Selling China in 2008 is like selling America in 1908...

Topsurfi · Feb 1, 2009

Quote from short&naked:

What's the point. It's well known that the price action on the Shanghai stock market is well manipulated. HELLO!!! It's a Communist country!

the shanghai stock market is definitely less manipulated then the US threasury market which is perhaps the most manipulated market in the world.
I think there is a certain risc involved in investing in china but this is offset by chances that are offered.
I have put money not only into chinese stocks but also vietnam ect. recently.
Go there and try to get your own picture, not only from the media.
I especially like the people in vietnam, I am sure they will get rid of the communistic gouvernemt sooner or later and then their stock market will go ballistic.

short&naked · Feb 1, 2009

Quote from Topsurfi:

the shanghai stock market is definitely less manipulated then the US threasury market which is perhaps the most manipulated market in the world.
I think there is a certain risc involved in investing in china but this is offset by chances that are offered.
I have put money not only into chinese stocks but also vietnam ect. recently.
Go there and try to get your own picture, not only from the media.
I especially like the people in vietnam, I am sure they will get rid of the communistic gouvernemt sooner or later and then their stock market will go ballistic.

That is a very naive statement. But good luck (you'll need it).
Oh, btw, shorting in China is ILLEGAL, geee wiz.

Topsurfi · Feb 1, 2009

Quote from short&naked:

That is a very naive statement. But good luck (you'll need it).
Oh, btw, shorting in China is ILLEGAL, geee wiz.

I don't think I am naive, I have been staying in Asia (Korea, Taiwan, Vietnam, China, Hongkong) around 20% of my time througout the last 3 years and always try to get my own picture.
But apart from my personal view there are also some facts:
China had 2008 GDP growth of 9% and even in the last quarter it reached more than 6%.
Exports dropped by 2.8% in December but this was more than offset by retail sailes in china which rose 25% per year.
What people in USA can't imaging is that China can make a living on their own. They don't need USA to buy all their goods. It will be 1 or 2 tough years but then they will be over it.

And this happens although the saving rate is still high and savings are now 3 Billion US-Dollar. They have plenty of money to consume, americans have nothing left, only dept.
China will outperform USA throughout the next 20 years, this is a given. There will be trouble and it will be a rough travel but I am sure if you invest in China now you will get 5x more return compared to Europe or USA.
If you look on the country side in China people still live there like 100 years ago and this is going to change. China can grow for the next 20 years with 10% annual rate without problems until all these enormous amounts of people have the same living standard as the people now living in Beijing.
And they don't have the problems we have, they have no dept and most people don't even have a credit card. And if you visit one of their schools you can see how hard and tough education is there. Compare that with our younger generation, you get your picture. All this is very very long term and I have no idea about the next 12 months, but if you are a long term investor you should have 1/3 of your stocks in Asia, that is what I have.

Cutten · Feb 1, 2009

Selling America in 1908 was a smart move - circa 1932 you would have lost money over a 24 year period.

A better analogy is selling Japan in 1944

Port1385 · Feb 1, 2009

I think there is going to be one more downdraft in the US and in CHINA. Then when that happens this year, it will be time to get in. I would say look in the 4th quarter for good opportunities to get long. 2008 was a wash, 2009 will be a wash, but towards 2010 will be the bottom and then 2011 a recovery. I know, it sucks, but thats the way it is...

cassielam · Feb 4, 2009

that is right,through the oversea trade is down, but increasing the local market, you know china has the largest people, and can if all the demand increase, the economic will develop sharply. Second, China has all source that life needed.

MohdSalleh · Feb 4, 2009

Quote from Topsurfi:

I don't think I am naive, I have been staying in Asia (Korea, Taiwan, Vietnam, China, Hongkong) around 20% of my time througout the last 3 years and always try to get my own picture.
But apart from my personal view there are also some facts:
China had 2008 GDP growth of 9% and even in the last quarter it reached more than 6%.
Exports dropped by 2.8% in December but this was more than offset by retail sailes in china which rose 25% per year.
What people in USA can't imaging is that China can make a living on their own. They don't need USA to buy all their goods. It will be 1 or 2 tough years but then they will be over it.

And this happens although the saving rate is still high and savings are now 3 Billion US-Dollar. They have plenty of money to consume, americans have nothing left, only dept.
China will outperform USA throughout the next 20 years, this is a given. There will be trouble and it will be a rough travel but I am sure if you invest in China now you will get 5x more return compared to Europe or USA.
If you look on the country side in China people still live there like 100 years ago and this is going to change. China can grow for the next 20 years with 10% annual rate without problems until all these enormous amounts of people have the same living standard as the people now living in Beijing.
And they don't have the problems we have, they have no dept and most people don't even have a credit card. And if you visit one of their schools you can see how hard and tough education is there. Compare that with our younger generation, you get your picture. All this is very very long term and I have no idea about the next 12 months, but if you are a long term investor you should have 1/3 of your stocks in Asia, that is what I have.

yes it is very true, shanghai etc are modern cities but western china is still undeveloped there is much potential there

short&naked · Feb 4, 2009

Quote from Topsurfi:

I don't think I am naive, I have been staying in Asia (Korea, Taiwan, Vietnam, China, Hongkong) around 20% of my time througout the last 3 years and always try to get my own picture.
But apart from my personal view there are also some facts:
China had 2008 GDP growth of 9% and even in the last quarter it reached more than 6%.
Exports dropped by 2.8% in December but this was more than offset by retail sailes in china which rose 25% per year.
What people in USA can't imaging is that China can make a living on their own. They don't need USA to buy all their goods. It will be 1 or 2 tough years but then they will be over it.

And this happens although the saving rate is still high and savings are now 3 Billion US-Dollar. They have plenty of money to consume, americans have nothing left, only dept.
China will outperform USA throughout the next 20 years, this is a given. There will be trouble and it will be a rough travel but I am sure if you invest in China now you will get 5x more return compared to Europe or USA.
If you look on the country side in China people still live there like 100 years ago and this is going to change. China can grow for the next 20 years with 10% annual rate without problems until all these enormous amounts of people have the same living standard as the people now living in Beijing.
And they don't have the problems we have, they have no dept and most people don't even have a credit card. And if you visit one of their schools you can see how hard and tough education is there. Compare that with our younger generation, you get your picture. All this is very very long term and I have no idea about the next 12 months, but if you are a long term investor you should have 1/3 of your stocks in Asia, that is what I have.

The potential may be there. But they are still communist and have that type of mind-set. We all know what happens when free market forces clash with a communist government. There is no margin of safety in term of the political structure.

So China doesn't need the American consumer? Everything I see here in the U.S. is made in China. Until this is proven I wouldn't believe it. We have all seen where the decoupling theory has gone in the past year: out the window!

Also, when there is political turmoil in any other country in the world those highly educated students you speak of go where? Correct, they come to the U.S. to work. In that sense America is the world.

As far as debt goes, it will have to be paid off. Social sevices will be cut, Americans will have to work for less. (Debt by definition is a form of repayment in future labor)