So we’ve watched the markets drop significantly in the last few weeks, and we had a little bit of a bounce on Friday and today. ..but as I said yesterday the market is undecided on a direction, after this correction. So when this happens I focus on finding extremely undervalued plays and I take very large positions in the stocks. (I suggest you read my blog from yesterday!!)
I also watch for sentiment, though it rarely sways my decision on long term investing, I do appreciate when everyone goes extreme bullish or bearish in one particular area of the market. It seems right now it’s cool to go bearish on China. Everyone is still talking about a bubble in China, the government is pulling back, blah blah blah.
Yet with all of this bearish sentiment it makes me wonder why certain funds are still taking large positions in China stocks while talking out of their ass on how crappy China is. These guys are about as subtle as a bull in a China shop.
Na, it doesn’t make me wonder “why”, it just makes me laugh. Even though $NEP and $CCME are *still* higher than they were when we started buying them after/before this recent correction, they are still off significantly from their highs. $LIWA fell from like $12 down to $7 and change, and *nothing* has changed fundamentally with the company. I sold all of my previous positions of $LIWA and took some profits from $NEP at the high, but I continue to add on the way down. I’m now rebuilding a position of $LIWA — a mega position — and I have faith the numbers should continue to roll in strong.
I don’t understand why people have such short memories in this market. You will remember, soon enough, why you should buy undervalued companies when no one else is looking. The DOW was up like 200 today and $LIWA and $CCME barely moved!! haha ha ha ha haha!
That said, I welcome you, my fellow Americans and Canadians, to travel to China. Go look around, and do your research. This country has the most tremendous emerging and economically responsible middle class I’ve ever seen. …ever!!
Yes, they have challenges, but take off your American “democracy rules” hat and understand that China is run by a very focused and controlled government. It’s important to respect the way the government can combine a communist society with democratic ideals.
Here are some reasons to remain long term Bullish on China in particular:
- Practically everyone in China has a job
- They don’t like or carry much personal debt
- The middle class are earning more money year after year
- They are exporting more product than they can physically ship in some areas
- They are consuming more oil than they produce, yet they are producing and acquiring more oil properties than most countries.
- The government is controlling the growth, but making responsible decisions in infrastructure that directly affect the income and growth of business in China.
- Read the last point again next time some idiot on CNBC says “the China government is pulling back!”
- They are buying homes, but the government is concerned about a real estate bubble so they are forcing developers to control price inflation. Right on! They should do this!
- They are a communist nation with capitalist ideals. We must respect the fact that China has a giant population and sometimes ruling with an iron fist is the only way to effectively run such a nation.
- Comparing China to Dubai is flat out stupid. You read right, stupid. Dubai is made up of rich people and slaves. China has a middle class — Dubai has NO middle class.
- Because the 21st Century does indeed belong to China.
- Because they got Jackie Chan. Jackie f*@#ing Chan man!
So before you go worrying about how your $LIWA you bought a week ago for $8.46 is down, I personally would say chill the heck out. This is what I do best — and I’ve been doing it, year after year after year. I have been fortunate enough to turn thousands into millions by investing in the right areas at the right time.
The difference between my investing this year and two years ago is thanks to social networking I’m able to share a little of what I know, here and there. I actually like the collaboration that BULLS and Twitter brings to the table. I enjoy helping others and paying it forward. I take risks because my balls are bigger than most. I trade and invest because I can and I love it!
Remember, take advantage of these opportunities, they rarely present themselves multiple times in one year. Fear no man, and don’t ever let anyone tell you China is on the brink of screwedville. Some foolish investor told me (roughly 2-3 weeks ago) that his Chinese friend told him the average Chinese company goes broke after 7 years. I’m still laughing at that comment for so many reasons — there simply are no averages when it comes to China. The world has changed fool!
If you haven’t traded for long you really don’t know how lucky you are. Making money in 2009 was easy — and so far making money in 2010 could also prove to be easier than I thought it would be. We’ll see if I’m right over time. 😉
By the way, I will be posting a follow up blog with my favorite China picks, reasons, time frames, and ranges for Gold and Black members — should have it up sometime on Sunday if I’m lucky.
disclaimer: while the size of my balls may or may not be anatomically larger than most, the context of this blog is real. the tone may come across as arrogant or humorous depending on your perspective — but in no way should you take anything personally. smile, your face won’t break, i promise.
