"Les Cargill"
cfl.rr.com> wrote in message
news:483d0d93$0$12892$4c368faf@roadrunner.com...> John Galt wrote:
>
>>>>>>
>>>>> They've taught us nothing of the sort. China was, forever, a "nation
>>>>> of
>>>>> shopkeepers", then it went into a Five Year Plan mentality, now it's
>>>>> a very large , high order bias-and-subsidy Enterprise Zone, complete
>>>>> with a currency being invented and trillions in funny money
>>>>> floating it.
>>>> I'll have to disagree. China, Singapore, Vietnam, and even Hong Kong
>>>> (to a lesser extent) are examples of successful states that are not
>>>> inherently democratic, which was the point I was making (nothing more).
>>> Still, we have to examine just how it is that they are becoming
>>> "capitalist". China, as a "village" state, has always had pretty good
>>> flow of information from the bottom to the top, it was just gradually
>>> discarded over time. The society they built worked very well; it simply
>>> stopped changing.
>>
>> Well, let's first point out that from an investment standpoint, Chinese
>> companies that are not traded on a Western exchange are not transparent.
>> This lack of transparency has led many to suggest that there are no
>> Chinese companies of substance where a substantial interest is not owned
>> by the goverment.
>
> I don't see how it could be otherwise. Look at the
> level of bonds purchase from the US. You don't have
> any other uberclass in China to do that. Production
> facilities tend towards plantations - dormitory
> housing, uniforms.... you have an emerging salaryman
> thing in the big cities, but kids have to get huge
> grants (over a year's pay for one married couple)
> from their parents to buy a basic car...
>
> It's *not* free, it's *not* particularly capitalist,
> and it's brittle. But Japan took from say, '45 to '75
> to spin up.
Ah, you give the Japanese too much credit. Peter Lynch discusses how their
stock markets were not transparent even well into the late 80s and early
90's, and he gives the example of a Japanese broker who once told him a year
in advance on the QT what the price of a particular company would be a year
in advance. The price was exactly what the broker said it would be on the
date he said.
But, your comments on the Chinese I basically agree with, from what I've
seen and experienced.
>
>> Now, any large shareholder can be passive, active, or active when the
>> situation occurs, but I'm not sure that really matters. Even if the
>> government holds no official stake in a company, if you hang out in China
>> at all (and I do)
>
> Neat!
>
>> eventually you hear stories about this-or-that where the goverment came
>> and and basically told the businesspeople how to conduct some aspect of
>> their business. (They have the right to refuse, officially, but it's a
>> career limiting option.)
>>
>
> Right. I can certainly believe that.
One time early in 06 a group of us were in Shanghai. We went shopping for
knockoffs in a large market close to the Regent Hotel, Shanghai side of the
river, not Pudong. We're talking a half dozen city blocks of what we would
call a flea market, maybe more. It was well established, with many rigged
booths, but also many permanent booths with cinder block and concrete
structures, some even with A/C. We got a lot of nice stuff.
I went back there with my family in late 06 and stayed at the Regent again.
I asked the concerige at the Regent for directions to the market, and he
thought for a moment, and said "Ah, it's not there anymore." Because of the
PERMANANCE of many of the strucutures there, I was rather shocked, and asked
him why, hadn't it been there for a long time? He looked from side to side
quickly, and comfortable that no extra ears were around, said "25 years. The
government decided they wanted the land, so they al had to leave."
Then, of course, he pulled out a map, circled an area closer to the Bund,
and said "But most of them moved HERE...."
JG
>
>> But, it appears that the government has learned to keep their
>> interventions to a minimum.
>>
>> JG
>>
>
> When it starts to go bad....
>
>
>
>
> --
> Les Cargill
