Text size:

  • Small
  • Normal
  • Large
The Wall Street crash and the start of the Great Depression took place in a snake year of 1929. AP Photo
The Wall Street crash and the start of the Great Depression took place in a snake year of 1929. AP Photo
The terrorist attacks on September 11, 2001 that demolished the World Trade Center Towers was also a snake year. Doug Kanter / AFP
The terrorist attacks on September 11, 2001 that demolished the World Trade Center Towers was also a snake year. Doug Kanter / AFP
This iconic picture during the Chinese government crackdown on pro-democracy demonstrators in Tiananmen Square was taken in 1989, likewise a snake year. Jeff Widener / AP / PA Photos
This iconic picture during the Chinese government crackdown on pro-democracy demonstrators in Tiananmen Square was taken in 1989, likewise a snake year. Jeff Widener / AP / PA Photos
Chinese New Year decorations at Yuyuan Garden in Shanghai this month. Market players are looking in unusual places for clues about what the Year of the Snake has in store. Carlos Barria / Reuters
Chinese New Year decorations at Yuyuan Garden in Shanghai this month. Market players are looking in unusual places for clues about what the Year of the Snake has in store. Carlos Barria / Reuters

Year of the Snake not so venomous

The Wall Street crash, 9/11 and the Tiananmen Square crackdown all occurred in previous snake years. This time it is all predicted to slither to a decent finish - if the scales do not shift.

The Year of the Snake is upon us and, now that the fireworks have died down across China, market players will be turning to their analysts to see what this year has in store.

Will this be a boom year for the financial markets in China or are things looking difficult?

A surprising number will be turning to fortune tellers to see what the ancient art and belief of feng shui has to say.

Feng shui, which translates as "wind water", is the Chinese practice of arranging objects and choosing dates to improve luck. The thought system includes elements of geomancy, astronomy and folk wisdom and is linked to the 12-yearly cycle of zodiac animals.

China's economy grew by about 7.8 per cent last year - the lowest rate since 1999 - and some forecasts for this year, such as those from the Organisation of Economic Cooperation and Development (OECD), are for relatively slow growth to continue.

According to the HSBC services purchasing managers' index, growth in China's services sector hit a four-month high last month, as a better business climate increased deal making and lifted corporate confidence to an eight-month peak.

Fortune tellers reckon the Year of the Snake is looking volatile, but they don't believe its venom will bring disaster to the financial markets as it has in previous snake years.

It's worth remembering that in Chinese mythology, the snake embodies wisdom, and people born in the year of the snake are meant to be intelligent and wise.

In fact, key indexes could slither higher this year on the back of growing optimism, say the feng shui experts.

Some of the most disastrous financial events have taken place during snake years, which are traditionally associated with chaotic events and disorder.

The Wall Street crash and the start of the Great Depression took place in a snake year of 1929, the September 11, 2001 attacks did too, and the harsh government crackdown on pro-democracy demonstrators in Tiananmen Square in 1989 likewise.

Snake years have been characterised by lower endings on stock markets - the three most recent snake years resulted in Hong Kong's Hang Seng Index finishing lower, down 33.5 per cent in 2001.

At this time every year, the brokerage CLSA releases a "feng shui index".

The report is based on the signs of the Chinese zodiac and features lighthearted predictions for financial markets. It is written with tongue firmly in cheek, but CLSA's feng shui analyst, or "sorcerer's apprentice", Mariana Kou, believes there are signs of optimism.

"We've got the fire element so we're pretty hopeful," says Ms Kou, predicting a "decent finish" to the end of the year.

She says there is "good balance on the five fundamental elements" - fire, water, earth, metal and wood - which should rein in any significant upheaval.

"As befits 'skin-shedders', snake years are marked by major transformation and change, and sometimes great upheaval," CLSA says, while emphasising its research is based on "bottom-up" fundamentals.

The Hong Kong feng shui master Raymond Lo Hang-lap is decidedly upbeat on the outlook for this snake year. "We will see a lot of positive energy coming and people will have more confidence in economic recovery," he says, adding that this year's variety of snake is a relatively mild, less venomous kind.

"The stock market is already going up. Even stronger fire will come in 2014, the Year of the Horse, and that means longer-term recovery could be quite substantial and will last for a few years," he says.

The snake year "is more moderate, humble and patient", Mr Lo adds, saying he is bullish on this year's prospects for the world as a whole and sees good opportunities for economic growth.

Geomancer projections aside, China trade data from last month showed exports gained 25 per cent from a year earlier and imports rose by 28.8 per cent. So analysts who do not rely on feng shui believe recovery is on track in the world's second-biggest economy. All the same, feng shui should never be underestimated - the economist He Fan says it has a symbolic importance, reflecting how Chinese politics works.

Looking to hard data, one of the first pieces of news in the Year of the Snake was the revelation that China overtook the United States to become the world's largest trading nation last year, based on the sum of exports and imports of goods.

Data from the US commerce department showed American exports and imports of goods last year totalled US$3.82 trillion (Dh14.03tn), while China's customs administration reported last month that the country's trade in goods last year amounted to $3.87tn.

China is certainly gaining but it still has a way to go. The US economy is more than double the size of China's, according to the World Bank, with GDP in 2011 of $15tn, while China's totalled $7.3tn.

Still, in this Year of the Snake the scales will shift again.

 

business@thenational.ae

   

Back to the top

More articles


Editor's Picks

 The Greens, villas: Q1 no change. 3BR - Dh210-250,000. 4BR - Dh210-260,000. 5BR - Dh220-300,000. Q1 2013-Q1 2014 5% rise. Pawan Singh / The National

In pictures: Where Dubai rents have risen and fallen, Q1 2014

Find out how rental prices in the prime locations in Dubai have altered during the first three months of the year and the current rates you will pay according to data provided by Asteco.

 Miele coffee maker making Cappuccino at Miele Gallery in Sama Tower in Dubai. The cost of this coffee maker is around Dh 17,000. Pawan Singh / The National

Space-age coffee comes at a price from Miele

Miele have taken the coffee machine to a new level with its Dh17,000 offering that is built into your kitchen.

 The bridge of Seajacks Hydra, as the wind farm installation vessel undergoes finishing touches and testing works at Lamprell’s Hamriyah facility in Sharjah before its planned delivery on June 2, 2014. Jeffrey E Biteng / The National

In pictures: Building the Seajacks Hydra

The Seajacks Hydra, a wind farm installation vessel, is undergoing finishing touches and testing works at Lamprell’s Hamriyah facility in Sharjah before its planned delivery on June 2, 2014.

 The Wind, Energy, Technology and Environment Exhibition takes place from April 14 to April 16. Above, the Dewa showroom during last year’s Wetex. Jaime Puebla / The National

April corporate and economic calendar for the UAE and overseas

From Cityscape to Wetex to stock-market holidays to nations reporting first-quarter GDP figures, here is our helpful calendar of April's business events in the UAE and internationally.

 The rush of new supply of hotel rooms pushed Dubai occupancy rates down to 87 per cent. Sarah Dea / The National

Dubai hotel room rates rise 10 per cent

The rush of new supply pushed occupancy rates down to 87 per cent, a dip of 2.6 per cent from the previous year. Winter months are the strongest for Dubai hotels, with occupancy and prices falling to half their peaks by July.

 Get the latest information on credit cards, bank accounts and loan products in the UAE. Mark Lennihan / AP Photo

Rates report: Latest on UAE loans, accounts and credit cards

Souqamal.com brings you the latest interest rates on banking products in the UAE.

Events

To add your event to The National listings, click here

Get the most from The National