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

To: TobagoJack who wrote (66215)	9/20/2010 12:43:14 AM
From: energyplay	Read Replies (1) \| Respond to of 218688

Taiwan opportunities - >>>We believe that Taiwan would be the best beneficiary of China recovery. For the past 50 years, Taiwan has been isolated politically and financially by its big brother. With last year’s KMT election to power, Taiwan finalized a historic trade agreements with China in June and started in August, new negotiations with Singapore to do the same. We believe there will be a new P/E expansion for this country. Taiwan Q1 and Q2 2010 GDP grew at 10% and 13%, respectively, compared to China’s 11.9% and 10.3%. China/HK are 40% of Taiwan’s exports. As a laggard, second worst performing Asian market YTD at -5%, and under-owned sovereign by international investors provide low downside risk.<<< This "financially" adjective is not completely correct, as many Taiwan firms have operations on the Mainland and have for over 10 years, and it is commonly believed that many Mainland people have some investment or interest in Taiwan companies,often through Hong Kong or Canadian holding operations, or relatives, or other means. The other numbers, including the "40% of Taiwan's exports go to China / HK" show the degree of integration of the mainland and Taiwan economies - from an economic view, the case could be made that unification has already happened ;-) So what happens now if MOST formal capital controls between Taiwan and PRC are removed ? Will the various proxy ownership structures be unwound, or just continue ? There is a good chance of huge sums of money flowing around. Some of that will likely end up in Victoria Peak property in HK, some in gold, since gold is the fashion of the the year. Since the Mainland property market looks very soft, and it is reasonable to expect that after making some strong moves to cool property speculation in China, the last thing the PRC economics people want to see is a wave of hot money moving into real estate, that money will either go for new factories (possibly inland) or get parked / invested outside of the mainland. Here's an article on the Taiwan government FX reserves - this is not private capital, but will mirror private capital to a degree. taipeitimes.com The wikipedia article on the Taiwan economy - note the larger number of small and medium businesses, instead of giant chaebols - en.wikipedia.org ******** Simplifying what I am trying to say, there is a big lake of money that has been at least partially restricted and dammed, and MOST of that dam will be coming down. Much of that money would go into property in China, but China does not need more hot money to push up the RMB and make a property bubble. So I expect a lot of the money will go to Hong Kong, either long term,or on the way to somewhere else... >>>This is a huge pile of money<<< Larger than the 146 billion Greek bailout. Is anyone looking at this ? It's a way to move Vancouver condos, Thailand beach property, expensive watches, and maybe even a time share in a New Zealand sheep.