If all you've been hearing regarding China recently is noise about its economic slowdown, you need to find a better news source.
Investors need to stop worrying over China's long-expected gradual slowdown. Do so and you likely will see, as my guest today does, the long-term growth ahead for key tech sectors in the world's most populous nation.
I'm talking about the kind of growth that will fill investors' portfolios with soaring profits for years to come.
Back from China
That's one takeaway I gleaned from an in-depth conversation I just wrapped up with one of the tech investing world's leading China experts. And he has plenty more evidence to debunk the "Chinese slowdown" story.
In other words, Kevin Carter is helping us "Separate the signals from the noise" - Rule No. 2 of Strategic Tech Investor's "Your Tech Wealth Blueprint."
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He just returned from a trip to China, so now is the perfect time to hear what else he has to say...
My guest today, Kevin Carter, runs the Emerging Markets Internet & Ecommerce ETF (NYSE: EMQQ). On his most recent overseas trip, he spent his time checking up on the health of China's tech industry and economy.
Carter's fund concentrates on Chinese tech leaders like STI's "Million Dollar Tech Portfolio" holding Alibaba Group Holding Ltd. (NYSE: BABA) and Baidu Inc. (Nasdaq: BIDU), the so-called "Google of China."
Today, I want to share his thoughts on the profit potential that lies ahead for Chinese tech firms. The following is an edited transcript of our wide-ranging conversation.
Michael Robinson: Having just returned from China, can you give us your ground-level assessment of economic conditions there?
Kevin Carter: I'm just back from 10 days in four cities in China - Shanghai, Nanjing, Yangshuo, and Beijing - and I'd have to say, quite strongly, I saw no signs of China "slowing down." Domestic leisure travel, or tourism, is a prime example of consumption and China's move toward a service economy.
One of the main things I observed was that all of the places I visited were more crowded than I had ever seen them. And, importantly, the crowds seem to be coming increasingly from second- and third-tier cities. Their increasing presence is an indicator that domestic tourism continues to grow rapidly.
Another observation is the spread of the smartphone. As I awaited my delayed flight from Yangshuo to Beijing, I noticed that nearly everyone waiting with me was on a smartphone. From my count, at least 70% of the people were on their smartphones.
I also experienced firsthand how app-based business models, like Airbnb and Lyft, are spreading in China just as they are here in the United States.
I was the first person waiting for a taxi in the cue at the Grand Hyatt Beijing one night. Three times a cab turned into the circle only to be quickly taken by people that held up their phones and said "Didi Dache." When I expressed my dismay that they were "taking my cab," I was informed that Didi Dache is "the Uber of China."
About the Author
Michael A. Robinson is a 36-year Silicon Valley veteran and one of the top tech and biotech financial analysts working today. That's because, as a consultant, senior adviser, and board member for Silicon Valley venture capital firms, Michael enjoys privileged access to pioneering CEOs, scientists, and high-profile players. And he brings this entire world of Silicon Valley "insiders" right to you...
- He was one of five people involved in early meetings for the $160 billion "cloud" computing phenomenon.
- He was there as Lee Iacocca and Roger Smith, the CEOs of Chrysler and GM, led the robotics revolution that saved the U.S. automotive industry.
- As cyber-security was becoming a focus of national security, Michael was with Dave DeWalt, the CEO of McAfee, right before Intel acquired his company for $7.8 billion.
This all means the entire world is constantly seeking Michael's insight.
In addition to being a regular guest and panelist on CNBC and Fox Business, he is also a Pulitzer Prize-nominated writer and reporter. His first book Overdrawn: The Bailout of American Savings warned people about the coming financial collapse - years before the word "bailout" became a household word.
Silicon Valley defense publications vie for his analysis. He's worked for Defense Media Network and Signal Magazine, as well as The New York Times, American Enterprise, and The Wall Street Journal.
And even with decades of experience, Michael believes there has never been a moment in time quite like this.
Right now, medical breakthroughs that once took years to develop are moving at a record speed. And that means we are going to see highly lucrative biotech investment opportunities come in fast and furious.
To help you navigate the historic opportunity in biotech, Michael launched the Bio-Tech Profit Alliance.
His other publications include: Strategic Tech Investor, The Nova-X Report, Bio-Technology Profit Alliance and Nexus-9 Network.