Overall, it seems that it is not AS dramatic as the Western press want it tolook, although concerning
I see it as a sign of the necessary correction into an healthier economic system, where real estate can be affordable, tech companies are not sucking all the best graduates into unproductive endeavor, and stimulus money goes to family formation instead of infrastructure and real estate.
The meantime might be a little painful, but after decade of boom, some sense into the economy, workers and employers is probably needed through a sort of recession
News was the youth unemployment in China is now more than 20% and they stoped publishing data about it? Isn't this correct?
Why do you think youth unemployment is a sign of correction you mentioned. Given that the same central government brought country to here, why do you think they are switching policy, any signs of that? Also I think China is not using stimulus for the people
and demography is declining.
Funny that in the west tech used to complain finance is pulling talent to the unproductive endeavors :)
As far as I could tell without visiting China, but listening to people on the ground, it is "kinda" 20%
In the sense that there is also a lot of job openings not finding workers, and many fresh graduates refuse to "downgrade" their ambitions after more than a generation of endless growth.
Regarding stimulus I saw passing a stimulus for family of a few hundreds bucks extra, and the CCP is pretty clear that it is what they want to see in the future, not bailing out industries like real estate. Beside, letting real estate go down in a semi-controlled fashion is a great way to subsidize youngsters, and making foreign investors and asset owners pay for it.
Demographic decline of China is by the way overblown, only the Zeihan -type liars insist on it, not different situation from the US by much, and better than EU, they retire at FIFTY FIVE years, so this leave a LOT of rooms to get more workers. And beside, they will do well with 200-400 million less to compete for food, fuel and water. 1 billion people highly automated and food secure China will be a stronger nation than 1.4 billion in the current conditions.
A very good answer in contrast to all the propaganda we hear all the time. Besides all you mentioned they still have a few hundred milions workers potential which they can exploit with rising urbanisation - moving people from countryside into cities.
I personally own Transocean (RIG), Petrobras (PBR), and more recently Ecopetrol.
I also like VAR in Norway and Orlen in Poland, but the first I am wary of how Scandinavians are turning very leftist and might put windfall tax and carbon tax on it. Orlen I would buy if Poland would stop toying with war with Russia.
CNOOC is also pretty good, but not sure about taking the exposure to China risk when you can get more international business like RIG or more dividends like PBR and EC. Oil as it is is already exposed enough to China economic risk without adding geopolitics.
Not too much because he barely control his own parlement
Also since he is in power, Petrobras is only paying lip services to green policy,with projects "under review until 2027" and such
The key thing is that I am paid for the risk, and pretty handsomely
I also assume that the absence of geopolitical risk is worth something
+that brazilian political risk (corruption) is equal to western political risk (green madness), but one is priced in already, while the other is looming for a repricing down
Thank you for your quick response. Today I became a paying member of your site. After reading a few articles, I wanted to ask you whether there is a specific article in which you - based on your geostrategic analyzes - present specific companies with which you can react to the scenarios you have outlined. What is missing is concrete ideas of stocks that it would make sense to own if the scenarios you describe come to pass. Could you imagine presenting your portfolio in the future or, alternatively, pointing out a specific stock that you like once a month? At the moment I'm missing the added value that I can get from your often somewhat abstract geopolitical analyzes when it comes to my stock decisions. Or should I have missed a specific article?
I think I will publish my portfolio soon, with an explainer of each position.
Although this might not be right for everybody, I have personally an absurdly high tolerance to volatility that make most people unfit for that portfolio.
Regarding the oil theme, I can point at Transocean RIG which I covered a while ago, which still have quite some steam in it I suspect, even if up more than 100% since I entered myself
Petrobras and Ecopetrol are 2 south American national oil company that match as well the general "stay out of conflict zone" and give a lot of dividends. I never did Petrobras and Ecopetrol reports because most would have been derivative of other writers' reports and it did not feel right to plagiarize it.
Many thanks for your response. yes, I think it would be great if you showed your portfolio. Maybe you can explain in one sentence whether you think the respective position is worth buying or not.
Can I also ask you briefly what other reports about Ecopetrol and Petrobras you mean? could you possibly link them.
And another quick question: What do you currently think of Cresud and Pampa Energia? (I think you're even invested in Pampa, right?) The peso has just collapsed incredibly. It would probably be better at the moment to wait for the upcoming elections before taking a closer look at either one, right?
What do you think about increasing youth unemployment in China?
Overall, it seems that it is not AS dramatic as the Western press want it tolook, although concerning
I see it as a sign of the necessary correction into an healthier economic system, where real estate can be affordable, tech companies are not sucking all the best graduates into unproductive endeavor, and stimulus money goes to family formation instead of infrastructure and real estate.
The meantime might be a little painful, but after decade of boom, some sense into the economy, workers and employers is probably needed through a sort of recession
News was the youth unemployment in China is now more than 20% and they stoped publishing data about it? Isn't this correct?
Why do you think youth unemployment is a sign of correction you mentioned. Given that the same central government brought country to here, why do you think they are switching policy, any signs of that? Also I think China is not using stimulus for the people
and demography is declining.
Funny that in the west tech used to complain finance is pulling talent to the unproductive endeavors :)
As far as I could tell without visiting China, but listening to people on the ground, it is "kinda" 20%
In the sense that there is also a lot of job openings not finding workers, and many fresh graduates refuse to "downgrade" their ambitions after more than a generation of endless growth.
Regarding stimulus I saw passing a stimulus for family of a few hundreds bucks extra, and the CCP is pretty clear that it is what they want to see in the future, not bailing out industries like real estate. Beside, letting real estate go down in a semi-controlled fashion is a great way to subsidize youngsters, and making foreign investors and asset owners pay for it.
Demographic decline of China is by the way overblown, only the Zeihan -type liars insist on it, not different situation from the US by much, and better than EU, they retire at FIFTY FIVE years, so this leave a LOT of rooms to get more workers. And beside, they will do well with 200-400 million less to compete for food, fuel and water. 1 billion people highly automated and food secure China will be a stronger nation than 1.4 billion in the current conditions.
A very good answer in contrast to all the propaganda we hear all the time. Besides all you mentioned they still have a few hundred milions workers potential which they can exploit with rising urbanisation - moving people from countryside into cities.
Or alternatively, developing the country side, seemingly the new goal "rural revitalisation" by Xi
Ultimately, I will believe a collapse in economic activity when Chinese oil & gas & coal consumption collapse.
If record high, it mean consumers move, tourists visit, goods transit and factories are using power and trucks.
Great analysis. Which Oil companys do you like besides Petrobras?
I personally own Transocean (RIG), Petrobras (PBR), and more recently Ecopetrol.
I also like VAR in Norway and Orlen in Poland, but the first I am wary of how Scandinavians are turning very leftist and might put windfall tax and carbon tax on it. Orlen I would buy if Poland would stop toying with war with Russia.
CNOOC is also pretty good, but not sure about taking the exposure to China risk when you can get more international business like RIG or more dividends like PBR and EC. Oil as it is is already exposed enough to China economic risk without adding geopolitics.
Thank you very much. Appreciate your insight. Not worried about political risks regarding Lulas leftist approach?
Not too much because he barely control his own parlement
Also since he is in power, Petrobras is only paying lip services to green policy,with projects "under review until 2027" and such
The key thing is that I am paid for the risk, and pretty handsomely
I also assume that the absence of geopolitical risk is worth something
+that brazilian political risk (corruption) is equal to western political risk (green madness), but one is priced in already, while the other is looming for a repricing down
Hello Jonathan,
Thank you for your quick response. Today I became a paying member of your site. After reading a few articles, I wanted to ask you whether there is a specific article in which you - based on your geostrategic analyzes - present specific companies with which you can react to the scenarios you have outlined. What is missing is concrete ideas of stocks that it would make sense to own if the scenarios you describe come to pass. Could you imagine presenting your portfolio in the future or, alternatively, pointing out a specific stock that you like once a month? At the moment I'm missing the added value that I can get from your often somewhat abstract geopolitical analyzes when it comes to my stock decisions. Or should I have missed a specific article?
Best regards,
Lars
Thanks for the comment.
I think I will publish my portfolio soon, with an explainer of each position.
Although this might not be right for everybody, I have personally an absurdly high tolerance to volatility that make most people unfit for that portfolio.
Regarding the oil theme, I can point at Transocean RIG which I covered a while ago, which still have quite some steam in it I suspect, even if up more than 100% since I entered myself
Petrobras and Ecopetrol are 2 south American national oil company that match as well the general "stay out of conflict zone" and give a lot of dividends. I never did Petrobras and Ecopetrol reports because most would have been derivative of other writers' reports and it did not feel right to plagiarize it.
Many thanks for your response. yes, I think it would be great if you showed your portfolio. Maybe you can explain in one sentence whether you think the respective position is worth buying or not.
Can I also ask you briefly what other reports about Ecopetrol and Petrobras you mean? could you possibly link them.
And another quick question: What do you currently think of Cresud and Pampa Energia? (I think you're even invested in Pampa, right?) The peso has just collapsed incredibly. It would probably be better at the moment to wait for the upcoming elections before taking a closer look at either one, right?