Big Mouse

The Next Phase the Crisis Is Beginning with an Eye on China

There is a social security system in China, despite there is a gap between urban and suburban areas. Urban People, who have better situations in the social security than suburban people, are active in buying flats. So a lack of social security is not the main reason for apartment purchase.

> 13). China do not have a social security system, so people put all their money in buying a house and hope for appreciation. People also believe the bank won't fail because it is government owned. At the same time, there is no official guarantee like the FDIC $250,000 insurance. If there is bank run, the bank will be wiped out with 48h.

Alarming China Statistic of the Day

On one side, manufacture is not profitable, so industry funds leave factories for other profitable ways. Today the funds flow from the equity market to the property market.
On the other side, officials' relatives are active in making money in the property market. Therefore, local govs promulgate policies to boost property prices. For expample, Shanghai approves more citizenships as demands, despite there is an unempolyment problem.

Sohu Outperforms, Outlook Raised

I note there are some risks. Sohu sues an insignificant competitor at the begining of July. The yoy revenue growth rate continued declining in 2Q09.

Chinese Economy May Be Heading into an Iceberg

"Indeed, at Trading Economics, we think the unprecedented rebound in the Chinese stock market has been to some extent engineered by the Chinese government and not propelled by a positive change in real economic fundamentals."

---- I would like to explain the Chinese stock market in another way. Neither government manipulations nor a positive economy signal. The industry funds give up their factories due to weak demand from overseas. These funds went to coal mines in 2H08 and then transferred from coal mines to the stock market in 1H09. Now they move from the stock market to porperties. The index boom has nothing to do with economy. The Chinese stock market is merely a way for capital to make money in the weak time - just like the oil price in developed countries.
---- An analyst in Shanghai

Rio Tinto's Chinese Mistake

Briberby can hardly be avoided in China.

Fast Food Is Becoming More Expensive in China

McDonald and KFC can do that.
They are still crowded in China.

In supermarkets, it is hard to find anything,
which has a price rise below the released inflation rate.

Now I worry about the true inflation may accelerate after the Olympic Games.

Hard Times in Hong Kong?

Mr. Carl T. Delfeld:

I'd like to give you the Tibet history lesson for free.

Tibet was independent, ---- but only before A. D. 1244.
In A.D. 1244, Tibet surrendered themselves to Genghis Khan's son and Yuan Dynasty.
Throughout Yuan Dynasty, Ming Dynasty, Tsing Dynasty, Republic of China, and People's Republic of China,
The Tibet area belongs to China.

The only thing, which implied that Tibet was relatively independent,
was that Tibet maintained the slavery system until the Republic of China period. When the communist party wanted to abolish the slavery, nobles rebelled. Similar to the situation of the American Civil War.

How do you think about the Confederated States of America?

Hard Times in Hong Kong?

Advocates of democracy? Where are they before 1997, when there was no election in Hong Kong at all. ---- Then it is easy to understand who is their sponsor. Hong Kong people need real democracy advocates on behalf Hong Kong citizens, but not Washington.

If you want to comment polictics, please turn to another forum.
But before doing that, I suggests you read the Hong Kong history first.

Have you ever commented the democracy situation in Hong Kong before 1997?

Tibetan Unrest and Economic Implications: 'Nancy Pelosi's War'

I think most Chinese in rich provinces agree the independence of Tibet, but dare not to speak out. The central government takes money from provinces along side the sea, and injects money into poor Tibet simultaneously. But Tibetans will never say 'thank you'.

Tibetans can get extra 8 points in China university entry exams (like SAT in US), but a gap of one or two points have been ruining many Han Chinese. Suicides for exam failure are not news (though rarely reported).

Economically, Tibet is a burden.
If they want independence, get out and get away.

Baidu May Test August Lows

I thought about peer P/E comparison, but have never used it.
If a cross-sectional comparison works,
how can the company's P/E maintain high for such a long time.
Note that, Baidu is a monopolist, while Sina and Sohu are merely market leaders.
So Baidu should have a P/E premium over those news portals, if comparable.
Now I use P/E band, time series might be more reasonable.

Chinese Banks Are Still Weak

If some one is an ICBC customer, waiting in the queue for more than three hours, he/she will never believe ICBC's future. He/she need not understand those jargons like NPL, capital adequacy, or proportion of non-interest businesses.

Just How Big is the China Bubble?

Bubble has been talked for a long time.

It will come true when no one dare to mention.

Investing in China, The Non-ETF Way

Hi, Joseph:

I have several points to discuss with you.

1. You are right – there are many problems in SOEs. But research analysts should seek profitable opportunities for investors rather than complain the investment environment. I promote both SOEs and small caps for investors as long as these picks are undervalued.

2. Major shareholder vs. minor shareholders – that’s the basic corporate governance problem. The problem exists whether the major shareholder is a government or an individual.

3. Taiwan is independent in economic operation and has nothing to do with the growth in China. If some company raises a “Great China” concept – it is a Taiwanese company. Only Taiwanese companies actively use the “Great China” concept when they try to attract clients or investors. Hong Kong companies need not.