William J. Holstein

Best Quote Of The Day
January 9--It's an odd story in today's New York Times, but it provides an awfully funny quote. The article is about a wealthy hedge fund manager named James S. Chanos, who is betting heavily against China's economy. He thinks it is a bubble, just like Enron. He only started studying the Chinese economy last summer (!), but he's running around making speeches and media appearances describing his vision of a coming Chinese collapse. Why the New York Times would give him any ink is a mystery, but, okay, they have to fill all that white space every day.

The best quote comes from Jim Rogers, who co-founded the Quantum Fund and who now lives in Singapore. He's had many years of experience in Asia. He said this about Chanos: "I find it interesting that people who couldn't even spell China 10 years ago are now experts on China!"

Hah! Good one. My advice to Chanos: the Chinese economy does not operate on the basis of prevailing Western business practices. If you apply your own standards of excess and overcapacity, you are making a big mistake. The Chinese government, which still controls the economy, retains the capacity to adjust and rein in prices. They are not a banana republic.