Jun
18
China Growth
Junho 18, 2009 |
China is focusing on growing internally—and not through export…
This is why they’ve cut down on buying U.S. Treasuries and are reinvesting their stimulus money in their own economy.
To be sure, that’s less than the hot years of 11% annual growth, but compared with the 3% contraction projected for the U.S. this year…
The reasons are simple:
· China is the only country on Earth that’s growing, and with none of the exposure to the problems in the U.S.
· China has no restrictions on spending stimulus money.
· China’s banks are stronger with no sub-prime mess holding them back.
· China has a $2 trillion surplus to spend as it sees fit. AND—get this—
· China has shrewdly tied up Russian oil reserves at $28 a barrel to fund it’s growing energy demands.
A recent report by McKinsey Global Institute will tell you the same thing:
“In 20 years, China’s cities will have added 350 million people—more than the entire population of the United States today.”
“By 2025, China will have 221 cities with more than one million inhabitants—compared with 35 in Europe today—and 24 cities with more than five million people.”
“By 2030, 1 billion people will live in China’s cities…170 mass-transit systems could be built…40 billion of square meters of floor space will be built in five million buildings—50,000 of which could be skyscrapers.”
In other words, as China transforms itself from a nation of farmers to a nation of urban dwellers, the equivalent of 10 New York cities will need to be built, and in doing so will richly reward investors who invest now.
The reason is simple:
With 7% growth, China’s economy is still growing like a weed. Its standard of living is on the rise. And its people are spending like there’s no tomorrow: buying into a much richer lifestyle, filled with cell phones, big-screen TVs and cars—the same things Americans take for granted.
When you consider that by the year 2025 China will have 221 cities with more than one million people living in them, you can only imagine the kind of money that is going to be made, as China’s newfound consumer class enters the marketplace and replaces the American consumer as the supreme driver of world growth.
The bottom line is this:
In a world that’s been crippled by the U.S. financial crisis, the Fed bailout, and collapsing consumer and investors confidence, the flood of capital pouring into China will put powerful upward pressure under the stock prices of companies that are fueling China’s new growth…
Profit From China’s Thirst for Oil: (Brazil will be continuosly “financing” commodity boom of China)Two reasons: 1. Rising oil prices, and 2. China’s dependence on foreign oil to fuel its growth.When you consider that China’s dependence on energy exports is expected to increase significantly over the next 20 years and it is projected that China will need to import at least 60% of its oil and 30% of its natural gas by 2020…
Profit From China’s New Housing Boom: (as well as in Brazil)
As Chinese workers invest their newfound wealth, their first goal is to own their own home.
Profit From China’s Love for Cell Phones and All Things Wireless: (as well as in Brazil)
Make no mistake about it, China leads the world in telecom growth. By 2010, half of the world’s 1 billion global subscribers will be located in China.
When it comes to China, the big money is always made when most investors are looking the other way. Frankly, it’s been that way for the past 120 years. It will continue to ring true for the next 20 as well