Chinese LLLL.com bubble!?

[freezer]

Is it a somewhat good estimate that
chinese LLLL.com premiums are at at least $1billion value today?
Unlike Number .coms chinese premium LLLL.com boomed in value in a very short period.
Will they hold their value or is it the biggest BUBBLE ever seen in domains?

Share your thoughts please

 

[thetruman]

A better question is why do YOU think you know the future.

Because I'm just saying that markets can fluctuate wildly and quickly and that people should be aware of that, and that the price can fall sharply just as it has risen sharply.

Whilst you don't want to even entertain the possibility that these prices could crash. Which is negligent and highly naive.

You live in the EU where anybody selling or advising on any investment has to make it very clear by law that the value of any investment can rise or fall.

Anybody who doesn't even entertain the prospect of a decrease in value should not be taken seriously.

it looks you know everything. Why you bother? it really seems to be your approach. I have checked domain prices for the period 2007/08. There was an increase just for the "western premium" while the other were still selling at 30$ to 100$. Now is a completely different environment. You can t apply your golden rule that "anything that goes up have to crash". We (and it includes you) don t know at what stage of the cycle we are. IMHO we are just at the beginning of a cycle. You might disagree, fair enough. But time will tell, not surely yourself

 

[Kate]

The whole Chinese economy is going through a bubble. When the crash happens, the impact will be felt on the domain market as well.

 

[DomainGist]

The whole Chinese economy is going through a bubble. When the crash happens, the impact will be felt on the domain market as well.

Exactly.

 

[DomainGist]

it looks you know everything. Why you bother?

You don't need to "know everything" to see that China is heading towards a major crisis.

Why do people have such short memories or such a lack of understanding of what happened in 2008 in the Western world?

China's boom is built on massive levels of debts, banks are leveraged to the hilt, it will be the biggest "credit crunch" the world has ever seen. Their growth is being superficially maintained by huge amounts of unsustainable debt creation.

You don't need to "know everything", only need a basic understanding of economics and money markets to see that the Chinese are heading for a period of great depression.

I'd have thought an Italian of all people would understand the impact of a triple dip recession, over leveraged banks, a property market collapse, a weakened currency and high unemployment.

It just defies any sort of conventional wisdom for people to expect the value of domain names to continue to rise in a slowing economy or hold value in a contracting economy.

Italy may not have been too big to bail out, but China is.

 

[thetruman]

prior to 1980 China never had a recession.
DEFINITION of 'Recession'
A significant decline in activity across the economy, lasting longer than a few months. It is visible in industrial production, employment, real income and wholesale-retail trade. The technical indicator of a recession is two consecutive quarters of negative economic growth as measured by a country's gross domestic product (GDP);


during the western latest recession China was growing check
China currently holds 8% ot total US debt. that means technically that it holds US balls.
China has a centralized government/ policy which can shift policies without asking permission .
Another recession? well possible but not in China
we italians understand much more then you can think.The fact is that we are binded in this silly European nosense

 

[DomainGist]

I see there is literally no getting through to you, so lets leave it there.

Anybody with half a brain will read this: "Another recession? well possible but not in China" and realise that you are either utterly deluded or simply have no idea whatsoever what you are talking about.

 

[frank-germany]

are you in despair or fear?

I buy your 4l.com CHIPS

 

[thetruman]

yes leave it there- your vote is for the bubble , my vote is contrary.

 

[thetruman]

are you in despair or fear?

I buy your 4l.com CHIPS

I think he is just a chronic pessimist , right the person I don t want to have a coffee with...

 

[DomainGist]

I think he is just a chronic pessimist.

Depends which way you look at it, I spend about $30,000 a year importing products from China. A collapse in the value of the Yuan would be a positive thing for me, I'm a buyer.

It would be a bad thing for anybody selling anything into China, whether that's a physical product or an intangible asset like a domain name.

So you could argue that I'm the eternal optimist.

 

[frank-germany]

if you lose on income taxes or domain makes no difference

 

[mitok]

China's boom is built on massive levels of debts, banks are leveraged to the hilt, it will be the biggest "credit crunch" the world has ever seen. Their growth is being superficially maintained by huge amounts of unsustainable debt creation.

You are talking about US or China? Or both?
Yes, crisis is possible and will come for sure. When? Nobody knows! But it will affect LLLL.coms just as any other premium one word keyword .com, real estate market, auto industry, paintings, postal stamps, football market, advertisers etc. So according to your sayings it would be the best choice that nobody invest in ANYTHING.

BTW, besides experts on domain market, another huge bubble is dollar! Yes, it will go more up soon after expected FED decision, but it is one of the biggest bubbles the world has ever seen. And this bubble is not new, but STILL GROWING. If LLLL.coms really are a bubble like you said, you cant be sure it will burst soon. As US have enough military and diplomacy power to maintain their dollar bubble, Chinese investors have enough cash to maintain LLLL.com "bubble".
You mentioned economics, if you really understand economics then you must agree or I cant talk with you about economics.

 

[thetruman]

It would be a bad thing for anybody selling anything into China, whether that's a physical product or an intangible asset like a domain name.

not exactly. Chinese, forecasting a devaluation of the national currency buy assets that are liquid and denominated in another currency and are available anywhere in the World. Yes I am talking of domain names.

 

[DomainGist]

buy assets that are liquid and denominated in another currency and are available anywhere in the World.

They will look for alternative assets, yes, but not assets where the demand is almost entirely being driven internally.

It isn't Russians, Americans and Brits driving the demand for Chinese premium LLLL domains is it!

Look, we'll wait and see.

I do understand that somebody who holds a particular asset will only want to "talk up" that asset, and won't want to "talk down" that asset.

I'm merely pointing out that if late entrants get stung and you get out in time, you won't be shedding any tears for them.

As somebody who has no current horse in this race I've got nothing to win or lose. You have, so as long as we clear that one of us has a bias because of a declared vested interest and one doesn't then lets just agree to disagree.

 

[thetruman]

good discussion, just wanted to point out the other side of the coin. Undoubtably chineses are buying domains not as investment and neither to build websites on them (or partially not). The flow of capitals out of China is huge and this is one way to hide them securely in a safe and not-audited space.By the way my investment in the chinese space is limited. I rather prefer good brandables or keywords. But I think is worth to diversify on the chinese market

 

[thetruman]

plus I forgot to mention how china is behind on the web market at world level. We are talking big numbers and themarket online is a big share of the economy. This means there is need for acquire domains that is your space on the web. Put all those pieces together andyou will see that the potential is immense

 

[accent]

A bubble is where a price grows beyond rational levels.
A REVERSE bubble is where a price is held down below rational levels, for example by government policy or superstition.

LLLL.com WAS a reverse bubble. Ever since the buy-out, and long before, many people have said that 460,000 LLLL.com domains was a tiny amount compared with the world potential of the internet - and that the LLLL.com price should align with LLL.com. This mis-alignment was seized on by Chinese investors as a buying opportunity when the Chinese government changed the rules encouraging enterprise.

Now the CP LLLL.com floor is (very roughly) 1/20 the CP LLL.com floor and the non-CP market is moving to 1/26. I suggest the market is now at (near) balance. There is no bubble - there was a reverse bubble, now corrected.

One inference from this line of thinking is that I would not expect a large increase in LLLL.com prices from here without a similar % increase in LL and LLL.com.

 

[Recons.Com]

Bulls and Bears fighting it out...

Don't see the point in getting overemotional.

If somebody shares his/her honest opinion (unless it is an invite into a scam), see if you can use those insights and ignore if you cannot. No need to attack the source.

 

[Weber]

You don't make money with domains being a bear.

 

[domainventure]

Technically you can. Downplay a category of domains as bad, prices start falling, swoop in and buy some, resistance points get built, leading to more buys...of course I am oversimplifying it and it happens over a period of time.

Everything is cyclical, as long as the demand and supply sides have strength in numbers. The current domain market is a microcosm of what is being played out in the stock markets at a larger scale.

You don't make money with domains being a bear.