108,000—giving an index of 91.4.
fortune.com, January 21st, Meet the housing market ‘hackers’ who do not live in their homes: These people bought run-down cabins, moved into their sheds and slept in their basements to rake in extra cash
In a world of global QE, predicting the future movement of markets was a slam dunk. To the few who stopped by and took my advice as far back as 2012, I say congrats!
How do you think the synagogue of Satan is going to achieve their Great Reset objectives? They can only do it through the spending of tens of trillions of dollars, which come out of our pockets, via inflation from the sovereign debt generation that only QE can provide. The emergence of the Great Reset objectives climb a wall of incredulity, worry, and despair. Besides, investors prefer the QE world over the pre-2008 world, so there’s no going back.
The alt-media and charlatans like Martin Armstrong who screamed about the 2015 Big Bang, as well as Mormons like Joel Skousen, all kept their faithful followers in gold and other non-income producing assets waiting for that proverbial shoe to drop, They watched in disbelief and on the sidelines.
The S&P 500 just put in a new closing ATH on Friday and that was only made possible by the automatic revenue and profit generation mechanism that QE-inspired social spending offers. All that massive deficit spending, whether on bombs in Ukraine, Section-8 vouchers, or COVID mRNA injection bioweapon production, is ultimately captured onto the balance sheets of asset owners and publicly traded firms.
Gone are the days where the governments were constrained by the global net savings rate and their currency’s attractiveness to foreigners. The central banks render all that a moot point. Now, the more assets someone owns, the wealthier they become as a matter of perfunctory function.
This is why AAPL and MSFT are both worth about $3 trillion. Their market caps reflect their abilities to capture this deficit and social spending; by the government and by the public. These two firms will net over $100 billion each to shareholders as net income this year, and this net income growth rate continues to grow much faster than official CPI numbers.
The public spends the money they earn from wages and from government unilateral transfers, but has little to no means to profit from it. The asset owners capture all of this newly made money. This is not a bubble, since these large firms are the economy and have the blessings of the governments, which are merely the customer service windows for the central bank owners – the synagogue of Satan.
These alt-media economic experts also never recommended the one best single investment out there for the common man, SFRs. It’s even better than Bitcoin or AAPL with its huge and growing cash flow, leveragability, and ample tax benefits. Moreover, those who work at building an SFR portfolio for ten years don’t have to get a job or run a business anymore. They’re financially set for life. I haven’t worked for an employer since 911 nor do I have to listen to a bunch of heathen customers or cater to unwashed subscribers.
I thank the God of Jacob in the name of Jesus everyday for allowing me to possess my rare and unfiltered insight to dispense my financial advice, while taking heed of it. It’s more expedient for fools to jump on the Alex Jones and Martin Armstrong bandwagon. Moreover, I would never take a dime from my readers. There’s no way I could buy my rental portfolio now with its tasty six -figure net cash flow. What amazes me is that the so-called alt-media financial “gurus” claim to understand the financial and monetary system, yet dispense the worst advice. This makes sense, since the word “guru” is a Hindu term. Let the heathen rage.
For my critics who chuckle and call me hurtful, please remember, Tuesdays are Soylent Green days and keep studying the Schofield Bible, which says God loves everyone and the Old Testament was written for the Jews. These deceived people are psychologically handicapped and unable to determine the true enemy.
___________
SUCCESS REAL ESTATE
Meet the housing market ‘hackers’ who do not live in their homes: These people bought run-down cabins, moved into their sheds and slept in their basements to rake in extra cash
“I never wanted to lose my job but I knew I had a backup, and that gave me a sense of freedom that I couldn’t put a value on.”
https://fortune.com/2024/01/21/housing-market-hacks-cabins-basements-sheds-property-ladder/amp/
BY ELEANOR PRINGLE
January 21, 2024
Across America there’s a growing trend: people own homes, they just don’t live in them. Instead, tenants renting in expensive areas are buying cheaper properties as holiday homes, retirement nest eggs, or to bring in some extra cash.
The individuals Fortune spoke to said the choice to buy a house which isn’t their primary residence was pretty simple: they had a pot of savings and didn’t want to miss out on the returns promised by the housing sector.
After all, while the S&P500 tends to have an average return rate of around 10% a year, property comes with an average value increase of 5.4% annually and might have the added boon of rental or holiday letting income.
So individuals are choosing to bury their cash in property, even if they don’t have the benefit of that roof over their head.
Whether it was purchasing a smaller holiday home, buying a rental in need of some love, or even moving into the shed, there’s one thing everyone agreed on: the get-rich-quick property market America loves so much simply no longer exists.
I bought a run-down cabin in the mountains
For six months 36-year-old Allison Ullo cried weekly because the cabin she had bought in the Catskills was hemorrhaging cash.
The two-bed wooden property needed a complete refurbishment, meaning insurance was difficult to secure and handymen were hard to come by.
On top of that, New York-based Ullo lived two hours away and as a self-employed entrepreneur working two jobs and several side hustles, the burden was almost too much to bear.
With the help of her parents, Ullo turned the fortunes of the cabin around: replacing windows, repairing stoves and making the home habitable.
It’s now listed on Airbnb and is bringing in around $1,500 a month—enough to pay the mortgage and cover any other unforeseen issues.
The labor of love doesn’t just give Ullo a bolthole in the mountains, but also represents a retirement option and financial safe haven for the future: “Who knows what will happen but for me freedom is options,” she said.
“Having the option to either move and live there with no mortgage … or the option to sell off a property and make money so I can buy the retirement home of my dreams or use it as a salary that I’m going to live on, those options are what real freedom is.”
Ullo is now open to the idea of buying a second cabin, saying the renovation of her first—which she purchased for approximately $300,000—has inspired confidence.
Ullo—who has inspired a number of friends to go and buy their own cabins—said she’d prioritize buying another Catskills property over a New York apartment.
She explained: “I love the idea of owning land, when you buy in New York you’re getting a box in essence and unless you’re buying a building … you’re not getting any land with it.
“Part of what I was buying with the cabin was the property and land value, which was just as important as the house itself, if something were to happen to the house there’s multiple things you can still do with that land—if your apartment burns down that’s it.”
I live in Miami—my condo is in Brooklyn
Victoria Shannon didn’t want the commitment of buying a home in New York in 2022, but didn’t want to miss out on the housing boom either. So despite preparing to pack her bags and move to Miami the PR CEO put down a deposit on a new-build condo in Brooklyn, while still renting at the time.
Shannon didn’t want to live in the property in Flatbush herself but said crunching the numbers and evaluating the property appreciation in the area made the financial case clear.
“I really believe in real estate as a way to build long-term wealth,” the entrepreneur told Fortune. “It’s not supplementing my own rent but the property is paying for itself and helping me build equity.”
Eventually, the 34-year-old hopes to balance her work and personal life more evenly, having worked 24/7 to get her business off the ground.
Buying another two or three properties—perhaps even one to call home—forms part of that plan.
She said: “I plan to work as hard as I can for another 10 to 15 years and then I would like to have more freedom with my time. I see [property] as more of a long-term bet for retirement and to relieve the pressure of being self-employed, where everything feels like it’s on the line.”
The businesswoman added the purchase of her property—which was in the region of $400,000—had been relatively straightforward, advising potential buyers to search beyond the bad news across the industry for opportunities in certain areas.
When it comes to housing affordability the devil is in the detail and, like Shannon, some prospective buyers may have to go out of state to purchase a property.
For example, the Bureau of Economic Analysis found that Mississippi is the most affordable state to buy a home, followed by West Virginia, Arkansas, Alabama and Kentucky.
On the flip side, California is the least affordable, followed by Hawaii, New Jersey, New York and Colorado.
Across the board, data suggests that it is becoming increasingly impossible to buy a house in America.
According to the National Association of Realtors’ affordability index throughout 2023, it become increasingly difficult for families to be eligible for the qualifying income to buy a home.
In Oct. 2023, the latest set of data, the median family income in the U.S. was just over $99,000 while the qualifying earnings for a home needed to exceed $108,000—giving an index of 91.4.
We moved into the shed
Unlike other people Fortune spoke to, Julie Fornasero and her husband Tim Logan did once live in their 1,100-square-foot home in San Anselmo, California.
But when Tim’s sons decided to move out—one for college and the other for boarding school—the couple began to look at how they could live more flexibly to increase their income.
The idea was to build a modular home in the large garden and rent it out, but when the maths shook out it made more sense for the couple to rent out their own, larger home, and move into their Studio Shed.
Having moved into the 544-square-foot shed in 2018, Fornasero’s tenants—a mother and son—now pay the couple approximately $5,000 a month to live close to good schools.
It’s meant the owners—Fornasero, a property manager, and Logan, a tech consultant—are more secure financially and can enjoy a more flexible lifestyle.
The couple plans to live abroad for half the year, but looking into the long term see the modular home as an investment for their retirement. A live-in carer, for example, could live in the garden house if needed.
Fornasero said neither she nor her husband had ever felt uncomfortable with the idea of someone living in the home they still owned—it was a purely commercial decision: “We don’t have an attachment to the house … it’s allowed more financial freedom.”
That freedom has come at a cost, space, which is Fornasero’s main piece of advice to those thinking about making a similar change: “It’s a challenge to remain small, not to buy loads of stuff—it feels like you’re missing out because you have to buy smaller things. It’s not live within your means, it’s buy within your space.”
We lived in the basement
Ten years ago Suzanne Moore bought her first duplex in Portland, Oregon, while renting herself and has now built a portfolio of nearly 20 properties worth millions of dollars.
“I was paying $1,200 a month in rent and bought a duplex that was barely financeable,” said Moore. “It was $210,000 and needed a lot of work … we fixed up one of the units before the first mortgage payment was due, so we’ve never had to make a mortgage payment out of our pocket. As soon as we got the second unit up and running we had the passive income and that got us started.”
Moore has never bought a house purely to make it her home—even now technically ‘renting’ from her partner as they aren’t married—and has sometimes lived in the properties for a short period of time in order to secure better financing agreements.
Even when they did live in one of their houses, Moore and her partner ended up splitting the basement unit from the property and moving downstairs to bring in a higher rental income from the upstairs.
“It was my goal to be able to have an alternate retirement plan,” Moore said. “I wanted to generate some passive income to ultimately leave a corporate job. I worked in the fashion industry and every 18 months there’s a new round of layoffs, and I didn’t have to worry.
“I loved what I did but I didn’t have that sense of fear that I saw in my colleagues when those times would roll around. I never wanted to lose my job but I knew I had a backup, and that gave me a sense of freedom that I couldn’t put a value on.”
Younger generations are going to have to get used to thinking outside the box if they want to get on the housing ladder.
According to the NAR’s most recent Home Buyers and Sellers Generational Trends Report, the vast majority of property changing hands is between people in Gen X (people aged around 45) and above.
Moore highlighted that any would-be property magnates won’t be able to make a quick buck by holding onto a property and selling it with no work: “You don’t have to be wealthy or rich in order to get started, that’s a common misconception. But you have to be creative and willing to sacrifice your own comfort in order to do it.
“We lived in construction zones and moved a lot for six or seven years—it was a lot of work, we had our day job and in the evenings and weekends and holidays were building the foundation for our property business. The payoff was pretty fast and really sweet because now I have the freedom to set my own schedule and travel.”
Just ran across this short article and could not help to think it’s an advertising campaign for those who own property. The Blackstone’s of the world and those who run the REITs may have written the article!
https://www.cnbc.com/2024/01/31/why-self-made-millionaire-tori-dunlap-still-rents.html?utm_source=pocket-newtab-en-us
A customer I had years ago was a wealthy entrepreneur and he rented until he retired. Clearly it worked for him. Last I heard he bought a place at Opal Cliffs near Santa Cruz but after retirement. This was maybe 8 years ago. I think it’s still working out for him.
A millionaire rents from a millionaire… I rented for a long time well into my 30s, while I owned rentals. For people like we are, it pays to own rentals. Great retirement fund. Retire early. I’m taking my SS benefits at 62. Only several years away. Equivalent to another net rental payment.
When owning SFRs, it is also predicated on the area in which one invests. The area that I had concentrated on the past 2 years, which stretches from Winchester to Woodstock VA, especially Strasburg, is up about 50% over the past 3 years. While rents have risen quite a bit, I no longer think it’s a cheap area to buy. One of my homes is up about 50% in 2 years. The rents have only risen about 30%. I’m taking a step back for now. I think the area has gotten overpriced, though My equity has risen nicely.
Of course, it’s 85% to 90% White European, and that’s where the money is. The multicoloreds are slowly taking over, which really helps me with my rents, but it’s still a relatively homogeneous area and an oasis, which manifests in nice price growth as the conservative money flows away from Northern VA, where the property values are struggling.
I wish there was a place in the world I could sail away to and build a new nation. The Bible’s teachings would be front and center, with the Old Testament emphasized, since that part clearly instructs us on how to build a stable and long lasting nation.
Today’s NT-only idiots would not be allowed as they would invite everyone to enter, saying God loves everyone.
The entire Bible would be the textbook carried in the schools and it would replace the Internet and cellphone. This would help to ensure the synagogue of Satan would not exert its control over Jesus’s sheep.
Please,Lord, have mercy on my readers’ households and get me out of here! I cannot stand censoring people who are determined to censor others.
There is truly little difference between amoral humans and lab rats…
The uncomfortable predictions of John B. Calhoun’s utopia experimentts
https://youtu.be/ampmkFrD33Q?si=xi9YNP57I01MY7RJ
Behavioral sink” is a term invented by ethologist John B. Calhoun to describe a collapse in behavior that can result from overpopulation. The term and concept derive from a series of over-population experiments Calhoun conducted on Norway rats between 1958 and 1962. In the experiments, Calhoun and his researchers created a series of “rat utopias” – enclosed spaces where rats were given unlimited access to food and water, enabling unfettered population growth. Calhoun coined the term “behavioral sink” in his February 1, 1962 report in an article titled “Population Density and Social Pathology” in Scientific American on the rat experiment. He would later perform similar experiments on mice, from 1968 to 1972.
Calhoun’s work became used as an animal model of societal collapse, and his study has become a touchstone of urban sociology and psychology in general.
Calhoun’s phrase “behavioral sink” was sometimes used by others in reference to perceived urban moral degradation. Alan Grant, co-creator of the dystopian Judge Dredd character, has acknowledged Calhoun’s work as an influence. Calhoun’s work also influenced other apocalyptic fiction as well, including Soylent Green.
Getting gene therapy and changing our genetics will be propagandized as normal, even though it will damn our souls as our essence is in our DNA. Whiteness will also be done away with.
Children with genetic deafness have hearing restored with gene therapy: Study
Researchers say deafness can affect children’s brain development.
https://abcnews.go.com/Health/children-genetic-deafness-hearing-restored-gene-therapy-study/story?id=106641428
Jacob’s trouble
https://www.terminaleconomics.com/wp-content/uploads/2024/01/extinct.jpg
$ENSC I bought into the stock yesterday morning in the wake of their press release. It’s regarding a FDA breakthrough designation. It looks like something that could really go pretty far. I don’t get married to the stock, but I pass it along to the reader in case they want to kick the tires. I have a few thousand shares and I’m willing to take the risk. The primary risk, in my opinion, is any type of secondary offering of shares. Thus I am scaling as the price rises, as I normally do.
Once the stock broke $1.50 I sold my trade. Someone knows something I don’t. Took a small loss and got out.
Microsoft Hits $3 Trillion Value, Cementing Strength of AI Rally
(Bloomberg) — Microsoft Corp. achieved a historic $3 trillion market valuation on Wednesday, in the latest example of how optimism over artificial intelligence has fueled a seemingly unstoppable advance in the software giant.
The stock rose as much as 1.3% to $403.95, resulting in a market capitalization of $3 trillion. The threshold cements Microsoft’s status as one of the largest public stocks. It briefly surpassed Apple Inc. in value — which last year became the first company to hit $3 trillion — but subsequently dropped back below the iPhone maker, with the two trading places ever since.
The Redmond, Washington-based company is one of the so-called Magnificent 7 that fueled the market’s advance over 2023, gaining about 57%. The advance continued into this year, with a 7.4% rise that exceeds the 4.6% gain of the Nasdaq 100 Index. Microsoft accounts for 7.3% of the S&P 500 Index.
Much of the gain reflects investor enthusiasm over AI and its potential to accelerate growth in both earnings and revenue. Microsoft, through its partnership with OpenAI Inc., is seen as one of the biggest beneficiaries of AI. It has released AI-supported services to customers.
Demand for AI services, along with cloud computing to support it, is projected to support Microsoft’s long-term growth trends. Revenue is expected to rise nearly 15% in its 2024 fiscal year, faster than the overall tech sector, according to data from Bloomberg Intelligence.
This kind of growth has resulted in Microsoft being one of the most popular stocks on Wall Street. More than 90% of the analysts tracked by Bloomberg recommend buying shares, and the average analyst price target points to upside of about 7% from current levels.
Emerging Markets Jump as China Stimulus Hits Sweet Spot for Risk
(Bloomberg) — Emerging markets rebounded after weeks of declines as the latest stimulus measures from China added to positive signals from the US economy to boost risk appetite.
China reaffirmed its resolve to support markets by cutting banks’ reserve requirement ratio next month, on top of a $278 billion stock rescue package already announced. The moves follow a $4.6 trillion selloff since 2021 that left the nation’s mainland stocks trading at the lowest valuations in five years and its Hong Kong-listed stocks at the cheapest in eight.
Emerging-market stocks raced toward the biggest two-day gains this year and currencies to a fifth day of advances. A bond rally pushed default-hedging costs lower. A weaker dollar, lower US yields and positive earnings momentum in the world’s biggest economy all encouraged risk-taking.
“There’s nothing in the short-term that does more to benefit emerging markets than better news out of China,” said Charles Robertson, the head of macro-strategy at FIM Partners Ltd. “The RRR rate doesn’t resolve the geopolitical angst, heal the property sector or promise strong growth, but it is a signal that the authorities are prepared to do something to reverse the equity market decline. That’s good enough for markets this morning.”
US yields extended a drop, led by short-term rates in a move called “bull steepening,” which signaled bets for Federal Reserve easing are coming back. That helped fuel a rebound from the worst start to a year since 2016 for both emerging-market stocks and currencies.
Analysts’ earnings estimates for companies in the MSCI Emerging Markets Index are going up again as well. They posted the first back-to-back increases since Jan. 1. Meanwhile, early trends showed US companies were heading for a strong earnings season. Five out of every six companies were beating profit forecasts.
Tuesday’s rally in Netflix Inc., on the back of better-then-expected numbers for subscriber growth, underpinned sentiment toward technology stocks. The Hang Seng Tech Index jumped 4.2%, the biggest gain since Nov. 15.
The Israeli shekel led currencies higher, posting a 1.2% increase. Israel’s stock exchange was in the limelight after news that Billionaire Bill Ackman and his wife Neri Oxman bought a stake in the Tel Aviv stock exchange.
South Africa’s rand climbed after data that showed December inflation fell slightly more than forecast.
Investors will be turning their attention to a slew of US economic data, including purchasing managers’ indexes on Wednesday. The European Central Bank’s monetary-policy decision Thursday will set the course for the euro and eastern European assets.
I wanted to pass along this email I received from a reader. It’s obviously very insightful and, unfortunately, very sobering. I don’t doubt any of this stuff he mentions, including his thoughts on all of these novel weight loss drugs. I’ve also been wondering how so many pharmaceutical firms can come up with the same type of drug for weight loss at the same time. It mirrors what we observed with the covid injections, in which four or five firms somehow come up with a response to covid simultaneously and ready for roll out in only a few months. We have subsequently found out that the formulations of the covid injections are actually owned by the DoD as a “countermeasure”.
I observe how the pharmaceutical firms that are doing well with these weight loss drugs we’re not involved in the covid mRNA injection campaign. Perhaps all this technology, and more, is already in the pipeline, waiting to be dispensed at a proper time from some centralized location or source.
I edited the email the best I could to help ensure anonymity.
Just one comment on LLY and NVOs stock prices; they have gone gang busters as many investors believe their weight loss drugs are the answers for everything plaguing the health of humanity.
______________
Hi Chris,
We had a family gathering this past Saturday, my older and younger sisters were both in attendance. My elder sister… I had recommended the site to her and she gleaned much information from you… I do not talk with her about anything specific but she is still aware of the times we are in and I think she is doing the best she can given her circumstances. She remains unvaccinated…
My younger sister is another story… When at Health Canada (she was ) responsible for the rollout in late 2020 – she was on loan reporting to the military General in charge of the rollout operation in Canada. Prior to this she was at UNICEF as director of purchasing for vaccines – the single largest purchaser of vaccines on the planet. She herself avoided the Covid jab and swore she would not get it or let her children take it – that was until Theresa XXXX offered her a post she coveted in Washington. One of the requirements was Covid vaccination, so she relented and when she presented proof, was told the post already went to someone else ( these posts are created as promotion and meant for the person offered, they are not open so she was duped ). FYI senior bureaucrats all got J&J one shot jabs which were conveniently unavailable to most people – probably saline.
They know about the mortality rates, the side effects, sudden deaths, turbo cancer etc. They also know already that there is a link between Ozempic and liver cancer. Officially, they say they need to see more data. My younger sister has blood on her hands, she believes she is saved as a catholic. I have tried to help her and save her soul. I will continue to try, as that is my duty per Jesus’ instruction.
The ozempic and clones are going to have a problem, the industry is aware and maybe that is why the stocks are going nowhere. Just a thought.
It is really sad how the younger sister got duped to take the kill shot for a job despite her convictions.
Lesson learned here: Do not sacrifice your body and soul for a job. Nothing on earth is worth sacrificing your body and soul for as you will answer for it on judgement day when Jesus measures your soul. Those who sacrifice for a job or money are going to be the ones who are most likely to take the mark of the beast. In addition, those who sacrifice their body and/or soul are worshipping idols other than our Heavenly Father.
I pass along this link without comment, which I received from a subscriber. I hope none of this is true.
United Airlines CEO is a cross-dressing freak…
https://revolver.news/2024/01/united-airlines-ceo-is-cross-dressing-freak/
This is why it is important to be a passive asset owner as your goal in life. It is the only ticket out of requiring to work for a satanic politically correct employer. When you live paycheck to paycheck you have to deal with idiot bosses and coworkers.
What makes Pfizer CEO Albert Bourla so certain there will be a tsunami of cancer between 2025-2030?
Confident enough to pay 43 billion for a cancer company generating only 2 billion in revenue.
https://twitter.com/SaiKate108/status/1749261377339109491?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1749261377339109491%7Ctwgr%5E49906512c63f8d3480ad97382c1e1c031c58f5f7%7Ctwcon%5Es1_&ref_url=https%3A%2F%2Funcutnews.ch%2Falbert-bourla-ceo-von-pfizer-weiss-etwas-was-wir-nicht-wissen%2F
Bio weapons can be very profitable to shareholders, if they survive.
I observe the movement in all these small biotechs and they have been on fire for the past few months. Death and disease, even man-made ones, can make a lot of money.
It’s been my experience over the decades as an observer of Pfizer that it seems to make poor corporate choices. I was always a fan of Eli Lilly as it was smart (or not chosen by the DoD) for not getting involved with all that covid garbage. It stuck to its knitting, servicing diabetics and their avoidable diseases.
Locals ‘worried’ as Minnesota billionaire massively overspends on ‘piece of crap’ houses
https://nypost.com/2024/01/23/news/locals-nervous-as-minnesota-billionaire-buys-10-crap-houses/amp/
China Selloff Leads to Record $38 Trillion Gap With US Stocks
(Bloomberg) — The value of China’s stock market has never been this far behind that of the US, as the losses continue to pile up in a seemingly relentless equity rout.
The market capitalization of the US stock market is now $38 trillion greater than that of Hong Kong and China put together, a fresh record, according to data compiled by Bloomberg.
“China offers value, but catalysts are just not there,” said Michael Liang, chief investment officer at Foundation Asset Management HK Ltd. “Meanwhile, the US market has momentum and economy on its side.”
The growing divergence comes as steep losses paint a troubling picture of global investor sentiment toward the world’s No. 2 economy. At the same time, US stocks have hit record highs, powered by a megacap technology rally amid optimism that the Federal Reserve will cut interest rates this year and navigate a soft economic landing.
Chinese stocks have lost more than $6.3 trillion in market value from a peak in February 2021. Over the same period, US equities have gained some $5.3 trillion.
Investors have been underwhelmed by Beijing’s efforts to revive a economy struggling with deflation and an ongoing property crisis. But what began as a performance-driven exodus now risks becoming a structural shift due to doubts over Beijing’s long-term economic agenda and strategic competition with the US.
Bloomberg strategists including Kumar Gautam wrote in a note that while China’s correction may seem overdone, “our simulations suggest the pain can continue.” They estimated there’s a 51% probability of the MSCI China Index trading below its peak for an average of 35 months.
Chinese Price Gauge Shows Longest Deflation Streak Since 1999
On one hand, the rout has run for so long that some investors see potential for a technical rebound, given valuations are now cheap. The selloff has made the MSCI China Index 60% cheaper than the US equity benchmark on earnings-based valuations, according to data compiled by Bloomberg.
China Skeptics Are Gearing Up for a Sudden Rebound in Stocks
MSCI Inc.’s key gauge for Chinese equities is trading at about eight times of 12-month forward estimated earnings, while the same metric for the S&P 500 Index stands at 20 times.
For now however, there’s little end in sight to the dismal start to 2024 for Chinese equities. Less than a month into the new year, a gauge of Chinese stocks listed in Hong Kong has already lost 13%, making it the worst-performing major benchmark global index.
Aired at the superbowl, 40 years ago today.
https://youtu.be/ErwS24cBZPc?feature=shared
The year I graduated high school. Funny how computers helped create today’s “1984”.
I remember that Apple Ad. Such fond memories of a better time and place when we were young and felt like I had the world at my fingertips. I was a high school junior at that time.