Thursday, February 4, 2010

Jim Rogers Still Likes China

Jim Rogers China and Commodities

...and China likes and need commodities.

While there are a few people zeroing in on the real estate market in China and exclaiming the country is in trouble, that's far from the truth, as China, as Jim Rogers continues to say, is still the hottest market on the planet. After all, where else in the world will you get close to 10 percent growth for a country?

Even if China drops to about 9 percent growth in 2010, who else is competing with those numbers?

Commodity demand continues to soar in China, as the recent demand for iron ore reveals, as China authorities attempted to negotiate prices down with major iron ore suppliers, but domestic demand was so high they were weakened by their own markets as internally steel producers were willing to pay the price companies like Rio Tinto asked for.

That's how demand even overcomes a command economy like China, where the needs outstrip the ability to centrally control or even negotiate prices, as demand is now and must be met quickly.

This is going to continue to happen with other commodities as well, even with the tightening up of the money in the country, which has made some people think China will cut back on spending.

Not only do I think that's doubtful, but I think it was an attempt by China to negotiate lower prices by giving the public appearance of tightening up money in the country.

That seems contrary in that tightening money would seem to make prices go up more. But like I mentioned, this more than likely is posturing by the Chinese who I think are trying to hide the demand so commodity prices may continue at lower rates.

Jim Rogers China and Commodities

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