Analysts say china will adjust interest rate

[landlord investor]

May be as early as next week.

[Kubes.SG]

Exactly as forecasted and needed.   Let bleating and bleeding begin.  

AgentIdiot, have the idiots who have loaded up on free money and overpaid for crap SG property and now are to be caught with their pants down while playing with themselves, actually have missed the boat?  


Emerging nations drive interest rates up

By David Oakley

Published: December 9 2010 00:13 | Last updated: December 9 2010 00:13

Borrowing costs are set to rise across the globe with huge ramifications for financial markets as dramatic growth in emerging markets forces up interest rates.

McKinsey Global Institute, a thinktank, says in a report that, as a result, investors are almost certain to switch out of equities in this environment into the safety of government bonds and other more secure fixed-income securities.

Richard Dobbs, director of MGI, said: “As a world economy, we have to get used to a world where rates are no longer falling. This will have a big impact on the financial markets.”

The McKinsey research looks beyond the present climate of extremely low interest rates, which have benefited equities, to a new higher interest rate environment in the next five to 10 years that will attract new investors to bonds.

McKinsey says the main driver of this turnround is emerging economies embarking on one of the biggest building booms in history. Rapid urbanisation is increasing demand for new roads, ports, water, power stations, schools, hospitals and other public infrastructure in the developing world.

At the same time, the thinktank says ageing populations and China’s efforts to boost domestic demand will constrain growth in global savings. The world is, therefore, entering a new era in which the desire to invest exceeds the willingness to save, pushing interest rates up.

McKinsey says the world is at the start of another potentially enormous wave of capital investment, driven by the emerging markets.

The thinktank projects that by 2020, global investment demand could reach levels not seen since the post-war rebuilding of Europe and Japan.

It says this investment boom will put sustained upward pressure on real interest rates unless global saving increases significantly.

In most scenarios of future economic growth, McKinsey analysis of saving suggests that it will not increase enough, leaving a substantial gap between the willingness to save and the desire to invest.

It stresses that a higher interest rate environment could make traditional fixed income investment, such as high quality government, municipal and corporate bonds, more attractive. In the short-term, any increase in interest rates will mean losses for bondholders as the market value of previously issued, lower yield bonds declines.

But over the longer term, higher interest rates will enable investors to earn better returns from fixed-income investments than they could in the years of cheap capital up to August 2007, or before the financial crisis.

Copyright The Financial Times Limited 2010.

[landlord investor]

It was on the TV news tonight.

[Agent007]

Thanks for that Kubes. As you are usually completely wrong and doing the opposite to what you say has always paid off handsomely I'll go out and buy another couple of units without any fear of interest rates increasing.

[Want fries with that?]

Thanks for that Kubes. As you are usually completely wrong and doing the opposite to what you say has always paid off handsomely I'll go out and buy another couple of units without any fear of interest rates increasing.

McDonalds pays that much meh?

[Board Games]

Thanks for that Kubes. As you are usually completely wrong and doing the opposite to what you say has always paid off handsomely I'll go out and buy another couple of units without any fear of interest rates increasing.

Monopoly properties don't count lah.

[Agent Provocateur]

Someone has an acute comprehension problem here.

You dont have to read between the lines. Read:

Emerging nations drive interest rates up

It says this investment boom will put sustained upward pressure on real interest rates unless global saving increases significantly.

In most scenarios of future economic growth, McKinsey analysis of saving suggests that it will not increase enough, leaving a substantial gap between the willingness to save and the desire to invest.

Savings, it says, are not going to increase enough; in which case the investment boom will continue with or without the paltry rise in interest rates. We dont have a Volker when we need one.

Over here investments are more than equivalent to savings. That's the point made in the article. Bonds to match real estate returns in eastern culture ? Dream on.

The old man once nobly desired Singaporeans owning at least 2 parcels of property per head. Cant recall him mentioning a target amount for savings.

Soon we wont be measuring wealth by the amount of savings we have but by the number of properties we own.

[Agent Provocateur]

Yes, finally China does it by a quarter basis point !

Is it enough ?

[Agent Provocateur]

Exactly as forecasted and needed.   Let bleating and bleeding begin.  

AgentIdiot, have the idiots who have loaded up on free money and overpaid for crap SG property and now are to be caught with their pants down while playing with themselves, actually have missed the boat?

Emerging nations drive interest rates up

Kubesy, you imply in this or other posts that a strong currency is preferred and Australia is inclined towards that.

If that is what you are in fact saying again I beg to differ mate. No nation prefers an overly strong currency. For example Japan and China are terrified about having a strong yen or yuan. On the otherhand most nations are now beginning to exhibit a tendency in wanting a weaker currency(especially the Americans now who have a started a race to the bottom with their agenda in wanting to tackle their enormous external debt problem).

Actually what every nation prefers is a stable currency. But the markets, which are filled with speculators will not allow for that. The speculators' jobs centre around volatility because that's what makes the bucks for them. Volatility for them is a mainstay of any 'healthy' market. A stable flatliner market (which was main street also prefers) is a 'dead' market in their eyes.

I am not saying that interest rates dont have a purpose. These laggard policies are used for damage control tho' they bear no lasting benefits.

The blood in the sreets is mopped up so regularly, by interest rate policies, that you and I wont get to see it.

[Agent007]

From KUBES....."Exactly as forecasted and needed.   Let bleating and bleeding begin.  

AgentIdiot, have the idiots who have loaded up on free money and overpaid for crap SG property and now are to be caught with their pants down while playing with themselves, actually have missed the boat?"

Still waiting Kubes. You know nothing and are also extremely stupid.

Why you think that interest rates here may increase in the next 12 months is beyond me. There is only one way they will go and that is down.

Be told idiot and stop making a fool of yourself.

[china_watch]

With USD2.8 trillion and growing, tis is a matter of time !
scary growth ! Not sure if another bubble in the making !