European Debt crisis, China credit tightening,Global exit strategy impact on global stocks


 Comment by  Dr. Warren Huang on Yahoo, Wall Street Journal Market  Blog May 10, 2010 I predicted on Sept 2007 Wall Street Journal Real Time Economics, Market Beat blog and this blog that the burst of  US and global super housing prices bubble will repeat 1980 style last through 2010 with double dip recession and stock market rebound and correction due to excessive stimulus , zero interest and trillions liquidity into the financial and economic system. We are in the second stage of recession recovery , the global debt bubble burst crisis with public debt over 6- 12 % of GDP, starting with Greece, US, Spain, Portuguese were caused by easy credits, excessive liquidity resulted debt  and asset ( equities, commodities, housing )bubbles burst. Global stock markets rally over Euro trillion bail out fades in one day due to US and global stocks investors and economist are overoptimistic about US 1 Q GDP growth at 3.2 %, April PMI at 60, and rebound in housing and retail sales 2010  all due to housing stimulus credit soon to expire in April, and tax rebate resulted consumer spending rebound at 6 % will peaking out after May, Greece, euro area debt crisis drag GDP growth to 1 % , dollar appreciation from 1.5 to 1.26 euro will further slowdown US export growth in the second half  , China credit tightening slow GDP to 8 % by yearend , India, Austria, Korea interest rate hikes will slow down GDP growth , leading to US export decline related  while any further exit strategy, credit tightening, inflationary control, rate hikes will lead to economic growth  double dip to below  2.5 % by yearend . US stocks are extremely overpriced , subject to 20- 30 % correction Dow Jones, Nasdaq, S&P stock index forecasts Dow Junes will be return to consolidate in 9000- 9900 soon , NASDAQ test 2000- 2200, S&P test 1000- 1100 , China Shanghai A index 2250- 2500, Shenzhen A index 9000- 10000, Hang Seng Index 16000- 28000, Singapore st. index 2600- 2800, Taiwan Index 6600- 7200, London Financial Times 4800- 5000, Dax index 5000- 5500 and may test in second financial , recession crisis double dip triggered by Greek and PIGS countries debt crisis, China/Asian slowdown Details on  

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