Sunday, October 26, 2008

你好 读者(Ni hao duzhe)-- Hello readers

I must apologize to all those who once counted on this blog for perspectives, news, analysis and all the rest that used to be provided on a daily basis.  Sadly Internet restrictions and lack of access in the far east have made it difficult, sometimes impossible to access blogger. 

I write to you from the beautiful, bustling, urbanized yet serene city of Suzhou, China.  

I had planned to keep this website going strong during my year long stay in China.  Sadly, it is incredibly difficult to update from here.  I will continue to try, and I have a new internet connection arriving in a few days, which I hope will allow me more privileges as I am being forced to provide everything down to my blood type in order to obtain (hehe).

While my connection lasts i'll get what word I can out.  Everyday as I check in with the world via my blackberry I see stock markets plummeting, governments hosting meeting to address the crises, blame being dealt left and right, and my portfolio sadly decrease in value more and more.

While on this side of the Pacific, many express concern and legitimate worry that something horrible is on the verge of beginning (a global recession).  Meanwhile, from a rational point of view, I don't exactly see the world crumbling into pieces.  Buildings are still going up, the malls in China are full, people are swiping their credit cards, mortgages are being taken to buy apartments and houses, and people have generally remained hopeful of a brighter future.

Whether it will still be like this 6 months from now when the economic problems of the West more fully manifest, I can not tell.  What I can say for certain is it is not in China or any other emerging market of Asia's interest to see the United States and Europe come tumbling down. There is still tremendous room for China to grow, and grow it will.  Factories which produce goods for export to the West will shut, but the economy will re-adjust with a heavier focus on the domestic front.  

Just as the United States has centers of economic activity - New York, California, Texas, etc, so does China.  Beijing, Shanghai, the Southern Coast, the rebuilding of Sichuan will dominate China's economy on the surface in the months to come.  

Yes, hardships will probably become more obvious in the poorer regions of the country in the months to come, but they will not dictate the course of China's economy.  I have come to learn, China can not grow to infinity on its own, if it could, my Chinese stocks would not be hurting so greatly right now.  China can however soften the impact it will feel from the global financial meltdown underway right now.  

After researching, analyzing and attempting to no avail to decipher the commodity trade between China and South America, one thing I can say for certain is that the recent plunge in commodity prices will help China continue to prosper, not hurt it.  Record high prices of everything from copper, iron ore to energy had become a genuine problem for many industries here in Asia.  

In the coming months it will be interesting to see how and if a new balance can be established, and where prices will settle.  I'll leave my personal observations here, and I hope to be able to soon be in a position where I can begin bringing news, analysis and my personal observations to all readers of this site.