China's Strategic Investments, Has Deflation Arrived?, Fixing the U.S. Economy

China's Strategic Investments, Has Deflation Arrived?, Fixing the U.S. Economy

China's Strategic Investments

I strongly recommend you take the time to read an article published today on Seeking Alpha titled 'China Plans for Its Competitive Future With Mining Asset Drive' - reading time 4 minutes.  Written by Jack Lifton, a consultant focusing on the market fundamentals and future end use trends of the rare metals, the article sets out an articulate review of what and why China is focusing on the global resource sector as it is.  I commented on Mr. Lifton's article today as follows:

I have said for some time 'watch China use its U.S.$ holdings to buy resource assets around the globe that it considers strategic to it'. I consider this article an excellent summary of what has happened to date and what is going to happen. China's ongoing investment in, and acquisition of, resource assets has been on my own personal 'front page' for over 3 years now, and is my own 'front page' every day as I continue to develop www.stockresearchporta..., a website entirely focused on Mining and Oil & Gas Company Investment Research.

I think every Seeking Alpha reader who participates in the equity markets ought to read this article carefully and think about the consequences of what it says even more carefully. Thanks to Jack Lifton for it.

Has Deflation Arrived?

Here is another Seeking Alpha article published today that I strongly recommend you read if you participate in the equity markets as either an investor or as a trader.  It is titled 'Has Deflation Arrived?' - reading time 6 minutes if you think carefully about what you read, and I think you should do that.

In my past few e-mails I have referred to 'deflation' at least two other times.  I received an e-mail from a reader in Western Canada two days ago who asked me for clarification as to why I was so focused on deflation.  I invited him by return e-mail to call me, and what ensued yesterday afternoon was from my point of view a delightful conversation with someone who spends considerable time pondering, as do I, what the economic future holds for us, our children, and our grandchildren.

For clarity, I am neither a deflationist nor am I an inflationist.  My current view, which I work hard as a 'non-economist' to moderate as economic events transpire and I reflect on those changes, is that the world fiat currency system has for the past 40 years been prone to inflation as Governments of developed countries have increasingly overextended their debt obligations.  That said, from my perspective the U.S. Government policies combined with unregulated egregious and greedy behavior on the part of the (U.S. in particular) financial intermediaries has placed the U.S. - and hence the rest of the developed countries currently overburdened with debt - in an 'impossible to resolve' economic morass.  Could this, in circumstances of the very high rates of unemployment in the U.S. and drop in U.S. residential housing values, lead to deflation or depression in the U.S. and hence most or all of the rest of the world?  My intuition tells me that is a possible outcome.

I monitor and think about this possibility every day.  My message in this and every other e-mail I send is that I recommend you do likewise if you invest in equities generally and resource equities in particular.  I unequivocally believe that the more you 'think for yourself' in respect of your investments the better off you will be.

I am open to discuss my views with any reader.  If you have an interest in doing that please write to me at info@stockresearchportal.com.

Fixing the U.S. Economy

A third Seeking Alpha article today titled 'McCullough vs. Ritholtz:  How to Fix the Economy' shows a video debate of two people, one who believes the U.S. Government should cut spending seriously and one who says recession could result from such a strategy.  I commented on that article as follows:

There is, of course, a fundamental assumption in all suggestions of how the U.S. economy can 'be fixed' - the implication being, or so I think, that the U.S. economy can be returned to its pre-2000 position of world dominance.

I have come to believe many (clearly not all) U.S. based commentators focus far to much (if not exclusively) in their thoughts and writings from a parochial base and a position of what I have come to think of as rather naive 'U.S. Centricity'. As I see it, the U.S. economy is not going to regain its lost manufacturing jobs in our increasingly 'globalized world', nor will it be able to compete effectively with resource based and 'manufacturing' nations with a predominantly 'serviced based' economy. That said, from my perspective the sooner Americans with parochial tendencies expand their horizons beyond the U.S. borders and embrace a 'new realism' as to prospective U.S. economic opportunities the better off America will be - and the better will be the possibility of a new, different, and hopefully 'long term successful' U.S. economy emerging, like the proverbial phoenix, from the increasingly large 'pile of U.S. economic ashes'.

I have reproduced my comment here to assist readers in better understanding where I am coming from as I make by comments in these e-mails.  If you disagree with my comments with respect what I see as 'U.S. Centric' thinking on the part of many Americans - which I see as an important issue - please let me know you disagree and why you disagree by writing me at info@stockresearchportal.com.  I expect to receive an large number of 'thumbs down' on my comments from what I believe to be a predominantly U.S. readership of Seeking Alpha.  I will let you know the 'thumbs up'/'thumbs down' results in my e-mail tomorrow.

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Best Regards,

Ian R. Campbell

President

StockResearchPortal.com

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