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Sinomania! the truth about china
China SEARCH Engine
Volume II, Episode 46
January 29, 2008
Chinese Stocks: Correction or Bear? Davos 2008 - IPOs!

January 20, 2008

Four predictions for where Chinese stocks will be in 2008 - plus more!

December 31, 2007

A brief look back at some of the images of 2007

December 20, 2007

Markets Sag - Chevron Gas Deal - Aging Time Bomb? - Property ETF - IPOs - more!

December 10, 2007

US-China Summits in Beijing - QFII Up to $30 Billion (US) - IPOs losing steam?

November 27, 2007

Chinese Stock Prices Melt - Sarkozy Up to Beijing - IPO Updates - Will Trent Lott Lobby for Taiwan?

November 20, 2007

Currency Crisis! Dollars Drained by China, OPEC Continue Down - Inflation

November 14, 2007

Time to Short China's Yo-Yo Market? - Mining In or Out? IPOs - more

November 2, 2007

Oil Shock! Price Problems At the Chinese Pump - Stocks: Where's the Correction?

October 24, 2007

SPECIAL REPORT: 17th Party Congress - Shanghai Bubbles? - Market Numbers

October 15, 2007

China Bull Run Gets New Highs - PetroChina - IPOs - Money - more

October 9, 2007

Chinese Stocks Up & Up - IPOs - Iron & Steel - Pacific Pipeline - more

October 4, 2007

Hong Kong Booms - Commodities, Inflation, Oil at $100 a barrel? - more

September 25, 2007

UAW Tells GM No Jobs For China - Markets Hit 5,500 - China's Auto Industry - IPOs

September 19, 2007

New IPOs Rock Shanghai! But is Resistance Building? A Big Push for Private Equity…

September 10, 2007

Report on APEC 2007 - Energy Security - Markets Update - IPOs in Hong Kong

August 30, 2007

Chinese Stocks Stay Up - Big Bond Sale - IPOs - Upcoming Party Congress

August 22, 2007

China Stock Markets Get Higher But For How Much Longer? - Surprise Rate Hike - IPO Update

August 14, 2007

China Toy Recall - Markets & IPOs - Western Banks Catch Asian Flu?

August 6, 2007

Shanghai Composite Busts Past 4,600 - Beijing Bets on Banks - Chinese IPOs in Japan

July 31, 2007

China Stocks Up Again & Again! - Pussyfooting Around Currency? - Democracy in Japan?!

July 25, 2007

Will Barclay's Turn Chinese? 2Q/H1 Macro Report + IPOs!

July 19, 2007

Food Fight! China-USA sling hash / Peak Oil? / Markets Flat Line...

July 10, 2007

Chinese markets confused? Big IPOs - Chery+Chrysler

June 27, 2007

COSCO - China Mobile - IPOs - Telecom Mergers & Acquisitions

June 21, 2007

New Record Highs in Hong Kong, Shanghai: Will Beijing Put On the Squeeze? - IPOs & more

June 15, 2007

Fundamental Misalignment: US-China currency war - stock markets up & IPOs

June 7, 2007

China Stock Pop - Hot News items - climate change, tainted food...

May 31, 2007

Chinese stock markets hiccup - IPOs - USA-China Trade Gap

May 25, 2007

Report on the 2nd USA/China Strategic Economic Dialogue: Win-Win or When-When? - Market numbers - New IPOs

May 18, 2007

New life for Hong Kong? IPO Update - USA/China summit

May 11, 2007

Will Shanghai end up like NASDAQ or Nikkei? - IPOs

April 30, 2007

Tulips to Dotcom - is Sino Mania the next big bubble?

April 20, 2007

The Heat is on! - IPO Report - Air Pollution in China

April 15, 2007

China markets, IPO update, Beijing Ready for Olympics?

March 30, 2007

China markets up, up, up! Sinomania! goes to China

March 23, 2007

Focus on National People's Congress... Hi-Tech, IPOs

March 17, 2007

China's new investment strategy, IPOs, the Wrap...

March 7, 2007

China syndrome or hong bao bounce? New IPOs... more!

February 27, 2007

China Stock Market Yo-yo, new IPO issues, the wrap

February 17, 2007

Chinese New Year edition! Will China buy Chrysler & more!

February 9, 2007

The USA-China WTO trade dispute and New IPOs

February 1, 2007

IPOs: New Red Chip — Bubble Burst? — USA-China

January 26, 2007

BUBBLE TROUBLE? — IPOs on NASDAQ — Renminbi Yuan

January 20, 2007

IPOs in 3 hot sectors — BAOSteel — Macro Report

HKEX Hang Seng Shanghai
SSE Shanghai Hong Kong
SZEX Shenzhen Beijing
MUSIC in China: Listen!

TRANSCRIPT: Shanghai stocks fall, special comment on Davos 2008, and introducing this week's Alpha Bet for China stocks...
Sinomania! Volume II Webisode 46, January 29, 2008

Shanghai Falls!
But is it a Bear Market or Correction?
Introducing the weekly Alpha Bet.
And a look at this year's Davos summit…

DAVOS 2008

The annual self-styled World Economic Forum concluded yesterday in Davos, Switzerland, with celebrity sightings and lugubrious laments about the state of globalization. The world's political and business elites agree that it's the East's turn to keep the world in the black, particularly China and India. There was some lofty talk about re-igniting the stalled Doha round of world trade negotiations but ultimately no real action was taken.

The Davos event underscores the great conundrum of globalization. On one hand rich and powerful citizens from all corners of the globe see the solution to the world's problems in cooperation and unity. After all, capital knows no border. But the current age is marked by fierce nationalism and military build up. This opposition prevents real integration from occurring and how globalization can go much further, equalizing currencies, for example, or justly sharing the planet's natural resources, is uncertain.


Since January 14 Chinese shares have been hammered. The Shanghai Composite Index is down about 16% from the start of the year and closed January 28 at 4,419.29 a seven percent drop to the level last seen at the beginning of August 2007.

The news is the same for all Chinese stocks. The CSI 300 Index closed today at 4,731.883 a loss of almost seven percent. Shanghai B shares closed at 304.853, over a five percent decline, and are now back where they were last August. ShenZhen Bs were down almost five percent January 28 to close at 625.60 back to the bottom of last summer's trough after the tripling of the stamp tax.

As I speak there is a very modest recovery, around one to two percent across East Asia but no rally.

So are we in the middle of the long anticipated "correction" or the start of a new Bear Market? It is hard to say. Remember volatility is the rule in emerging markets and all four of my predictions for Shanghai this year warn of volatility and the possibility of severe price drops.

News over the past two weeks has not been good. Bank of China shares were suspended in Shanghai after the bank, China's second biggest lender, revealed serious losses in so-called subprime investment exposure. Chinese mutual funds suffered losses of around ten billion US dollars in the last months of 2007. And don't forget what I call the "hong bao" effect - the impact on Chinese stockmarkets from profit taking around the Chinese New Year holidays.

And speaking of Chinese New Year, the world's largest migration of humans is underway with an estimated 179 million people returning home and visiting family all over China. The annual event overwhelms transportation in the country but this year it verges on travel chaos: record-breaking snow storms are dumping snow from Xi'An to Shanghai and falling on parts of China that normally see little winter weather. In the southwest sleet and ice have damaged power transmission. The China Southern Power Grid Corporation is particularly affected and power has been cut for all but essential uses in Guizhou, Guangdong, and many other areas.

The weather and power disruption is exacerbated by the coal shortage in China and priority given to transporting coal over China's railways is leaving hundreds of thousands of poorer Chinese stranded at train stations.

China Southern Power Grid Corp. is the ninth largest company in China and ranked 237 last year in Fortune magazine's global 500. The Guangzhou based company made about $28 billion US dollars in revenue last year and is long rumored to be planning an IPO on an overseas exchange but I can find no concrete details at this time.


And now introducing a new feature on the Sinomania! show - the weekly Alpha Bet!

This week's Alpha Bet starts with ATAI for ATA Inc., China's biggest computer based testing and education software producer, listing on the NASDAQ global market sometime this week. The company plans about five million American Depositary Shares priced between $9.50 to $11.50 US dollars.

Next we have BCDS which stands for BCD Semiconductor Manufacturing Limited soon to IPO on NASDAQ. BCDS plans to sell six million American Depositary Shares in the $9 to $11 US dollar range. The Shanghai based company, founded in 2000, supplies devices to major electronics conglomerates including LG, Samsung, Sony, and FoxConn.

SOL stands for ReneSola, a solar wafer technology firm that sold ten million ADRs on the New York Stock Exchange today for $13 US dollars each. The company already trades as a L share on London's Alternative Investment Market. It begins trading in New York tomorrow.

No letters yet but another solar wafer tech firm, Qiangsheng Photovoltaic Technology, out of Hong Kong, plans a $250 million dollar IPO on NASDAQ sometime this year. The company is in trial production of thin-film amorphous silicon solar cells and is looking to expand.

That's it for this week. I'll see you next time!


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