If you have more than a passing interest in China no doubt somebody has brought to your attention a recent letter from Mr. Kyle Bass to investors in his fund Hayman Capital Management? [A friend sent me the link to the full text posted at ValueWalk which you can access here Kyle Bass Letter] Sticking […]
You’ve seen this image a lot in the last few months, or some version very similar. Bewildered (old or middle aged works best) retail investors with their heads in their hands. ‘What’ it seems to imply ‘were we thinking?!’. Or ‘I should have stuck to the ponies’ (which, BTW, you can’t in China). Yes folks, […]
You’ll need to print this out and read it carefully; but it’s worth the effort. In this 180-page tour de force Mr. Yi Wen of the Federal Reserve Bank of St. Louis’ Research Division and Tsinghua University deconstructs the British and American Industrial Revolutions to see what this tells us about China and it’s prospects. […]
Why is the West, and America in particular, so disliked, by so many in the Middle East (ME)? Constant meddling since oil was first discovered in large quantities has a lot to do with it. [Giving China a rest this week as I think we’ve had rather enough of it of late!] Over the Christmas […]
A twofer today. Not so much papers, more pamphlets. The first, from the World Travel and Tourism Council, highlights how important to the Chinese economy tourism is. They estimate by 2025 3% of China’s workforce will be employed in the travel and tourism business and that it could account for 10% of GDP at that […]
Summary Conclusion China’s financial market’s problems are home grown. As such weakness caused in other markets, especially China shares listed in Hong Kong, is unjustified. China will take time to fix broken systems; but that shouldn’t blind investors to the opportunities fumbling is producing. Preamble Complete understanding, of any market, isn’t possible; the knowledge would […]
The answer matters if you’re trying to predict how enthusiastically China will likely pursue alternative sources of energy and/or act to curb coal usage. In the paper highlighted this week, from Paul J. Burke of the Australian National University and Hua Liao of the Beijing Institute of Technology, they reach an encouraging conclusion. The price […]
China invests badly; and the situation is getting worse. With nearly 50% of GDP invested each year this is an unprecedented level compared to Japan or Korea at similar points of development who were rarely investing more than 40%. Calamity is the inevitable end-game as the system ultimately collapses under the debt burden associated with […]
Who doesn’t know* in Chinese culture the numbers six and eight are considered ‘good’ and the number four ‘bad’? Certainly not property buyers as this study of transaction details for a particularly warm spell in the Chengdu real estate market between 2004~2006 reveal. Particularly granular data is available for this period and Matthew Shum of […]
Here are some interesting statistics. How many US companies (up to 2010) combined the roles of CEO and Chairman; and how many Chinese companies (A-shares, to 2014) permitted the same duality? The answers are 54% and 26% respectively. So that’s good for investors in Chinese companies right? Not when you discover the China number has […]
No scary math for a change. Just a fireside chat of observation from Jijo George et al from the Department of Management Studies of Pondicherry University in Puducherry India on the never ending story of what it takes to shift product in the world’s second largest consumer market. Although the paper was posted at the […]
[I took a new-ish book for company on this visit; Ghost Cities of China by Mr. Wade Shepard and it’s the best, most informed and sensible work that I’ve seen on this issue. It’s an easy read and if you care about the subject I commend it to you highly. More at http://www.amazon.com/Ghost-Cities-China-Populated-Arguments/dp/178360218X] Introduction I […]
There’s no reason why views of the future need be timed to coincide with either the moon’s rotation about the earth or the earth’s rotation about the sun. Nonetheless, fund managers write monthly letters and seers in general think loudest about the future around this time of year. Having noted the above, and because it’s […]
It’s been noted ‘Big-Data’ is like teenage sex; everyone talks about it, nobody really knows how it’s done, everyone thinks everyone else is at it, so everyone claims they’re doing it. The paper highlighted this week, from Guanghua Chi (et al) from the Big Data Lab, Baidu Research, Baidu Inc. seems though to have harnessed […]
A break from China and investment theory this Sunday. What do wedding expenses and the cost of an engagement ring reveal about the likely duration of a marriage? To try and balance the wedding industry leitmotiv that more is more Andrew Francis-Tan and Hugo M. Mialon, both from Emory University, performed a study in 2014 […]
Beneath the title of this paper the late Benny Hill would have been proud to compose [Benny who? Really? This will either remind or introduce Benny Hill – Classic Chase. Part of my nation’s rich cultural legacy…] is a very important argument for any who have been persuaded that small-caps aren’t worth the trouble. The […]
Over the weekend of July 4th and 5th this year the Chinese government panicked. A raft of measures were announced to try and halt the slide in the domestic stock markets and in the following week over half of the stocks traded in the Shenzhen and Shanghai markets were suspended. The Shanghai stock market, at […]
China’s stock markets present to investors what Charlie Munger might describe as a ‘turds and raisins’ proposition. There are some good companies; but they’re mixed in with an awful lot of, often very big, duffers. Prior to their lift off last year these markets were startling underperformers (and, after their return to earth, remain so) […]
Albert Einstein observed “Compound interest is the eighth wonder of the world. He who understands it, earns it … he who doesn’t … pays it.” A break from China specifically this week as I highlight a paper from Antonia Grohmann (et al) from the Leibnitz University Hanover who wants to know where financial literacy comes […]
China is transitioning into a labor shortage economy, having been a labor surplus economy since at least 1991. What the authors of the paper highlighted this week, Mitali Das and Papa N’Diaye from the IMF, demonstrate is there’s no way out of what’s coming soon to a massive economy near you. Growth in the working […]