A must read series of China articles published by The Economist in June 2011.
Rising power, anxious state
Monday, June 27, 2011
Thursday, June 9, 2011
Hedge-fun titan John Paulson got burned by a China company
Have you heard of Muddy Water Research? A so called equity research firm specialized in shorting Chinese companies listed overseas via reverse takeover. Muddy Water has attacked 4 companies since last summer and the first three ones were small- and micro-cap Chinese companies traded in the U.S. The company now goes after the big fish and its last prey was a Chinese company called Sino-Forest traded in the Canadian Stock Exchange.
Sino-Forest had over $6B market cap before the attack and John Paulson, the renowned hedge-fund manager, owns about 14% of the company. Since the short attack on June 2nd, the company's stock has plunged from 20 to 5, or over 75%. At one point of time, Paulson had more than $300MM paper loss.
Read more about the story.
Big Funds See Red in China by WSJ 6/9/11
Sino-Forest clobbered by short-seller's report By Reuters 6/3/11
Sino-Forest Plunges as Short Seller Block Targets Stock Owned by Paulson by Bloomberg 6/3/11
Sino-Forest had over $6B market cap before the attack and John Paulson, the renowned hedge-fund manager, owns about 14% of the company. Since the short attack on June 2nd, the company's stock has plunged from 20 to 5, or over 75%. At one point of time, Paulson had more than $300MM paper loss.
Read more about the story.
Big Funds See Red in China by WSJ 6/9/11
Sino-Forest clobbered by short-seller's report By Reuters 6/3/11
Sino-Forest Plunges as Short Seller Block Targets Stock Owned by Paulson by Bloomberg 6/3/11
Sunday, June 5, 2011
Stephen Roach is bullish on China
Nowadays, it is not so easy to hear a positive voice about China. But here comes one from Stephen Roach, who is a Yale faculty and the Non-Executive Chairman of Morgan Stanley Asia. More importantly, Roach is a well-known long-time bear.
Here is his recent bullish view about China
Ten Reasons Why China is Different May 2011
Here is his recent bullish view about China
Ten Reasons Why China is Different May 2011
Friday, June 3, 2011
Will China have a debt problem?
We all know that the Chinese government has shoveled 4 trillions Yuan since 2008. But how much debts do central and local governments carry? A few recent articles may give us a clue...
The Trillion Dollar Question: China’s Local Government Debts Mystery Revealed 06/2/2011
China always has more debts than you think 06/02/2011
China Economy: Clean-up Of Local Government’s Debts 06/01/2011
China to clean up billions worth of local debt 5/31/2011
The Trillion Dollar Question: China’s Local Government Debts Mystery Revealed 06/2/2011
China always has more debts than you think 06/02/2011
China Economy: Clean-up Of Local Government’s Debts 06/01/2011
China to clean up billions worth of local debt 5/31/2011
Friday, May 20, 2011
Richard Duncan's new article, "China: Every Boom Busts"
Richard Duncan, the former global head of investment strategy at ABN AMRO Asset Management in London, wrote an article about China recently.He argues that the growth of China's economy is largely depends on the debt-fuelled consumption from the U.S. consumers. Once people in the U.S. slow down consuming goods imported from China, the boom will bust.
But have U.S. consumers ever learned the lessons of stopping buy stuffs that they do not really need? There is an old Chinese saying, "It is easy to step from thrifty to sumptuous, but it is hard to do so in an opposite way"
China: Every Boom Busts by Richard Duncan on May 3, 2011
But have U.S. consumers ever learned the lessons of stopping buy stuffs that they do not really need? There is an old Chinese saying, "It is easy to step from thrifty to sumptuous, but it is hard to do so in an opposite way"
China: Every Boom Busts by Richard Duncan on May 3, 2011
Monday, May 16, 2011
"The Future of Chinese Growth" by David Beim
David Beim, a former banker and now a professor at Columbia Business School, published an article in March 2011 analyzing the growth models of China in the past 30 years as well as the bumpy road the country is facing ahead for its further development.
The author summarizes the past 30 year's development of China into three growth phases, the 80s, the 90s and the first decade of this new century. Based on the composition of GDP, he analyzes China's past/future growth under different models, which includes investment-driven, export-driven, and domestic consumption-driven growth.
He concludes that the golden age of Chinese super-growth is likely near to an end. In the meantime, the country holds bright future but has come to a crossroad where a new growth model is needed badly to replace the old one. The only question remains is that whether China can stimulate domestic consumption fast enough to fill the gap left by investment- and export-driven growth.
The link of David Beim's full article
The Future of Chinese Growth March 2011
The author summarizes the past 30 year's development of China into three growth phases, the 80s, the 90s and the first decade of this new century. Based on the composition of GDP, he analyzes China's past/future growth under different models, which includes investment-driven, export-driven, and domestic consumption-driven growth.
He concludes that the golden age of Chinese super-growth is likely near to an end. In the meantime, the country holds bright future but has come to a crossroad where a new growth model is needed badly to replace the old one. The only question remains is that whether China can stimulate domestic consumption fast enough to fill the gap left by investment- and export-driven growth.
The link of David Beim's full article
The Future of Chinese Growth March 2011
Wednesday, May 11, 2011
Bloomberg: Poll: China’s Yuan Convertible by 2016
Take a look of what Bloomberg' survey about the future of China's Yuan. I personally do not believe it will happen so soon.
Poll: China’s Yuan Convertible by 2016
Poll: China’s Yuan Convertible by 2016
Monday, May 9, 2011
Greg Zuckerman says "a lot of people are betting against China..."
Greg Zuckerman, a senior writer at the WSJ, is interviewed by Yahoo Breakout. He also wrote the book of "The Greatest Trade Ever", a story about how John Paulson made his big fortune by betting against the US housing market in 2006 and 2007.
Smart Money Betting Against China: Zuckerman
Smart Money Betting Against China: Zuckerman
Sunday, May 8, 2011
More bear cases about China from prominent names such as Goldman's Jim O'Neill
As Roubini expressed his bearish view of China recently, a renowned long time China bull, Goldman's Jim O' Neill who invented the BRICs, is also concerned about China's shift of its growth strategy, from investment- and export- driven growth to consumer driven growth.
George Magnus, an economist from UBS, also worries about the over-extended credits by Chinese banks may collapse.
Articles on 5/3/2011
Why One Of The World's Biggest China Bulls Is Getting Worried by Joe Weisenthal
China risks credit-fuelled Minsky moment by George Magnus
George Magnus, an economist from UBS, also worries about the over-extended credits by Chinese banks may collapse.
Articles on 5/3/2011
Why One Of The World's Biggest China Bulls Is Getting Worried by Joe Weisenthal
China risks credit-fuelled Minsky moment by George Magnus
Monday, May 2, 2011
A collection of Jim Chanos' bearish view of China
Jim Chanos, a short selling hedge fund manager, made his fortunate and fame by spotting Enron's problem early. Now he returns under the spotlight by betting against China, especially the real estate market. Using his own word, "China's property bubble is Dubai x 1000". We will see how much he will be right or wrong this time.
Some of his arguments
1. China's fix asset investment is at 70% of GDP and it is not sustainable. The transition between a infrastructure investment driven to a consumer based growth will be painful and the consumer can't pick up fast enough.
2. He is not all bearish about China and some of his China related long positions include casino operators such as LVS and WYNN. His argues that corruptions in China are hard to control and some of the money are ended on black jack tables in Macau.
From Business Insider
- The Fundamental Difference Between The Soviet Union And China Apr 2011
- Jim Chanos Just Announced The One China Long Bet He's Making Feb 2011
- Jim Chanos Explains Why There Won't Be Gentle Landing In China Feb 2011
- A Year After Calling Chanos An "Ignorant Slut", Stephen Roach Is Getting Nervous About Chinese Inflation Jan 2011
- Jim Chanos: Adam Smith Will Get His Revenge In China Dec 2010
- Jim Chanos Ratchets Up The China Rhetoric, Says It's On A Treadmill To Hell Apr 2010
- UBS' Jonathan Anderson Slams Chanos: China Is Nothing Like Dubai Feb 2010
Some of his arguments
1. China's fix asset investment is at 70% of GDP and it is not sustainable. The transition between a infrastructure investment driven to a consumer based growth will be painful and the consumer can't pick up fast enough.
2. He is not all bearish about China and some of his China related long positions include casino operators such as LVS and WYNN. His argues that corruptions in China are hard to control and some of the money are ended on black jack tables in Macau.
From Business Insider
- The Fundamental Difference Between The Soviet Union And China Apr 2011
- Jim Chanos Just Announced The One China Long Bet He's Making Feb 2011
- Jim Chanos Explains Why There Won't Be Gentle Landing In China Feb 2011
- A Year After Calling Chanos An "Ignorant Slut", Stephen Roach Is Getting Nervous About Chinese Inflation Jan 2011
- Jim Chanos: Adam Smith Will Get His Revenge In China Dec 2010
- Jim Chanos Ratchets Up The China Rhetoric, Says It's On A Treadmill To Hell Apr 2010
- UBS' Jonathan Anderson Slams Chanos: China Is Nothing Like Dubai Feb 2010
Sunday, April 24, 2011
Business Insider's onsite investigation
Dec, 14 2010. Amazing Satellite Images Of The Ghost Cities Of China
March, 2011 follow on video post, A Stunning Look At China's Ghost Cities
March, 2011 follow on video post, A Stunning Look At China's Ghost Cities
A recent bearish bet of China from Dr. Doom, Nouriel Roubini
April, 2011. Financial Times: Boom vs Doom: is Nouriel Roubini right on China?
China’s Bad Growth Bet, Nouriel Roubini on Project Syndicate
Why Roubini is wrong on China, Shaun Rein on CNBC.com
China’s Bad Growth Bet, Nouriel Roubini on Project Syndicate
Why Roubini is wrong on China, Shaun Rein on CNBC.com
Forbes Blog
Since China is running a market-oriented economy based on a totalitarian political system, it will be difficult to analyze China's real estate market using classic economic theories without understanding the role of the Chinese government .
April 2011,
why-chinas-property-bubble-is-different by Kenneth Rapoza
China’s Property Bubble? by Jack Perkowski
Jack referred a very interesting report from Economist Intelligence Unit (EIU), “Building Rome in a day: the sustainability of China’s housing boom”. And I kind of agree with what Jack pointed out that "outside observers like Chanos underestimate the efforts of the Chinese government to avoid a bubble..."
Other old blogs from forbes 2010
Here’s Why Andy Xie’s Latest Claim About Chinese Real Estate Is A Bombshell
Real Estate Curbs Dampen Chinese Billionaires’ Wealth
China Real Estate Needs ‘Cap’ To Avert Full-Blown Bubble: Executive
Reality Check For China’s Real Estate
Chinese Real Estate Bubble Is Bursting
Ghost Towns In China Due to Property Bubble
April 2011,
why-chinas-property-bubble-is-different by Kenneth Rapoza
China’s Property Bubble? by Jack Perkowski
Jack referred a very interesting report from Economist Intelligence Unit (EIU), “Building Rome in a day: the sustainability of China’s housing boom”. And I kind of agree with what Jack pointed out that "outside observers like Chanos underestimate the efforts of the Chinese government to avoid a bubble..."
Other old blogs from forbes 2010
Here’s Why Andy Xie’s Latest Claim About Chinese Real Estate Is A Bombshell
Real Estate Curbs Dampen Chinese Billionaires’ Wealth
China Real Estate Needs ‘Cap’ To Avert Full-Blown Bubble: Executive
Reality Check For China’s Real Estate
Chinese Real Estate Bubble Is Bursting
Ghost Towns In China Due to Property Bubble
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