http://albertpeia.com/criticalchinaissue.htm
‘The investment world is
convinced that China is about to engage in another massive round of stimulus.
After all, this is what China did in 2008 when its economy slowed, so surely
this is what they’ll do now that the economy is slowing again.
The fact of the
matter is that China cannot and will not do this. The reason is that the
Chinese Government today is facing a very different set of circumstances than
it was in 2008.
Since 2008, global
Central Banks have printed $10 trillion in new money. Between this and the
supply shock to natural resource companies created by credit drying up in the
crash, the inflation genie is now officially out of the bottle.
This is most clear
in China, where workers have begun demanding wage increases.
With nearly a third
of its population living off less than $2 per day, any bump in food prices hits
China much harder than the US or other developed nations.
Chinese workers are
now demanding higher wages to survive. Indeed, this situation is so serious
that many multinational manufacturing firms are in fact moving facilities to
the US because of the greater stability there. Apple, Ford, GE,
Bridgestone and many others have announced this.
Even China’s
official data shows inflation is at a seven month high. Chilly weather is
blamed in the official reports, but the truth is that China has a major problem
with food inflation regardless of the weather.
The Chinese
Government cannot suddenly print a massive amount of money without facing
massive civil unrest. We already know that the Government is deeply concerned
about losing its grip on society from the fact that it is making a very public
display of cracking down on corruption.
This is meant to
appease a population that has realized A) it’s no longer better off than before
B) many government officials and their families are getting wealthy through
corrupt means.
So China cannot and
will not be engaging in massive stimulus for the simple reason that doing so
would kick off a very dangerous wave of civil unrest. Indeed, China’s new party
leader Xi Jinping has openly stated that China will not be pursuing high growth
rates through stimulus going forward.
This is why, smart
investors are already taking advantage of the lull in the markets today to
position themselves for several key issues (including the misguided beliefs in
China that we’ve analyzed above).
While everyone else
continues to believe the fairytale story spun by the political class and
mainstream media, our Private Wealth Advisory newsletter subscribers have
already been warned of these issues and are taking action (just as they did in
early 2008 when others were bullish, or in 2010 when the EU crisis first began
to take off).
Private
Wealth Advisory outlined several critical investment strategies, designed to hedge
our subscribers from the risks in the market while also alerting them to unique
investment ideas that 99% of investors don’t know about.
This includes out of
the way hard asset plays that are undervalued by as much as 70%, back-door
investments on the US debt ceiling talks that allow individual investors to
profit when the stuff hits the fan there, as well as a major slowdown in China.
To find out about
these investments and start positioning yourself for what we all know is
coming, but no one wants to openly admit, all you need to do is take out a
trial subscription to Private
Wealth Advisory.
You’ll immediately
be given full access to the subscribers’ only Private
Wealth Advisory website where you can find the historical archives of this
investment newsletter.
You’ll also begin receiving
new, hot off the press, issues of Private Wealth Advisory to your inbox every other
Wednesday. Running between 20 and 30 pages in length, these intensive
newsletters outline an expert understanding of what’s happening in the world,
in plain, easy to understand language so our subscribers have the best research
presented in the clearest way possible.
In this manner, our
clients are always informed about the economy, financial markets, and most
importantly, their investments.
To find out more
about Private Wealth Advisory and how it can help you and
your investments…’
Phoenix Capital
Research