Shadow Banking & Other Scary Stuff In Stock Markets
I was reading a WSJ article on how a Chinese think tank estimates that shadow banking activities amount to about 40%of GDP last year. Within the article, it was mentioned that Fitch Ratings estimates it at 198% whilst JP Morgan has it at about 69%.
Who knows ?
Then I read that Alibaba wants to go into fund management ! After Ten Cent wants to set up a bank. http://english.caixin.com/2013-10-10/100589952.html
Is this not an a stock analyst’s worst nightmare ?
When I was initially alerted to the news that Singapore listed Freight Links Express (market cap SGD 254 mio) gave a loan, via a subsidiary, to City Harvest church, I was amused and jokingly associated the idea to a variant form of shadow banking. As if I would know ?
No wonder I cannot find any analyst covering that stock. It’s just too difficult with their multi-faceted business model. From what I hear, which is unverified, they have invested in hedge funds as well. Hmmm, I do not know what to say about shareholder interests, except I suppose if it is profitable, then there is nothing much to complain about ?
I guess all this is coming out now with the market scandal involving Blumont lately. Articles have sprouted all over the web and in the Straits Times regarding all these cross holdings and stuff with about 9 companies in total involved. (will post the links in the forum if you like – do not want to risk being sued)
Recently, I have been advised to take a look at some penny stocks. My friend’s immediate advice is TAKE A LOOK BUT DO NOT ANALYSE OR ASK QUESTIONS. Just buy on price action, trading style.
I am beginning to understand it now which I why I wrote Getting Rich On Penny Stocks, the other day.
Reuters did something quite witty – “(Reuters) – A funeral parlor switches into gold mining; a steel trader turns into a property developer; and a food packaging firm ventures into resources.” Guess which country ? No, not Vietnam ! but Singapore ! And I noticed the funeral parlour one too because I have this little home made alert system now that alerts me to spikes in prices and volumes.
We can list anything that is legitimate. In China, a graveyard owner is attempting an IPO after the temple managed to list successfully.
“Fu Shou Yuan, which operates a high-end cemetery in Shanghai that appeals to rich families aiming to give their loved ones a luxurious place to rest in the next life, hopes to raise around $200m, a person with knowledge of the deal said.” FT http://www.ft.com/intl/fastft
There is nothing to stop the graveyard company from deciding to buy a bus stop, I suppose ! Just like Ezion buying Ocean Sky the other day. It doesn’t make sense to me and if it doesn’t, I try not to be too greedy as a little shareholder.