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 [分享]Loss in physical capital, gain in social capital |
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新科AOW
头衔: 海归中校
声望: 博导
性别: 
加入时间: 2007/11/22
文章: 426
海归分: 40909
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作者：新科AOW 在 谈股论金 发贴, 来自【海归网】 http://www.haiguinet.com
A recent research report issued by ML. Very good perspectives!
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Loss in physical capital, gain in social capital
The earthquake in China’s Sichuan Province on 12 May 2008 is the country’s deadliest natural disaster in decades. The death toll exceeds 55,000 and direct economic losses could surpass US$20bn. But massive loss in physical capital is more than compensated for by a big gain in social capital, so it’s our view that you should have more confidence in China’s ability to sustain high growth. Investment implications are straightforward for those believers of fundamental analysis.
Significant progress in government, people and society
Social capital is trust and trustworthiness in a society, which determines the ease with which people cooperate to deliver socially efficient outcomes. Beijing responded much faster to the quake than the snowstorm. Media coverage of the quake has been unprecedented. Many NGOs actively got involved and numerous individuals volunteered for rescue work at their own expenses.
You should have more confidence in long-term growth because the loss in physical capital in the earthquake could be more than compensated for by the big gain in social capital, which could be the single most important driver of long-term economic growth.
You should have more confidence in medium-term growth because a more open society (an indicator of increasing social capital) and lessons from the quake beg China to impose higher standards when rebuilding millions of buildings and recapitalizing thousands of factories. Higher standards will demand more investment and deliver more added values to the economy.
You should have enough confidence in even the short-term growth because China’s economy is huge and the quake-stricken areas are relatively small. Rising social capital speeds up rescue, recovery of power supply and reconstruction, so even short-term growth impact of the quake is very small.
Chinese economy in May — data and policies
In May, CPI inflation could be around 8.0% y-o-y. The earthquake could have some marginal impact on inflation through food prices; it could also have some slight negative impact on IP growth in the month of May, though impact on exports should be close to negligible.
On policies, the PBoC may put off rate hikes till later this year on account of the quake. This week RMB rose again vs. USD after hovering at 7.0 for a month. We believe that authorities continue to engineer an appreciation in the RMB and see the exchange rate under their NEER (nominal effective exchange rate) framework rather than a pure USD-RMB move.
作者：新科AOW 在 谈股论金 发贴, 来自【海归网】 http://www.haiguinet.com
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 [分享]Loss in physical capital, gain in social capital -- 新科AOW - (2900 Byte) 2008-5-26 周一, 19:34 (1085 reads)
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