Chris Zhang,CAIA’s Post

China, PBOC??? Folly is not learning from Japan very costly mistakes. Don't make the mistakes of Japan, MOF 1990-2012, huge wasteful, debt incurring policy. Use the playbook of Japan, BOJ from 2013-2023. Buy ETFs & REITS on a monthly basis from current depressed levels. That achieved: 1. Lots of profits overtime. 2. Boost consumers confidence. In turn boost economy. 3. Create lots of market wealth. 4. Boost market capitalization of Index listed firms. In turn boost investments, boost job creation, boost innovations. Virtuous cycle. Zero wasteful spending & zero debt incurred.

ASR's emerging-market economist - Adam Wolfe was quoted in the latest Bloomberg News piece on China's credit engine.   He noted that household savings, traditionally funnelled into property investments, are now entering the financial system. However, there is a noticeable shortage of borrowers to match this influx of savings. This trend underscores the People's Bank of China's (PBOC) efforts to establish a "new normal" for credit growth in the country.   https://lnkd.in/eMXVPuW2 For those interested in Wolfe's broader insights on China's economic impacts, he has previously authored a piece titled "The Global Spill-overs from China’s Reopening". Additionally, in March this year, Wolfe was invited to testify before the US-China Economic and Security Review Commission of the US Congress. His detailed testimony and a recording of the hearing can be accessed here: https://lnkd.in/eRj9ptAC ASR clients can read reports by Adam here: https://lnkd.in/g7aUwh5s   If you are not already a client and are interested in a free trial of our award-winning research, please see: https://lnkd.in/drYZWGy Absolute Strategy Research Ltd #Economics #China #CreditGrowth #FinancialMarkets #PBOC #EmergingMarkets #GlobalEconomy #EconomicInsights #Research #Bloomberg #USChinaRelations #ASRResearch #MarketTrends

🗞 ASR's emerging-market economist - Adam Wolfe was quoted in the latest Bloomberg News piece on China's credit engine.   He noted that household savings, traditionally funneled into property investments, are now entering the financial system. However, there is a noticeable shortage of borrowers to match this influx of savings. This trend underscores the People's Bank of China's (PBOC) efforts to establish a "new normal" for credit growth in the country.  https://lnkd.in/e_QAPin9   For those interested in Wolfe's broader insights on China's economic impacts, he has previously authored a piece titled "The Global Spill-overs from China’s Reopening". Additionally, in March this year, Wolfe was invited to testify before the US-China Economic and Security Review Commission of the US Congress. His detailed testimony and a recording of the hearing can be accessed here: https://lnkd.in/etYKrb5u   ASR clients can read reports by Adam here: https://lnkd.in/g7aUwh5s   If you are not already a client and are interested in a free trial of our award-winning research, please see: https://lnkd.in/drYZWGy Absolute Strategy Research Ltd #Economics #China #CreditGrowth #FinancialMarkets #PBOC #EmergingMarkets #GlobalEconomy #EconomicInsights #Research #Bloomberg #USChinaRelations #ASRResearch #MarketTrends

When meeting clients in the APAC early this month, some of my points on China especially struck a nerve and invited many questions. These points were: ·       Should China stimulate when the credit growth rate is 9-10%, and the net new credit creation was equivalent to 27% of GDP in the past 12 months (Chart)? ·       Why has the economy failed to recover despite such rampant credit growth? ·       Where are all these enormous new credit flows – 27% of GDP in the past 12 months – going? Even though China’s problems are well known, many investors incorrectly perceive their root causes. In the latest report, I discussed (1) the root cause of China’s problems, (2) where these colossal new credit flows are going, (3) why they are failing to produce a recovery, (4) what needs to be done to cure China’s credit addiction. The link to the report titled What Clients Are Asking is available here: https://lnkd.in/gur-T6zX

To the so-called China “experts,” analysts, pundits, observers, and investors… Who were hoping for and/or predicting further and bigger stimulus measures from Beijing to revive the economy, this article “这就是本轮经济刺激政策最大的大招，没有之一！市场对此解读严重低估！” posted today is an unofficial retort, if not a quasi-official statement on this all-important topic. A well-written piece, it should be read thoroughly, your views notwithstanding. The SOE advisor who shared the article had this much to say - “10万亿以上的拖款欠费是最大的问题.” Related to the topic - a globally-known Wall St. figure, often regarded as a pro-China investment expert, yesterday said China needs stimulus with “beautiful deleveraging” to avoid a debt crisis. If we are keeping score, I can say unequivocally that a few Chinese investors have amassed nearly as much wealth as this American, in far less time and without being burdened with managing a global fund. A significant difference, in some eyes, is that these long-time acquaintances have, at a minimum, “perfected” the art of the deal as part of their China investment strategy. It is not for the faint of heart and requires a modicum of prudence and discreetness. Hence, unlike the aforementioned American fund manager and others, these Chinese investors, for lack of a better term, ardently refrain from “抛头露面.” A must read. #china #economy #stimulus https://lnkd.in/gNrWtyiM

Economic data and stimulus blitz from China carried U.S. equities to their third straight week of gains… Chief Investment Officer, Chris Bouffard, CFA recaps last week's economic and market performance in our Weekly Market Update.📈 https://ow.ly/HKN150TyWSr #marketupdate #marketperformance #investing #wealthmanagement

Is it time for a new approach to investing in China? The world’s second biggest economy is too big to ignore, but the current environment appears too uncertain to inspire investor confidence. We explore some tactical alternatives to direct China exposures that could benefit from signs of economic stabilisation in the country and contribute to returns in a globally balanced portfolio. Proxy investments for ‘trading the dragon’ include European luxury goods companies, regional equity markets and beneficiaries of ‘friend shoring’, as well as via commodities and related currency trades. Read more from our experts here. https://lnkd.in/gD7vKySE #investmentinsights #macroeconomics #china #lombardodierasia

Chinese officials are eager to shed the "ABC" stigma and attract foreign capital, they're touting economic green shoots and promising a "slow-moving bull" market. Yet, they're also grappling with stubborn challenges:   ⭕ A festering property crisis: Despite recent easing measures, the real estate sector remains mired in debt and oversupply.   ⭕ Local government debt woes: Years of heavy borrowing have left many local authorities financially strained, limiting their ability to stimulate growth.   ⭕ Weak consumer spending: Households remain cautious, hesitant to unleash pent-up demand amid economic uncertainty.   Foreign investors, burned before by false dawns, are adopting a wait-and-see approach. They need more than just rhetoric and piecemeal stimulus. Concrete evidence of a sustained economic turnaround, along with clear and consistent policy signals, will be crucial to breaking the "ABC" curse and luring back foreign capital.   Can Beijing deliver? The jury is still out. The coming months will be critical in determining whether China can finally dispel the doubts and reclaim its allure for global investors.#China #stockmarket #foreign #investors

https://lnkd.in/giuhM3Ah Why invest in China's A-share market A once-in-a-century opportunity for foreign investors to make a fortune Investing in China's A-Share Market: A Hidden Gem China’s A-share market represents a world-class value opportunity, especially considering that the nation is the second-largest economy globally. Currently hovering around just over 3,000 points, the A-share market appears significantly undervalued. This presents a compelling case for investors looking for growth potential in emerging markets. Unlike many other major powers that have relied on conflict to achieve development, China stands out as the only major country to have prospered without resorting to war. This unique position not only underscores the stability of its economic growth but also enhances the long-term investment outlook for its A-share market. As China's economy continues to expand, driven by innovation and structural reforms, investors have a rare chance to tap into the potential of this undervalued market, positioning themselves for substantial gains in the years to come. 1. Economic Recovery and Growth Potential As China’s economy gradually recovers, the government has implemented various stimulus measures to boost consumption and investment. These policies are expected to drive corporate profit growth, providing strong support for the stock market. Technological Innovation and Industrial Upgrading China is accelerating its transition to high-tech and high-value-added industries. Emerging sectors such as artificial intelligence, green energy, and biotechnology are set to become new market drivers, attracting significant capital inflows. Increased Capital Inflows and Market Enthusiasm In recent years, foreign capital has consistently flowed into the A-share market. With the ongoing opening of China’s capital markets, more international investors are participating, further elevating market enthusiasm. Long-Term Investment Philosophy Investors are increasingly recognizing the value of holding quality stocks for the long term. Market participants are focusing more on fundamentals, which may lead to higher valuations for high-quality companies. Policy Support and Reforms Government economic policies and market reforms (such as the promotion of a registration-based system and the legalization of capital markets) provide a healthy environment for market development, helping to enhance investor confidence. Risk Management and Liquidity Although the market outlook is optimistic, investors should remain mindful of market volatility and potential risks. Proper asset allocation and risk management will be key to successful investing over the next decade. Investor Education and Market Maturity With the deepening of investor education, the quality of market participants is gradually improving, which helps enhance overall market stability and maturity.