j
Member of DD Central
Penguins are very misunderstood!
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Post by j on Aug 26, 2015 8:10:49 GMT
With things going off in China, if it all leads to another market crash, what will the effect be on p2p lending mid-long term (I doubt there will be much of an efeect short term)?
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ribs
Probably not James Marshall
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Post by ribs on Aug 26, 2015 8:35:55 GMT
I highly doubt there will be a "crash". This is more of a "correction". The prices have been too high for too long, and many people have been expecting a drop. Some have been expecting it since 2012, I've personally been expecting it this year or first half of next year.
Honestly, I think the impact will be fairly minimal by any measure. The Chinese will be going through some pain, but in Britain and the EU there will be an impact in the short term, but I fully expect it to be business as usual after a few weeks of a bumpy ride. This is not another 2008. Probably.
The Chinese economy is having to transition from a manufacturing economy to a consumer economy, and that will be painful for them. The Chinese government interfering with the market like this will only delay the inevitable and will probably make it worse in the longer term. The government is learning some painful lessons about how much they can control.
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Post by Deleted on Aug 26, 2015 9:22:33 GMT
Very little volume in the recent crash, most serious traders on holiday, on the other hand the effect in say Australia will continue to be hard and I would avoid commodities for a few months, still watching gold and looking forward to $1050 sometime in the Autumn.
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Post by domUP on Aug 26, 2015 10:55:50 GMT
I wrote a blog about this here - www.investup.co/news/How-the-global-turmoil-will-affect-crowdfunding/In short it could be a good opportunity for crowdfunding to grow and become more mainstream. But then again who really knows. As Ribs says transitioning China into a consumer economy at that scale is brutal. The global markets are fickle beasts and probably far too intertwined so expect choppy times.
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james
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Post by james on Aug 26, 2015 12:31:54 GMT
Just markets being markets but it will encourage those who don't like equity risk to look at P2P, while discouraging some who think that all investing is high risk.
Personally I've been gradually shifting my investments to P2P in anticipation of the next big market drop, given that I can get equity-like returns from P2P so I'm not losing out long term, or not much. Around 15-20% so far. I expect to move all of my ISA money into P2P ISAs as soon as sensibly practical once that option is available. Non-sensible would be things like borrowers or platforms exploiting the initial surge of money, say, or after a big equity drop has happened instead of before. On the pension side I'll do a lot of moving into P2P once I think there's a good value platform to move the money to and a suitable range of P2P options that interest me. Most of my investable money is in ISA or pension tax wrappers so getting those in place will cause a large increase in the amount I can put into P2P.
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Post by ablrateandy on Aug 27, 2015 21:47:59 GMT
I wouldn't expect a massive impact to P2P or P2B really. Non-Chinese bank exposures to China are very small because it has always been hard as an "outsider" to do business there. During the last crisis the problem was that banks were exposed to losses directly. In this case, HSBC and Standard Chartered are probably the only two UK banks with any decent exposure, and it is probably negligible in the grand scheme of things.
China is selling down some of its US Treasuries and that will cause a bit of a tremor because they have so many of them.... but that very fact means that they will never dump so many that they incur massive mark-to-market losses. It will make treasuries a little cheaper vs LIBOR and that means that credit will become a little more expensive, buy you are only looking at a 0.1-0.3% move I suspect. That won't be enough to cause too much of a bump.
The bigger driver is cashflows.... I don't think that Monday was a blip - I personally think that equities are massively over-valued and that Monday was advance warning that their is an inherent weakness there. As more people start to think that, you'll see more people looking to move out of equities and into other things.
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Post by domUP on Sept 8, 2015 14:17:35 GMT
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mv
Member of DD Central
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Post by mv on Sept 8, 2015 14:27:00 GMT
Although his role in investUP is in his profile he doesn't state his massive COI in the piece...He seems to imply that he is a novice crowdfunder rather than the COO of an ambitious platform supermarket!
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Post by domUP on Sept 8, 2015 14:42:44 GMT
Might tell him to add a disclaimer alert ha!
I'm liking the sound of "ambitious platform supermarket."
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