China - boom or bubble?

China-focused funds keep on coming with some advocating an IMA China sector

Determining when booms become bubbles has engaged the best investment minds, particularly those analysing China at present. Those who see boom say Chinese GDP of 11.9% in the first quarter of this year can continue with tame inflation, and shareholders in listed companies will benefit as a result. The Shanghai SE Composite index’s 43% rise last year, followed by its 2.4% fall so far this year still leaves markets on comfortable P/E multiples, the bulls say. Those who foresee a bubble counter that China bears all the hallmarks of overextension, listing everything from land price fal...