(GuruFocus, November 17, 2009) For people who do not know Andy Xie, here is a prime from the “And Xie” entry from Wikipedia:
While President Obama is in China negotiating with China’s leadership, Andy Xie was interviewed by Bloomberg's Erik Schatzker about U.S. exchange rate policy and the valuation of the yuan. According to Xie, China is not in a position to appreciate its Yuan as much of the export sector is experiencing low profit margins and import prices are going up.
Further, according to Xie, a higher Yuan is the wrong thing to ask at this time. China’s problem lays in its lack of consumption, and the root cause of that is overweight of the state-owned enterprises.
Tough luck to ask Chinese government to loosen up its grip on economy, Mr. President.
Watch the vidoe:
Also check out:
Andy Xie graduated from Massachusetts Institute of Technology with a M.S. in Civil Engineering. He then obtained a PhD in Economics from Massachusetts Institute of Technology in 1990 and went on to become an economist for IMF, specialising in South-east Asian economies. He joined Morgan Stanley in 1997 as a Managing Director, and is noted for his provocative views on the Chinese economy. His bearish calls on Shanghai property and Chinese stock market have attracted criticism from Chinese officials. In China, some local economists criticized his bearish calls on Chinese Asset Bubble-Burst Cycle, even questioned his personality and claimed him as an "American Parrot".
Andy Xie is one of the few economists who accurately predicted economic bubbles including Southeast Asian Financial Crisis(1997), dotcom bubble (1999) and US Subprime Financial Crisis (2008). Andy Xie considers himself as one who has had a reasonably good record at calling bubbles in the past. "I wrote my doctoral thesis arguing that Japan was a bubble in late 1980s, a long report at the World Bank in earl 1990s arguing that Southeast Asia was a bubble, research notes at Morgan Stanley in 1999 calling dotcom boom a bubble, and numerous research notes from 2003 onwards arguing that the US property market was a bubble. On the other hand I have never called something a bubble that turned out not to be a bubble."
While President Obama is in China negotiating with China’s leadership, Andy Xie was interviewed by Bloomberg's Erik Schatzker about U.S. exchange rate policy and the valuation of the yuan. According to Xie, China is not in a position to appreciate its Yuan as much of the export sector is experiencing low profit margins and import prices are going up.
Further, according to Xie, a higher Yuan is the wrong thing to ask at this time. China’s problem lays in its lack of consumption, and the root cause of that is overweight of the state-owned enterprises.
Tough luck to ask Chinese government to loosen up its grip on economy, Mr. President.
Watch the vidoe:
Also check out:
