PowerShares Gld Drg Haltr USX China (ETF) (PGJ)

Justin5342002 (83.78) Submitted: 6/23/08 4:41 AM : Start Price: $25.35 PGJ Score: 10.07

I think economically China will outperform, however, I think people need to realize the difference between economic growth and prices for equities. Economically, I think China will far outpace U.S. and other developed country GDP growth rates for years to come. However, near term it looks like Chinese equities will continue to suffer. China is actively trying to slow economic growth and as long as they continue to hike interest rates to slow economic growth equities will continue to sell off.

However, as soon as China decided to lower interest rates or hold for a prolonged period of time I would be long China.

So, once again, higher interest rates = slower growth = slower growth in earnings/share per quarter = declining prices in equity.

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