Chandler Lutz

Six Reasons To Buy China Soon

Great Article! I have to disagree that over the long run a super high savings rate is not always a good thing...After all, how do you get people to spend money in the face of a downturn if they save so much??...Japan couldn't figure it out throughout the 1990s. China's obviously not facing that right now, but it's something to keep in mind.

I do have to say that you have to pick Chinese stocks very carefully. First, I don't believe any numbers provided by Chinese companies that aren't traded on an SEC regulated exchange. Also, many Chinese companies are situated in very precarious competitive positions. These companies are trying to "move up the value chain" and produce more technologically advanced products. This may be great for China as a country but could present a difficult scenario for investors since these firms have no history of producing such products so it may be difficult for investors to judge the company's competence. Also, China's companies are going to start competing more directly with firms firms in many developed countries especially those in southeast Asia. How that competitive landscape plays out often very difficult to determine especially given uncertainty in the international currency markets

I know I've been rambling but I just want to say one last thing: A growing GDP does not necessarily mean success for investors. Jeremy Siegel in his book "Future For Investors" cites a study that found that stock returns are actually negatively correlated with gdp growth given that gdp growth is positive.

China's P/E Down to 20

Interesting post...but could you please provide the source of your information?...thanks....

Why China's Exporters Are Complaining Loudly

Michael, Great Article. I really enjoyed it....

I don't pretend to be an expert on China, but I believe that China's export market is and will be a victim of their own success. Since, the Chinese government has kept their currency artificially low it has engendered the rise of many lower quality production goods. If the government lets the currency rise, these exporters will face severely decreasing margins. On the other hand, if the government maintains the current currency rates it may impede China's transformation into a producer of higher quality goods like Japan experienced after WWII. I'm not sure if there exists a graceful solution to this dilemma....Your thoughts?