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An Excellent Summation Of My Views On China

24 May 2010 No Comment

This is written by David Rosenberg as noted by Zero Hedge:

“With the world stuck with the USD as a reserve currency, the question is how much more monetization and QE (and make no mistake, the Fed will be forced to do more of both of these activities) needs to occur before people give up on the greenback. And for all those who question what could possibly take the place of the dollar as the world reserve currency, we would like to point out that any country that has a massive stockpile of resources, an even more massive producing class (as opposed to consuming), a clean sovereign balance sheet, and a society hell-bent on being far more capitalist than the US, would likely make a great target. One specific country in Asia comes to mind. However, this will not occur before the next global economic collapse as century-old habits are difficult things to break. Once the economic reset button is pushed half way once again, and the US-China vassal linkage is broken, look for fund flows to redirect promptly across the Pacific.”

Read that again.  It is excellent.  Ok, now read it one more time.

Essentially, yes, China has issues and is in a bubble state potentially due for a crash.  But, once it crashes, throw all your money at it, because the global economic engine of the future is China for the reasons stated in that quote.

Patience… the best investment opportunities of your life time might be just around the corner…

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