China is the greatest growth story in history. A true triumph of market-forces. But since the boom-bust cycles of capitalism is a feature and not a bug. China will have the greatest bust in history, to match its boom. As long the government doesn’t regress to the delusions of communism, capital will move from weak hands to strong hands at vastly discounted rates. Which is the only element of trickle-down economics that truly works. Ideally, they would become more democratic (think Singapore not India).
However, there are forces pushing the boom further. First and most importantly, the inclusion of China into the existing indices. I do not buy the argument that China is undervalued. Look at any nation with sketchy rule of law and you’ll see the markdown in valuation. Again, use a simple momentum filter and follow along.
Opinion | China’s Bill Will Have to Be Paid – Bloomberg https://apple.news/AEmbNkGakTG6Z8CY80rK_lg