China and robots
China has been increasing using
robots due to the aging population and the rising wages. Most robots in China
today were made in China, quite different from 10 years ago.
Today's robots are cost effective
in manufacturing. Service-typed robots such as taking care of elderly and
teaching children are in the future and they depend on AI advances. Robots for
consumers will be more sophisticated and practical in the near future.
Bad China’s one-party rule according to an Indian
One-party rule is not a bad thing
if you consider what China has accomplished in the last 35 years. India is not
even able to copy China's model. I watched several YouTube videos compared the
two countries and not a single one was made by Chinese. Indians should compare
herself to India 5 or 10 years ago.
If you cannot have the basics
such as food and shelter, all the freedom is NOTHING. Chinese in some areas
have too much freedom and need regulations / enforcement esp. in running
businesses.
Facts are not facts
The facts are not facts that most
interpret.
1. India's growth of oil import
is larger than China.
2. India's GDP growth is larger
than China.
The growths are but not the
actual numbers as India started in a low level last year.
China imports about double the
oil as India.
The encouraging sign is China is
moving from coal (my estimate from the peak of 70% polluting coal to less than
65%) to green energies. With the growth of high speed rail and subway, China
uses energy more efficiently. India is efficient too if considering riders on
the top of the train. When you buy a ticket, you may be told to go upstairs!
Bombardier
Bombardier may be saved by
Chinese to a small extent. The coming joint venture of airport people movers is
promising. Shenzhen is the first one and China has more than 100 airports.
China bought many Bombardier’s passenger
cars for the trains to Tibet that have oxygen supply.
Today China can build most
passenger cars (trains and subway cars) for home market and export (invading Bombardier's
traditional market) and the short-distance jets.
TTWO
TTWO has been doing wonder for me
in the last 3 years until a big plunge recently. It was recommended among 12 or
so stocks in my SA article Amazing Returns many years ago. Normally I do not
hold the stocks I bought for long. But, these stocks were given to minors and
they should keep them after college.
Apple
Is Apple peaking? Fundamentally
it is very sound among FAANGs. China plays an important factor on the stock
price.
I like iPhone X for taking great
videos but I will not shell out the money to upgrade mine. It applies to
millions of users, so Apple may be peaking.
There will be no breakthroughs or
new products from Apple in September. The new products will cover different
markets for the X platform.
I bet there will be no lines
camped to buy the new phones. I could be wrong.
Aug 27, 2018. 12:27 PMLink
Good employment report
Mathematically incorrect, 4% is
full employment.
To me, there are 4% population
who do not want to work. If they work, they will lose the generous welfare, all
kinds of subsidies, free health care in some states, etc. Now it could be 3%
for full employment. There is no proof from me, but it is a great Ph.D. thesis
and a better research thesis than "Are the bees mate for fun?".
Many industries such as
construction have a hard time to find employees. Do we need more illegal
Mexicans (better with an improved work visa program)? Sep 7, 2018. 08:30 AMLink
Zero commission
With today's efficient software
systems and minimal people intervention, they still can make money. Most of our
cash in the broker account are virtually interest free and can be very
profitable to lend them out. Their margin interest rate costs us a fortune.
Plus there are many other ways to squeeze money from us. It is great for
traders if there is no limit in the no. of trades. Some brokers offer two
choices for the cash in these accounts: cash (that has no interest usually) and
money market. Check out which one is good for you.
Johnson and Johnson
They settled one lawsuit in
India. How about the baby powder lawsuit that could turn the company upside
down?
Macau stocks suffer
About 2 or 3 months ago, I laid
out the reasons not buying any casino stocks in Macau. Folks had been laughing
at me for a while. Now they're crying to the bank. It is hard to convince
lottery winners not to buy lotteries.
Microsoft using Huawei chip instead of Nvidia’s
Chinese chip has AI, 5G and many
functions. They do have to fight biases and any Trump's trade policy. Kissinger
and Nixon would never dream of this. Trump is trying to turn back the clock.
Microsoft may feel pressure from
the Chinese government and/or tries to get a better pricing deal from Nvidia
Miss Homes and her
blood-test company
Be careful of articulate,
beautiful and young CEOs and the handsome x-CEO from J.C. Pennies. Holmes has
many honors and the last one is the biggest cheater of 1 B dollar. She made a
big mistake: All lies have to surface some time.
Bayer and Monsanto
Did Bayer consider the Round-up
lawsuit before the purchase? If I were one of the many victims, I would be the
1%. Fortunate or unfortunate depending on how much longer you can enjoy your
sudden wealth.
Opportunities in life
Oil has broken the $70 mark
several times. When the global economies improve and/or some events in the
Middle East, it will return to the $100 range. Looking back when I recommended
oil when it was $30, I should have invested far more. Opportunities only knock
several times in a life time. Sep 4, 2018. 07:04 AMLink
Beating the deadlines
The trade increase could be
temporary due to beating the deadlines of the tariffs. Next quarter would be
more factual.
Apple fundamentals
Even with the biggest show, Apple
may be peaking (i.e. no way to go but down).
Fundamentals are just OK but
better than most FAANGs. Forward P/E is around 16, but debt is higher than
average. The China factor is a liability more than an asset now. It has climbed
from $155 to to $234 recently. I bet many institution investors are following
the trend. When they change their minds, watch out. I would recommend stops for
this stock.
Risky market?
It is interesting there are many
parallels today with 2007 such as interest rate and debt. Here is my deeper look. The market is fundamentally unsound but
technical sound.
Fundamentals are P/E...while
technical are Moving Average... as explained below.
For example, compare the current
P/E to the historical average P/E (from my check last time it was 25 and the
average is 15). All Moving Averages are positives and that indicates technically
sound.
Some metrics are not available
from finviz.com but some others are still available by searching Google for
CAPE as an example.
If I really want to get all of
the metrics, I can get the metric average of the top 10 holdings of the ETF such
as SPY. Sep 21, 2018. 11:48 AMLink
Great Depression
Great Depression is not a good
reference to predict today’s market trend. There are so many changes today from
that era.
Today internet is the culprit for
destroying mortar retailers and newspapers. It is profitable to short the old
industries such as Sears and buy the stocks that replace them such as Amazon.
Free trade (for example with
China) is another factor. Walmart makes money when it is the middle man for
Chinese products. It works today as the cost of freights is low compared to 30
years ago. A trade war could change all the benefits.
Today politics plays an important
role in our market. If Trump got impeached, the market would be tank.
Great Depression did not have
internet, free trade (too costly to ship goods worldwide then) and Trump.
Comparing 2000 and 2007 is good
enough. Even for that, today’s market is different from 2000 and 2007. They did
not have the 'market stop switch' and Trump. Banking system is far secured today
than in 2007.
Sam Walton
Sam Walton miscalculated profit
margins of most Chinese products. Being a patriot, he preferred to make less
profit. When he died, his family and close relatives changed to buying Chinese
stuffs for Walmart. They became the wealthiest family in the world (yes more
than Gates and Buffett as a family) and the rest is history.
Ask me why the market is down these few days
Fundamentals only work in the
long term. A short but important message.
One belt one road
One Belt One Road is fine but
expensive to China. In some instances it does not make economic sense for
China. I believe EU’s works are the enhancements rather than building a
separate silk road. China has laid out many procedures and simplified some.
China has the following major benefits.
1. Energy
import and ore import (Iran) from Middle East.
2. Enrich
the neighboring countries so they can buy Chinese products.
3. Strengthen
the Chinese yuan as a reserve currency.
4. An
alternative trade route to Europe. OBOR is less expensive than air but takes
longer time than by sea for most countries.
5. Some
trade partners are land-locked countries.
6. Uses
her excessive capacity and expertise such as in bridge building, rail building
and tunnel drilling.
7. Military.
Faster deployment and second route in case the sea route is blockaded.
8. Enriches
provinces in west China to reduce the wealth gap from the coastal provinces.
China’s weapons in the trade war
China was #1 foreign country in
holding our treasuries, then #2 and #1 again from my last check. Hence, I guess
China is still buying our treasuries or Japanese is not buying.
China has been devaluing the yuan
for the last few years. It may accelerate if the trade war materializes.
Be patient. Will Trump still our
president in the next election? Take out the political bias. Trump may lose the
Hispanic votes and the votes from ObamaCare subscribers.
Profiting with China’s rise
Many global companies are benefiting from co-operating with China from Walmart to Boeing. Australia has a good surplus with China. My high-school classmate (and one or two friends too) became a billionaire because of the rise of China. Do not complain but take advantage of the opportunity.
10% tariff
Most likely the 10% instead of
25% will be continued next year.
When we raise 25% or ban the
Chinese products, they will be replaced from other low-wage countries. Hence,
it does not gain us any jobs here but the retaliation from China. Have we
learned from banning Chinese tires? We do not manufacture low-quality tires and
they are replaced by worse tires at higher costs from other countries.
The cost of an iPhone and similar
products should be partially included in the trade deficit. It is about $8.50
for Chinese labor. The components inside are all over the world including many
Asian countries. Our marketing and design should be considered too.
Protecting our IP please
A beautiful girl jogging at 2 am
in a high-crime area was raped. Who's fault? Both but one should go to jail.
We have to protect our
intelligence properties (the beautiful girl in our example)!!! Hackers (the
rapist) are criminals here but professionals in many countries.
China is smarter than other
countries in hacking. Russia (supposed to be the top hacker) has not stolen the
entire blueprints of our top fighter jets.
China has produced these top
weapons routinely. It is not just a copy cat to me. Otherwise, many countries
can do the same.
China reverses engineering of Russia’s
SU-33 and the joke on Russia is it is better than the original. You have to be
quite innovative and supported by the economy and many component suppliers to
produce the copied products in amazing pace and quality.
The battle of two Ma (Mas)
WeChat is quite powerful. It
combines Facebook, Amazon... into one package. Its e-pay system is widely used
in China. One apps does it all.
I can see why Facebook and Google
are banned in China beside political reasons. It would let the local companies the
time developing their own systems. EU, Take notes and there are more in life
than just milking the fat cows.
iPhone X
The new Apple products are
powerful. There are a lot to enhance in the watch, but not much in the phone.
Apple is peaking and 1 trillion market cap is unimaginable 5 years ago.
No comments:
Post a Comment