Andrew Ling

Considerations on Investing in China

Duder has some good points. As a Chinese-American I visited Shanghai for the first time last year and talked to some random people for an uncensored view of the country. I saw less homeless than in S.F., and the people were generally content. The vast majority agree with such laws as 1 child per family which has outraged many Americans. Additionally, even my uncle's housekeeper seemed to be more knowledgeable of politics than the average American.

As soon as I got home I purchased a bunch of FXI. I've since sold it all as I feel alternative energy is a much better investment.

Waiting for the Great Wall of Chinese Liquidity

Thanks for your response Michael that is a good point. Being a Chinese American I also considered investing in something Yuan denominated such as Chinese real estate but unfortunately they had already passed laws making it difficult for foreigners to invest. Part of the problem with holding Yuan though is it's illiquidity. That obviously isnt a problem if you're living in China and can spend the money there.

Waiting for the Great Wall of Chinese Liquidity

Where did you get the 12-14% figure? China's central bank recently raised rates to 6.84%, meaning that individuals making deposits can expect to earn perhaps only 4%.

Waiting for the Great Wall of Chinese Liquidity

Where does the 12-14% interest rate on bank deposits come from? China's central bank has interest rates set at 6.84% so investors should be payed only about 4% not 12-14%.