APS China Monthly

APS China Monthly
March 2023
Political ideologies are but a means to that end. In essence, the CCP is more pragmatic than dogmatic.
In “The Pendulum Swings Back To Pragmatism?”, APS China Vice Chairman Dr Tan Kong Yam looks at the latest swing of the pendulum towards pragmatism; the private sector’s critical role in employment creation, growth, and the CCP’s political legitimacy; the red line of challenging Party supremacy; how the power dynamics between the different factions will take shape over the next 10 years under Xi, Taiwan; and lastly, investment implications for global investors.
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The Japanese economic miracle hit its zenith in 1989, before collapsing under the weight of investor hubris, loose lending standards, excessive risk taking, and central bank recklessness. As a group, we professional investors have this tendency to behave like lemmings once every decade, and do not seem to learn the lessons from history – the 1600s Tulipmania, the 1700s Mississippi Bubble, the TMT bubble of 2000, et cetera.
Through the eyes of a young professional Tokyo-based fund manager, we travel back to that 1980s go-go era in what seemed to be the Land of the (Forever) Rising Sun, not for good old nostalgia, but to distil the lessons from probably the biggest, craziest bubble in modern times. Hopefully, it can help us sidestep today’s bubbles, and guide us to safer spots.
I share my view of four key contributory factors of bubbles, China’s recent and current bubbles as well as those across the Pacific Ocean, what remains investable in China, and a possible “changing of the guard” among tech-focused fund managers who have achieved phenomenal successes on the back of this latest “tech stock” bull run.