rosey99

China Remains a Compelling Buy via PowerShares Golden Dragon ETF

No doubt. I often wonder why people fail to remember these little nuggets of truth. Rationalizations for investing in China always seem to leave the reality of the situation, political and social, out. I'm looking at the Jan. 2011 10 calls and they seem entirely reasonable, especially given a little backward/diagonal spread action along the way.

Unless you are as nimble as a Chinese gymnast, putting a client's money in China today seems a little more than risky.
On Jul 16 08:28 PM doubleshortetf wrote:

> Some sober facts:
>
> 1. China is a communist country ruled by 1 party with iron grip.
> Party bosses pick the politicians and many private company managements
> since many private companies are ex-SOE (communist state owned enterprises).
>
> 2. Corruption in China is rampant and one of the worst even down
> to lower ranking employees. Even factory canteen chef gets "envelopes"
> in scheme where he claims he received 10 bags of rice when only 8
> bags are delivered.
> 3. There is almost no "law" since law itself is written to support
> the communist party or corrupt local communist bosses. Judges are
> appointed by the local communist boss and few if any understand law.
> Many judges got job thru "guanxi" or connection and of course bribes.
>
> 4. The Chinese banks in are BIG TROUBLE. E&Y got in heaps of
> trouble for discussing hidden bad and uncollectible debts. Local
> communist cadres dictate banks to lend to their pet projects and
> of course friends who bribe them not to mention COMPLETE lack of
> transparency.
> 5. No one except pea size brains trusts the communist government's
> statistics which are MANIPULATED.
> 6. Many of the listed companies numbers are COOKED. Auditors and
> their management can be bribed and extorted. It's beyond me how
> anyone would trust Chinese companies' financials unless audited by
> Big 4. And even Big 4s audited numbers are suspect since most Chinese
> companies carry multiple books including one for taxation and another
> for real book with slush funds.
> 7. Latest Chinese share and commodity appreciation have lot to do
> with communists pumping money to the economy by directing the banks
> to make loans. This kind of stimulus cannot go on.
> unison are recommending Chinese stocks.