August 18th, 2009
In this post in TheMarker, 5 experts have expressed their opinions regarding why the stock markets are about to collapse again. Jeffrey Gundlach has also predicted about this collapse that is about to come, he was amongst the first ones to warn that an era of easy money would come to a bad end. The stock market’s recent rally is likely to run out of steam soon and there are very high chances that equity prices may collapse again.
I agreed with this estimates and converted 100% of my stocks and company bonds to cash. I am desperately waiting for the new wave of 2009 that will take us back to a bearish market…
August 6th, 2009
Great interview of Shlomo Yanai CEO of Teva about the big drug manufacturers going into the generic market. Here is the original interview. In the next month i plan to write to more articles about Teva, one that will cover the big drug companies globably and the other about Teva’s potential to penetrate the Chinese market
August 1st, 2009
The economist inteligence unit just wrote in its July Global Economic – update:
“The US real GDP forecast for 2010 from 1% to 1.4%, but has downgraded its US 2010 forecast from growth of 1.4% to 0.8%. It says that in view of the likely continued weakness of domestic demand, a renewed weakening is likely in 2011 when stimulus measures start to fade. It is forecasting that the US budget deficit will be close to 15% of GDP in the next two years.
Chinese growth for 2009 has been revised upwards to 7.8% (from 6.8% previously), but again, the EIU forecasts Chinese growth to ease slightly in 2010, to 7.4%, again as the impact of the stimulus wanes. It says China’s export picture remains subdued.”
One thing that i remember from Macro economics is that the only force driving inflation is deficit. 15% is a hugh deficit! I would expect inflation levels in the US to reach 5%-10% within the next 5 years. This will drive interest up to 5%-10% compared to 0% today and will result in the USD devaluating vs most major currencies. Long term bonds yields can jump from 3% today to 10% within 5 years. Buyers of these bonds today can suffer from the capital loss of 50% on 10 year US bonds. in addition, if we take into account the currency devaluation that i predict, these investors can lose up to 70-80% of their initial investment – if we will measure it in RMB or Euro.
THIS IS PROBABLY THE BIGGEST BUBBLE IN TODAY’S GLOBAL ECONOMY.
How can we make money from this as individuals?
1. Buy TBT index fund which actually short US treasury bonds.
2. Avoid USD investment and hedge the currency risk if we do invest in USD assets (like the great opportunity of real estate in the US).
How can we protect our business as managers and entrepreneurs?
We should hedge the RMB appreciation risk (I estimate that USD/RMB will be at 4.00 in 5 years) by doing annual forward deals in the major banks.
July 27th, 2009
This post in The marker is one of the best i read about real estate invesment in the US. Enjoy!
July 26th, 2009
Last Saturday I did one of the things that I don’t like very much – sorting out my paper files. We return in 10 days to Israel and the moving company will arrive tomorrow. To my great surprise I actually enjoyed the process and it was not the chore I thought it would be. I found myself reading documents that were written 3 years ago about business plans and ideas that went through my mind at the time and checking back on them with 20/20 hindsight was quite exciting. It reminded me of browsing pictures from my youth, or from my 7 month trip to South America. We’ve spent 4 years in Beijing. The experience has been amazing and I’ve enjoyed almost every minute of my “China” experience. It’s hard to describe how many different new things we have experienced here. We have learned Chinese. Even after 4 years it still remains the toughest language for me in the whole planet. We have started up 2 internet companies that together employ over 30 employees. All are very devoted and form a strong family like culture. In both websites combined – over 40 million unique visitors have visited so far. I can’t grasp this number – 40 Million! I got so used to this number that I forget to stop for a second, breath and look at the achievement. I managed to sing “Lan Lian Hua” in Chinese several times. We have raised over 2 Million dollars from investors and generated many long lasting friendships.
Change in priorities
We arrived in China as a couple and we return to Israel as a family with 2 children. I can’t describe the intensity of our love for them. The part I miss the most is sharing the joy of raising them with my family in Israel, particularly our son’s grandparents. It’s hard to believe that after 4 years in China, I have nothing bad to say about China. I love this country. I enjoyed living here and I admire the way this country is managed. It is clear to me that China’s role in the global economy will become even stronger as we move forward. The progress I have made in my personal career here in China is huge. I feel that every year in China was equal to 7 years in any other country (very similar to a dog’s year). The intensity and the speed of change and development is so much greater than Israel. Most of the circumstances show me that China is and will continue to be the future. But something in my gut and my heart, something that I can’t describe in words, directs me back to my family in Israel.
Special Thanks:
The 1st, is to my wife Irit, who has supported me during the ups and downs. Without her I wouldn’t have gotten past first base. The 2nd is to my 2nd “wife”, Guy. Guy has been my Yin and my Yang over the last 4 years and helped me balance myself and Meijob. The 3rd goes to our lead investor and member of the board Arik, a true angel, if ever there was one. To the Meijob family: Philip – for following our vision and values with such devotion, your management capability and the passion you have for people and your desire for them to achieve their personal best. You are one of the best managers I’ve had the pleasure to work with; Evelyn – for the biggest heart I ever met; Lika – that I would have taken in a suitcase with me to Israel; Jackie – One of the best developers and devoted employees I’ve ever come across; Gil – for the great initiatives, charisma and management capabilities; Hongyin – for making Meijob’s development procedure robust and organized; Saprina – for leading the marketing with great results; Helix – for mastering the SEO and PPC while leading Meijob to new traffic records; Vivian – for the distance she made in 3 years in her career at Meijob; Alon – for the great improvement in our Employer site design; Eric for the attention to details that makes our site strong and healthy; Fei Shuang ge – for the great development of our Employer site and matching algorithm; Angela – for taking over Susan’s responsibility with enthusiasm; Mei for the love she projects to her environment; Rui – for running the daily operations of the office and last but not least – Andy for taking over the IT operations, developing our office, as well as our website’s IT environment and a tremendous ability to solve any problem that presents itself. I want to thank you all and let you know that I carry you in my heart, no matter where I am, you will always be with me and you will always be a part of me. Having co-Founded Meijob with Guy Rotberg, I will continue to influence and challenge the strategic direction of the business in my role as a Director of the Board in the hope of making our dreams come true.
My love to you all, Barak
July 20th, 2009
In this post in The Marker Eitan Avriel write about different investment opportunities in Israel with major focus on Real estate. The 2nd post is about guidelines for investment in Real estate in Israel.
July 20th, 2009
In this post in the marker, written in Hebrew they quote the economist Big mack index and predicts that the Euro is over valued againts the dollar in 30%.
I think that this index is not accurate at all and might lead to the wrong conclusions. If European salaries and real estate price is higher than the US than of course it will be more expensive to create one big mack in Denmark than in the US. that does not mean that the Euro is too strong… Actually i think that the best indicator is the trade balance between the European union and the US which shows that most European countries and Germany in particular exports more to the US than imports. This is a clear indication for me that the Euro is not strong enough and definitely not 30% over valued… I wrote more about this issue here…
July 19th, 2009
The following post compares the top 10 chinese stocks in terms of market cap.
Baidu is by far the stock with the highest P/E – I would strongly recommend to avoid investing in Baidu in the current stock levels.
July 19th, 2009
So what is a better investment? Real estate or Stocks?
The following graph shows a very interesting picture
