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Motley Fool Global Gains / GGM: Global Gains Philosophy


Subject:  Re: Investment Biker Discussion Date:  5/26/2009  12:00 PM
Author:  Starrob Number:  1694 of 5166

"Rogers writes, "I’d be tempted to sell short almost any non-Chinese company with a massive investment in China, because the Chinese frame of reference won’t allow outsiders to make the big money…How, then, should a prudent Western investor play the Chinese economic explosion? If you want to get involved, you should get a Chinese company to do business for you in China."

Bingo...The Chinese are sort of protectionist. Most multi-nationals are more likely to have their ideas stolen rather than make enormous profits. Also the business scene is so difficult in China that most companies will have to partner with a local Chinese firm and it will be the local Chinese firm that benefits more than the big foreign company.

There are a few Multinationals that will do well in China but a lot won't. Many seem to think that our big multinationals are just going to roll in and take over but I know in my heart that it is going to be a lot more difficult than that.

I had a American friend on ship that basically grew up in Hong Kong. He used to have mostly Chinese as friends and he hated playing with the Australians. He used to tell me that most Chinese may not show it to a Westerners face but privately there are a lot of Chinese people that have a serious beef about Western powers coming in and colonizing China in the past.

You must understand the Chinese are a proud people. At one point in time they were about the most advanced society on this earth. They have a serious beef about being turned into second class citizens within their own countries by both Japan and the Taipans from the Western Powers in the earlier part of the last century.

So people that think that Western Corporations are going to go in and re-colonize China are going to be in for a rude awakening. It is going to be tougher to gain a foothold there than most assume.

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