Asian opportunity beckons

White List Us Print Issue Follow us on Twitter   Follow us on Facebook   A Publication of The Sovereign Society The Best Place to Be an Investor By Jeff Opdyke, Editor, Emerging Market Strategist Dear Sovereign Investor, I stood against the railing of a roof-deck bar 57 stories up, looking out over Singapore Strait and trying to put the scene into context. There, splayed across the dark blue sea, lay scores of cargo ships and tankers - maybe even a hundred - all awaiting entrance into Singapore’s ship terminals, among the world’s busiest. What struck me was the stark dichotomy of the global situation. Here in the West, we have America and Europe in undeniable decline, the victims of self-imposed decay rooted in historically misguided political and fiscal policies going back at least two decades. Yet gaze out across Singapore Strait and it doesn’t take an MBA to realize there’s a marked difference in what Asia in experiencing at the moment. As the world’s former economic engines recede, Asia is taking flight. >>Advertisement CALLING ALL FINANCIAL “SURVIVALISTS” If you are confused or concerned about the radical changes sweeping through our eroding financial system... And you want to ensure that your life savings... your home and your business are never held hostage by a collapsing economy... and an out of control government. We’re putting the finishing touches on a critical new financial survival plan. One that you can use to survive and thrive through the challenging times ahead. For full details, click here... And in that fact is a great opportunity for investors who understand the profound shift now taking place - even though it is overshadowed by the sideshow antics in Washington and Brussels. The upside of the mess in America and Europe is that fantastic companies throughout Asia are on sale. Asia: Decoupling from the West and Looking Inward Instead I’ve been an Asia investor for more than a decade, operating from brokerage accounts in places like New Zealand, Singapore and Hong Kong. I saw the 1997 Asia currency crisis from a front-row seat. I was there for SARS and bird flu... and I’ve seen, heard or read about every worry that has emerged in the last 10 years regarding China’s hard-landing, soft-landing, or implosion. Today, however, seems unique from my perspective. In the last six or seven trips I’ve taken to Asia since the U.S.-inspired global financial crisis hit, one fact has remained constant: GROWTH. It’s everywhere. It’s visible in all the major cities and across the secondary and tertiary towns in China. It’s everywhere in Hong Kong and Singapore. Cambodia is swimming in growth. It’s all over Thailand and readily apparent across Australia. But you would never know that by looking at Asia’s stock markets. Share prices are under intense pressure - often not because of company- or country-specific concerns, but because of the daily news flow from America and, particularly, Europe and its ongoing sovereign-debt crisis. The problem is that institutional investors largely dictate the ebb and flow of global stock markets. They shovel money into countries when the managers are feeling ebullient about Western debt solutions... and then they withdraw the cash when their mood changes. The thing is, the vast majority of the institutional crowd is based in the West. They think with a Western mindset and continue to view the world through the same lens that for decades had the West responsible for the world’s economic growth. They are, in short, refusing to acknowledge the sea change. A fundamental decoupling is happening. It’s slow, and it has many years to run, but Asia is increasingly less dependent on America and Europe than Western economists and strategists want to believe. Instead, Asia is increasingly more dependent on intra-regional trade. I had that very conversation in Bangkok in September with a leading economist. I had the same conversation in China, Hong Kong and Singapore a year ago. Each conversation highlighted the same fact: Asian countries are purposely moving away from reliance on the West, recognizing that the indebtedness of Western economies will hamper American and European economic growth for years, if not decades. To survive and grow their own consumer-driven domestic economies, Asian countries and companies are looking inward... And the winners in this sea change are the local companies focused on domestic and regional consumers. Up 53% in Chicken... and Much More to Go Here’s a good example of what I’m talking about: CP Foods, a Thai chicken processor and provider of animal feeds and branded food products. I put my Emerging Market Strategist subscribers into CP Foods earlier this year and we’re up more than 53%. The reason for the gain is simple: Demand for better food and convenient food is exploding across Asia as the new consumer culture emerges. Families in Thailand, the Philippines, Malaysia, China and Indonesia really don’t care what’s happening in Athens, Washington or Brussels. Whether Greece is in or out of the Eurozone doesn’t change the desire of a Thai family to have chicken for dinner tonight, instead of rice or noodles. CP Foods’ business has been on a tear for the past decade, with sales up 12% and net profits up 15% on a compounded annualized basis. That’s fast growth. Better still, that growth shows no signs of letting up anytime soon. CP Foods just last week announced plans to snap up complementary businesses in China and Vietnam that, the company expects, will increase sales by 50%. This is exactly the kind of stock you want to own. Even as America and Europe struggle with their political and economic circuses, Asia continues to disengage from Western dependence and Asia’s consumers continue to seek a better life for themselves and their families. That is a long-term trend more powerful than debt crises in the West. Ultimately, Asia is the one place on the globe where economies are functioning properly, despite what stock markets are doing. Use the weakness to your advantage and grab shares of local Asian companies that are serving local and regional markets. Until next time, keep a global view... Jeff D. Opdyke Editor, Emerging Market Strategist Editor’s Note: You may have noticed that investing in U.S. stock markets has increasingly become a waste of time and money - not to mention a source of disappointment and frustration. And the insane volatility in recent years could give even the healthiest of investors high blood pressure. Yet, even during the height of the tech boom, U.S. stock markets never cracked the Top Five Best Performers in the world. Jeff can show you how to widen your investment horizons. Click here and learn how to open up a whole new world of opportunity. >>RECENT ARTICLES 11/28/2011 Texas Light Sweet Crude – the Game-Changer Could mean lower prices at the gasoline pumps... 11/28/2011 TED Spread Says Banks are getting Spooked Again! It's an indicator of perceived credit risk in the general economy. 11/25/2011 Tax Justice Network: There They Go Again! Back in 2005 the TJN's favorite villains were drug dealers, Enron-like corporate thieves and terrorists, but on must stay au courante. 11/24/2011 Things to Be Thankful For If we ask how life in the United States is different from life in most of the history of the world, a few key elements come to mind... 11/23/2011 A Norman Rockwell View of Thanksgiving: Not Linked to Reality Thanksgiving Day is for eating turkey, over-indulging, bickering with your family, watching football and shopping; right? It Ends Midnight Wednesday... Until midnight Wednesday, we’re offering you a 30-day trial subscription to Jeff Opdyke’s Emerging Market Strategist research advisory for just $1.00. If you’ve ever wanted to try our premium research, but didn’t want to pay $1,595... this is a great way to test the waters and see if it’s right for you. For full details, just go here... HOME    |     ABOUT US    |     PREMIUM CONTENT    |    CONTACT US

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