BUZ LIVINGSTON: Springtime in South Walton

Published: Tuesday, April 22, 2014 at 08:39 AM.

China could be facing a sharp downturn, too. Their official 7.5 percent GDP growth could be sheer fantasy. According to a recent Morningstar report, the Chinese financial sector holds tons of sketchy assets. Non-performing loans and other bad debt are routinely handled by extending maturities.  Chinese bankers also repackage bad debt and sell it to individual investors who savor higher yields. This will not end well.

Chinese land prices increased more than 12 percent, after inflation, last year. Chinese consumers are ignoring a lesson Americans know very well. From 2008 to 2013 Chinese mortgage debt, as a percent of disposable income, shot from 18 percent to more than 30 percent. If prices head south, small savers will be wiped out. Twice last year, the Chinese central bank staved off a liquidity crisis by pumping more money into the economy. If you rebalance your portfolio regularly, let the market timers worry. Check out the beaches, fish, kayak, bike and enjoy South Walton’s beauty. 

Buz Livingston, CFP has a Blue Mountain Beach based fee-only, hourly financial planning and investment management firm.  For more information, visit www.livingstonfinancial.net or come by our new office at 2050 Scenic 30A, M1-Unit 230, Redfish Village.

 



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