In summary: Dollar depreciation now, and Chinese Yuan revaluation as soon as possible is the easiest first step to rebalance an imbalanced U.S./global economy. Dirty float” is and likely will remain synonymous with Japanese forex policy.
For US Bond investors, his recommandations are: 1) As long as the Euro strengthens against the dollar, there is reason to favor German Bunds instead of U.S. Treasuries. I would only be leery of Bunds when and if China revalues. 2) Buy TIPS. 3) Be careful with U.S. Treasuries. A deteriorating balance of payments deficit may actually have a positive effect leading to lower interest rates until a large creditor turns tail.
------------ The above is only useful for US bond investors. If you believe in HK peg, you are welcomed to follow. A highly sepeculative bet is to buy long U.S. Treasuries and sell it right before the change of trend.
If you would go to read the actual porfolio of the China and Japan central Banks, you will find that Japan has been buying US Treasuries only and its size is growing forever. On the other hands, China net balance on US Treasuries is flat for the last year even its is accumulating US trade surplus. China is channelling the excess to MBS. That means the Chinese do realize the long-term implication of US trade deflicit. They are diversifying. They know Yuen will float, just like Us drop again Yen in 80s. It is not IF but a matter of WHEN. They are planning their move and They will change the ped of Yuen some time in the future. They will anticipate the effect of their move. All that means that they may switch move asset to other currencies. Thus, you can work out a strategy from its implications too.
My opinion is that China would have started a process to move away from US peg gradually if Greenspan and Snow had not talked down the dollow in the last few month. Therefore, a fix deposite in RMB is not a bad idea.
文人
發表於： 2004/12/30 01:10am
The safest investment strategy is : Monthly stock buying plan from your favor bank on any one of the following: 0005, 0011, or 2800.
Recommand monthly deposite of $3000 so that the $50 fee is just 1.67% of your investment. Please also select a bank with no custodian charge and minimal fees. They will eat your return witouth mercy.
If you believe in Japan recovery and devaluation of US dollar, it is a reasonable bet. I only know there are iShare Korea and iShare Taiwan at HK Exchange and they are very inactively traded. You will have to try your luck at your favor choice of US brokerage.
我可以說起手七隻萬子當然要做清一色,但唔包生仔.
0to1
發表於： 2004/12/28 07:54pm
集思廣益!
muffin
發表於： 2004/12/28 01:55am
There are more fundamental newsbites from various "sources"
1) Japan's companies are done cleaning their books. They unwinded their cross holdings foreign investors. They pay down their debt and start accumulating cashes. They shift their production lines to China for cost saving. In aggregate, Japanese companies, including banks, are in better shape. However, Japan Government is still in very bad shape to issue so many bonds.
2) Australia had the first wave on Olympic. The second wave is the China boom and raw material hunger. The oil price is down now and various indexes, new building, GDP growth, ... etc is starting to slow down.
3) No breaking news on Europe.
4) Bush wants to devalue their debt out by inflation.
5) Japan Government is the sole net buyer of US Treasuries.
6) During the last year, China government buys enough Treasuries without increasing the stake. They shift to MBS in US housing. People says US real estate is a bubble for the past wo years and it is still rising.
So it is up to you to decide how to translate these macro observations into your investment ideas.
12345678
發表於： 2004/12/27 01:58pm
Warren Buffett on Dollar 2004上半年加碼放空部位70億美元,其一部位價格1.2175~1.2300(euro) 2004下半年加碼放空部位10億美元,其一部位價格1.2000~1.2300(euro)
文人
發表於： 2004/12/25 11:04am
Warren Buffett's vote of no confidence in U.S. fiscal policies is up to $20 billion.
The dollar has fallen savagely against the euro for the past three years, and the trade deficit is running $55 billion a month. Is the currency rout over? Can the trade deficit be fixed with a rise in interest rates or an upward revaluation of the Chinese currency? Warren Buffett, the world's most visible dollar bear, says the answer to both these questions is no. His bet against the dollar, reported at $12 billion in his last annual report (for Dec. 31, 2003), has gotten all the bigger. Now his Berkshire Hathaway has a $20 billion bet in favor of the euro, the pound and six other foreign currencies.
