So NOW the Mainstream Likes China’s Economy…

The market makes us laugh sometimes.

The hapless hacks parading as serious analysts and commentators make us laugh too.

We see them all the time on CNBC and Bloomberg TV.

It’s typical mainstream stuff.

It’s all reactionary. There’s nothing proactive about them.

It’s why they always miss the biggest trends. And it’s why they’re in the throes of missing the biggest trend right now…

You should watch the business channels from time to time.

It’s hypnotic.

After a while, you notice that on any given day not that much happens in the financial markets. So once you’ve sat through the half-hour news cycle for the first time, you realise they have to repeat the same news cycle all day long.

That’s what makes it hypnotic. You try to guess the segment, the stock film footage, and which captions are coming up next.

You punch the air in excitement (in your mind) when you correctly remember that the footage of the big dumper truck goes with the story about mining stocks, and the clip of the scientist dropping liquid in a series of test tubes goes with the medical story.

That’s the mainstream. It’s boring. It’s predictable. But for most investors, it’s what they want…because it’s comfortable.

Do you remember when the market hated China’s Economy?

The only time you’ll get any excitement on the finance channels is before the announcement of a super important [sarcasm] government statistic.

Then they’ll have a countdown, leading to the mighty proclamation that…the unemployment rate is the same as last month, or the Reserve Bank of Australia has kept interest rates on hold.

Wow! Amazingly, some folks actually find that stuff interesting.

We know they find it interesting because we get emails all the time from mainstream analysts telling us about the importance of the key data, and the impact it will have on the market.

Yawn. The truth is it’s all junk.

Take the HSBC ‘flash’ PMI number. The media gets all excited about this number. It’s a statistic that claims to show if China’s economy is growing or shrinking.

For months the market has gotten into a fluster, worried that China’s economy was slowing. You probably saw the reports about a potential economic collapse.

You may remember the horror when a Chinese solar energy firm defaulted on a bond. If you listened to the mainstream, you would have thought it was the end of the world.

And yet, what does the reactionary media say about China now? Take this from yesterday’sFinancial Times:

‘Chinese equities led Asia-Pacific bourses higher on hopes that the manufacturing sector in the world’s second-largest economy is expanding at a quickening pace.

‘HSBC’s “flash” purchasing managers’ index for July — an early indicator of factory activity — rose to an 18-month high of 52. A reading above 50 indicates growth.’

This is what we mean by reactionary. If you had let the mainstream scare you witless about China, you would never have invested in stocks that are sensitive to China. In other words, about half of the Aussie market.

Read the rest of this article at Money Morning