SubscribeWhy I Am Bearish On China
The guy who made this video is a hedge fund manager and in the video he shows several buildings in China that are worth hundreds of millions of dollars with no tenants. This is what happens in a credit fueled bubble as misallocations of capital take place. China will be heading for a fall when the credit bubble pops. I will be using the Proshares China Ultra Short Fund (FXP) on the NYSE to trade this. This is a dangerous trade because credit fueled bubbles can go on for sometime and if you are wrong on the timing you can take serious losses. The Chinese market has been down severely over the last few weeks. I will wait for a relief rally and if it fails without breaking the previous top then I will get short. This fund gives you 200% the move of the index. For example, if the the index falls 2% this fund will go up 4%. The recent rally in China was based on a 28.5% increase in money supply which fueled speculation. Credit is now being withdrawn so the market is crashing.
John Polomny
The Real Deal
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