Evergrande. Here's hoping CCP will step in.

Prism

tranquility1 said:

As I've said, there aren't any investors alive today who have a lived experienced of equities doing anything other than go up and make money.  This has been going on for 40 years, and interest rates have been coming down for 40 years.  Yes, there have been some painful crashes, but it didn't take long to recover and then shoot through the ceiling again.

Investors today, even the smartest of them, do not know anything different.  And they think these times will last forever.


Investors of the past had very different experiences.  They didn't have governments who could print money and bloat the stock markets.  And this printing of money has almost run its course.

How long do you think it took to recover from the dot.com crash? As someone who started investing just a couple of years before that the only good returns I have seen have been in the last 12 years or so - before that returns were very poor.

wmb194

Prism said:

tranquility1 said:

As I've said, there aren't any investors alive today who have a lived experienced of equities doing anything other than go up and make money.  This has been going on for 40 years, and interest rates have been coming down for 40 years.  Yes, there have been some painful crashes, but it didn't take long to recover and then shoot through the ceiling again.

Investors today, even the smartest of them, do not know anything different.  And they think these times will last forever.


Investors of the past had very different experiences.  They didn't have governments who could print money and bloat the stock markets.  And this printing of money has almost run its course.

How long do you think it took to recover from the dot.com crash? As someone who started investing just a couple of years before that the only good returns I have seen have been in the last 12 years or so - before that returns were very poor.

Japanese people/investors in Japan would raise an eyebrow to Tranquility's statement, too.

Alexland

wmb194 said:

Japanese people/investors in Japan would raise an eyebrow to Tranquility's statement, too.

Indeed but for the long term dollar cost averaging Japan investor using regular spare income and dividend reinvestment they would have been buying better value units before and after the ramp-up and crash so would have had a very different investment outcome than a graph of the index would suggest. Similar with the Wall Street crash investor there is an argument that even if they had invested a lump sum at the top then with the deflation their investment would have recovered the spending power within just a few years.

kuratowski

Which proves that volatility is a lot easier for accumulators to handle than it is for decumulators.

Alexland

kuratowski said:

Which proves that volatility is a lot easier for accumulators to handle than it is for decumulators.

Yup that's why decumulators (and those approaching that phase) need enough non-equity assets to avoid spending down capital while markets are low. The proportion also depends on the withdrawal rate as the closer you get to natural yield the less capital you would need to sell each year so the longer the non-equity assets might last.

Prism

kuratowski said:

Which proves that volatility is a lot easier for accumulators to handle than it is for decumulators.

True, but even that can be testing when you haven't seen it before. I remember signing up for my first personal pension in around '97 and the projected figures if I remember correctly were around 6/9/12%. So 12 years later when my total was worth nowhere near to those figures after two major crashes and almost half of those years being negative you do begin to wonder if you have made a major mistake. In the first 19 years my annual return was under 4% which was hardly the basis for a good retirement pot.

Thrugelmir

maxsteam said:

Thrugelmir said:

Evergrande is incorporated in the Cayman Islands. Another company with a murky non transparent relationship with the Chinese mainland.  Investors are buying shares in shell companies. The listed company does not actually own any of the underlying assets of the operating companies. Hence , in part, why the SEC in the US wishes to have them delisted from US markets. Non publication of audit reports raises questions over accounting standards. 

Yes, they have an OTC listing in US. The rules for OTC listings are less strict than for main market listings. Your comments remind me of the Luckin Coffee saga.

However, access to international markets is such that if Evergrande were delisted in US, a novice investors would still not have too much trouble putting their life savings into the stock via another market.

Evergrande is listed in HK.  HK is now China's financial centre. 

maxsteam

Thrugelmir said:

HK is now China's financial centre. 

Maybe. It certainly used to be but money and traders have been moving out of HK in recent years. The Shanghai stock exchange is now slightly larger than the HK stock exchange in terms of market capitalisation and is much larger in terms of trading volumes. The Shenzhen stock exchange is not far behind. HK probably attracts more foreign money than the other two markets but the Chinese economy does not depend on foreign money so much today.