A Bull in China: Investing Profitably in the World's Greatest Market
Rating:  -
Anytime someone makes you a lot of money, you tend to become a fan. And so I am a fan of Jim Rogers. I believe this man makes a lot of sense when he talks economics. I learned this by reading his earlier books about driving around the world. He admits to being a lousy trader. But he is great at looking at the big picture and investing according.
He made me money with an earlier book, Hot Commodities, which I had for four years before I invested in commodities. If I had invested when I first read the book, I would be retired 2 or 3 times over. Even though commodities have taken a huge tumble lately the bull market is not over yet and they will make me more money.
But this book is about the money that can be made in China. If you watched the 2008 Olympics you saw a new China. The reports from China are amazing. The growth, the production, the consumption, and everything about China is not just super-sized, it's gigantic-sized. With three stock exchanges, close to double digit GDP growth every year, and the largest financial reserves, there is plenty of opportunity here.
I am writing this review to help you decide if you should buy this book or not. I hope this review helps. If you want to read more of my reviews of stock trading and investment book, you can get them at www.thetradingtipster.com.
Another reviewer has already painstakingly detailed the book chapter by chapter. My takeaway is that if you are looking for places to invest, then get this book. It explains why China is growing and why it will continue to grow. This book also breaks down all the sectors of the economy. Everything from travel to agriculture to the Chinese space program is discusses and dissected in easy to understand language. Dozens of companies are also listed with brief descriptions of each. The descriptions are good because you get a sense of what if happening in China, but for the average American investor most of these companies cannot be invested in.
But even if you only focus on Chinese companies listed on NYSE and NASDAQ or get into the Chinese Market ETF (FXI) you can still make a nice long term gain. The author stresses that investing in China is a long term process with ups and many downs along the way. He does not recommend any company in the book, he only mentions them to give the reader a broad understanding.
If you want to know what's going on in China and profit from it, from a man who knows how to make money, this book is a great place to start. It opened my eyes to China when I first read it and am patiently waiting for an opportunity to invest in the largest bull market of our lifetime. The author compares China to the Wild West of America. Lots of money to be made, but you have to be careful.
By looking at the trends in the US market and what is going on around the world, it makes sense to reason that investments for the next few decades will probably get a higher return in places like China than in the US. Even if you don't agree with me on this point, you will probably agree that diversifying by investing in China is not a bad idea. And if you believe that then this book will help.
Rating:  -
As a big Jim Rogers fan, I am amazed to find myself giving his book a 1 star rating. While his first 3 books were excellent, this book should never have been published.
The book gives a cursory rehash of the "China is the next great super power" argument (which I believe is true) and then just gives long lists of random Chinese stocks with short and shallow rambles in between stock lists.
The book makes it clear that the listed stocks are not recommended stocks, just a long list of all the Chinese stocks that the author could come up with. It's obvious that no research was done on the stocks listed and most have no more than 1 paragraph on them describing what they do.
Rating: -
1. The Chinese saving and investment rate exceeds 35 percent among its 1.3 billion people.
2. There is room for upward growth in Chinese industry, including power and energy, tourism and media, agriculture, infrastructure, and high tech.
3. American Depositary Receipts is a way for Americans to invest in China.
4. Changes in regulation, reduction of tariffs, and the promise of greater market access for foreign first are beginning to shape competition in fields like banking, media, and telecommunications.
5. Commodities will be a way to profit from China's expansion. Owing a piece of the things that china's hot economy simply can't do without guarantees less need to worry about governments, management, or pension funds.
6. In 2006, China attracted $70 billion in foreign investment and brought their foreign currency reserves about $1.3 trillion.
7. Do you want to profit from increased purchasing power of the biggest middle class the world has ever seen?
8. Huawei Technologies sold 1.5 million notebooks in 2006.
9. Lenovo Group (LNVGY) caters to 160 countries and 2006 revenues reached $1.3 billion
10. China Spacesat (SHA) has increased orders for smaller satellites.
11. Shanghai Aerospace Automobile Electromechanical engages in military and civilian work, makes satellite-data-receiving equipment, auto parts, battery panels, and solar battery panels.
12. 2006, there are 137 million internet user in China and 76% have high speed internet. There are eighty million bloggers. Shanda Interactive Entertainment (SNDA) claims 2.29 million active accounts.
13. China has a baseball league, the CBL, Basketball (CBA), football (CSL).
14. 2006, China had sixty million credit card owners. 2009, the banks break even and by 2013, they are $1.3 billion in the black.
15. 2006, there were 440 million mobile phone services and another 48 million expect to join by 2007. China Mobile is the largest cell phone operator with 300 million subscribers.
16. Keeping holdings in the Chinese Yuan, or renminbi, may be a relatively safe way to hitch an upward ride on China's growth.
17. It is reasonable to expect a 300 to 500 percent rise against the debt ridden US dollar over the next twenty years.
18. In 2005, there were an estimated 510,000 public disputes across China, a sign that some forms of protests are being allowed. Will the turmoil rise to the point where it would seriously affect the business and investment climate?
19. Three reason why China's economy will flourish: a. rural dwellers replenishing aging labor b. corruption is comparable to Asian tigers c. foreign companies will invest to solve China's environmental problems.
20. There are 110 million Chinese carriers of hepatitis B and C.
21. Will China float its currency freely. The yuan levels against the dollar are increasingly strong. Will the higher valuations on the yuan cripple Chinese exports? Foreign investment and Chinese innovation should sustain demand for higher quality Chinese products, a similar cycle that the Japanese import/export cycle experienced in the 70s/80s/90s.
22. Is China heading for a "hard landing" as the Chinese government struggles to control growth. China's growth may not be strongly tied to US economics. In 1997, during the Asian financial crisis, China's market soared 38 percent. In 2000, as the US internet bubble burst, China's economy surged forward 49 percent. The US imports are not the only influence in China. Much of China's growth has been internal and stimulated by domestic demand. Because China is a country with high savings, a stock crash won't have the same impact on capital for expansion. Chinese companies have plenty of places other than the stock market for cash.
23. 2006, sixty-five million investment accounts or 10 percent of the population of China, grow from nothing.
24. What are the biggest challenges facing China? Excess liquidity, balooning credit, an asset boom and over-investment in loss-making heavy industries. All factors in Japan's downturn through the 80s.
25. In 2006, China produced 50 percent of the cameras, 30 percent of the worlds air conditioners, and 40 percent of the microwaves sold in Europe.
26. In 2005, 98 percent of villages were electrified and the second largest consumer of electricity in the world. By the end of the 1990s, the Chinese central government controlled less than 50 percent of the power production. The Big five include China Datang Corp, China Power Investment Corp, China Huaneng Group, China Guodian Corp, and China Huadian Corp.
27. China needs $2 trillion in electricity infrastructure between 2001 and 2030. In China, coal accounts for 70% of the electricity capacity. In 2007, China became a net importer of Coal.
28. China will reach US oil consumption of 20 million barrels a day within twenty years. China imports 3.5 million barrel/day of oil. Chinese oil refineries are among the best-managed enterprises. Due to price control, China ranks with the US among the countries with the lowest gas prices. The Chinese governments have been will to let gas prices rise to regulate use and allow Chinese oil companies to stay profitable. Chinese oil companies boost exports of diesel to take advantage of better prices on the world market.
29. The Chinese government plans on spending $200 billion on renewable energy.
30. China ranks number one in world farm output. China has a rural population of 940 million. China's farm production remains relatively unproductive. A single US farm hand works 140 acres and is 200 times more productive than his Chinese counterpart, who works one acre. China plans on a $42 billion investment in agrarian infrastructure: more efficient irrigation systems, retail markets, and e-commerce.
31. Between 2000 and 2004, China jumped from nineth to fourth in world agricultural exports by emphasizing products they have a comparative advantage: a half pound peach, fuji apples, Chinese Walnuts, mushrooms, garlic, Christmas trees, Mandrin Oranges, and strawberries.
Rating:  -
I agree with Jim Rogers. China is way too important for investors to ignore. China is growing fast and they are here to stay and perhaps are on their way to become the next great world power. But I found Rogers' book very flimsy. If you are unfamiliar with the changes in China, there are many other better books that can help you to better understand the changes. If you already know about these changes, then this book adds hardly anything. Book is also poorly organized. One minute he can be talking about the different dynasties or the cultural revolution, the next minute he talks about the newest companies in different industries.
From an investor's perspective, it gives you some information about various companies and types of shares (ie: A shares, H shares, etc.). There is no depth though. There are lists of companies in various industries, but Rogers provides hardly any information. He also does not teach you how to find out more about these companies and regulations that might affect investors. For example there are no answers to important questions like: Does China have anything analogous to SEC, GAAP? Where can we get financial statements on companies listed in Shanghai stock exchange? What is executive compensation like? Etc.
If you are thinking about investing in China then it is important to understand their culture, politics and recent business environment and Rogers tries to provide readers with some basic material here, but the lack of depth or new insights make this book not worthwhile. Here are some other books that I recommend:
China Wakes (a little outdated but still very important)
China Road
Wild Swans
Rating:  -
As a professional in the investment business I highly recommend this book. I will sum it up in a few words. A book that all CEOs, World Leaders and anyone serious about understanding the positioning of the United States in the decades to come. A fascinating book written by an intriguing person, the combination equals a must read.
|
