To all those arguing that the US market is greatly influenced by the China market, take a look at the S&P 500 vs. the Shanghai Composite. There is clearly no correlation. The S&P is at record highs while the Shanghai Composite is trading lower than it was in 2009.
We borrow so much money from China. It is hard to imagine they would not have to an effect on us. We had to know this day was coming.
The worlds economy's are pretty much linked. If something happens to country like China economically, other nations are going to feel it too.
What do you think will happen here once the Fed stops the artificial highs of printing and pumping money and holding rates down?
If there was one thing holding the S&P500 from moving higher this year, it would be news out of China. And like Ewing says, the Fed is proping up the markets right now. If QE ended tomorrow, I would be selling off a bunch of my holdings.
Exactly, all is maintained artificially, pretty much like the swaps and other similar deals. There are geniuses making financial engineering to levels we never can understand.
I'm not really in the business of trying to predict markets. What I do know is that the "doom and gloom crowd" have been complaining about the state of the economy for the last five years while US equity markets have charged on. Many people have missed one of the greatest bull markets, worrying about the Fed or the Chinese economy or the US dollar. I don't know what is going to happen so I just try to trade whats happening now and not try to predict the future.
I'm the same way at the end of the day - whatever happens on a broad scale here and elsewhere happens. I'm mostly bottom-up growth and value bargain hunter.
A comment on Bloomberg.com this morning: "Chen Li, the chief China equity strategist at UBS, estimates companies in China's CSI 300 Index will post a 3 percent drop in earnings this year, versus consensus forecasts for a 14 percent gain. As analysts downgrade projections to account for a weak property market and depreciating yuan, China’s biggest non-bank stocks may extend this year’s drop to 20 percent, Chen says." This is just one analysts view but it does point to a market that has its own unique problems and may even go lower if forecasts are missed. Don't even bother taking a view, its just to unpredictable.