Tuesday, December 4, 2012

WSJ from 2011: "Fund Manager Bets On Busted Chinese Convertibles"

I wonder how betting on Chinese convertible debt has gone over the past year?

He noted the risk of investing in Chinese assets is high as the country's bankruptcy process is still largely untested and investors run a chance of having entire holdings being wiped out.

But, he added, there are "legitimate companies" worth betting on. And, on a broader level, Kao said some sectors are more strategically significant to China.

"The solar space is deemed 'too big to fail' from Beijing's perspective," he said, noting the Chinese government's commitment to develop alternative energy sources and decrease the nation's reliance on fossil fuel.
Recent developments at Suntech Power have not seemed to support the idea that Chinese solar firms are necessarily too big to fail or will be bailed out.

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