Hong Kong officially out of recession

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  1. #1

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    Hong Kong officially out of recession

    According to the BBC, HK is out of the recession (but Singapore left it first, dammit!).

    BBC NEWS | Business | Hong Kong emerges from recession


  2. #2

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    Same was reported for France & Germany: FOREX-Euro rises as France, Germany exit recession


  3. #3

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    lol, right, it's a big finance circle jerk pretending they're out of trouble. The news still reports the terrible phrase "we are in the least decrease of the economy".


  4. #4

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    When your economy is based around the performance of the stock exchange and that is up 50% in 6 months then its hard NOT to be out of a recession.

    Whats the bet we are back in one in a few months ?


  5. #5

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    Agree with Boris...the stock market gives the illusion of all is back. well overvalued stocks and this level is not sustainable. As my mate Mr Li Ka Shing said week too !


  6. #6

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    Your mate Mr. Li also said to buy his properties;-) We are out of the woods and while there may be a few bumps ahead, things will be all right as they always are...

    There's a reason why stocks are going back up, companies are posting profits and showing some growth. That's what ebing out of a recession means.

    It'll take time to build back because imports will be lagging for a little bit but by mid next year, we should be at full speed.

    Everyone saw doom and gloom and I bought loads when the market was down and I am rolling on the floor laughing at those prophets of doom. They may have their turn at some point but I am certainly a very happy camper...


  7. #7

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    Quote Originally Posted by gilleshk:
    There's a reason why stocks are going back up, companies are posting profits and showing some growth. That's what ebing out of a recession means.

    It'll take time to build back because imports will be lagging for a little bit but by mid next year, we should be at full speed.

    First point - I would love to know the companies you are looking at, without showing profits, without massive restructuring of the cost base. IE - lay offs and closing loss making outlets. Profit per sea, does not mean an expanding economy. It can mean cutting back to basics and even the experts like Warren Buffet are commenting that they underestimated the depth of the downturn and see MANY years before returning to anything like usual. Show me your companies that are showing year on year growth in any meaningful sector that is not say, alcohol related.

    Second point - that's really naive and and I am surprised that someone like you would say it. Unless your writing tongue in cheek. Donguan ( the bell weather of the China economy ) is PUBLICLY reporting a 25% drop in workers employed in factories. Take a walk around and its definitely more like half with retail locally closing down or having massive sales promotions . For THAT operation to come back up to " full speed " is going to take years. Shipping companies are showing profit drops of more that 60% which means no one is making replacement goods in half the volume before. Airfrieght volumes are down the toilet too. Buyers are NOT attending trade fairs by at least a 40% volume in normal times as the contraction makes their job more, use what you know rather than, look for more.

    China themselves say lots of stuff that obscures the fact that they are shoving Trillions of RMB into favoured projects and companies just to keep them viable. Ordinary countries do not have such a war chest to dip into and the money coming into HK inflating the market is more like fools gold rather than 24 carat. It will leave quicker than it arrives when the time comes. hardly a viable barometer of economic stability.

    There are no customers buying regular in major importing countries which is one reason Walmart is doing OK. Cheap sells in hard times and they have to fight,fight, fight in normal times with "spectaculars". The holiday industry is reporting record sales for domestic destinations showing careful spending ( you never skimp on the kids ) and people do not come back easily to " full speed spending " after such a shock that as happened to cause the downturn. This is a sign of " careful " not prolific spending.

    Repossessions down? Yes, but is that more to do with domestic governmental policy and their hand grasping the wheel ?

    Yes there is liquidity in the market, but its not getting to industry. Its staying in financial's as banks play the market and refill their treasure chests. That isn't coming out of recession activity, that's" lets pay the bailout money back and get governments off our back so we can get back to doing things our way " activity. Where are banks getting the money to show upticks in quarterely profits , if not making loans ? You know the answer but I fear you may be in denial.

    So - if your quoting financial companies as doing well its pretty pointless. Show me some industrial or mainstream non cheapo retail that are doing well WITHOUT a balance sheet showing savings through cutbacks and repositioning or dramatic cutting of inventories as they drive sales selling re cycled stock ( aka the BHS group ). Looking at my company. we have gone from 60 containers to 6 and these all happening now. Our forecast next year is maybe 15 and we deal in low cost high volume toys for the amusement industry where " full speed " shows disposable income being spent in large amounts. I even had old customers calling over the last few days telling me life was diabolical and apologizing for the lack of orders. Full speed ??? 2012 is my guess.

    I thought you where pretty tuned in, but your comments are strangely irrational.

  8. #8

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    I'm probably the most bearish around here, so take this with a grain of salt. I rather see long term recovery and proper growth, then this insane speculative bubble - both stocks and real estate. It doesn't seem like anyone cares about long term prospects for HK, just short term speculative gains. This "recovery," if it can even be called that, is based around the huge speculative gains in the stock market and real estate, I doubt it will last long.


  9. #9

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    Once again, we'll just have to wait and see. In the meantime, financially, I've had a splendid year and I'm continuing to conservatively bet on recovery and not doom and gloom.

    By the way, HK isn't the only country that's out of recession, there are several others in Asia and some in Europe. Being out of recession by definition means that the economy is showing some growth. It doesn't mean it's healthy and many companies will never recover from this crisis. That's the beauty of a crisis, it gets rid of the weak.

    Granted that many products are seasonal so factories in China will take several seasons before they are back at full speed and that won't be mid next year. On the other hand, what's a better way to cut cost for western enterprises than to look for asian cheap labor? Where do you think Wal Mart gets most of its products? I'd much rather bet on Asia than on the US at the moment...

    Many companies will come out stronger, leaner and better positioned, the world will continue to turn, financial wizards will find some other rackets and repackaged the old ones and we'll go on our merry way until the next one...


  10. #10

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    Seeing as Recession is defined a s set periods of negative GDP and
    GDP = Consumption + Government Expenditures + Investment +Exports - Imports

    It might be seen that with massive amounts of Government expenditures by France and Germany ( both claiming that they are now OUT of recession ) it would be conceiveable that is why they can claim Positive GDP growth.

    Spain on the other hand, who's main industry by far is agricultural and tourism and who has NOT the abilities of F&G to soak billions of Euro into what is essentially seasonal industry and has not chosen to launch huge government led projects, is still labelled as in recession.

    Normal statistical methods are for normal times. These are not normal times and it all seems like a bit of a fudge with a creamy spin topping to me.


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