Sunday, October 6, 2013
I am not a Specialist on Chinese Stocks
TGR: Could the slowdown in China be the tipping point for a correction?
Marc Faber : The Philippines, Indonesia and Thailand have performed superbly in the market, up four times the 2009 lows. Other Asian markets have performed miserably, like China and Vietnam, and until recently, Japan. There are opportunities in China and Vietnam, but it is difficult to know the true financial condition of Chinese companies because of so many off-balance sheet items and a lot of cheating and fraud going on. I'm not a specialist on Chinese stocks, but let us not forget that a large hedge fund in the U.S. recently had a major position in an agricultural company in China that turned out to be a fraud. I imagine that that hedge fund did its due diligence before buying so heavily into one company, so the company must have been very good at hiding the truth.
Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.