Goldman's O'Neill Talks to Aliens, Comments on China
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Goldman Sachs Asset Management chairman Jim O'Neill recently wrote a piece for Investment Week in the U.K. regarding the U.S. debt crisis and implications from the Chinese rail disaster.
O'Neill starts out, "I had a visit from a really smart hedge fund from Outer Space, and the CIO said that he expected US Treasuries to fall significantly as a result of Congress' inability to reach a deal and the US being downgraded. I told him that while it seemed very sound reasoning, here on Planet Earth, things don't necessarily pan out that way." O'Neill says Treasuries would benefit as investors became more risk adverse. The same investors might also shift from investments in the U.S. dollar in favor of the euro despite all the problems.
O'Neill, who coined the acronym BRIC (Brazil, Russia, India, and China), is still bullish on China following the recent high-speed train disaster that occurred in Zhejiang. Some bears might argue China is trying to move "too fast" in expanding its infrastructure, a possible signal that China is heading for "considerable difficulties."
O'Neill starts out, "I had a visit from a really smart hedge fund from Outer Space, and the CIO said that he expected US Treasuries to fall significantly as a result of Congress' inability to reach a deal and the US being downgraded. I told him that while it seemed very sound reasoning, here on Planet Earth, things don't necessarily pan out that way." O'Neill says Treasuries would benefit as investors became more risk adverse. The same investors might also shift from investments in the U.S. dollar in favor of the euro despite all the problems.
O'Neill, who coined the acronym BRIC (Brazil, Russia, India, and China), is still bullish on China following the recent high-speed train disaster that occurred in Zhejiang. Some bears might argue China is trying to move "too fast" in expanding its infrastructure, a possible signal that China is heading for "considerable difficulties."
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