Wednesday, February 25, 2009

Buy China

Many investors should be looking to buy into China because of the growth and stability in the Chinese economy.  The consumers in China are starting grow and have not been too effected by the downturn because of their very high savings rate.  The Chinese government would actually like to see the Chinese people consumer more goods.  The best way to invest in the Chinese market is to buy American companies that have a strong presence in China.  I would disagree with those that would rather buy Chinese equities. (although they are finally a bit more fairly priced)

American companies can not only be trusted more then their Chinese counterparts, but they are much more efficient as well.  The heavily centralized government should definitely make an investor think twice about owning common stock in a Chinese company.  American companies are usually much more diversified and also have proven management that is used to competing on a global stage.  With the markets severely down, I see many quality companies with heavy Chinese exposure that can allow investors to finally get into China without paying a "premium" price.

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