Chinese exchange traded funds (ETFs) have been big performers in the past (up 80% in 2006), although they aren’t at those levels this year, they are still up about 15% year-to-date. This growth can be partially attributed to the country’s eagerness to participate in the global market. China also seems to be in the middle of an unprecedented construction boom, according to Jim Wiandt for Index Universe. Its economy has grown so quickly that the government has had to tighten credit six times and raise interest rates three times this year already. China’s like an economic runaway train with all its growth.
However, all good things come at a price and with an economy growing so rapidly, something usually slips by the wayside. For example, food and toy recalls have slammed China’s industrial sector. Will these recalls affect its booming economy? Will it result in countries placing bans on Chinese products or food? Will China implement better quality controls and standards?
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.