Business Channel 2007-10-07&10-09, 可能的投资风暴顾忌

Scripts:

I think that you've had really two events over the last couple of months. You had one, a liquidity 1 event in August that the Fed monetized a few weeks ago by lowering rates 50 basis points more than those expected. And then you've had credit worries. But in the liquidity problems you have some shares just beat down so hard that you had them, you had a lot of people come into the market with a lot of li(quidity), a lot of extra capital around that push shares up to an all time high. Yesterday and you have some people as you have, coming on more board, bearish 2 trend and the economy has still lots of potential to roll over probably of taking some money off the table at this point.

So essentially 3 you think this is a relatively 4 short term move. That there is some uncertainty 5 there , there is a lot of worry, a lot of people just kinda in and then quickly back out again having made a profit. And it's rather hard therefore presumably to discern the future direction of the Dow.

Charles that's absolutely correct. And I would say that there is a ton of uncertainty right now. I think that some financial shares and some of the companies that are tied to the mortgage market do present compelling valuations right now for the truly long term investor 6, think 3 to 5 years. But in the near term you've got a lot of credit term while that the Fed has effectively delayed maybe or trying to make a softer landing by lowering rates. But that remains 7 to be seen. I think you've seen the housing data coming out, and we're coming to a holiday season, Retail 8 Wise that could be quite weak because of that. So it's a really kind of a wait-and-see approach with the market right now whether that there are pockets of attractive valuations.

What was striking on Monday was that we had two big banks, City Group in the United States, UBS in Switzerland coming out and effectively cleaning up their balance sheets, taking big hits which was ugly and painful. But essentially moving forward with a lot of the bad news certainly already out there. Their stocks went up quite sharply. Do you think that it will be that easy for some of the other banks to cast off some of these sub-prime worries.

Well, with City and UBS, they are such huge large global money banks that by writing down at those loans they can basically move forward and reallocate capital into more high return businesses right now. Some of the smaller players are gonna who are more tied to the mortgage market, it's gonna take a little bit longer for them to play out and they are gonna have potentially some more restructure and some more pain/ to go through on their balance sheets. But for the larger players I think the market was expecting even worse just because of the severe liquidity crunch 9 in August. And seeing at least some clarity along those lines, you know, was a relief to some investors 10.

Let's look at the broader world scene because we are seeing a great deal of strength clearly in Asia. Do you suspect that Asia rather than Europe and certainly rather than the United States is gonna be where the excitement will be, if you like for equity 11 investors in next few months possibly years?

Well, Charles, I will tell you this. The highest growth areas in the world right now are in Asia. Really you look at all the Asian countries you know clearly led by China which seems to be on everybody's tongue these days. But that's where the highest growth is. That's where so many of the manufacture and production, jobs have moved. And in Asia it's basically reengineering I mean you can also think about Japan 20 or 30 years ago when they were going through their growth period. I mean so many countries in Asia right now are in that type of growth phase where just the average consumers are gonna be buying washing machines, driers, refrigerators, cars. And there are gonna be a huge amount of growth and expenditure 12 by them as they become more of developed countries more than the 3rd world countries.

Notes:

Liquidity: Available cash or the capacity to obtain it on demand.

Citigroup: International financial conglomerate 13 with operations in consumer, corporate 14, and investment banking 15 and insurance.