Tuesday, September 09, 2008
The US bail-out is a great opportunity to sell
The Federal Reserve flew in to ‘save the planet’ by nationalising
Fannie and Freddie, but UK investors couldn’t even get in to sell their
rebounding banking shares, because the LSE computers imploded at the
vital moment
The move isn’t likely to help US house prices, because it won’t make
life easier for millions of Americans struggling to repay mortgages. It
won’t reduce the massive stock of unsold American houses - 4.7m at the
last count and the equivalent of over 11 months supply, roughly twice a
‘stable’ market level, according to the National Association of
Realtors.
Deutsche Bank analysts agree, predicting that investment will shrink in
2009 for the first time in seven years, so that the eurozone’s economy
will grow just 0.1%.
That’s a good opportunity to dump any retailers, property stocks or banking shares you’re still holding on to.
China has immense resources available to stimulate domestic demand,
with a high savings ratio, nearly $2 trillion in foreign reserves, and
strong state finances. The national debt, for example, is only 16 per
cent of GDP, compared to 75 per cent in India
Fannie and Freddie, but UK investors couldn’t even get in to sell their
rebounding banking shares, because the LSE computers imploded at the
vital moment
The move isn’t likely to help US house prices, because it won’t make
life easier for millions of Americans struggling to repay mortgages. It
won’t reduce the massive stock of unsold American houses - 4.7m at the
last count and the equivalent of over 11 months supply, roughly twice a
‘stable’ market level, according to the National Association of
Realtors.
Deutsche Bank analysts agree, predicting that investment will shrink in
2009 for the first time in seven years, so that the eurozone’s economy
will grow just 0.1%.
That’s a good opportunity to dump any retailers, property stocks or banking shares you’re still holding on to.
Why I’m optimistic about China
Yet, unlike other economies,China has immense resources available to stimulate domestic demand,
with a high savings ratio, nearly $2 trillion in foreign reserves, and
strong state finances. The national debt, for example, is only 16 per
cent of GDP, compared to 75 per cent in India
Labels: invest
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