April 06, 2007 at 1:00 pm by Tom Lydon
Since the correction in China’s Shanghai A Index the benchmark has escalated 28% from it’s February low and exchange traded funds (ETFs) that focus in on that market are following. Consider this: China’s economy is hot-it grew 10.7% last year. Consumer demand is high, factory output is immense and corporate profits are up 62% year after year. Over a billion people are transitioning from a farm-based Communist economy into the 21st Century!
Martin Weiss recently reported on Beijing’s plans to invest $1.1 trillion of reserves into other things besides U.S. bonds. Even if they only invest one-third of that money, it’s already 21 times more money combined than what is now being invested into China by all the worlds mutual funds and ETFs together. China focused ETFs include PowerShares Golden Dragon Halter USX China Portfolio (PGJ) up 13.3% over the past month and iShares FTSE/Xinhua China (FXI) up 16.6%.
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