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Some of the revisionist historians are getting themselves in a heat today about how bad this Chinese industrial production number was. While we agree with the facts that September-November was a period of deteriorating growth, we do not agree with the idea that January will represent another sequential deterioration.

Today, for the record, is December 15th, and markets trade on what happens tomorrow, not last month. Both China and Hong Kong closed up overnight, despite this “news.”

The more interesting chart is the second one below, simply because it’s a proactive prediction of what tomorrow (January 2009) may bring. The Chinese stimulus plan is math, and we can draw conclusions from it. We remain bullish on China and suggest that those who have missed the recent +20% and +40% moves in the Shanghai and Hang Seng indices, respectively, find room in their portfolios to buy China on down days.
KM