Tuesday, January 11, 2011
With the stock market closing up 2010 with a nice rally, relative recovery is overshadowed by concerns of where the most money will be made in 2011. Could emerging markets be the answer?
Many investors are wary of the potential bubbles which could be forming, such as that of the Chinese housing market (most notably James Cannos of Kynikos Asosciates, a short only fund), but others are confident that the Chinese government having proved itself before will be able to contain the problem.
Those who argue for the potential of Asian markets look not to the economic activity and relative stability already in place but the excess of saving in China. With worries of inflation aside and taking into account rising wages it seems that the only missing part to the equation would be the same consumerism spirit which plagues other areas of the world. As soon the the Chinese learn to break the piggy bank and start spending we can expect corporate earnings to rise, making a nice profit for investors. If only we could some how introduce the magic bullet and snuggies to the Asian market. Could a Chinese TV Shop be the answer?