November 9, 2007
Taxation, Nationalization, Expropriation
This bit from the ProShares prospectus for the FXP made me chuckle:
“… investments in China are subject to … the risk that the Chinese government may decide not to continue to support the economic reform programs implemented in 1978 and possibly return to the completely centrally planned economy that existed prior to 1978, and the risk of confiscatory taxation, and nationalization or expropriation of assets.”
Fat chance!
Cat: | Time: 5:04 pm (utc+8)
November 9th, 2007 at 6:26 pm
I can’t believe they still have such ridiculous hope.
November 9th, 2007 at 7:34 pm
ucla: Nobody anywhere hopes for a return to that time.
November 12th, 2007 at 1:56 am
CM
But 20 years ago, nobody believed that china will open up economically. anything could happen if chinese govt is desperate to gain world domination after economic domination by market manipultion
November 13th, 2007 at 5:38 pm
CM,
So you’re saying FXP is feeding the quacking ducks? Or just that the risk of confiscation is laughable?
Could it be that the fantastic rise in Chinese stocks and the US gains of the past year have been inflationary moves based on currency valuations? With the US facing a slowdown and credit market problems, the rise in stocks here has baffled me. And if the move is a repricing of assets in a weakening currency, that move is likely to be permanent, isn’t it?
Just a few thoughts from this Prospectus.
November 13th, 2007 at 8:33 pm
@rs: They’re not going to achieve world domination by going back to shoveling pigshit.
@Prospectus: The FXP is a short-side fund and the ducks aren’t generally interested in shorting. The risk of confiscation at this point is somewhat laughable but then again I’m naturally a short-sighted optimist. Don’t ask me any big picture stuff because I’m too dense to comment.