huangjin

Why I'm Buying Morgan Stanley China A-Share Fund

China loaned as much money in Q1 as in all of 2008, when the economy was growing at 11%+ per quarter, annualized. The state forced the banks to lend and the companies accepted the cash, and parked as much as one-third of it in the stock market.

U.S. Treasuries: China's Dilemma

Also, the U.S. doesn't have to pay off the debt, just stop making it bigger.

U.S. Treasuries: China's Dilemma

He's exactly right. If the U.S. government stops creating Treasury bonds, foreign holders of dollars have three (main) options: invest in U.S. stocks and bonds, buy American goods, or sell their dollars.

The U.S. Treasury is crowding out U.S. business and investment.

Will U.S. Growth Beat China's in 2009?

The producer to the world, U.S.A., suffered the most in the first Depression. Producer to the world, China, may suffer more this time, if history repeats. Whether your theory is right or wrong, you are right to ask the question.

In my opinion, it's the idle factories (malinvestments) that matter, not the money supply.

China's Looming Hangover?

More importantly the economy rolled right through the changes in consumer confidence.

Bullish on China After My Recent Visit

The cabby was happy because tipping is not the custom in China.

I think many people have wildly exaggerated ideas of China, either it is a communist pit or uber-capitalist. In terms of business you are right, but if you spend time reading news from China (or live there for an extended period), you will learn that there is a dark side to taking peoples' homes and farms, compensated or not. There is great unrest because government policies favored the coastal areas over the inland. The young people you met probably live in the cities and want to get rich, but the young people in the west and countryside are like illegal immigrants in their own country because they cannot get permits to work legally in the cities. Also, in Shanghai and Xiamen, residents have successfully blocked development and their power is growing.

Although I think it's far less rosy than your impression (take a look at the balance sheets of state banks), the Chinese will overcome whatever obstacles are in their way, be it economic or political, because they want to succeed. They have the attitude that America had 100 years ago.

The Next Credit Crisis Will Originate in China

China has the capital to pay off their NPLs—all those Treasuries they hold. The victim of a credit crisis will be the Chinese yuan.

Five Most Interesting Asian ETF and Indexing Stories Currently Playing Out

I've never seen anything but technical analysis on Chinese television and in Chinese newspapers, although one can find plenty of books on or by people like Buffett and Lynch.

What Caused The Latest Chinese Correction?

If you look at a chart of the NASDAQ, you will see the index plunges the week of the government's ruling against Microsoft. The Japanese stock market corrected in October-November 2006 after investors expected the government to let capital gains tax cuts expire. The Taiwan market plunged after a capital gains tax was introduced. The Chinese market plunged in February after rumors of a capital gains tax spread. The Chinese market plunged after tripling the stamp tax.

Generally speaking, markets need a catalyst to send them lower. Frequently, it has been government interference.

Is the Chinese Market Overvalued?

Chinese accounting standards are reason enough to declare the market overvalued.

China's Stock Mania: The End is Near

The U.S. Fed killed the party when they raised interest rates. The Chinese are in the process of raising rates and raising reserve requirements; it's only a matter of when inflation scares the crap out of the PBOC and they overshoot. Right now they're still under the delusion that they can control the economy. They have been trying to slow growth for 4 straight years now, with no effect. Since the country can cover their tracks with bad CPI data (and GDP growth, and non-performing loans, and...) for awhile, they can prolong the inevitable. But the inevitable always comes. The longer the wait, the bigger the fall.

The Irrationally Exuberant Chinese Stock Market Bubble

Chinese investors are behaving rationally as individuals. Their investment choices are limited and interest rates are too low. Together they are driving the market to unsupportable levels.

China as an Economic Superpower: 'Watch Out Below'

The Marxist theory of capitalism is that capitalists are greedy profiteers who cheat their customers. Taking a customer for all one can is the way of doing business, in their minds. If the people are indoctrinated for 50 years that this is capitalism, and suddenly the country begins opening up, what will their idea of capitalism be?

Using the definition of free market as the most free market in the world is not the same thing as a totally free market. Every example you cited involved using the courts and laws to their advantage, i.e. with the help of the government. How can a monopolist maintain his advantage if new entrants can enter the field? To fend off the competition, they must constantly offer more value, or lower their price to keep entrants out. That is, unless they can get lots of regulations and laws passed that hamper the competition, or simply enough laws that it becomes difficult for any small business to compete without an army of lawyers.

China as an Economic Superpower: 'Watch Out Below'

The problem with China is that they have a Marxist theory of capitalism, which led them to create the wrong kind of capitalism. In a free-market system with strong legal protections, capital cannot form a monopoly because competition immediately competes away a profit advantage. The market is a destroyer of profits. The government, on the other hand, is the greatest friend monopolists have. China is a fascist country run for the benefit of the party and elites.

Recent Reports Hint Of Trouble on the Chinese Front

There are a few riots like that every year in China, among tens of thousands of other public protests. The real threat to China is that a good portion of their GDP growth is funded by low interest loans to party members and their immediate family, who used the money to build unwise infrastructure that directly benefit themselves in some way. There is a 1929 style credit bubble brewing in China.