by C.F. Bergsten, B. Gill, N.R. Lardy & D. Mitchell
What Does the World Need to Know Now About the Emerging Superpower?
From an investor’s viewpoint, “China: The Balance Sheet” is a great book providing information on how to understand China.
“China; The Balance Sheet” provides ample viewpoints on China: it emphasises the complexities of China, and helps to unravel them. “China; The Balance Sheet”is essential reading for any investor thinking about investments in China.
Fundamental Investment Ideas that Changed Investor Viewpoints
Bernstein does a wonderful job of telling the story of how fundamental ideas about China have evolved in the mid twentieth century by explaining to the investor:
- Investors shouldn’t view China as a single entity (view China like Europe).
- Investors should be aware of the complex China – US relationship.
- Investors need to understand the economic facts (don’t believe the hype).
Each of these investment ideas is briefly covered below.
Investors Should Not View China as a Single Entity (View China Like Europe)
“China; The Balance Sheet“ emphasises how important it is not to view China as a single entity. China is a huge land mass with enormous differences across different regions. An investor would never treat Europe as a single entity, since each country is so different. China deserves a similar treatment from the investor.
Investors Should Be Aware of the Complex China – USA Relationship
Investors in China need to be aware of the economic relationship between China and USA. There are many economic dependencies between the two superpowers; these include debt, investments, balance of trade to name but a few. This book helps unravel this complex situation, which is important for potential investors to understand.
Investors Need to Understand the Economic Facts (i.e. Don’t Believe the Hype)
There is so much hype in the media about China that the investor needs to carefully understand the reality from the fantasy. This book helps unravel the economic situation from an investors point of view. The book certainly does not give the investor the “silver bullet”, but it does provide different viewpoints and an in-depth analysis.
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