Wednesday, January 27, 2016

Smart Money is Fleeing China - Don't Be Left Holding the Bag

Subject: Smart Money is Fleeing China - Don't Be Left Holding the Bag

Dear Subscriber,
Boris & Kathy
It’s been nearly two decades now, but some of you may still remember the “Asian contagion” of 1997 that wreaked havoc in the fastest growing region of the world and left some economies like Thailand permanently hobbled by the exit of hot money. Indeed the words “Thai baht” became shorthand for the dangers of investing in emerging markets and took out Victor Niederhoffer one of the most legendary hedge fund managers of all time permanently out of business.
So why concern ourselves with events that are nearly twenty years old? Because market history has a nasty habit of repeating itself and this time the damage may be far, far worse.
This year started with rumblings in the Chinese equity market caused by weakening of the Chinese yuan. But despite a couple of days of panic selling, few investors truly appreciate the danger that lies ahead. According to JPMorgan economist Nikolaos Panigirtzoglou, a stunning $930 billion of capital fled China over the past six quarters and his data doesn’t even account for the end of last year. That means that a cool one trillion dollars have evaporated from Chinese balance sheets in basically just one year.
Smart money is fleeing China at unprecedented rate as some of the wealthiest Chinese businessmen continue to “disappear”. According to South China Morning Post, “Xu Xiang, an aggressive private fund manager regarded as China’s George Soros, was arrested last month for alleged insider trading, while six of the top eight executives at CITIC Securities, a brokerage house aiming to become China’s version of Goldman Sachs, are being held for questioning over possible wrongdoing.”
As we told CNBC just a few days ago, the party is over. The chickens are coming home to roost. The junkets to Macao, the rampant corruption in the real estate sector, the ghost cities, the massive bank loans to essentially bankrupt and non-competitive state owned enterprises are all finally starting to crack up under a mountain of unproductive and unsustainable debt.
While the conventional wisdom worried about the “strength of the yuan” and the fact that China was manipulating its currency lower, we warned as early as the middle of 2014, that the country was a paper tiger, noting that if the going was so good at home why were the Chinese buying up all the real estate in New York and Vancouver?
Now investors are making the same complacent mistake, thinking that this is “just a bump in the road” when in fact it’s a gaping crater that is going to swallow up a lot of naive Western capital as the situation in China goes from bad to worse.
To help grow your wealth from China’s decline, Boris Schlossberg and I have agreed to be interviewed by Weiss Research’s Mike Burnick next Monday, January 25 at 2:00 PM.
The title of this special briefing is “The Ultimate Wealth-Building Tool for a World Gone Mad” — and the information we have for you is IMPERATIVE to be a successful investor in 2016. Here’s just a taste of the indispensable information we have in store for you:
** Carnage on Wall Street: The 13 “unlucky” reasons why Wall Street insiders say stocks and bonds are likely to collapse in 2016 ...
** Urgent self-defense: What you must do immediately — in early February if at all possible — to help grow your wealth and save your retirement ...
** The ultimate investment for a world on the brink: This “secret” investment market is virtually unknown to everyday investors — but the world’s richest bankers use it to grow richer even in the most terrifying times.
PLUS Boris and I will also give you ...
>> 12 compelling reasons why this alternative to stocks and bonds is essential to growing your wealth in 2016 and beyond ...
>> Three surprisingly simple ways to harness its enormous money-making power — and why at least one of them is sure to fit YOUR objectives and risk tolerance hand-in-glove ...
>> The quickest, easiest way to know what to buy, what to sell and when to do it — to go for gains that could multiply your money by up to 17 times — enough to turn every $10,000 invested into nearly $170,000 ...
>> And more.
And we will also give you our simple strategy designed to multiply your money as this crisis unfolds in the year ahead!
This is not a promotional event. Nothing will be offered for sale.
To attend, simply save this bulletin to your desktop, then click this link a few minutes before 2:00 PM Eastern Time (1:00 PM Central, 12 Noon Mountain, 11:00 AM Pacific, 7:00 PM GMT) this coming Monday.
Boris & Kathy
Kathy Lien
Boris Schlossberg
Weiss Research

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