E China Not Looking Good

Today Barron's told us to cut our risk with Chinese electric vehicle stocks. We only own one and already cut our risk by selling 2/3 of our holding in the soaring ADR, in two separate sales this year.

China is not looking good. Its domestic bond market is in disarray after a second borrower defaulted on debt of $153 mn (in RMB). The first was a coal firm. But the new defaulter is Shandong Ruyi, which is part of the country's garment supply chain, being the vendor of Lycra.

China has also arrested the guy in charge of vetting local borrowers for risk, for taking bribes to upgrade ratings. The local bond market has total debt equal to $4 bn and the risk to the regime for its failure is great.

Meanwhile, Beijing is attacking Australia for questioning the origins of the COVID-19 bug and other misdeeds by banning its output from the country. Canberra pointed out that this is a violation of World Trade Organisation rules. Among the goods barred is Oz wine to which I am switching my tipple.

Brazilian Oi, a former holding of Portugal Telecom looted by PT's management and bankers, sold its mobile telecom arm to America Movil of Mexico, Telefonica of Spain, and Telecom Italia sub TIM. None of them speak Portuguese.

More information on the Russian hack attack against US businesses and government bodies reveal leaks hit the websites of the Pentagon, US intelligence services, nuclear and health labs, and about 500 major US corporations. How should the USA retaliate against something like this to prevent repeats?

Business newspaper article

image source

Funds

*I switched our country fund to Taiwan Fund TWN, discriminated against because of Chinese objections to its name. I sold Korea Fund KF because it is changing its advisor from Germany's Allianz to JP Morgan.

*Harry Geisel's recent recommendation, Atlantica Sustainable Yield Fund, AY, of Britain, ex-div, was rated buy by Seaport Global. Its part-owner Algonquin Power & Utilities AQN was rated strong buy by Raymond James. Ir also is a dividend aristocrat and a green play.

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