Deficit, Hard Landing in China, Benjamin Graham, Stock Thoughts: Stocks too high?

Deficit

Deficit at 2-2.3% of GDP:

http://www.bworldonline.com/content.php?section=TopStory&title=Deficit-at-2-2.3%-Of-GDP&id=65379

What does that mean? It means the government has more fiscal policy up his sleeve to push our country’s GDP higher.

 

Hard Landing in China

What is about China’s hard landing? Why is everybody worried about that?

China’s GDP growth is fuelled by heavy investments by its government and therefore not sustainable. When it stops, aggregate demand will fall and China’s GDP growth will plunge, a hard landing.

What industries will be much affected?

Companies deriving their revenues through sale of produce to China.

Can you think of a company?

 

Learn the basics of Macroeconomics here:

https://fundamentalenthusiast.wordpress.com/2012/08/08/macroeconomics-basics/

 

Benjamin Graham

I am hungry on anything Benjamin Graham and this video of WEB talking about him is a 5.46-minute well spent:

http://www.youtube.com/watch?v=HCZMs01W0KM

 

Stocks too high?

My boss and I were invited for talk about stocks in front of an MBA class. They threw a lot of good questions and one is:

Is the stock market already too high for us to enter?

The answer is simple:

Know the business that you are buying. Understand how it generates revenue and determine if it can still exhibit favorable growth in the future. Everybody has an edge or competitive advantage.

Open your eyes and be aware of what you already know, what you are capable of learning more, and who your connections are. That is your competitive advantage.

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