China Archives - Page 2 of 33 - Money Morning - Only the News You Can Profit From
I Just Uncovered Some Shocking Numbers About China
There are few things more exciting in the investment business than finding a golden opportunity staring you in the face.
That's why I do a lot of research. Because I know that the more I dig, the greater the chance I will find something that others miss, that leads to big opportunity.
Just like when I revisited China's recent economic data, looking for something in there that indicates whether the country's economy is any closer to reviving its engine of growth.
And its stock market, too.
The Chinese stock market has fallen 40.9% since August 2009, leading Oppenheimer to refer to it as a "dead animal" and millions of investors to conclude it's a lost cause.
All the more reason to dig…
How China's One-Child Policy Will Transform the Future Global Economy
In 1979, China implemented a one-child policy in an effort to alleviate social, economic, and environmental problems in the country.
Government officials indicate that the policy prevented over 250 million births between 1980 and 2000, and 400 million births between 1979 and 2011.
"China was a very different place back then," recalls Money Morning Global Investing & Income Strategist Robert Hsu. "It was very poor and there was overpopulation; they had to do something about it. I'm not saying that it's the best policy, but that's what they did to fix these problems. Nowadays though, the economic situation in China has vastly changed."
And changed it has – China is currently the world's second-largest economy, which is precisely why investors worry about how demographic issues there will play out globally. How will China's shrinking birthrate affect global economic growth?
What the Financial Press isn't Telling You About China’s Subprime Crisis
China is the world's second-largest economy, a simple fact that underscores the importance of its financial health to investors worldwide.
And unfortunately, thanks to China's subprime crisis, it's not doing as well as we're led to believe.
The Chinese stock market has fallen to levels unseen since the 2009 global financial crisis, and short-term interest rates have reached as high as 25%.
We've been told by the mainstream financial press the Chinese economic crisis is being caused by shadow banking.
The term has been demonized by reporters outside China. But that's not the whole story. In fact, there is a valid reason for shadow banking to thrive in China:
"Chinese banks are mostly state-owned, and they rarely lend money to the private sector. Thus, there has always been strong demand for financing outside of official banking circles," says Money Morning Global Investing & Income Strategist Robert Hsu.
Most Everything You've Heard about China's Currency is Dead Wrong (and that Means Money for Us)
Nearly everything you've heard about China's currency, the yuan, is dead wrong. It's not undervalued and it's not undercutting the U.S. dollar as the financial press and politicians like to point out. I'll show you why.
You likely heard that China recently reported it had grown just 7.5 percent in the second quarter of 2013, the lowest level in over three years.
What you likely don't know is, more than half of that growth came from wasteful infrastructure and property investments, such as this: http://www.ibtimes.com/worlds-largest-building-new-century-global-center-opens-chengdu-china-1330585.
China uses government investments as the main channel to pump money into its economy. The resulting monetary growth makes the Fed's quantitative easing seem like child's play.
Keith Fitz-Gerald Sheds Different Light on China’s Economic Growth Forecasts
We've heard reports of a slowdown in the Chinese juggernaut. Forecasts have shown that China's economy will grow by "only" 7.5% in the second quarter of 2013.
Europe is already in a recession, and America's own economic growth is wheezing along at less than 1% this quarter.
Is the media hype about China's economic growth slowdown overblown, or will it have real fallout for the United States and Europe?
Money MorningChief Investment Strategist Keith-Fitzgerald speaks with FOXBusiness' "Varney & Co."about what these figures really mean for the global economy. Watch the following video for the answer.
How to Digest China's Credit Crunch Cereal
So, you've been consuming large servings of China's "credit crunch" in your morning news lately…but do you know the ingredients hiding inside your breakfast?
Here is a simple breakdown on what China's credit crunch is, and why it's important to your wallet:
Let's begin with some shocking numbers.
China is the world's 2nd largest economy.
The Chinese stock market fell as much as 1.7% on Wednesday, and it had already reached lows unseen since the 2009 global financial crisis.
Short-term inter-bank interest rates last week reached as high as 25%.
It is an understatement to say that investors around the globe are extremely nervous as to what this all means for China's growth.
These dismal numbers all stem from the Chinese credit crunch.
China's government-controlled central bank, the People's Bank of China (PBOC), has been pulling back on feeding the banks yuan to meet the demand for money in order to combat excessive lending that was causing concerns it might overheat the economy and lead to bad investments.
Issues like creating a real estate bubble.
Sound intimately familiar? It definitely should.
Why Jim Chanos is Wrong About China's "Ghost Cities"
China's "ghost cities" present the West with the shocking images of vast urban areas that sit nearly empty.
In a striking report, shown recently on CBS News' "60 Minutes,"there are rows of high-rise apartment buildings, tracts full of suburban American-sized detached homes and imposing government edifices in China's western desert that are empty and utterly devoid of any signs of life.
Their existence has raised more than a few red flags among investors.
Invest in the Chinese Yuan Before It Takes Over the Financial World
It's only a matter of time before the U.S. dollar loses its more than 50-year reign as the world's dominant reserve currency, and it will be replaced by the Chinese yuan.
From January 2012-January 2013, transactions in yuan grew 171% in value, moving the yuan ahead of the Russian ruble to 13th place in global currency payments, up from 20th last year.
And you can bet the yuan will soon crack the top 10. In March, yuan payments grew in value 32.7%, compared with a gain of only 5.1% across all currencies.
Part of the reason for the yuan's growth is that at least half of all trade with emerging markets could be settled in yuan by 2013- 2015, which would be up from just 3% in 2010, according to HSBC.
For Money Morning readers, the rise of the yuan shouldn't be a surprise.
Why China Is Tunneling a Mind-Boggling 800 Miles in 2 Years
Would it surprise you to discover that China is planning to add 800 miles to its subway system over the next two years?
That's the distance equivalent to building a network from Dallas to Chicago in less time than the U.S. Congress can resolve a budget!
In 2015, when the out is complete, China's subway track alone will be a mind-boggling 1,900 miles, according to JP Morgan.
The Asian giant has been in the midst of constructing the world's largest transportation system, laying mile after mile of high-speed rail and subway track.
According to the World Metro Database, Beijing and Shanghai currently have the longest metro and subway systems, with about 275 miles each. The city of Guangzhou in China also falls in the top 10, with 144 miles of rail, beating Paris' network length of 135 miles.
This ambitious program is part of the pragmatic solution to help 1.3 billion residents move around the country efficiently and reduce the increasing problem of air pollution due to car emissions in big cities including Beijing.
The circulating reports and photos of Beijing's smog have recently become a dark cloud hanging over the country's remarkable achievements, but it's not a new issue. In the winter, smog conditions can seem much worse. Pollutants tend to linger when the air is heavier and colder compared to lighter, warmer air during the summer. In addition, the city is located near the Gobi Desert and has always been subject to sand and dirt storms, even back in the days when it was called Peking.