Without Confidence, Everything Is Nonsense.

2008/1/31 15:13:08

At 3:30, some tedious fellow is coming all the way from Dalian specifically to discuss a shell acquisition deal in the Hong Kong market. After the meeting, I'll come back and write a post with pure technical analysis of the subsequent trend. This ID's mood has already fully shifted to New Year mode—the mere thought of having things to do gives me a headache.

Today's market trend is entirely unsurprising. When you're following someone else's lead, that's just how it goes. So what if they cut interest rates? In fact, even for the United States, whether they cut rates or not, what's meant to die will still die. Once rate cuts trigger massive capital dumping of dollar-denominated assets, the death will be even uglier. Unfortunately, the one pool that could absorb this massive capital flight—China's—is precisely what's missing. Just thinking about it is depressing. Where were they when it mattered?

Economics is a specialized discipline. Those managing the economy should at least have studied economics or grown up immersed in economic circles. Otherwise, blacksmiths, ditch-diggers, dam-builders, and flatbread vendors can all have a go at economics—then what kind of economics is that?

In one sentence: this round of decline probably still won't result in the stamp duty being lowered. Likely, an even more violent plunge is needed. Of course, there will be rebounds, but as long as the stamp duty doesn't come down, this ID's enthusiasm will remain in the doldrums.

This year, it all depends on what changes after the March meetings. If there are none, then things will be what they'll be. This ID absolutely will not take on the business of catching falling rocks again—with transaction costs this outrageous, on what grounds?

On short-term technicals, there's nothing much to say. Right now, if this 1-minute hub can't be broken upward, it'll keep stepping down. On individual stocks, many need to proactively pull back first—otherwise, holding at the top lifting barbells serves no purpose.

Right now, the key isn't the stock market itself, but a crisis of confidence. Here's the simplest question: why should Chinese investors endure the highest transaction costs in the entire world?

Can anyone answer this question?

This ID already stated clearly at the end of last year: the stamp duty must come down this year. No matter who it is, if you've made a mistake, you correct it. If you don't correct it, that's unacceptable.

This ID isn't worried about the stock market at all right now, because there's something far more worrying—if this round of economic confrontation is handled incorrectly, things far more serious than the stock market are waiting ahead.

Can we handle it correctly? Sorry, this ID has no confidence.

If you're still in the mood, please read this dream of this ID's: "Retracing Du Fu's 'Ascending Heights' Rhyme, Recording a Dream 2008-01-26 10:23:21"

Heading out now, goodbye.