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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?


To: TobagoJack who wrote (66121)9/17/2010 3:23:19 AM
From: elmatador  Read Replies (1) | Respond to of 218256
 
The New Silk Road And The Center of the Trading Universe

History buffs will recall the Silk Road as the lucrative trade routes that crisscrossed Asia in the past. It connected merchants in China to India, the Middle East, eastern Africa and the Roman Empire.

These days, there is a new Silk Road emerging in Asia, Africa, Latin America and the Middle East. And according to the World Trade Organization, it generated some $2.8 trillion in trade in 2008.

The WTO also estimates that trade between emerging markets rose an annual average of 18% from 2000 to 2008. The same can’t be said for trade between such countries and their advanced counterparts.

In other words, this new silk road bypasses the United States and other developed economies.

The New Silk Road And The Center of the Trading Universe

by Tony D’Altorio, Investment U Research
Wednesday, September 15, 2010

History buffs will recall the Silk Road as the lucrative trade routes that crisscrossed Asia in the past. It connected merchants in China to India, the Middle East, eastern Africa and the Roman Empire.

These days, there is a new Silk Road emerging in Asia, Africa, Latin America and the Middle East. And according to the World Trade Organization, it generated some $2.8 trillion in trade in 2008.

The WTO also estimates that trade between emerging markets rose an annual average of 18% from 2000 to 2008. The same can’t be said for trade between such countries and their advanced counterparts.

In other words, this new silk road bypasses the United States and other developed economies.

Investing in China: The Center of the Trading Universe

Investors can most fully get a piece of the action by skirting developed countries altogether and focusing on investing in China, which is once again, the center of the trading universe.

Last year, China overtook the U.S. to become Brazil’s largest trading partner. And the Asian giant will likely emerge as Brazil’s biggest direct investor this year as well.

Investment came in at only $92 million in 2009 but should exceed $10 billion this year, thanks to a string of mining, steel, construction equipment and electricity transmission deals.

That kind of interaction helped Brazil to record China-style growth rates of nearly 9% for the first half of 2010. Those two growing economic ties have become symbolic of the ongoing global economic shift over the past decade.

Slowly but surely, China is becoming the anchor for a new cycle of self-sustaining economic development between Asia and the rest of the developing world. Even while it sucks in raw materials from outside emerging economies, China is also investing in infrastructure and industry in such places.

Together with its low-priced and increasingly sophisticated manufacturing companies, its low-cost financing terms have helped make such deals possible. China has focused successfully in Africa for years and now is rolling out this type of investment elsewhere as part of a long-term strategy.

Uncertain about the long-term economic prospects of the developed world, China wants to reduce its dependency there. And fellow emerging markets offer a sound solution so far.

Many other developing economies have the same concerns, so they don’t mind accepting what China offers.

The New Silk Road

Ben Simpfendorfer, an economist at RBS and author of the book The New Silk Road, says: “It is the start of a new cycle. China has companies that are willing to invest, they have products that are good enough, and they are backed by abundant liquidity in the country’s financial system.”

China has birthed companies that make internationally desirable capital goods. They offer developing countries new trains, power stations, machinery and telecommunications equipment at prices well below those of their multinational competitors.

And right behind them are Chinese banks to finance any such expenditures.

Take Brazilian mining giant Vale ADR (NYSE: VALE), which recently announced a $1.23 billion loan with two such banks to finance 12 huge cargo ships from a Chinese shipyard. The purpose: to transport iron ore between the two countries.

China knows exactly what it’s doing with such deals too. Its financial system has begun recycling its vast holdings of U.S. dollars into its trading partners in order to stimulate demand for Chinese goods.

The results show in China’s trade statistics, with the biggest increases coming from other emerging economies. Trade with ASEAN nations rose by nearly 55% in the first half of 2010 and by more than 60% with Brazil alone.

On the downside, all of this will likely increase competition between developed world multinationals and state-backed Chinese companies. And that could easily fuel accusations that Chinese businesses aren’t playing on a level field.

In fact, General Electric (NYSE: GE) has already started. After all, it used to dominate such sectors as power equipment and railways, areas that Chinese companies are taking over.

Silk Road Investments

The emerging markets now have strong trade connections. And that means the developing world has some protection against any more turmoil from the developed world.

The new Silk Road may not necessarily be one to easy riches but it’s important nonetheless. Fortunately, it isn’t that difficult to get involved.

Investors can buy broad-based ETFs such as:

SPDR S&P China (NYSE: GXC)
iShares MSCI Brazil Index (NYSE: EWZ)
WisdomTree India Earnings (NYSE: EPI).
There are also some relatively new emerging market sector ETFs from EGShares. And GlobalX Funds offers more of the same for Brazil consumer and financial sectors, and China consumer, financial, technology and industrial sectors, among others.

Any one of them gives a tantalizing taste of the wealth emerging nations have to offer.

Good investing,

Tony D’Altorio



To: TobagoJack who wrote (66121)9/17/2010 9:48:09 AM
From: Hawkmoon8 Recommendations  Read Replies (3) | Respond to of 218256
 
perhaps this goes some distance in explaining the cesspool that is the war mongering team usa

Oh yes.. China's got no connection to the exploitation of young girls and boys. No child prostitution/slavery rings..

I say investigate them, and if sufficient evidence is found, lock them away.

gvnet.com

What about Burma, which is one of China's close allies. Some of their military officials were caught back in 2007 running a prostitution ring.

guardian.co.uk

Think it's any different in China?

Virgins are in great demand among Chinese from Taiwan, Singapore and Hong Kong, Michael Satchell, writes in an extensive article on the topic in Preda. Chinese men prize sexual intercourse with young girls for the rejuvenating properties they believe to be associated with the act. According to O'Grady, "there are surprisingly large number of aging and wealthy Chinese businessmen who believe that they must deflower a virgin at least once a year to gain the energy needed to be successful in their business enterprise and have a long life".

military.com

asiafinest.com

Get out of your "Ivory Tower" TJ.. And don't think that Chinese military officers, with their foreign contacts, and responsibility for controlling the borders, aren't involved in child "sexploitation" as well. The rest of the world just won't hear about it.

Hawk