I get a strong suspicion that too many people are too overweight in Chinese stocks now. The reason for this is that after posting the China Tax and China Labour Law changes on a number of sites, there has been absolutely no response at all on most. High profile names ignore the posts, nobody commenting at all, either pro or against.

It therefore suggests to me that lots of people are presently very overweight in China stocks, they have got caught with the market weakness, and are now holding at a loss - waiting to sell any rise.

If, and its only an "if", the market weakness continues, and more and more of these people are trapped into China plays - you can foresee, imv, a lot of weakness coming into that sector, as more and more give up and bail out.

Quite remarkable that so many got duped into buying "China" as a safety against US/EU credit fears and recessions - only to now find its not as safe as they thought, and China stocks are also falling.

My own suspicions were that the China stock dream would go into breakdown and start its fall once the 2008 Summer Olympics had passed and the government can afford the luxury of upsetting lots more people and not caring about "face" during the Olympics that the world will be watching.

Is there another boom left in them before the Olympics comes and goes ? Will the boom not happen as its sold into ? Will they all meakly fade now and continue to do so ? Will they just keep on booming and not fall back again ?

Please discuss !!

On top of the GNG admission that things are slowing down, today also saw ZTC (Chinese telecoms) say this which again is more evidence to say that things in China are under pressure, and those who said 2009 would be a bad year for anything China related, might well be proven correct :

"As has been widely reported, trading and credit conditions for SME's in the PRC have become increasingly difficult throughout the third quarter of 2008. This is due to deteriorating macro economic conditions outside the PRC and slowing economic growth and restrictive credit policies in China. As a consequence, our markets have become increasingly competitive, disruptive and oversupplied. ZTC has therefore achieved sales significantly below those seen in the same period last year.

As a consequence, the Company's working capital available to operate and expand its business has become constrained, as has been previously announced. The Company continues to review all aspects of its operations to reduce costs and improve efficiencies to improve the availability of working capital for new model and market development. The possible sale of assets referred to above is one example of a potential method of cash generation that is being actively considered."

Well worth a read for anyone with an opinion on or interest in, China :


http://research.standardchartered.com/researchdocuments/Pages/ResearchArticle.aspx?&R=56005


Well written and researched, and I would not argue against the opinions, in fact we are already seeing the Chinese governments knee jerk reactions to the troubles being reported by Chinese companies.

The China bubble wobbles some more - wait until it bursts.................

WHEN WILL IT BURSTS, LOOKS GOOD TO ME.

BANG POP OR A BURST

Just think, this is only the start - if it falls - the fall will be massive..........that must frighten the China bulls, who are already losing their shirts.

THE WORLD IS GOING DOWN THE DRAIN,ALL OF IT.

http://news.idg.no/cw/art.cfm?id=241B925E-17A4-0F78-315F6C837378FD5F

Skrevet av Steven Schwankert

22.10.2008 kl 10:14 | IDG News Service

Dell bullish on Asia but cautions on rising costs in China

CEO and Chairman Michael Dell expressed .....................................

The following broker's report was posted by the team at FT Alphaville. If true, growth prospects in China are very much less than are assumed in most people's global economic forecasting models:


"Our resources analysts have recently been touring China and have been talking to a wide range of companies, consultants, users etc. They have returned with a very bleak picture of the Chinese economy, even gloomier than the bearish picture being painted at the moment in the market. The picture can be extended to other sectors of the Chinese economy and will have a regional impact, especially on Australia resource companies. Highlights are:

1. There is a very surprising negative rate of change in the economy being openly vocalised by corporates and other market participants. A significant number of factories are shutting down. These are shutting down due to a collapse in overseas demand as global consumers scale back spending.

2. Trade flow is locking up rapidly - letters of credit and 90-day commercial paper are no longer being accepted or transacted. Companies are resorting to 30 and 60 day paper putting further pressure on working capital. Letters of credit not being honoured beyond 3m will be a key hurdle for foreign traders who have 1-year contracts. Liquidity pressures are being seen in 60-day paper and this is expected to seize up soon.

3. There is a significant collapse in demand with end products not being able to be sold - domestic coastal coal shipments for example have declined by 30% in the past 3 months.

4. All copper smelters are losing money at current prices but demand from power companies remains stable for now. Further closures are expected at zinc smelters, with 85% of smelters thinking prices will continue to fall. A senior advisor to CISA has just said that the steel industry faces a costs crisis as material costs exceed falling prices.

5. The property market has significantly slowed, and companies are now pinning hopes on infrastructure projects. Property prices are down at least 20% in the past few weeks, with 30-40% falls in some areas. Demand for cement, aluminuim, copper, zinc, steel, iron ore and coal have already weakened.

6. For some companies, preservation of capital will be key. Our analysts believe that there are significant risks of survival in the commodities sector.

7. Consensus amongst Chinese corporates is that they are banking on a recovery in 2H09, but in the meantime they expect a significant contraction for the remainder of this year and the first half of next year. The single biggest risk they see is an extended OECD recession post 1H09 and incremental changes to China policies.

There are great hopes being pinned on the Chinese Government to help the economy. Preservation of capital is likely to be crucial over the next
18-24 months - we expect significantly more difficult conditions ahead.

Things are bad and rapidly getting worse - there is no sign that this market is about to form a base any time soon."

SOURCE: http://ftalphaville.ft.com/blog/2008/10/27/17470/markets-live/

Output cuts spark fears over China economy

By Geoff Dyer in Beijing

Published: October 29 2008 19:04 | Last updated: October 29 2008 19:04

Signs are growing that Chinas economy could be cooling quicker than expected, with a string of big industrial companies announcing production cuts over the past week.

The cuts have come as anecdotal evidence from other companies suggests a surprising weakening of demand in October amid the global financial crisis and a local housing market slowdown.

Aluminium Corporation of China, the countrys biggest producer, said last week it would cut production by 18 per cent and a senior executive was quoted in local media on Monday saying further cutbacks were possible.

Jinchuan, Chinas biggest nickel producer, said on Tuesday it was cutting its production target for this year by 17 per cent, while several copper smelters have made large cutbacks over the past two weeks.

Metals and mining companies around the world have had to rethink production in recent months because of falling prices and weakening global demand. However, companies in China have also faced reduced orders from construction companies as house prices have dropped.

Analysts from Macquarie Securities said that in Tangshan, a big steel-making centre in north China, most mills were running at 30-50 per cent of normal capacity and many small iron ore mines had ceased production.

Orders for cars and home appliances have already begun to shrink, Xu Lejiang, chairman of Baosteel, Chinas biggest steelmaker, said last week.

Zhou Xizeng, analyst with Citic Securities, said steelmakers were trying to adjust rapidly to uncertainty about demand and an inventory build-up. The recent drop in production is a sort of psychological panic, he said.

Executives in a number of other industries also said demand had been unusually weak in recent weeks.

But some executives said the slowdown could also reflect shorter-term factors such as customers reducing their inventories because of global uncertainties.

We had been expecting this to pick up a bit after the end of Olympics restrictions on factories, but things have been very quiet, said the chief executive of the China operations of a large paints company. We are trying to work out how much is due to weak demand and how much to destocking.

Economists are predicting growth next year of 8-9 per cent, down from nearly 12 per cent in 2007. Several have downgraded their numbers in recent weeks and more cuts are expected.

In September and October, there has been an acceleration in the slowdown in consumption and in exports that has not yet showed up in the official data, said Stephen Green, economist at Standard Chartered in Shanghai.

Despite fears of a sharp slowdown, a number of companies remain upbeat about growth prospects in China. I do not see this as the start of a significant decline, said Nick Reilly, president of General Motors Asia.

Paul French, a retail industry consultant in Shanghai, said the holiday week in early October had been strong for retailers. For now, things seem to be all right for retailers but when the market does slow, it does so very quickly, he said.

Local sentiment may be boosted by the central banks willingness to trim interest rates repeatedly, as demonstrated by Wednesday's move to cut the benchmark one-year deposit rate from 3.87 per cent to 3.60.

Additional reporting by Patti Waldmeir in Shanghai and Mure Dickie in Beijing

http://www.ft.com/cms/s/0/35e79c6c-a5eb-11dd-9d26-000077b07658.html

Worth a read for background China info/opinon going forward :

http://www.investegate.co.uk/invarticle.aspx?id=58707

.

Proselenes = PP =one sad troll

The markets should continue to tank.

Democrat president.
Democrat majority in the Senate.

Lots of lots of " trade and job protective" legislation to come in imv, its going to mean Asia will be hit with less export work, and its going to mean US companies will struggle to make higher profits.

Republicans like to make money at any cost - Democrats are more job protective, and now the markets must start to price in the fact the money maker glottalization loving Republicans are not there any more.

Recession, Democrats in control - one could say Wall Street is in for some lean years ahead.

The main thing and relative to this thread is that China (and India and other Asian countries) will be hit and hurt now, imo, with the Democrats in control and the likely move to "job protectionism" that will come.

Worth a read ahead of the Nov figures coming out soon :


http://www.forbes.com/reuters/feeds/reuters/2008/11/07/2008-11-07T081234Z_01_PEK6605_RTRIDST_0_CHINA-ECONOMY-POLL.html


.

Chinese Communist Party remains telling large porky pies about 9% growth ???????

Yet another Chinese AIM stock warns over the troubles of recession, sorry, must not say that we must say warns of the problems of just 9% growth.........LOL

Recession................ :) Wonder what they will be saying if the Communist Party reports growth of 8%, or 7% even..... ;)



RNS Number : 8793H
Et-china.com International Holdings
11 November 2008

ET-CHINA.COM INTERNATIONAL HOLDINGS LIMITED

('Et-china', 'the Group' or 'the Company')

Trading Update

Et-china, a leading travel services group in the fast growing region of South China, announces the following trading update. The Group is being affected by the reduced level of economic growth in China and the current cautious approach by the Chinese to leisure and business travel spending as well as considerable price cutting in the travel industry. As a result, the Company is not expecting to meet market expectations but the Board is optimistic that current conditions will prove to be short lived and the market will recover soon.

The Company remains liquid with RMB267m (approximately 22m) in cash and believes that the Chinese economy is fundamentally sound. The Company will seek to speed up its expansion via selective acquisition at this opportune time and provide an update to the market as soon as possible.

Wonder who has been saying this, for many months.....


http://news.yahoo.com/s/afp/20081113/ts_afp/financeeconomychinawen_081113044914


Impact of financial crisis on China 'worse than expected': Wen

2 hrs 47 mins ago AFP/File

Chinese Premier Wen Jiabao at a press conference in Beijing. Wen Jiabao has said the effect of the global BEIJING (AFP)

China's Premier Wen Jiabao said the effect of the global financial meltdown on the country was "worse than expected," state media said Thursday, in a sign of growing concern at the impact of the crisis.

Wen was quoted as making the assessment by the director of the National Bureau of Statistics Ma Jiantang when he briefed his staff on Tuesday, according to the website of the bureau's newspaper China Information News.

"The impact of the global financial crisis on the Chinese economy is much worse than many had expected," Ma said according to the website, passing on remarks made by Wen.

China initially said the global financial crisis would not cause too much harm to its economy, but in recent days the signals from Beijing have changed markedly.

Wen's comment comes after the Chinese government unveiled a four trillion yuan (586 billion dollars) economic stimulus plan on Sunday aimed at boosting domestic consumer demand in the face of flagging exports.

A good article to read - if you are not so exposed to Chinese AIM stocks that you cannot see the wood for the trees.

I must admit that presently everything in China is going as I thought it would, and thats into "crisis" for 2009. Some key months ahead now, but 2009 is certainly looking to be a real problem for China.


http://www.boxun.us/news/publish/china_comment/Chinese_Economy_Turning_Point.shtml


.

How are LEAD doing since our psychopath ramped it? Not to mention the prediction of oil at $200.

YAWN. Mendacity is best filtered.

Rumours around China's growth figure for Q4 could be less than 6%.

It seems the "panic" measure of interest rate cuts and massive "proposed" spending is because fears are the slowdown is accelerating and they see "contraction" and therefore real recession in 2009.

This explains the panic measure being made by the Chinese government, for negative growth in China would potentially lead to massive social problems.

The action they are taking is not sustainable, and can only make things worse long term.

Will it work ? and can they bump up the growth figure for a long enough time to see demand return from the US and Europe and therefore stave of a contraction ? It seems people think there will be a contraction in 2009, but it will not be "released" and the Ministry of Fudge will pump out lower, but not that low growth figures.

I wonder who has been saying China is in real trouble, more than was being let on.........


http://www.telegraph.co.uk/news/worldnews/asia/china/3525052/China-slashes-interest-rates-as-panic-spreads.html

China slashes interest rates as panic spreads

The People's Bank of China cut interest rates by more than 1pc point as the economy crumbles and millions of jobs are predicted to go ahead of Christmas.

By Malcolm Moore in Shanghai
Last Updated: 12:48PM GMT 26 Nov 2008


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