The talking heads on the financial networks tell me that I need to be worried about Europe. After I’m sufficiently worried about Europe the talking heads tell me that I also need to be worried about China slowing down.
Maybe it is just me, but I am starting to get the feeling that there is always going to be something to worry about.
Yes, the old wall of worry.
I’m not suggesting that the European mess and China’s rate of growth aren’t important issues. But what I am inclined to think that the real time to worry about owning stocks is when there doesn’t seem to be anything to worry about.
Emerging Markets Guru Mark Mobius has a refreshingly balanced view of China in his most recent commentary:
Many feel that China is the engine for the world economy, and worry that if it slows down, we may be doomed to a recession or even a depression. However, I don’t feel it’s time to push the panic button. Yes, China’s growth is decelerating from the double-digits of recent years; various forecasters are predicting a possible GDP growth range of 7 – 8% this year. However, I think it’s important to emphasize that would still represent an impressive pace, and remember that China isn’t the world economy’s only locomotive.
Slowing growth is a natural part of the evolution of an emerging economy, particularly one as large as China, the second-largest economy in the world. Many of the world’s economies are facing slower growth trends this year, and China is also undergoing structural changes that often come with the side-effect of a few growing pains. It has been moving toward a more consumption-oriented economic model and loosening controls on the economy, which require some adjustments. A piece of good news for China in regard to these domestic-driven efforts is that new lending during the first half of this year helped drive fixed-asset investment in China 20% higher than levels seen during the same time in 2011.1
Link to full Mobius commentary:
http://mobius.blog.franklintempleton.com/2012/08/01/chinas-growing-pains/?nicamp=other&nichn=markmobius&nismseg=twitter
Maybe it is just me, but I am starting to get the feeling that there is always going to be something to worry about.
Yes, the old wall of worry.
I’m not suggesting that the European mess and China’s rate of growth aren’t important issues. But what I am inclined to think that the real time to worry about owning stocks is when there doesn’t seem to be anything to worry about.
Emerging Markets Guru Mark Mobius has a refreshingly balanced view of China in his most recent commentary:
Many feel that China is the engine for the world economy, and worry that if it slows down, we may be doomed to a recession or even a depression. However, I don’t feel it’s time to push the panic button. Yes, China’s growth is decelerating from the double-digits of recent years; various forecasters are predicting a possible GDP growth range of 7 – 8% this year. However, I think it’s important to emphasize that would still represent an impressive pace, and remember that China isn’t the world economy’s only locomotive.
Slowing growth is a natural part of the evolution of an emerging economy, particularly one as large as China, the second-largest economy in the world. Many of the world’s economies are facing slower growth trends this year, and China is also undergoing structural changes that often come with the side-effect of a few growing pains. It has been moving toward a more consumption-oriented economic model and loosening controls on the economy, which require some adjustments. A piece of good news for China in regard to these domestic-driven efforts is that new lending during the first half of this year helped drive fixed-asset investment in China 20% higher than levels seen during the same time in 2011.1
Link to full Mobius commentary:
http://mobius.blog.franklintempleton.com/2012/08/01/chinas-growing-pains/?nicamp=other&nichn=markmobius&nismseg=twitter
