CLSA-Bulls versus BearsIn recent time, we are witnessing a debate amongst the major clients on growth rate of China post Olympics. On Friday morning our two top brains, Head of Economic research, Eric Fishwick and China Macrostrategist, Andy Rothman engaged in an interesting debate on the significance of a slowing Euro GDP and the possible impact to Asia, in particular, China.Eric's view is that Euro zone has followed Japan in posting negative growth. Asian exporters so far has benefitted from euro gains, despite weak EU domestic demand on account of appreciating euro.So now with euro all set to weaken, export growth from Asian countries will take beating...This will impact China's growth adversly, as around 80% of Asian export growth to the EU comes from China. Official trade statistics show that 20.5% of China's total exports go to the EU compared with 18% that go to the US.Andy Rothman takes a less bearish view and reiterates his view that a sharp drop in export growth will have only a small impact on China's economy, as domestic investment and consumption are the primary engines of growth, not net exports.Chinese goods have only grabbed big market share in the EU recently, and have done so at very wide margins. This mimics what China did in the US market a decade ago, and enables Chinese consumer goods producers to cut prices to protect volumes while remaining profitable.He feels domestic investment and consumption are driving China's economy suggesting that a deceleration in export growth will have only a muted effect. Andy cites steel industry example where growth fell from 136% to 13%, he beleives most of the slowdown is due to Chinese government policies rather than weaker demand.Safe Harbor Statement:Some forward looking statements on projections, estimates, expectations & outlook are included to enable a better comprehension of the Company prospects. Actual results may, however, differ materially from those stated on account of factors such as changes in government regulations, tax regimes, economic developments within India and the countries within which the Company conducts its business, exchange rate and interest rate movements, impact of competing products and their pricing, product demand and supply constraints.Nothing in this article is, or should be construed as, investment advice. __._,_.___ *****************************************http://in.groups.yahoo.com/group/investwise/INVESTMENTS IN INDIAWe are low-risk, long-term investors. Stocks, mutual funds and the entire investment gamut. Only financing/investment avenues in India will be discussed. For any assistance, questions or improvement ideas, contact [EMAIL PROTECTED] ==== Check our LINKS and FILES sections for a world of information. REGULARLY UPDATED.NEW! ==== Check "Tracklist" in Links and Files sections for Investment Ideas.****************************************************************Your email settings: Individual EmailTraditionalChange settings via the Web (Yahoo! ID required)Change settings via email: Switch delivery to Daily Digest Switch to Fully FeaturedVisit Your Group Yahoo! Groups Terms of Use Unsubscribe __,_._,___
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