China's Slow but Steady Economic Decline is Continuing

Discussion in 'Stock Market' started by william the wie, Jul 14, 2019.

  1. william the wie
    Online

    william the wie Gold Member

    Joined:
    Nov 18, 2009
    Messages:
    15,942
    Thanks Received:
    2,188
    Trophy Points:
    280
    Ratings:
    +8,538
    I am interested in the good and bad effects on my portfolio if these trends keep on going.

    For example, is the brand spanking new Japanese-S Korean trade war likely to make the China decline steeper?

    How about Trump's projected trade wars with the EU and possibly India are they worrisome?
     
  2. shockedcanadian
    Offline

    shockedcanadian Platinum Member

    Joined:
    Aug 6, 2012
    Messages:
    8,133
    Thanks Received:
    2,468
    Trophy Points:
    350
    Ratings:
    +11,929
    I can't help you as I am a believer in finding great, undervalued businesses, not specific industries or nations. Though when I was interested in investing more passionately, I always invested in U.S companies. Such better investments than Canadian businesses as long as you do your homework, and I did it excessively, reading every financial statement and detail I could about the company before diving in.

    So. The decline of China hinders on them not wanting to make a deal with America and deciding they will continue to try and exploit the world. If the world stands up, demands better access and less government abuses in their businesses, than China is in for a longer slow down. If they get smart and decide to become more capitalist (unlikely), they will earn more modest, but stable, reliable growth.
     
  3. candycorn
    Offline

    candycorn Alis volat propriis

    Joined:
    Aug 25, 2009
    Messages:
    55,180
    Thanks Received:
    6,251
    Trophy Points:
    1,830
    Ratings:
    +23,617
    So is ours….

    A trade war helps nobody. Even if the alleged goal of opening more native factories is achieved (which it won’t be), the market for those factories is by definition limited by the retaliatory tariffs.
     
    • Funny Funny x 1
  4. william the wie
    Online

    william the wie Gold Member

    Joined:
    Nov 18, 2009
    Messages:
    15,942
    Thanks Received:
    2,188
    Trophy Points:
    280
    Ratings:
    +8,538
    while I sympathize with your belief Buffett continuously warns people not to invest as he does. The catch is Buffett's mentor beat the Dow by an average of 400% 1926-56, which Buffett has not done.
     
    • Informative Informative x 1
  5. shockedcanadian
    Offline

    shockedcanadian Platinum Member

    Joined:
    Aug 6, 2012
    Messages:
    8,133
    Thanks Received:
    2,468
    Trophy Points:
    350
    Ratings:
    +11,929

    Nothing wrong with being an Index investor, low to no management fees and little work to be done. Certainly been a great investment for anyone on the DOW the last 50 years.
     
  6. Flopper
    Offline

    Flopper Gold Member Gold Supporting Member Supporting Member

    Joined:
    Mar 23, 2010
    Messages:
    22,366
    Thanks Received:
    3,806
    Trophy Points:
    280
    Location:
    Washington
    Ratings:
    +9,725
    Despite Trump's dire predictions about China's future if they don't come to terms with the US, China's growth rate this year after the Trump tariffs will be about 6% down only .6% over last year. While the US is China's biggest customer, US exports are only 2% of it's GDP and 81% of it's exports go elsewhere.

    China's growth rate is projected to fall to as low as 4.5% over the next 5 years. The US growth rate is expected to fall to 1.8% to 2.5% over the same time period and the EU growth rate is projected at 1.5% to 1.8%. China will become the largest economy in the world in next few years even with lower growth rates.

    China has many problems but they have also proved to be more than capable of handling them. The double digit growth rates of the last decade are probably gone forever, but China will still be the greatest economic power in the 21st century.
     
    • Informative Informative x 2
    • Funny Funny x 1
  7. Flopper
    Offline

    Flopper Gold Member Gold Supporting Member Supporting Member

    Joined:
    Mar 23, 2010
    Messages:
    22,366
    Thanks Received:
    3,806
    Trophy Points:
    280
    Location:
    Washington
    Ratings:
    +9,725
    One of the biggest problems China faces is the same as the rest of world, lower global economic growth over the next 5 years. Although Trump tariffs are certainly a problem for China, it will continue to grow and surpass the US to become the largest economy in the world in a few years regardless of the tariffs.

    I expect an agreement with China within the next 6 to 9 mos. Trump certainly needs it going into the election next year and China can easily give it too him without any real hardship. The question is will they? What Trump is asking far falls in two categories, "ain't never gonna happen and changes the Chinese are already making.

    It's very unlikely that the agreement will create any major changes in the US or Chinese economy.
     
    • Funny Funny x 1
    Last edited: Jul 14, 2019
  8. william the wie
    Online

    william the wie Gold Member

    Joined:
    Nov 18, 2009
    Messages:
    15,942
    Thanks Received:
    2,188
    Trophy Points:
    280
    Ratings:
    +8,538
    China's understated problem of negative growth in LFF combined with early retirement ages 55 and 60 is starting to really bite.
     
    • Thank You! Thank You! x 1
  9. Picaro
    Offline

    Picaro Gold Member

    Joined:
    Oct 31, 2010
    Messages:
    15,268
    Thanks Received:
    2,029
    Trophy Points:
    290
    Location:
    Texas
    Ratings:
    +10,175
    It's a lot tougher to make 5% a year on $20 billion than it is to make 400% on $100. Diminishing returns is built into finite systems. And, when your every move is watched and copied to boot, you're lucky to break even, and have to be very very careful not to tip your hand, also a tough thing to do.
     
  10. Manonthestreet
    Offline

    Manonthestreet Platinum Member Gold Supporting Member Supporting Member

    Joined:
    May 20, 2014
    Messages:
    21,901
    Thanks Received:
    7,258
    Trophy Points:
    430
    Ratings:
    +19,181
    new car sales in China have tanked
     
    • Agree Agree x 2

Share This Page