Yesterday Hong Kong just saw the first interest rate hike in 12 years finally despite it is the 8th hike in the U.S already. This first hike did not put much impact on the local stock market but there are more concern on the property market though.
Many experts related to the property market commented that the impact is minimal because the hike is merely 0.125% so the installment increment is just HK$60+ per every million dollar mortgage. That will translate into absolute dollars for an averaged size property around $300 per month and that should be well within the affordability. Therefore it will not bring much pressure on the property market even if a few more hikes are expected in the coming two years.
It is true that the increment on the installment amount does not and will not apply too much financial burden to existing flat owners especially to those whom became owners more than five years ago because the price of their properties have risen much already while on the other hand the outstanding loan reduced. Perhaps new owners are those most concerned.
However, the above opinion is one sided perspective only. The majority of property market, in term of quantity, is residential ones while this segment is also divided into two categories, in terms of purchase purpose, ie,, dwelling and investment. The above mentioned opinion is applicable mainly on the property owners with the former purchase purpose. Since their properties, most of the case the only one, are for own consumption and they need dwelling anyway disregard the rise of interest rate on their mortgage. They don't seem to be likely to sell their own dwellings even if there is a rather big hike in the interest rate in the future. The most possible extent of the impact is only on the people whom are currently thinking to buy their home and the increment on interest payment could likely make their purchase to be put aside. Yet there will not be a price pressure arising from a massive selling.
I think this is the rationale behind the opinion that those experts advocated the impact will be minimal. Nevertheless they ignored the view from the other category of residential owners with purchase purpose as investing. Their properties is for investment only and most likely it is only part of their investment portfolio which is constantly under review to see whether risk and return are in proper ratio. Hong Kong property market has an high degree of internationalization meaning apart from local people whom bought for own consumption as well as investment but there are also overseas owners purchased Hong Kong properties just for investment. Despite local buyers outnumbered overseas counterparts but the movement of the latter should not be underestimated especially in the luxury segment of the market.
The return of Hong Kong property investment sits around 2-3% only which is not particularly attractive especially after a consecutive 28 months upward on the price index. Investor owners, both local and overseas, mainly eye on the future appreciation on their properties rather than relying on the rental income due to the low return. Despite the forecast on continuous interest rate hike will not lead to a major correction but if the steam of the price appreciation is expected to lose somehow. The investment on Hong Kong property is no longer attractive considering the low return it can provide.
When the hope of further price appreciation becomes slimmer while the return is just 2-3%, it might trigger the smart money to look for safer place to put their investment on. Recently the yield of the 10Y U.S. Treasury Bill is 3.06% which is considered as a risk-free investment. The return of Hong Kong property investment is really unattractive considering the potential downward movement in case the Sino-U.S. trade conflict worsen in the future. Furthermore, the U.S. interest rate hike is yet at the end so the comparison starts to become against Hong Kong property.
In an highly open economy like Hong Kong, price of different investments is driven not only by local factors so being an investor in Hong Kong market should review the situation with international perspective. Local investors should put them into their overseas counterparts' shoe to see what they think and how they want to allocate their assets globally. Local investors should have a view on when there is a change in their existing allocation in Hong Kong market then what likely the outcome is.
The impact on interest rate hike could mean far more affection than just installment increment.
2018年9月29日 星期六
2018年9月20日 星期四
Artificial intelligence, a destructive goodie?
A.I. has immersed in our everyday life with or without our awareness. Many jobs used to be done by human is now handled by computers. People see a more efficient way doing things. For example, auto spell check corrects typos and even anticipates the next words that greatly increases typing efficiency. The success of search engines are largely attributed to the employment of this technology. Most of the people, except those their jobs were replaced by A.I., embraces the convenience provided by this goodie.
However, in my earlier post myth on A.I. I am quite skeptical on this technology in the long run. It is true A.I. did bring us a lot of benefits that basically one is impossible to live without it now. The immediate drawback is jobs replaced while the ultimate concern is whether A.I., when combined with robots, will eventually become the master of human being. However, it seems there is an intermediate threat to the common folks as well.
If one agrees the concept in my post salarymen slaves that the world is factually governed by the few super rich families and most of the people in this world is only free ranged slaves to create wealth for these Families. When A.I. and robotic technology are so sophisticated that it can do most jobs at present done by people then do these super rich families still need to keep so many slaves? In their eyes slaves are nothing but tool only. Their existence serves only one purpose, ie., to work and produce value for them because so far most of the productive functions must still be carried out by human. It is something like why farmers rear milk cows but if one day milk can be manufactured without cows at all in more economical way then there is no reason to waste resources to keep them.
Just imagine in the days when doctors, composers, cooks, pilots...etc are no longer necessary. Let alone those less skillful workers. 90% of the world population becomes dispensable. There are only two categories of people still find their places in the world. The first one is of course the super rich families who are the true governors of the world while the another one is the super smart brains in my post new class of illiteracy whom are needed to maintain or further develop the A.I./robotic technology. The rest of the world population will become burden rather than assets (for wealth production). After all they still need to be fed even when they are of no value any more. Meanwhile the huge world population is one of the reasons attributed to the world pollution. On the other hand the super rich families and these smart brains can enjoy much more per capita natural resources when the dispensable population is eliminated. Isn't it a big temptation on such move?
Watch out! folks!
However, in my earlier post myth on A.I. I am quite skeptical on this technology in the long run. It is true A.I. did bring us a lot of benefits that basically one is impossible to live without it now. The immediate drawback is jobs replaced while the ultimate concern is whether A.I., when combined with robots, will eventually become the master of human being. However, it seems there is an intermediate threat to the common folks as well.
If one agrees the concept in my post salarymen slaves that the world is factually governed by the few super rich families and most of the people in this world is only free ranged slaves to create wealth for these Families. When A.I. and robotic technology are so sophisticated that it can do most jobs at present done by people then do these super rich families still need to keep so many slaves? In their eyes slaves are nothing but tool only. Their existence serves only one purpose, ie., to work and produce value for them because so far most of the productive functions must still be carried out by human. It is something like why farmers rear milk cows but if one day milk can be manufactured without cows at all in more economical way then there is no reason to waste resources to keep them.
Just imagine in the days when doctors, composers, cooks, pilots...etc are no longer necessary. Let alone those less skillful workers. 90% of the world population becomes dispensable. There are only two categories of people still find their places in the world. The first one is of course the super rich families who are the true governors of the world while the another one is the super smart brains in my post new class of illiteracy whom are needed to maintain or further develop the A.I./robotic technology. The rest of the world population will become burden rather than assets (for wealth production). After all they still need to be fed even when they are of no value any more. Meanwhile the huge world population is one of the reasons attributed to the world pollution. On the other hand the super rich families and these smart brains can enjoy much more per capita natural resources when the dispensable population is eliminated. Isn't it a big temptation on such move?
Watch out! folks!
2018年9月2日 星期日
Who are you?
We perceive the world through cognitive function in our brain. Cognition lies largely on our memory. A baby was taught that was a mug when he first saw it then this memory stayed in his brain. When he sees the same object that matches the cognition in his brain via pulling out the same image from the memory, he knows he is seeing a mug again.
In our daily interactions with the outside world, people form cognition on the outside world as well as themselves. One thinks he is a good person because he remembers he has done many good things like he is nice to people, he works hard, he cares about the people he knows....etc. All these favourable behaviour are stored as memories in his brain so he perceives himself as a good person.
Therefore memory is a cornerstone on the formation of how one perceives self, ie., who he is. This appears quite alright because memory is a very private and personal belonging that one owns one's memory and it is just stored in one's own brain and no other one has access to it so as possible to manipulate it. Or does it?
Many of us knows hypnotism can reach the subconsciousness in our mind and even manipulates it for therapy on mental issues. This is good but it could be bad as well. A reconstructed subconsciousness means a change of perception. When ill-done, the change of perception could be manipulated in favour of some ill-minded purposes.
As science advances, neuro-technologies is capable in altering one's memory or implanting segment of memory that even not exist at all. Likewise removal of some memories from the human hard drive is also feasible. Our brains appear like computer hard drives more than ever in front of those whom control these technologies. Naturally such researches need heavy funding so none of them are autonomous without any governmental sponsorship. The risk to the common folks is that "trouble markers" in the eyes of government can possibly be re-engineered to be sheeps. Salaried slaves can also be produced in mass production for a constant supply on cheap labour force while the society will be in more harmony ensuring easy ruling. With the memory manipulation technology the authorities has the access to more easily programming a person's character in order to have him/her to perform a specific task for the government.
Some may argue that how the masses will be receptive to the manipulation on their memories. Naturally like all conspiracies the project will be operated in the dark. A gadget something like the flashlight in the scientific movie "Man in Black" will erase the segment of the memory regarding the process of the manipulation so the victims are totally unaware of what has done on them.
We take it for granted that we know who we are but if your memory has actually altered. You in fact did not do something which you think you did while the memory of what you have done was removed. Are you still the actual one that you think who you are? Is what I am talking about only the episodes in scientific fiction movies? I am not really sure. I just hope that I am day-dreaming only.
In our daily interactions with the outside world, people form cognition on the outside world as well as themselves. One thinks he is a good person because he remembers he has done many good things like he is nice to people, he works hard, he cares about the people he knows....etc. All these favourable behaviour are stored as memories in his brain so he perceives himself as a good person.
Therefore memory is a cornerstone on the formation of how one perceives self, ie., who he is. This appears quite alright because memory is a very private and personal belonging that one owns one's memory and it is just stored in one's own brain and no other one has access to it so as possible to manipulate it. Or does it?
Many of us knows hypnotism can reach the subconsciousness in our mind and even manipulates it for therapy on mental issues. This is good but it could be bad as well. A reconstructed subconsciousness means a change of perception. When ill-done, the change of perception could be manipulated in favour of some ill-minded purposes.
As science advances, neuro-technologies is capable in altering one's memory or implanting segment of memory that even not exist at all. Likewise removal of some memories from the human hard drive is also feasible. Our brains appear like computer hard drives more than ever in front of those whom control these technologies. Naturally such researches need heavy funding so none of them are autonomous without any governmental sponsorship. The risk to the common folks is that "trouble markers" in the eyes of government can possibly be re-engineered to be sheeps. Salaried slaves can also be produced in mass production for a constant supply on cheap labour force while the society will be in more harmony ensuring easy ruling. With the memory manipulation technology the authorities has the access to more easily programming a person's character in order to have him/her to perform a specific task for the government.
Some may argue that how the masses will be receptive to the manipulation on their memories. Naturally like all conspiracies the project will be operated in the dark. A gadget something like the flashlight in the scientific movie "Man in Black" will erase the segment of the memory regarding the process of the manipulation so the victims are totally unaware of what has done on them.
We take it for granted that we know who we are but if your memory has actually altered. You in fact did not do something which you think you did while the memory of what you have done was removed. Are you still the actual one that you think who you are? Is what I am talking about only the episodes in scientific fiction movies? I am not really sure. I just hope that I am day-dreaming only.
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