Andy Kessler gave me the keenest insights in 1994 when Forbes.com was a gleam in our eye. A columnist for Forbes ASAP he is, in my opinion, the best person writing about technology financing and the markets. He takes on China.
“Their stock market could help. China is filled with entrepreneurs who build companies, not buildings. I spent 10 days in China this month meeting with investors. They are smart and hungry but crippled with Enron accounting. On Jan. 1, listed companies must start releasing two sets of numbers — Chinese earnings and then calculated again using international standards. Many will start to show losses. Ouch. China is scared to open up because the first move might be to short the whole damn country. George Soros has been sniffing around, and they won’t let him in. Outsiders need to be licensed as Qualified Foreign Institutional Investor with a quota — currently less than 1% of total capitalization. Doesn’t sound like a market economy to me. The total value of U.S. stocks is 20 times as large for a reason.”