China’s $460 Billion Rally

A nearly unprecedented rally in China’s equity market earlier this month added more than $460 billion to share values and helped “lift global stocks to a one-month high.” This according to an article in Bloomberg. After first making a case for buying shares, however, the article reports that “China’s state media struck a more measured tone,” by urging investors to be “mindful of potential risks and not use the market as a way to make… Read More

China Stocks Buoyed by Eager Small Investors

Millions of individual Chinese investors have been buying stocks, “confident that Beijing has mastered the coronavirus and that cheap money, state spending and lighter regulation will produce a new boom.” This according to a recent article in The Wall Street Journal. The article reports that this enthusiastic buying—funded in large part by borrowed money– is part of the reason Chinese stocks have held up better than others across the globe: “Compared with financial markets elsewhere,… Read More

China Won’t Rebound Quickly from Coronavirus

In a recent article for Bloomberg, Mohamed El-Erian suggests that although the market is interpreting the impact of coronavirus on China’s economy as a “V”–“a sharp deceleration of growth this quarter followed by a strong rebound in the second”—its too early to tell what might happen. He writes, “many have argued that the best analytical approach is to ‘look through’ the crisis, treating its economic effects as containable, temporary and reversible,” but argues that “given… Read More

Bridgewater: China on Track to be Largest Economy in the Next Ten Years

The head of China research for Bridgewater Associates said that China will become the world’s largest economy in approximately 10 years because of the country’s decision to open its markets to outsiders. This according to an article in Chief Investment Officer. Speaking at the board meeting of the Arizona Public Safety Personnel Retirement Trust last month, Bridgewater’s Paul Podolosky told pension officials that Chinese assets are appealing as more than just a good portfolio diversifier,… Read More

Chinese Stock Market a Step Closer to Global Community

A recent Bloomberg article says, “China’s stock market is about to go global like never before,” reporting that on June 1st MSCI, Inc. added more than 200 locally-listed Chinese companies to the benchmark equity gauges that guide its investment activities. “While foreign investors still have concerns about everything from China’s debt risk to state intervention and capital controls, many are keen to increase their exposure to a $13 trillion economy that’s growing twice as fast… Read More

Geopolitics and Economics: Niall Ferguson Calls for a Strong U.S. Role, Concerned about China

Niall Ferguson of Harvard spoke with Barron’s about the interface of geopolitics and economics in the U.S, and globally. He emphasizes the importance of political stability to economic prosperity, noting that “[g]lobal order and stability need to be underwritten. It doesn’t just happen.” He opined that “[t]he global economy needs a strong hegemonic power to reduce conflict, ensure freedom of the seas, and so forth.” Therefore, he believes that the U.S. needs to act as… Read More

Chinese Easing Might be Magic Formula for Stocks says Tepper

In a recent CNBC interview, hedge fund manager David Tepper says, “if there was a magic formula, it would be China really easing a lot, and I consider them much much too tight still and they play a lot of games with their economy.” He continued, “not one quarter, but . . . a couple hundred basis points.”  Tepper opined that “the United States is great,” it is China “that’s really causing the problem; it’s… Read More