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We Bought In The Evening, And The Price Dropped In The Morning!

A report from the Epoch Times. “China, for several years, has experienced higher real-estate sales in early October, earning the period the nickname ‘Golden Week.’ This year, however, the market has fared poorly, with developers doling out properties for steep discounts—to the dismay of many recent buyers across the country. They left many recent customers feeling cheated about the cost of their new homes.”

“On Oct. 2, more than 40 new homeowners in the city of Jingdezhen in Jiangxi Province gathered in protest outside the sales office of a property developer, and angrily shouted complaints such as ‘refund our money’ and ‘we bought in the evening, and the price dropped in the morning.'”

“The next day, in Shanghai’s high-end Pudong District, dozens of new homeowners congregated in front of a housing development, carrying signs emblazoned with the slogan ‘Refund my hard-earned money.’ The developer, Country Garden, had lowered prices from 35,000 yuan per square meter ($470 per square foot) to 26,000 yuan overnight.”

“On Oct. 4, the sales office of another Country Garden project in Jiangxi’s Shaorao city was pelted with eggs thrown by hundreds of angry buyers, who also destroyed the office decorations while demanding refunds. During the Golden Week, the company had lowered prices to 7,000 yuan per square meter from 10,000 yuan.”

“Shanghai Securities News reported that Shenzhen and Beijing are the two most active cities in the real-estate market. But in the most recent Golden Week, sales were down by half compared with previous years.”

“Zhou Qiang, a Beijing real-estate analyst, told Radio Free Asia (RFA) that the most important factor behind plummeting housing prices is state interventionism. ‘Personally, I think housing prices may decrease, but won’t decrease to a half or two-thirds,’ Zhou said. ‘The government won’t let them plummet too much, but they certainly won’t be allowed to increase.'”

“Another Beijing real-estate expert who spoke with RFA commented that the government may freeze the market to prevent its collapse. ‘In Beijing, I was told that the government has at least eight or nine solutions to control real-estate prices,’ he told RFA. ‘The most potent one is stop the transactions.'”

This Post Has 42 Comments
  1. ‘Personally, I think housing prices may decrease, but won’t decrease to a half or two-thirds…The government won’t let them plummet too much, but they certainly won’t be allowed to increase.’

    Here’s the thing Zhou. If there isn’t a possibility of ever growing prices, these airboxes are too freaking high! Plus for as long as I’ve been blogging 90% of the people in China own their shack or airbox. If you take away gambling, you’re dead in the water.

    1. won’t be allowed to increase…

      This is death to the speculator, but they will blame it on the government. If there is no gain, the airboxes are worse than worthless.

  2. ‘more than 40 new homeowners in the city of Jingdezhen in Jiangxi Province gathered in protest outside the sales office of a property developer, and angrily shouted complaints such as ‘refund our money’ and ‘we bought in the evening, and the price dropped in the morning.’

    Stamp them little feet! Stamp em!

  3. China has already lost this war.

    https://www.zerohedge.com/news/2018-10-10/china-has-already-lost-war

    Meanwhile a spokesman for the Chinese Supreme People’s Court is warning of an impending flood of Chinese bankruptcies and telling the Chinese judiciary to prepare in advance.

    “It’s hard to predict how this trade war will develop and to what extent,” the spokesman said. “But one thing is sure: if the US imposes tariffs on Chinese imports following an order of US$60 billion, US$200 billion, or even US$500 billion, many Chinese companies will go bankrupt.”

    Whew. Thank POTUS for this. People in the US have no idea what a bullet they dodged here. A “soft” handover of the US to China was actually in the works. Yes, there will be some pain, but it’s nothing compared to what it could have been.

    1. many Chinese companies will go bankrupt.”

      It was always inevitable, since so much was built on the back of a massive, fraudulent and reckless credit expansion. The US was a powerful enabler under the Globalists. Yes, let it stop, but there is going to be a reckoning. Anyone deep in debt is going to get hammered.

    2. People in the US have no idea what a bullet they dodged here. A “soft” handover of the US to China was actually in the works.

      Yeah, well, Screech with her Pol Pot-like attitude towards a quarter of the population – Les Deplorables – is openly advocating violence if the election results are not to the DNC’s liking. So maybe China is the lesser concern than power grabs by unscrupulous power-hungry collectivists.

      https://www.zerohedge.com/news/2018-10-10/we-crossed-line-martin-armstrong-lashes-out-hillary-advocating-violence-unless

      1. This is the universal commie playbook. Bolshevik Revolution, Cultural Revolution. A relatively small group uses violence against the populace AND those in power, then take over. And it does appear that they have the police on their side, if you saw the recent video of Pantyfa taking over the streets of downtown Portland. That’s how it is done, and has been done in the past.

        It’s been fun and games up to now, but there’s been a change.

        1. There’s a reason they don’t teach much history in the schools anymore, at least not the type of history they used to teach. If they did, people would recognize the signs. I guess Dr. Zhivago will have to do.

  4. “On Oct. 4, the sales office of another Country Garden project in Jiangxi’s Shaorao city was pelted with eggs thrown by hundreds of angry buyers, who also destroyed the office decorations while demanding refunds. During the Golden Week, the company had lowered prices to 7,000 yuan per square meter from 10,000 yuan.”

    A 30% haircut in a single day has to hurt alot! No wonder so much foot stamping is going on.

  5. Chinbabwe’s goose is cooked. No other country has even approached the level of money printing that they have during this massive credit expansion. Walmart trinket production isn’t where all the money for those Vancouver and Sydney shacks came from. It was their massive money printing operation. They now have to face the reaper.

    1. Too bad they are quite likely to fund their next wave of desperation stimulus measures by dumping their US Treasury bond HODLings.

      1. DealBook
        The Unknowable Fallout of China’s Trade War Nuclear Option

        China holds more than a trillion dollars in United States debt, and an escalating trade war could tempt it to wield that debt in a way that has long been unthinkable.
        By Andrew Ross Sorkin
        Oct. 9, 2018
        阅读简体中文版閱讀繁體中文版

        It is often called the nuclear option.

        In the trade war between the United States and China, economists and investors have long tried to game out how both sides might use their clout. In virtually all the predictions, at least until recently, they revolved around a tit-for-tat tariff war.

        Even in the gloomiest of doomsday scenarios, there is one weapon that has long been considered unthinkable: the Chinese, the biggest holder of United States foreign debt with more than $1 trillion, publicly taking a step back from buying United States Treasuries — or worse, dumping what they own in the open market.

        The very idea is typically dismissed as a waste of time to even consider, and the reason is a sort of mutually assured destruction. It would be wildly irrational in economic terms, the thinking goes. China selling Treasuries would send interest rates up and hurt the United States, but it would simultaneously severely damage the value of China’s own Treasury holdings. As the industrialist J. Paul Getty famously said, “If you owe the bank $100, that’s your problem; if you owe the bank $100 million, that’s the bank’s problem.” In the United States-China relationship, China is very clearly the bank.

        https://www.nytimes.com/2018/10/09/business/dealbook/china-trade-war-nuclear-option.html

      2. When you have an economy expanding at better than 4%, you can withstand it. It may justify slowing down the reduction of the Fed balance sheet and raising the discount rate but the bottom line is we do not need China to buy our treasury bonds. Thus, if China want to and may be dumping our debt to hurt us, it is just hurting itself more because it is receiving less money from the sales by dumping instead of professional selling them.

  6. There is nowhere left to hide. And nobody could have seen it coming!
    ———————————-
    A rare and worrisome thing happened during Wednesday’s stock market slaughter: Bonds fell, too

    Sharp stock market sell-offs usually send buyers into the Treasury market, but bonds continued to drop in a rare market move Wednesday as the Dow fell more than 800 points.

    Stocks are reacting to the rise in Treasury yields, which move inversely to price, and strategists say the unusual trading could signal more volatility ahead.

    “There’s no flight to safety in bonds. That’s a sea change,” said one strategist.

    Patti Domm | @pattidomm
    Published 7 Hours Ago Updated 5 Hours Ago

    https://www.cnbc.com/2018/10/10/a-rare-and-worrisome-thing-happened-during-wednesdays-stock-market-slaughter-bonds-fell-too.html

  7. Would now be a good time to buy the dip?
    ——————————————
    All 30 Dow stocks fall ahead of the open

    Home
    Markets
    U.S. & Canada
    The Tell
    The Titanic as ‘an iceberg loomed’ is how Guggenheim’s Minerd thinks of today’s stock market
    By Mark DeCambre
    Published: Oct 10, 2018 4:28 p.m. ET

    Minerd’s comments come as Dow suffers worst single-session drop since Feb. 8

    https://www.marketwatch.com/story/the-titanic-as-an-iceberg-loomed-is-how-guggenheims-minerd-thinks-of-todays-stock-market-2018-10-10

  8. Could a protracted period of abnormally low stockmarket volatility be the calm before the storm?

    1. Opinion: Three phenomena in the stock market might mean it’s the beginning of the end

      By Simon Maierhofer
      Published: Oct 11, 2018 5:09 a.m. ET

      Downside risks are increasing, though there could still be a temporary high

      The stock market has created some weird and unusual phenomena not seen in years, even decades.

      Those phenomena have been building for weeks, which is why I said in various September Profit Radar Reports that risk is starting to outweigh reward.

      The discrepancy between the Dow Jones Industrial Average (DJIA, -3.15%) (large-cap) and Russell 2000 (RUT, -2.86%) (small-cap) or Nasdaq (COMP, -4.08%) were obvious, but there are more hidden, and likely more meaningful, phenomena. Here is a look at three of them:

      New NYSE lows

      Last week (on Oct. 4), the S&P 500 closed 0.99% below its all-time high. On the same day, 13.7% of all stocks traded on the NYSE fell to 52-week lows.

      The chart below shows just how unusual this is. A spike of 52-week lows (especially more than 10% of all stocks traded) is usually seen near stock market lows (gray line), not highs.

      The last time something remotely similar happened was on July 27, 2015, when the S&P 500 closed 2.9% below its all-time high, and NYSE lows spiked to 14.9%.

      This was followed by two 10%-plus corrections.

      Alternate volatility

      There are many ways to measure volatility. The most popular gauge is the Volatility Index VIX, (+1.18%) and another way is to measure actual daily percentage swings.

      A couple of weeks ago, the maximum daily S&P 500 move (averaged out over the 30 days) was only 0.54%.

      Perhaps more astounding is that, prior to Wednesday, the S&P 500 has not moved more than 1% (from close to close) since June 25 (73 trading days).

      Last Friday’s 0.87% loss was the first time the S&P 500 moved more than even 0.80% since July 25 (51 trading days).

      The last time the S&P 500 has gone more than 51 days without a 0.80% move was in 1968. Over the next 18 months it lost 34%.

      https://www.marketwatch.com/story/three-phenomena-in-the-stock-market-might-mean-its-the-beginning-of-the-end-2018-10-11

  9. “The fundamental business of the country…is on a sound and prosperous basis.”
    —————————————–
    Mnuchin isn’t blaming the Fed for the market rout, says it’s a ‘normal correction’
    By Donna Borak, CNN Business
    Updated 3:52 AM ET, Thu October 11, 2018
    Dow drops more than 800 points
    Source: CNN Business

    Bali, Indonesia (CNN Business) Treasury Secretary Steven Mnuchin isn’t buying the argument that the Federal Reserve triggered Wednesday’s steep fall in US stocks.
    “I don’t think there was any new news that came out of the Fed today that wasn’t there beforehand,” Mnuchin said Thursday morning in an interview in Bali, Indonesia. He was speaking hours after the Dow and other major US indexes plunged more than 3%.
    “Markets go up. Markets go down,” Mnuchin said on the sidelines of a meeting of global finance chiefs and central bankers hosted by the International Monetary Fund. “I see this as a normal correction.”
    The fundamentals of the US economy are very strong, he added.

    https://www.cnn.com/2018/10/11/business/mnuchin-trump-fed-markets/index.html

    1. Don’t “normal corrections ” typically whack more than 10% off prices?

      Try not to catch yourself a falling knife.

      1. The stawk market is starting to look a bit plunge-y again today. It was sitting around even, then in a matter of 5 minutes was down over 100.

  10. Asia stocks crumble: Shanghai topples more than 5%, Nikkei declines nearly 4%

    – Asia markets fell sharply on Thursday, with the stock indexes in Shanghai and Shenzhen both tumbling more than 5 percent.
    – Both the Dow and S&P 500 posted their biggest one-day drops since early February, while the Nasdaq notched its largest single day sell-off since June 24, 2016.
    – As of 2:06 p.m. ET, the Dow Jones industrial average futures pointed to an implied open of 298.74 points lower.

    Eustance Huang
    Published 13 Hours Ago
    Updated 1 Hour Ago

    https://www.cnbc.com/2018/10/11/asia-markets-wall-street-sell-off-the-fed-currencies-in-focus.html

  11. Oil extends losses as markets fall, US crude stockpiles climb
    – Brent and U.S. crude oil both drop by more than $1 per barrel.
    – U.S. crude oil inventories jump by 9.7 million barrels, according to preliminary industry report.
    – Hurricane Michael dodges U.S. oil production sites.
    Published 10 Hours Ago
    Updated 1 Hour Ago Reuters

    Oil prices slumped on Thursday as global stock markets fell, with investor sentiment made more bearish by an industry report showing U.S. crude inventories rising more than expected.

    Brent crude fell $1.63, or 2 percent, to $81.46 by 7:40 a.m. ET (1140 GMT). Brent lost 2.2 percent on Wednesday. On Oct. 3, it hit a four-year high of $86.74.

    U.S. light crude dropped $1.31, or 1.8 percent, to $71.86. The contract lost 2.4 percent in the previous session.

    “The up-trend is over for the moment, and a new direction is settling in,” said Robin Bieber, technical chart analyst at London brokerage PVM Oil. “The market looks like heading lower, with valid targets south.”

    https://www.cnbc.com/2018/10/11/oil-markets-global-stock-markets-us-crude-oil-inventories-in-focus.html

    1. Wait. We’ve been told over and over that oil can’t be produced for less than $80. Some hen must be a layin.

    1. You’d have to have a hole in your head to want to buy stawks at this level. Look at Netflix for instance – the price has tripled in just the past 3 years, and it’s up like 30x in the past 6. There are innumerable companies with the same story.

    1. You had me looking for a power point haha. I figured it out though 😉

      PPT Plunge protection team – meaning the prop job that comes in towards the end of the day to give the market a boost into the next trading session

      1. It seemed like they stepped in early to prevent the selloff from morphing into a deadly avalanche. But now the heavy weight of selling pressure is weighing again.

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