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China has long been scouring the globe for energy and commodities to feed its thrumming economy. What is new is the leadership's determination to increase outbound foreign direct investment, or O.F.D.I., as it weans the economy off low-value, export-oriented manufacturing.
With domestic economies of scale largely exhausted, companies will have a powerful incentive to move abroad to upgrade their manufacturing and compete in more profitable areas like distribution, design and branding.
China's outbound foreign direct investment has increased steadily this decade, and the outflow of $52 billion last year was a record. Still, the historical stock of the outbound direct investment of $170 billion is puny next to China's foreign exchange reserves and its inward foreign investment stock of $876 billion.
With domestic economies of scale largely exhausted, companies will have a powerful incentive to move abroad to upgrade their manufacturing and compete in more profitable areas like distribution, design and branding.
China's outbound foreign direct investment has increased steadily this decade, and the outflow of $52 billion last year was a record. Still, the historical stock of the outbound direct investment of $170 billion is puny next to China's foreign exchange reserves and its inward foreign investment stock of $876 billion.
- New York Times
Templeton Asset Management emerging markets head Mark Mobius said China's stock market might surpass the United States as the world's largest by value in as little as three years.
The reasons are China's state-owned companies will sell new shares and the nation's 1.4 billion people will put more of their money into the market.
"The Chinese population is just dipping its toe into equities and they've got a long way to go," Mobius told Bloomberg, adding that state-owned companies are "coming up with more huge" initial public offerings.
Currently, China's market is valued at $3.2 trillion, compared with $11.2 trillion for the U.S. market, according to data compiled by Bloomberg.
The reasons are China's state-owned companies will sell new shares and the nation's 1.4 billion people will put more of their money into the market.
"The Chinese population is just dipping its toe into equities and they've got a long way to go," Mobius told Bloomberg, adding that state-owned companies are "coming up with more huge" initial public offerings.
Currently, China's market is valued at $3.2 trillion, compared with $11.2 trillion for the U.S. market, according to data compiled by Bloomberg.
- Newsmax
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How I Found a Pile of Cash Paying 11% Dividends
By Tom Dyson Monday, July 20, 2009 How I Found a Pile of Cash Paying 11% Dividends -
Two Shocking Silver Charts
By David Eifrig Saturday, July 18, 2009 Two Shocking Silver Charts -
You Won't Believe This Bear Market Is Almost Over
By Dr. Steve Sjuggerud Friday, July 17, 2009 You Won't Believe This Bear Market Is Almost Over -
What You Should Do If Stocks Fall Farther from Here
By Dan Ferris Thursday, July 16, 2009 What You Should Do If Stocks Fall Farther from Here -
My Real Estate Wake-Up Call
By Dr. Steve Sjuggerud Wednesday, July 15, 2009 My Real Estate Wake-Up Call
How to Get 20% a Year Out of Your Property
By Tom DysonTuesday, July 21, 2009
"Of all of our travels, the Seven Sisters Inn is by far the best we have seen," says a guest.
The Seven Sisters Inn was built in 1888, using Victorian architecture...
Bonnie Morehardt and her husband Ken Oden restored the inn in 1986. They did such a fine job, the Florida Trust Historic Preservation Society judged the Seven Sisters the "Best Restoration Project" and listed it on the National Register of Historic Places.
The Seven Sisters Inn is in Ocala, Florida. It has eight guest rooms and an office. The rooms have different themes... There's an Argentina room, an Egypt room, and a China room, for example. Bonnie Morehardt and her husband were pilots. For 20 years, they traveled the world collecting Egyptian-themed art, custom armoires, and Oriental rugs to decorate each of their rooms.
"I hand-picked everything for each room," Morehardt said. The rooms rent for around $200 a night.
Today, the Seven Sisters Inn is famous across the country as one of the finest bed and breakfasts in America. Here's the thing: The owners weren't able to cover their mortgage costs... and this week, the bank will sell the Seven Sisters Inn in an online auction.
The auction started two weeks ago. It ends in two days. As I write, the current bid for the Seven Sisters is $117,500. You can also bid on the contents of the inn. For example, the current bid on an antique desk is $55. There's an oil painting going for $25.
You can follow the auction of the Seven Sisters Inn and its contents here.
Right now, as a result of the housing collapse and recession, banks are selling thousands of properties through auction all around the country. I noticed three new auction announcements for property in my town last week. And a local hotel held an estate auction yesterday.
These auctions are loaded with bargain properties. One of the properties up for auction where I live is only nine years old, in great condition, and in a very desirable location. I asked the owner of a property-management company about it... He told me it would generate $30,000 a year in rental income. The current bid for this property is $152,500. That's a 20% rental yield at current prices.
To earn a 20% yield from the Seven Sisters Inn, at $200 per room, you'd only have to host 118 guests a year.
If you're interested in property investment... or even if you're thinking about moving house, I suggest you check out your local property auctions. With a quick search online, you'll find thousands of property auctions taking place each month all around the country. You'll find some absolute bargains. Check your local newspaper. Or check these sites. They are the largest property auctioneers in America: www.marknetalliance.com,www.hudsonandmarshall.com, www.williamsauction.com, www.auction.com.
When homeowners default on Fannie Mae and Freddie Mac mortgages, the government assumes ownership of the house. The government does not want to be a landlord, so it sells these houses at big discounts to market prices. You can search Fannie Mae properties for sale by going towww.fanniemae.com and then clicking on "Homes for Sale." You can browse property for sale from Freddie Mac at www.homesteps.com.
The United States Department of Housing and Urban Development (HUD) also makes loans to homeowners. If these homeowners default on their loans, HUD assumes ownership and auctions them on its website. Prices average two-thirds of appraised value. You can browse HUD homes for sale at www.hud.gov/homes.
Finally, many federal agencies auction confiscated and surplus property. You can find residential, commercial, and raw land here. Check out propertydisposal.gsa.gov for the full listings in your state.
As the year progresses, my town will likely see more and more property auctions... Yours probably will, too. Property prices may stay low for awhile, but right now, there are incredible bargains to be had.
Good investing,
Tom
The Seven Sisters Inn was built in 1888, using Victorian architecture...
Bonnie Morehardt and her husband Ken Oden restored the inn in 1986. They did such a fine job, the Florida Trust Historic Preservation Society judged the Seven Sisters the "Best Restoration Project" and listed it on the National Register of Historic Places.
The Seven Sisters Inn is in Ocala, Florida. It has eight guest rooms and an office. The rooms have different themes... There's an Argentina room, an Egypt room, and a China room, for example. Bonnie Morehardt and her husband were pilots. For 20 years, they traveled the world collecting Egyptian-themed art, custom armoires, and Oriental rugs to decorate each of their rooms.
"I hand-picked everything for each room," Morehardt said. The rooms rent for around $200 a night.
Today, the Seven Sisters Inn is famous across the country as one of the finest bed and breakfasts in America. Here's the thing: The owners weren't able to cover their mortgage costs... and this week, the bank will sell the Seven Sisters Inn in an online auction.
The auction started two weeks ago. It ends in two days. As I write, the current bid for the Seven Sisters is $117,500. You can also bid on the contents of the inn. For example, the current bid on an antique desk is $55. There's an oil painting going for $25.
You can follow the auction of the Seven Sisters Inn and its contents here.
Right now, as a result of the housing collapse and recession, banks are selling thousands of properties through auction all around the country. I noticed three new auction announcements for property in my town last week. And a local hotel held an estate auction yesterday.
These auctions are loaded with bargain properties. One of the properties up for auction where I live is only nine years old, in great condition, and in a very desirable location. I asked the owner of a property-management company about it... He told me it would generate $30,000 a year in rental income. The current bid for this property is $152,500. That's a 20% rental yield at current prices.
To earn a 20% yield from the Seven Sisters Inn, at $200 per room, you'd only have to host 118 guests a year.
If you're interested in property investment... or even if you're thinking about moving house, I suggest you check out your local property auctions. With a quick search online, you'll find thousands of property auctions taking place each month all around the country. You'll find some absolute bargains. Check your local newspaper. Or check these sites. They are the largest property auctioneers in America: www.marknetalliance.com,www.hudsonandmarshall.com, www.williamsauction.com, www.auction.com.
When homeowners default on Fannie Mae and Freddie Mac mortgages, the government assumes ownership of the house. The government does not want to be a landlord, so it sells these houses at big discounts to market prices. You can search Fannie Mae properties for sale by going towww.fanniemae.com and then clicking on "Homes for Sale." You can browse property for sale from Freddie Mac at www.homesteps.com.
The United States Department of Housing and Urban Development (HUD) also makes loans to homeowners. If these homeowners default on their loans, HUD assumes ownership and auctions them on its website. Prices average two-thirds of appraised value. You can browse HUD homes for sale at www.hud.gov/homes.
Finally, many federal agencies auction confiscated and surplus property. You can find residential, commercial, and raw land here. Check out propertydisposal.gsa.gov for the full listings in your state.
As the year progresses, my town will likely see more and more property auctions... Yours probably will, too. Property prices may stay low for awhile, but right now, there are incredible bargains to be had.
Good investing,
Tom
COPPER IS SOARING RIGHT NOW
Some news from "Dr. Copper" worth mentioning…
Longtime DailyWealth readers know we like to monitor the price of copper for a simple, instant read on what's happening in the global economy. Copper is a major ingredient in just about everything around you… cars, houses, power lines, plumbing, computers, and refrigerators are just a few major uses of copper. It's a low-tech version of our Intel indicator. Because of this "in everything" quality, copper rises and falls with global economic activity.
As you can see from today's chart, copper is sitting comfortably at a nine-month high. It's up 71% this year – an extraordinary rise for the commodity.
Sure, there's still plenty of bad news out there. Unemployment is at generational highs. Real estate stinks. But you don't make money trading off the news. You make money listening to the market. And right now, the market is saying, "Things aren't so bad… I'm sending copper to new highs." Until copper turns lower, we're in the "glass half full" camp.
Longtime DailyWealth readers know we like to monitor the price of copper for a simple, instant read on what's happening in the global economy. Copper is a major ingredient in just about everything around you… cars, houses, power lines, plumbing, computers, and refrigerators are just a few major uses of copper. It's a low-tech version of our Intel indicator. Because of this "in everything" quality, copper rises and falls with global economic activity.
As you can see from today's chart, copper is sitting comfortably at a nine-month high. It's up 71% this year – an extraordinary rise for the commodity.
Sure, there's still plenty of bad news out there. Unemployment is at generational highs. Real estate stinks. But you don't make money trading off the news. You make money listening to the market. And right now, the market is saying, "Things aren't so bad… I'm sending copper to new highs." Until copper turns lower, we're in the "glass half full" camp.