China Syndrome Part-II

In earlier writing:

Will China be the next super power? I don't know, I only remember Napoleon once said, "When China wakes, she will shake the world."!!!

Skeptical?

China skeptics still manage to make a living by comforting investors afraid they have already missed the opportunity to profit from China. Joe Studwell, a British freelance journalist, wrote The China Dream in 2002, characterizing China as a dream that would turn into a nightmare for foreign investors. He depicted GM’s investment in China as a disastrous decision, prophesizing that GM would meet their target of one million in annual unit sales only in more than twenty years ahead, in 2025. Yet three years after the publication of his book, GM reported that China’s total vehicle sales neared 7 million units, and GM’ s sales rose 35.2 percent on an annual basis to a record 665,390 units. GM now makes more money in China than in North America, a reality of which GM’s stockholders are painfully aware of.

Studwell at one point worked for the Economist, which also ran articles that predicted China’s collapse into smaller self-governing states. As recently zhanga’s 2006, Barron’s ran a cover story called “What Could Go Wrong With China?” even as China expanded at an 11% annualized pace that year. The article’s author, Jonathan Laing, correctly points to three challenges China faces: an aging population, environmental problems, and corrupt government officials. Yet he misses the more obvious trends: there are hundreds of millions of rural dwellers not subject to the one-child policy eager to replenish China’s labor force for decades to come; China’s environmental problems present a huge opportunity for foreign companies that specialize in the area of environmental solutions as well as alternative energy; and the same sense of corruption was pervasive a decade ago in Hong Kong, two decades ago in Taiwan, and perhaps a century ago in the United States.

But, Jim Rogers, the legendary "Quantum Fund" cofounder (together with Soros, will feature later) and the best seller book author is definitely a bull. He commented in his new book:

If the twentieth century was the American century, then the twenty-first century belongs to China. Now the one and only Jim Rogers shows how any investor can get in on the ground floor of “the greatest economic boom since England’s Industrial Revolution.”

--Source:
"A Bull in China
Investing Profitably in the World's Greatest Market "

He is so bullish on China, he call himself "THE BULL OF CHINA". He will sell his residence in NY and he move to any Chinese speaking community which is close to China if other conditions are met. The latest words are he will move to Singapore:

‘A Bull in China' Leaving New York for Singapore on The New York Sun September 14, 2007 edition


His doughter was born in 2003, and he hired a Chinese speaking nany and tutors and made clear that they can only speak to her in Mandarin. This is what he said in his new book:

I was once skeptical of China too. In fact, when I appeared as a featured guest on China Central Television’s flagship program, Dialogue, to discuss China’s stock market in the spring of 2004, the host was indignant that I was predicting stagnate growth for at least another year or two. The producers of the show were so horrified that they temporarily censored it and wouldn’t air it. But they did eventually air it, after the market tanked just as I explained and was headed for the recovery I also predicted would happen. You see, I am far from pessimistic about China’s growth. In fact, I am so optimistic about China’s long-term prospects that my daughter, who was born in 2003, is learning Chinese. Her Chinese nanny speaks only Mandarin to her, and I expect that she might learn Chinese before she learns English. In her lifetime, Chinese will be the most important language in the world, next to English. I have said, and I repeat again, if you are young and ambitious, learn Chinese. If you have ambitions for your children, persuade them to learn Chinese.

China’s economy is a train about to leave the station. And it’s not too late to catch the train if you haven’t boarded yet. China’s ripe for demand-driven booms in many sectors and will cause its fair share of demand shocks in the commodities markets.
How are investors to benefit from China’s growth? There are many misconceptions about China’s foreign investment policies, not the least because the government keeps changing them. This book aims to give an overview of the possibilities in investing in its growth.

-- To be continue