Re: Chinese currency activities

Re: Chinese currency activities

Randy,

That would be RELATIVE transparency, but who can assess what the thinking is of
billions of
investors, and their actions? I love it when the news reports the "Dow was down
36 points
today on profit-taking..." How can they possibly know why the Dow was down,
possibly know
the minds of the 25 million people who traded that day?

You are betting that Sarbanes Oxley will control fraud, and that the govt can
write rules that
make things more transparent. I bet not. If Enron broke the rules, how come
the SEC never
noticed? Private companies brought Enron down, the short sellers who spotted
the nonsense
in Enron's statements. They bet their money Enron was wrong, and got paid
plenty on their
bet. The short sellers are sufficient adult supervision in stock markets.

One of the first things Sarbanes Oxley did was cause a rush to the exits by CEOs
and CFOs.
Plenty of talent quit the field rather than face the hastily drafted Sarbanes
Oxley. Were thyey
all criminals? Or did we lose incalculable management talent?

Companies want to sell stock. The people selling the stock of their companies
are known
quantities. The short sellers will keep things honest in these foreign markets.

China has enough US dollars and wants to unload some. If the Bank of China IPO
went on the
NYSE the Chinese would end up with more dollars. In hongkong they get euros,
and hong
kong dollars and RMBY, canadian dollars and pesos, etc. They can let this
foreign currency
roll in, and make payments around the world in US dollars, quietly unloading
their dollar
positions. (if the dollar tanks, people will get mad at USA, not the Chinese
who paid them the
dollars).

AS to foreigners investing in USA, I don't know what the figures are, but I do
know USA
investing in foreign markets has grown tremendously.

A few years ago the stock market hit 11,000 and gold was something like $250/oz.
Now the
market is 11,000 and gold is $620/oz. I think the thing to watch is not what
the markets do,
but what gold does.

John



On Wed, 31 May 2006 21:18:23 -0500, "Randal Tietz" wrote
:

> John,
>
> I saw this in the Chi. Trib. today. It is another facet of the area you
> mentioned a few weeks back about not being able to buy stock in USD.
>
> I have been interested for some time now why Int'l invest in the US when
> there are so many other markets open to them. I have come to believe a
> significant piece of the puzzle is our system's transparency and SEC
> regulation. The viscerally hated Sarbanes-Oxley anti-fraud law may turn out
> to be the bitter medicine which saves the market which so loathes it.
> Ironic.
>
> >Bank of China IPO not available on NYSE
>
> Associated Press
> Published May 31, 2006
>
> HONG KONG -- When Chinese firms like the state-owned oil company PetroChina
> Co. or Internet start-up Baidu.com Inc. wanted to go global and raise cash
> on a stock market, they launched their initial public offerings on Wall
> Street.
>
> But that's not what the Bank of China plans to do Thursday with its IPO, the
> world's biggest in six years. The bank, China's No. 2 lender, is listing
> $9.7 billion worth of its shares only on the Hong Kong Stock Exchange.
>
> The IPO is part of a recent wave of Chinese firms that are skipping New York
> entirely. Hong Kong's new popularity for the mega-IPOs is seen by some as
> the latest trend in globalization: the rise of a new world with many
> financial capitals.
>
> But skeptics argue that the Chinese firms, called "red chips" in local
> lingo, don't dare list in the U.S. because their finances are too murky. The
> critics say Hong Kong's less rigorous financial disclosure regulations mean
> fewer headaches for the firms.<
> > (Complete article
> http://www.chicagotribune.com/business/chi-
0605310004may31,1,1116096.story?coll=chi-business-hed&ctrack=1&cset=true ) <
>

Bookmark this post --- Email this post