September 30, 2008

Buffett Bets on Chinese Batteries

Amid all the doom-and-gloom with American stocks Chinese investing remains a bright spot. Yesterday as the Dow Jones Industrial Average lost 7% value, famous stock picker Warren Buffett bought close to 10% of the shares of Chinese battery maker BYD, listed on the Hong Kong exchange as 1211.HK. The company is transforming itself into an electric car maker --BYD Auto -- with big plans. The F1 pictured here sells for under $3,000. One to watch!

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September 29, 2008

China to USA: A fish doesn’t stink from the tail

The 2008 summer session of the World Economic Forum has concluded in Tianjin, China, with harsh words from China bank regulator Liu Mingkang who criticized the US financial industry for getting the world into the current credit and liquidity mess. The oft quoted and widely respected Chairman of Morgan Stanley Asia, Stephen Roach, said the "The US will have its version of Japan’s lost decade" now.

The consenus appears to be that economic growth will come soley from Asia in the years ahead with all eyes on China primarily.

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September 25, 2008

Hong Kong Financial Virus Erupts

While Washingon and New York scramble to avoid a repeat of October '87 or even '29 on Wall Street, the Hong Kong rumour mill is in full gear and could yet trigger a massive slide.

Yesterday, rumours circulated that Bank of East Asia was failing and an old style bank run was on with photos and headlines splashed acrossed world media. Today, the South China Morning Post reported that Beijing's bank regulator (China Banking Regulatory Commission) told domestic banks to stop lending to US financial institutions, a report denied by the agency. If American politicians don't declare victory soon I expect the Hong Kong viral panic may wield its own special damage.

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September 24, 2008

China Space Program Accelerates

While it may be the 1930s again in Washington and New York, for urban Chinese it's the go-go Sixties with pop culture celebrating the advances of the Chinese space program (at left, the "Shenzhou VII" mobile phone).

On Thursday, the Shenzhou VII will lift off into orbit around Earth and test new advances in made-in-China space technology including a spacesuit for China's first ever spacewalk, air-locks, and rocket improvements. The lift-off will be broadcast live in a show of confidence in the Chinese space program.

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China May Say NO to Derivatives

According to an "exclusive" at Bloomberg, Beijing is reconsidering whether to introduce derivatives and further liberalize China's financial sector. Hank Paulson's supreme reputation is seriously tarnished and that has diminished his still considerable guanxi with the State Council. I predict China will turn more to Europe now as its primary model.

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September 19, 2008

At 100 GM Turns Chinese

General Motors (GM) celebrated its 100th birthday today 100 floors above Shanghai announcing the groundbreaking of its quarter billion dollar R&D and Asia-Pacific headquarters Shanghai facility and that GM's long anticipated electric vehicle the Chevy Volt will go on sale in China by 2011.

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September 18, 2008

Will China Rescue Morgan Stanley?

Already the China Investment Corp., China's sovereign wealth fund, owns close to 10% of Morgan Stanley. The latest speculation is a bigger investment maybe even a partial take over is in the works.

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September 17, 2008

Results of US-China Joint Commission on Commerce and Trade Meeting

The 19th session of the US-China Joint Commission on Commerce and Trade (JCCT) produced some important developments potentially impacting US exports to China (particularly medical devices) and progress at long last toward China entering into the WTO Government Procurement agreement. Details here.

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Obama China Bash Disingenuous

Obama TV spot accusing McCain of supporting US manufacturing jobs to China is a tad disingenuous given the all-important role the Clinton administration played in signing into law the US-China trade deal. And it pays no attention to the complex import/export ramifications of Corning's numerous China joint ventures. Finally, as with so much about trade with China, Corning's investments are one component of cheap flat screen TVs that so many Americans now enjoy.

China Tech Stocks Update

Courtesy Seeking Alpha blog.

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September 16, 2008

Beijing Cuts Interest Rate - Shanghai Freefall

China's central bank surprised soothsayers again today with an unexpected interest rate cut.

Meanwhile in Shanghai, Chinese stocks sank further. The Shanghai Composite closed under 2,000 for the first time since 2006.

September 15, 2008

Beijing Bolsters China Banks

As the Panic of '08 unfolds, the Chinese central bank eased key monetary policies in a surprise move today.

September 08, 2008

USA More "Communist" Than China

So says investor guru (and Singapore resident) Jim Rogers...

September 04, 2008

PROPERTY Sector Key to China Economy?

Morgan Stanley's China Analyst Qing Wang thinks so:

"We believe that the outlook for robust growth in China hinges critically on
the sustainability of investment growth in the property sector. Indeed, it is
hard to justify a positive outlook for the Chinese economy in the next 12-24
months, unless one remains constructive about the role of the property sector as
an engine of growth, particularly in some areas (e.g., Chongqing)."

Wang believes property is not a bubble in China, arguing that China's high house-price-to-income-ratio can be reduced and is not out of line with other so-called developing nations. There is risk however Beijing may restrict the property sector and cause a hard-landing to the economy.

China Property remains a sector to watch...

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