China resurgence

Posted: September 11, 2013 in Uncategorized
Tags: ,

The Chinese market formed a nice bottom in August and now everybody starts jumping on the boat….which will be very fast for the next 6 months.

The new political class now it is in charge and will have to show that they are great and wonderful…with a lot of fake data.

The funniest example is the jump in retail sale is great….but in China is accounted as number of units that left the factory…….can I repeat…not sales! Just how much increase of production.

Then in six months (after the Chinese New Year) there will be a lot of unsold items and factories winding down production and the evaporation of the miracle.

The issue is that the Chinese issues are much more deeper and a lot of them are social:

– the Chinese are some of the biggest savers in the world

– the Chinese “saving face” is extremely important. Even the Government does not know if the figures from the various region are correct (well they are not).

The GDP growth is 7.5%pa (in reality will be 5.5%pa if my calculus is correct)

But until everyone believes everyone else all will go all right. Enjoy a rally at least until end of the year (probably after October, I mean)


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