Dave-G Posted January 22, 2016 Report Share Posted January 22, 2016 I have a lot of respect for some of the worldly wise posters on here and hope to hear from them. Seeing some articles from some of the facebook tat papers about the China meltdown is going to lead to catastrophe for us and the world in general. Do we really need to be stocking up on tinned food and bottled water like some suggest? Quote Link to comment Share on other sites More sharing options...
kennym Posted January 22, 2016 Report Share Posted January 22, 2016 NO! Quote Link to comment Share on other sites More sharing options...
TIGHTCHOKE Posted January 22, 2016 Report Share Posted January 22, 2016 Are they touring again? Quote Link to comment Share on other sites More sharing options...
jason kaye Posted January 22, 2016 Report Share Posted January 22, 2016 Blackman Ray, remember it well Quote Link to comment Share on other sites More sharing options...
FalconFN Posted January 22, 2016 Report Share Posted January 22, 2016 (edited) I heard yesterday that the UK, at least in the medium term, is better placed than countries such as Germany as we are less reliant on exports (so manufacturing very little appears to be a benefit in this instance!) and due to us being a net importer of oil. The odd thing is that China has a growth rate that most of the developed world would kill for, but as the markets and large multinational industries expected so much more they were pinning their hopes, and planned profits, on China doing better. Edited January 22, 2016 by FalconFN Quote Link to comment Share on other sites More sharing options...
clakk Posted January 22, 2016 Report Share Posted January 22, 2016 No need to panic, same as the last Crash it,s the stock market plonkers telling everyone to sell sell sell so they can make a killing when they sell short and buy back for buttons.The market already recovered over 100 points by mid afternoon today.China has peaked is all 6.9% growth is still good growth,its just that as the U.K and US economy,s recover and sell then people buy less from China and more from us.Its nice to see the Global market going in our favour for once. Quote Link to comment Share on other sites More sharing options...
Vince Green Posted January 22, 2016 Report Share Posted January 22, 2016 (edited) China has to learn that the tide comes in but it also goes out. With their massive resources of cheap land and labour they have has it so easy for so long they must have felt invincible. Money is like water, it will always find its own level eventually Edited January 22, 2016 by Vince Green Quote Link to comment Share on other sites More sharing options...
grrclark Posted January 22, 2016 Report Share Posted January 22, 2016 There are a lot of alarming stories if you choose to listen to or read such things and as the majority of them have some basis in truth it is easy to get caught up in some of the things that they predict. The stories are not all originating from crackpots and radicals either which adds a bit of credibility. I think the upshot is that there are still a lot of weaknesses and vulnerabilities in the major economies and there is no one country or group of countries that can really influence the game enough to bring stability. There is still a lack of regulation in the financial markets, less so in the UK, but there are still lots of opportunities for people to play the game and take big risks and they are doing so. The stock markets are again near their all time high and our individual wealth is significantly weighted on the performance of the money markets, even if we don't play them directly, there is a very real risk that we are again surfing on a bubble that could pop. China are trying to embrace a free market economy as there is demand from within the country to increase what is still a largely very poor standard of living and that cannot be paid for out of government funds, so despite being a communist economy they are using capitalism to try and promote internal growth; the upshot is that when the free market produces results that don't stack up with the plans or goals of the government they try and influence the outcome and this causes a lot of instability and a lack of trust. Many economists suggest that the economic performance figures for China are very much exaggerated by the Chinese, influencing other world markets and introducing uncertainty & instability. The biggest example of this was the continued manipulation of their currency to keep them competitive. China cannot pay their own bills to satisfy the clamour for change in that country and they need to West to perform well in order to keep pumping money into them and in turn China pumps it back out again. The price of oil is also introducing huge uncertainty, essentially the Saudi's engaged in a price war campaign with the US shale oil market by keeping supply levels higher than global demand and subsequently driving down the price of oil. They hoped to price the US suppliers out the market by making it too expensive for them to produce and at the same time they were also very worried about Iran getting back into large scale production with the warming of relations between Iran and the west. The Saudi's increased their market share when sanctions on Iran were imposed and they don't want to lose that. Globally we are producing around 1.5m barrels of oil per day more than there is demand for and global storage capacity is also near full, if production continues as it is and the ability to store is exhausted then the price could fall to below $15/barrel, possibly even below $10. There are some rumours in the US that the federal reserve have started to influence the banks in how they should treat debt within the oil and gas sector in the US. As the cost of oil has decreased then the ability of the shale producers to pay their bills has also decreased, so increasing the risk of default. There are hundreds of billions of dollars in the value of loans provided to the energy sector in the US and there is a very real fear in the banking sector that these loans may have to be written off. The US shale oil boom was at face value an easy way for the banking sector to make some quick bucks by lending to domestic producers who were raking it in when the oil price was high, but they do appear to have been caught out, much like they were with the sub prime lending crisis which led to the collapse in 2008. Apparently the FED have quietly instructed banks not to pursue bankruptcy as that would see the values written off, instead they are pursuing asset sales and consolidation within that market. We are seeing some similar behaviour on this side of the pond too The Saudis are not faring so well either with strong rumours that they will seek to sell off part of their national oil company into private hands as they have their own liquidity problems in their finances with estimates of having a $100bn spending deficit this year; some commentators have suggested their aggressive stance on oil pricing could cost them $1tn dollars. Iran are capable of producing oil at around $1 - $2 per barrel and that is part of the reason why the west have warmed so quickly to Iran, they have the ability to push oil onto the market at silly low prices which may well call the bluff of the Saudi's. Of course the massive risk is that America runs out of bottle before the Saud's. It is brinksmanship of the highest order. If there is lack of confidence in the west then they stop buying, this hurts China disproportionately as they are a massive export economy, yet China have become such a significant global player that the west need them to keep things moving in our economies. Things like having the Chinese invest in our national infrastructure projects is part of that process, it is really just a massive manipulation of the financial system, but it keeps things moving around. The upshot is that it could all go boom and we could see a much bigger correction in the economy which would be brutally painful as a result, but despite all our differences politically and culturally it would benefit no country or economy if that were to happen. Our finance systems are also largely based on debt so the money held in the hedge funds, wealth funds, pension funds, property values, etc of the very wealthy really do depend on our ability to service that debt otherwise it all become meaningless. I personally don't think we will see a massive collapse that some of the prepper's might secretly wish for, but I do think there will be a good few ups and down. Quote Link to comment Share on other sites More sharing options...
FalconFN Posted January 22, 2016 Report Share Posted January 22, 2016 Thank you Mr Clark, interesting and insightful as ever. I was going to start storing all this cheap oil around the house in jam jars and milk bottles for when the price goes up, I don't think I'll bother now. Quote Link to comment Share on other sites More sharing options...
Fuji Shooter Posted January 22, 2016 Report Share Posted January 22, 2016 Are they touring again? That's just Wishful Thinking Quote Link to comment Share on other sites More sharing options...
grrclark Posted January 22, 2016 Report Share Posted January 22, 2016 Thank you Mr Clark, interesting and insightful as ever. I was going to start storing all this cheap oil around the house in jam jars and milk bottles for when the price goes up, I don't think I'll bother now. apparently there are some looking to buy supertankers as floating storage Quote Link to comment Share on other sites More sharing options...
rjimmer Posted January 22, 2016 Report Share Posted January 22, 2016 The Chinese are very clever and are hard workers, but their national addiction to gambling, at every level, could make them vulnerable. Quote Link to comment Share on other sites More sharing options...
clakk Posted January 22, 2016 Report Share Posted January 22, 2016 Just sit on the garden bar area of the Berry Head hotel in Brixham,youl see half a dozen supertanker,s parked up waiting for the oil price to rise before they offload their cargo that was worth a lot more when they left Saudi Quote Link to comment Share on other sites More sharing options...
dazb1967 Posted January 22, 2016 Report Share Posted January 22, 2016 apparently there are some looking to buy supertankers as floating storage Thats been happening for years, it's not un common for companies to fill tankers with oil and put them at anchor and wait for the price the go up a few dollars per barrel Quote Link to comment Share on other sites More sharing options...
LondonLuke Posted January 22, 2016 Report Share Posted January 22, 2016 I could see a dip in the housing market, there are a lot of factors culminating at once. - Wobble (perceived or otherwise) in China economy - Price of oil dropping - Stock market unstable, sharp troughs - Change in BTL taxation - BTL SDLT changes In London attitudes are definitely changing, some of our biggest clients are disposing of stock, particularly outside PCL - only time will tell. I don't think its all doom and gloom, but would personally be happy if my property investments are worth the same on 31.12.16 as they are now. Quote Link to comment Share on other sites More sharing options...
Dave-G Posted January 22, 2016 Author Report Share Posted January 22, 2016 Thank you gents - Mr Clark in particular for such a massive amount of information. Quote Link to comment Share on other sites More sharing options...
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