Economy, Talking Point

Off to the races?

What is the outlook for the Year of the Horse, and will it be good for you?

Horses w

The last Year of the Horse – in 2002 – saw markets plummet, but forecasters are more optimistic this time

To understand China’s love of horses, look no further than the country’s oldest state-owned firm. Shandan Horse Husbandry Farm was created as far back as the Han Dynasty (circa 121 BC).

At the time, Emperor Han Wudi envisaged a breeding facility for cavalry horses – to help him defend his empire’s borders against nomadic invaders. And somewhat incredibly the Shandan Horse Farm is still in existence today – surely making it the world’s oldest firm. It continues to be state-owned but no longer has a military purpose, pulling in the tourists instead.

Countless idioms in Chinese feature the animal too, which is known as ma in Mandarin. For instance, there’s ma ma hu hu, which means ‘just so-so.’ And one of the most popular Lunar New Year greetings is longma jingshen, which describes the vigour of a ‘dragon horse’ (like the unicorn, a mythical steed).

As the Year of the Horse approaches – the Lunar New Year actually starts today – WiC takes a brief look at what might be in store. Will the global economy be galloping ahead or can we expect it to fall at the first hurdle?

Who are some of the famous ‘Horses’?

According to feng shui principles, people who are born in the Year of the Horse are loyal, diligent and hardworking. Typically they’re elegant, independent and confident too. Many historical leaders were born in the Year of the Horse. Genghis Khan, (1162-1227) for instance, as well as American presidents Theodore Roosevelt (1858-1919) and Franklin D Roosevelt (1882-1945).

The leadership theme endures. Former South African president Nelson Mandela, who died last year, was a Horse, and his release from prison in 1990 also came in a Horse year.

Current German Chancellor Angela Merkel, French President Francois Hollande, Japanese Prime Minister Abe Shinzo and Hong Kong’s Chief Executive Leung Chun-ying are all Horses too (they were all born in 1954). British Prime Minister David Cameron is also a Horse, born in 1966 (and so are you if you were born in any 12-year cycle before or after).

But Merkel, Cameron and Abe will need to be cautious in 2014 as being born a Horse might not bring much luck in the year ahead (Francois Hollande may suspect his misfortunes arrived a few weeks ahead of schedule).

In fact, this year could be rather inauspicious for Horses and they should pay special attention to avoiding calamities, both in their careers and health, says China Jiangsu Net. At least it offered one caveat: Horses who change jobs or move houses can expect an improvement in fortunes.

For the global economy, it is harder to predict what the year will bring. In 2002 – the last Horse year – markets suffered a miserable 12 months after the tech bubble popped. The Dow Jones dropped 28%, while Hong Kong’s Hang Seng lost 22%. But this year is also associated with the ‘wood’ element. And the last time ‘wood’ combined with the Horse (1954) the Dow recorded one of its largest percentage gains on record. Other Horse years, like 1990 and 1978, also saw modest full year gains, so some feng shui masters say it could be a good time to invest in the stock market.

Even Shanghai’s A-share market could get a boost. “The Shanghai stock market has given the bears a run of more than seven years so this year could finally show the bulls some sign of life. After all, how much lower can it get? The only direction to go is up. So the stock market in the Year of the Horse is certainly worth a bet,” reckons Shanghai Financial News.

Which sectors will gallop away?

Since this is also a ‘wood’ year, industries associated with wood will outperform, say the forecasters. Retail, forestry, textiles, fashion, soft commodities, agriculture and culture (even newspapers) are expected to do well.

Wood fuels flames too; so industries related to the fire element will also flourish in the Year of the Horse. This includes energy (oil and gas) and electricity. Li Ka-shing’s Hongkong Electric, which made its listing debut on Wednesday (the penultimate day of the Year of the Snake) may be a beneficiary.

Gold, which continued its downward spiral last year, could also get a boost in the Year of the Horse. Jewellery shops say sales are already brisk as shoppers snap up golden horse ornaments as gifts. Jewellers say horses should sell better than snakes did last year too. “Horses are regarded as the symbol of energy and health to the Chinese,” Lau Hak-bun, chief operations director at jeweller Chow Sang Sang, told the South China Morning Post. “People like to wear accessories or have golden ornaments of horses rather than snakes, which are lazy and evil in their view.”

And which industries to avoid?

The element ‘metal’ isn’t regarded as compatible with the Horse, say forecasters, so investors should be wary of industries like machinery and steel (although for steel that shouldn’t come as a surprise). Banks and insurance companies are also associated with metal (think coins) and may underperform too. But also faring poorly are the ‘earth’ plays, such as chemicals, construction and property, and pharmaceuticals. Tencent Astrology reckons that homebuyers should expect a year in which the “property market is neither terrible nor great”.

Property prices in China have gone up quite a lot over the last year – in December, new home prices in major cities were up 9.2% from a year earlier – so it’s not likely Beijing will pull back on austerity measures designed to cool the market.

“Even though 2013 has experienced a significant rise in home prices, that trend is not likely to continue in 2014. We believe that it will continue to stabilise, but it is not likely there will be much room to go up as sharply again,” says Professor Huang Yanfen from Renmin University.

And any wider concerns?

The potentially combustible mix of ‘wood’ and Horse saw some of the bleaker commentators warning about forest fires and volcanic eruptions. Others pointed to the potential for military confrontation in the 60-year cycle. Previous years in which ‘wood’ and Horse have combined include 1954, a year of nuclear bomb testing by the US and the former Soviet Union, as well as the battle of Dien Bien Phu, which saw the defeat of French forces in Vietnam.

Perhaps most ominously in light of the current row row between Beijing and Tokyo over disputed islands in the East China Sea, another year in the cycle was 1894, which marked the start of the first Sino-Japanese war.

Who’s in for a pleasant canter?

Those born in the Year of the Sheep (1955, 1967, 1979) – like Premier Li Keqiang and actress Zhang Ziyi – will be pleased to know that their stars are aligned this year. According to Wen Wei Po, Sheep are very compatible with “the Presiding God” so the forces of good fortune are very strong for them. Their endeavours will proceed smoothly and they will get plenty of help from those around them.

Those born in the Year of the Dog (1958, 1970, 1982) will also enjoy a rewarding year ahead. Feng shui master Li Junming says that Dogs can afford to make dramatic changes to their lives in what promises to be a fortunate period. “They should muster all their courage and strength in the Year of the Horse and live their potential to the fullest,” Li urges. The new boss at the US Federal Reserve Janet Yellen – born in the Year of the Dog – will take heart.

And who will be thrown from the saddle?

Don’t get too excited about Alibaba’s IPO just yet. The company chairman Jack Ma – China’s most admired business leader according to a recent WiC poll – faces a turbulent time. Dragons (1964, 1976, 1988) can expect to see their careers in the “doldrums”, says Hong Kong feng shui practitioner Fang Jiuming. He urges Dragons to behave conservatively and not make too many risky decisions.

Those born in the Year of the Rat (1960, 1972, 1984) are also missing the lucky stars this year, Li Junming says. But they shouldn’t be too discouraged and concentrate on staying healthy. Go for regular check-ups, Li suggests.

Pigs, too, are going to have a tumultuous year. Owing to the risk of accidents, China Jiangsu Net suggests that those born in Pig years (1959, 1971, 1983) should even avoid outdoor activities whenever they can. Ma Huateng, chairman of internet giant Tencent, should stay inside. (Despite his English name Pony and last name Ma – meaning ‘horse’ – the Tencent boss was born in a Pig year.)

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