Colin Chen

http://www.sinocracy.com

5 Comments

    • ON: Tue Apr 22nd 22:27 PM
      Commented on:
      Decoupling: The Theory That Won't Die
      The various metrics that account for the growing trade between China and its peers don't really account for the final global cash flow. I'm don't know how much of that trade is for consumable goods and how much is for the various components of a final product to be sold in the us.

      That mentioned, I share the author's opinion that the infrastructure of these economies have some what decoupled from the west, and a slow down in the US won't wreck as much havok on the chinese and indian economies' GDP growths.

      However, the various financial markets have become much more interlinked and codependent. I shutter to imagine the global capital flow suddenly changing course or if the china starts massively selling its accumulated US treasury securities...
      View article »
    • ON: Tue Apr 22nd 21:34 PM
      Commented on:
      China's Economic Trouble May Just Be Beginning
      HAHAHA nice one chinesepetti, lets beat back the hun's. Your clever insights are what makes this site worth reading. (*sarcasm*)

      In anycase, the EU is China's largest trading partner, and the increased export to EU from the overvaluation of the euro should some what offset the slowing demand from the US caused by the drop in the dollar. The drop in light manufacturing and textiles are to be expected as beijing has in recent years abandoned the cultivation of those industries in place of more sophisticated industries. A rise in unemployment combined with a growing inflation rate is troubling however.
      What worries me the most is huge amount of cash moving to Hong Kong in red chips and H-shares. Is there another chinese speculation bubble this soon?
      View article »
    • ON: Tue Apr 22nd 21:16 PM
      Commented on:
      China's Worst Bear Market
      the obligated holding periods for many of the A-shares are ending, leading to large number of floating securities being loaded off. The chinese government will likely maintain control of the many operations, but its hard to deny the fact that there are more shares in the public hands than ever before. I agree with user that this is what is generating the downward pressure on the chinese stock market.

      Adding to the fire is the allowance of some chinese domestic investors to seek better investment opportunities abroad (hong kong in particular) through the QDII program. Not even the most nationalistic chinese would place his money in a rigged opaque domestic market.
      View article »
    • ON: Sun Apr 20th 05:57 AM
      Commented on:
      The Chinese RMB and the Euro
      ^ this is the kind of response people made at the height of the A-share bubble.

      great post prof. pettis. In response to your older writing about the unexpected pressure on Chinese inflation, can such inflation be linked to the exchange rate?

      This is what I believe could be the possible linkage. A depreciation of the dollar implies a decreased global purchasing power of the us populus. This in turn significantly slows the growth of demand for chinese goods and services, which would limit the real GDP growth. If MV=PY, could it be that the rate at which the Chinese central bank was increasing the money supply significantly outpaced the real growth of the economy, leading to a much much larger increase in the price levels?
      View article »
    • ON: Sun Apr 20th 02:53 AM
      Commented on:
      Five Ways to Invest in China and India
      looking back at this TA, I believe the first poster got it right when he used the term "mumbo-jumbo"...
      View article »
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