In a recent interview with Bloomberg Businessweek, United States Ambassador Gary Locke says Beijing is “very fearful” of a Chinese repeat of the Arab Spring, leading to a “significant crackdown on dissension.”
As Baron von Rothschild said, “Buy when the cannons are thundering, sell when the violins are playing.”
Should an “Arab Spring” event transpire in China, blue chips such as China Mobile (CHL, quote) and Petro China (PTR, quote) are sure to fall, along with the exchange traded fund, iShares (FXI, quote).
Any fall in blue chip prices is likely to be temporary, though, and should be taken advantage of. While growth in China is slowing, its economy keeps expanding. As Ambassador Locke says, “Even the Chinese government believes their growth will slow down from their double-digit growth of the last several years to perhaps around 7, 8, or 9 percent.”
China saves more than any other nation, too. Its $3 trillion in foreign reserves is the most of of any country in the world. All this increases the country’s stability and supports the bullish outlook detailed in many previous articles on www.emergingmoney.com.