Tags: fisher | china | stocks

Ken Fisher: China Stocks Will Recover

By    |   Thursday, 30 Jul 2009 01:02 PM

The Chinese government will not end its expansive lending policies, which will keep Chinese stock prices rising through the end of the year, says billionaire investor Kenneth Fisher.

China is “gangbusters compared to the rest of the world, why would they try to kick that?” said Fisher, according to a Bloomberg News report.

“They have zero incentive” to curb lending, he said.

Rising stock and other asset prices have fueled talk of a bubble in China, and some in the Chinese press are saying monetary authorities may take steps to cool the economy, such as requiring lenders to increase their reserves.

These headlines battered Chinese stock prices on Tuesday and U.S. equities on Wednesday, although they quickly recovered Thursday on the open.

China's Central Bank continues to say it will maintain loose monetary policy, keeping analysts happy.

"China has been a big driver of part of the global recovery. Their stimulus is direct and quick," Bobby Harrington, managing director of Boston trading for UBS, told Reuters.

Slower growth in China's economy "could limit upside and create downward momentum" in the U.S. stock market, he said.

Meanwhile, the Bank of China, the country's third-largest bank, says it will keep on lending out money until the government restricts its current credit boom.

A bank spokesman says the institution is sticking to a goal to account for 10 percent of China's loans.

The bank lent US$132 billion during the first half of this year, more than any other in China, Bloomberg reported.

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The Chinese government will not end its expansive lending policies, which will keep Chinese stock prices rising through the end of the year, says billionaire investor Kenneth Fisher.China is “gangbusters compared to the rest of the world, why would they try to kick that?”...
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2009-02-30
Thursday, 30 Jul 2009 01:02 PM
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