Posted on 08/31/2012 12:07:59 PM PDT by nickcarraway
U.S. companies are banking their future success on tapping into the enormous Chinese market. They're in for a nasty surprise.
At the height of the dot-com bubble in 1999, the magic word for hyping a stock was "Internet." Pets.com, one of many speculative dot-com companies, earned a gilded stock price of $11 per share in early 2000. Buoyed by an initial investment by Amazon.com, it ultimately raked in $300 million in early financing. Like many Internet companies in that era, however, it never earned a profit; when the bubble popped in late 2000, just months after Pets.com went public, the company announced its liquidation, driving shares down to 19 cents, a 98 percent loss. Today, the magic word for hyping stock could be "China."
A China strategy remains the holy grail for global companies. While China's growth has slowed from over 10 percent just two years ago to 7.6 percent in the second quarter of this year, executives still make their China strategy prominent in pitches to analysts and investors. Thirty-seven percent of companies surveyed from a range of industries consider China "critical to global strategy," according to an Economist Intelligence Unit report from November that surveyed executives from 328 companies. Forty-six percent expect China to be their biggest market within 10 years.
The conventional wisdom is that multinationals that successfully build market share in the fast-growing Chinese market will deliver profits that reward
(Excerpt) Read more at foreignpolicy.com ...
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My proprietary plan is to sell one stick of gum to every Chinaman. Keep this quiet.
What are you talking about? Registration is not required. I read full articles all the time there, and have never seem registration.
YMMV
China: collapsing repeatedly since fall of 2007 and growth of only “7.6 percent in the second quarter of this year.” It’s funny stuff to read. The truth is that China and other east Asian countries will be increasing their oil consumption for decades to come.
The bosses have moved most production facilities elsewhere while helping to prevent domestic manufacturing starts here, on the local levels, through various false environmentalist proxies (family, former employees/contractors, other associates,...). They frolic in foreign, yes-man tourist reserves with happy-lucky servants all around them.
Have fun. Enjoy the dwindling remnants of our servant economy and slide into the consequent western stone age.
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