huangjin

China and India's Growth Just Currency Related Illusions?

little increase in the narrowly defined U.S. money supply in 2008, etc...

You can say the same thing as far back as late 2005.

Anatomy of a Chinese Bubble: A Checklist For Spotting Bubble Tops

One has to parse these Chinese companies. How many people have researched anything beyond the big ADR firms like CHL, CHU, and LFC? I remember newscasts in 2005 and 2006 talking about how SOEs were making profits for the first time, due to energy and materials prices. If those reverse, earnings will tank. The Shanghai Exchange as of end of 2006 had 66% in the top ten stocks. It cold have changed quite a bit since then, but it would still be heavily weighted to a handful of stocks, although those are heavily telecom and financial.

Anatomy of a Chinese Bubble: A Checklist For Spotting Bubble Tops

Good analysis. One difference with the NASDAQ and Shanghai that I haven't seen covered is that China is only up 100% in 5 years. In fact, if you go back to summer 2005, the A-Shares index was down about 50% from 2002. So something significant is taking place. Why is a market people dumped to 50% of it's value 2 years ago, now shooting higher? Given that I barely read anything approaching value investing in the Chinese press when I was there during the bear market (technical analysis is dominant), it leans me towards the bubble side. But unless someone can say that 15% a year returns (100% in 5 years) in an economy growing at 10% are unreasonable , there is a clear argument to be made for fair valuation and no bubble.

John, not only is the number of securities limited, but bank deposits pay an artificially low rate as part of the policies to help state owned banks.