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Two Safe Ways to Profit From the "Alibaba Shockwave Effect"

In the mid-1990s, I was fortunate to meet and start working with an Upstate New York money manager named Anthony M. Gallea.

The relationship began when I attended and wrote stories about some of the investment seminars he periodically held for prospective and existing clients. He then became a “source” for some of the investment stories I periodically wrote for Gannett Newspapers. And we ultimately collaborated on a pretty successful book about “Contrarian Investing” that was published by Prentice Hall.


Along the way, Tony shared some pretty important snippets of investing wisdom…

  • Featured Story

    Forget About the Trade Deficit, Now is The Time to Invest in China

    You may have heard that China just posted the biggest trade deficit figures in over a decade .

    Naturally, this caused the usual suspects who have been waiting - some would say hoping - for a Chinese crash to jump up and down with excitement.

    But not so fast guys... one set of figures doesn't tell the entire story.

    The truth is the $31.5 billion trade deficit is actually a sign that things inside China are growing and that imports are becoming a more viable part of China's future than ever before.

    It's exactly as I've been telling Money Morning readers for several years now.

    Up some 39.6% year-over-year, the numbers are far ahead of expectations and a good deal higher than the 15.3% contraction China experienced in January.

    True, exports climbed at only 15.3% versus the 18.4% expected rate, but that's still plenty positive at a time when the so-called developed world is on track for overall growth of 1.3% according to The Conference Board.

    Get used to it.

    As China's wealth rises and its internal consumption strengthens, imports are going to decouple from exports and deficits like these will be the norm.

    If anything, these numbers reinforce the notion that investors should be actively looking to China and be accumulating Chinese investments.

    What Smart Investors Recognize about China

    What's changed?

    For starters, how China processes its imports. It used to be that the majority of stuff we sold them was fashioned into exportable goods that came boomeranging back to our shores as finished products.

    In other words, we sold China handles and steel and they sold us shovels.

    Maybe I'm exaggerating, but not by much. Today, more of China's imports now go straight to domestic consumption than we've ever seen before.

    What's happening is not magic. There is no rocket science. No hocus pocus.

    To continue reading, please click here...
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