Please take out 10 minutes and read the fascinating article by clicking the link below.
Wall Street's Bailout Hustle
MATT TAIBBI
Posted Feb 17, 2010 5:57 AM
Saturday, February 27, 2010
Article on Goldman Sachs
Please take out 10 minutes and read the fascinating article by clicking the link below.
Wall Street's Bailout Hustle
MATT TAIBBI
Posted Feb 17, 2010 5:57 AM
Monday, February 15, 2010
China goes to America
It used to be that Americans had the most money and maximum muscle power to go and acquire companies in other parts of the world or expand the American multinationals, until now.
Now increasingly the tide has turned. The Chinese and Indian companies (besides Abu Dhabi and Singapore Sovereign Wealth Funds) are now acquiring strategic, minority and majority stakes in the same multinationals they used to fear just a decade ago. One person's crisis is another person's opportunity!
Chinese companies have invested over USD 56b in 2008 while the precise numbers for 2009 are not yet available but could easily surpass USD 100bn if the 111% growth between 2007 to 2008's USD 56bn is to be extrapolated.
The recent filing under a US legal requirement with the SEC has shown what kind of companies has China invested their surplus money over the last 1 year. The companies are 82 in number and only a few have a large stake while most others are small stakes of less than 1% of the listed stock. However, the key point is that China has shown transparency with the public filing of such information as well as indicated where they are investing some of their reserves instead of just buying US Treasury bonds.
It is also my current opinion that in 2010 the US markets shall outperform most other major and lot of emerging markets. The reasons being that emerging markets did a fantastic recovery and provided between 40% to over 100% returns in 2009. This may not be possible due to slow global recovery, slow demand, still declining employment opportunities, fear of personal spending due to prevailing joblessness, lack of boom in any part of the world with the exception of China and some sectors in Brazil/India, inflation having caused unnecessarily high prices and wage disparities besides the major Governments worried to save their financial institutions in the past 2-3 years and that every year different markets outperform, among other factors.
This year hopefully the US markets will be one of the major markets to outperform besides Australia and Canada. The last two would outperform due to their robust economies and financial systems that have not suffered unlike the rest of the world in addition to their enormous natural resources of oil and other minerals & metals. US shall hopefully outperform since it cannot decline any further after 2 years of severe declines, decreasing job losses, foreigners investing more - just like China is - to capitalise on the enormous potential of USA over the long term and the FIFO philosophy (First In, First Out) in the recession. I believe America is almost 80% out of the recession at this juncture and shall continue to strengthen over the coming year. The weak dollar is helping the exporters of America to export their goods at a cheaper price and most major corporations are declaring profits and improving. The problems of Europe are just beginning and shall accelerate, in my opinion, and shall peak by sometime next year in 2011.
The Shanghai Stock Exchange peaked at 6,100 level in Oct 2007 and fell down to a level of 1,700 in Oct 2008 and today is trading at 3,000 level in Feb 2010. I believe it has a long way to go and a rise to 6,000 level should be expected in the next one if not over the next 2 years which basically means doubling the investment made in China index or funds (not just in individual stocks).
With China announcing almost USD 10bn of stock related investments in USA in 2009, it about time other investors should follow. Also please note that this USD 10bn is just the investments in listed securities and does not include the amount invested in unlisted securities, private equity transactions, real estate or US Treasury or other corporate bonds. China is expected to increase their investment size again in 2010 so stay tuned...
The next opportunity shall be both in China as well as in America at least over the next year, if we watch where the professional and sophisticated money is being invested.
How to Profit From China’s Next Move
February 11, 2010
By Keith Fitz-Gerald, Chief Investment Strategist, Money Morning
Now increasingly the tide has turned. The Chinese and Indian companies (besides Abu Dhabi and Singapore Sovereign Wealth Funds) are now acquiring strategic, minority and majority stakes in the same multinationals they used to fear just a decade ago. One person's crisis is another person's opportunity!
Chinese companies have invested over USD 56b in 2008 while the precise numbers for 2009 are not yet available but could easily surpass USD 100bn if the 111% growth between 2007 to 2008's USD 56bn is to be extrapolated.
The recent filing under a US legal requirement with the SEC has shown what kind of companies has China invested their surplus money over the last 1 year. The companies are 82 in number and only a few have a large stake while most others are small stakes of less than 1% of the listed stock. However, the key point is that China has shown transparency with the public filing of such information as well as indicated where they are investing some of their reserves instead of just buying US Treasury bonds.
It is also my current opinion that in 2010 the US markets shall outperform most other major and lot of emerging markets. The reasons being that emerging markets did a fantastic recovery and provided between 40% to over 100% returns in 2009. This may not be possible due to slow global recovery, slow demand, still declining employment opportunities, fear of personal spending due to prevailing joblessness, lack of boom in any part of the world with the exception of China and some sectors in Brazil/India, inflation having caused unnecessarily high prices and wage disparities besides the major Governments worried to save their financial institutions in the past 2-3 years and that every year different markets outperform, among other factors.
This year hopefully the US markets will be one of the major markets to outperform besides Australia and Canada. The last two would outperform due to their robust economies and financial systems that have not suffered unlike the rest of the world in addition to their enormous natural resources of oil and other minerals & metals. US shall hopefully outperform since it cannot decline any further after 2 years of severe declines, decreasing job losses, foreigners investing more - just like China is - to capitalise on the enormous potential of USA over the long term and the FIFO philosophy (First In, First Out) in the recession. I believe America is almost 80% out of the recession at this juncture and shall continue to strengthen over the coming year. The weak dollar is helping the exporters of America to export their goods at a cheaper price and most major corporations are declaring profits and improving. The problems of Europe are just beginning and shall accelerate, in my opinion, and shall peak by sometime next year in 2011.
The Shanghai Stock Exchange peaked at 6,100 level in Oct 2007 and fell down to a level of 1,700 in Oct 2008 and today is trading at 3,000 level in Feb 2010. I believe it has a long way to go and a rise to 6,000 level should be expected in the next one if not over the next 2 years which basically means doubling the investment made in China index or funds (not just in individual stocks).
With China announcing almost USD 10bn of stock related investments in USA in 2009, it about time other investors should follow. Also please note that this USD 10bn is just the investments in listed securities and does not include the amount invested in unlisted securities, private equity transactions, real estate or US Treasury or other corporate bonds. China is expected to increase their investment size again in 2010 so stay tuned...
The next opportunity shall be both in China as well as in America at least over the next year, if we watch where the professional and sophisticated money is being invested.
How to Profit From China’s Next Move
February 11, 2010
By Keith Fitz-Gerald, Chief Investment Strategist, Money Morning
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