HSI Yearly Range

HSI yearly range usually 7/8000 points.

It's heading towards 9000 or more.

Would it breach 10000 as its new yearly range？

An Island Top in the making Today

Check out this daily chart of HSI, if today's closing is as the chart shows, a gap existed between yesterday's low and today's high, an island would have been formed pushing HSI way lower than what's achieved only last week.

A Banking Crisis

Look at Credit Suisse prices.

What would happen to HSBC？

A banking crisis coupled with likely a EURO & EU crisis is likely to happen and very soon.

The Global Economy in the future

We haven't seen any special observations leading to the following guesstimate, but my hunch is it is likely to happen.

Will the US do further QE in the future, likely and not likely.  

Why likely, only in extreme circumstances like Covid, a depression or a war involving US directly which cannot be ruled out of such happenings in the future.  

Why not likely, the Fed would like to keep the government spendings in check and also to re-establish the credibility which it has lost since leaving QE on for too long creating serious inflation.  Another reason is labor gets even tighter going forward since Covid pushes more people [who can afford] to retire early or has since retired because of life uncertainties.  This huge group of retirees will need big labor to serve their retirement which wouldn't be easy to cover entirely by government and labor costs will keep rising as people retire.

If interest rates remain high in the range 3-5% for medium to long term, investments are more difficult to come by and with a smaller young population, it won't be easy to make enough returns to justify them.  US government will pay more interest leaving it unable to serve its citizens for the good life they enjoyed back in the years between 1990-2020.

Economies around the world will then teeter on the brink of recovery and recessions more often as interest rates are unlikely to drop as much as before to feed speculations and investments thereby reducing returns from stock and bond markets.

HSI rebound might falter

Federal Reserve officials back moving interest rates higher in order to slow the economy, minutes show: https://on.mktw.net/3QS7GSI

The news above add pressure to stocks moving up except a quick short squeeze.

COVID 3 Enemies

抗疫3宝

Vitamin D

洋蔥索

綠茶素

Green tea extracts and quercetin as well as Vitamin D have science research support they are effective against Covid.

Study: Vitamin D Deficiency Linked to Severe COVID

https://www.webmd.com/lung/news/20220208/vitamin-d-deficiency-tied-to-severe-covid

Trump taking high dosage Vitamin D

https://www.insider.com/science-behind-supplements-trump-taking-coronavirus-zinc-vitamin-d-2020-10

Data support further clinical evaluation and development of EGCG (from green tea extracts) as a novel, safe, and cost-effective natural product for prevention/treatment of SARS-CoV-2 transmission and infection.

https://cellandbioscience.biomedcentral.com/articles/10.1186/s13578-021-00680-8

Benefits of using Quercetin in Covid

https://www.pharmaca.com/projectwellness/whats-the-relationship-between-quercetin-covid-19/

HSI rebound

As recent as only a week or two ago, HKD is tightly weaved to the uppermost bound of 7.85+/- a few 0.001 points.

This weekend, it's suddenly moved to 7.834/7.839.

The USDHKD rate is a sound indicator of HSI direction at least for the short term.

How high is it going to go though？

HSI can easily has a ride of 1500/2000 points rebound from the recent low of 19500.

There's still a catch, USDHKD rate must stay at or be better than today's rate.

So you have 1000/1500 points ahead, good luck.

Berkshire Hathaway investment decisions

How do you interpret BH continuous investment in OXY and its likely decision to dispose of its stake in BYD？

The decisions seem to contradict each other, why？

If EV maker BYD is successful, it will likely reduce gasoline usage and thus reduce dependence on oil, therefore impacting oil stocks.

But if you look more closely, the decisions might not look so contradictory.

It's unlikely all motor cars on the road can switch to EV although many countries in the West make promises to go green and reduce combustion engines by certain dates.  Recent research suggests there's not enough lithium on earth to be turned into car battery for EV use, thus EV market share could plateau off if lithium batteries become exhaustively expensive after EV grew to a certain percentage of market.

Given current inflation rates, EV might reach the plateau even earlier as oil gets expensive, everything becomes more expensive and thus pushing lithium battery costs too high to compete with internal combustion cars.

If there are other types of car battery becoming popular before EV comes to its demise, they might still save EV's future.

Some of them being sodium battery and solid state battery which had already been tested in lab, whether they can fit into current EV without major manufacturing changes remains to be seen.  Any major changes to the car manufacturing process means another round of investments by EV maker which might bankrupt many of them as some haven't yet turn a profit.

So BH decisions may make some sense.

Are interest rates going down？

If you believe interest rates will soon go down, check out recent action by Apple.

https://on.mktw.net/3JjxUes

Why would Apple raises medium to long term funds if interest rates were to go down soon, why not wait？

Your Guess of future direction

Check out the above charts.

One is NVR, a US stock, back in 2008.

Another is HSI, HK stock index, from 2008 till present.

Both charts show you an uptrend being broken and fell off sharply.

NVR experiences indicate falling off a rising trend will bring price back down to the start of the trend, in fact, such behavior repeated itself in a very short while.

HSI haven't traced such behavior because the rising trend is formed over almost 13 years, falling off the trend will probably take quite a long while to get it to the starting point, if it ever will.

Any readers who can throw some light on HSI future behavior, please comment below.