Banks

(Further mails a few days later.)

****************************

Dear LS,

With further meltdown of financial system in US and Europe, those foreign banks will beg you to buy their holdings of CCB at very bargain price in the next several months. There is no need to rush.

I am still confident that HSBC’s economic franchise and monopoly will ultimately be realized with the fall of all other international banks and even insurance companies ... but there is mounting evidence suggesting that the worst of HSBC hasn’t arrived yet and the proposed price of right issue is actually unsafe. I am also quite disappointed with the decline in its corporate governance, which does not match its track record in 20th century.

If it falls further, I am sure the 3 big brothers (CCB, BOC and ICBC) will become the major shareholders of HSBC before British government can take any action (because it will be going bankrupt as well).

How can we Chinese find a better way to revenge the Opium War by acquiring HSBC as a Chinese bank?

Warren

****************************

Dear all,

I think HSBC is really disappointing in the way they handle the present situation, especially when compared to Standard chartered. I think the current problem is not about buying the issues or not, it's a matter of holding on to HSBC or not. If one decided to hold on I think one should buy the issues. But if the stock price continue to fall to approach $28, no one will buy the issues and I think it will end up in further disaster. Therefore one of the important factor will be the stock price in the coming few days.

Warren might be right perhaps putting the same money into 2888 (for emerging markets), 11 (for HK), and 3328 (for China) will fare better if the only portion making money in HSBC is from the above.

I haven't decided yet, I will decide next wk.

Cheers,

TW