Quick Take – NY Times wakes up, realizes China = Lie.

The slow to wake up New York Times has finally begun to realize what BuyersStrike! readers have long known. Statistics, figures, and “results” coming out of China and Chinese companies are, simply put, lies.

In a front page article in today’s New York Times (23 June), available here, one particular section screams out:

Indeed, officials in some cities and provinces are also overstating economic output, corporate revenue, corporate profits and tax receipts, the corporate executives and economists said. The officials do so by urging businesses to keep separate sets of books, showing improving business results and tax payments that do not exist.

Your author believes that the main point deserves repeating: “The officials do so by urging businesses to keep separate sets of books, showing improving business results and tax payments that do not exist”.

Of course, recent moves by the Chinese government to stifle the ability of foreign investors and journalists to perform proper due dilligence, come as no surprise. The Chinese have cracked down on the ability of even Chinese, let alone Westerners, to access SAIC and land registry information, just as a start. Read more in a piece by Stratfor here.

To believe, as China bulls do, that the set of books reported to Western investors is the true and accurate one is foolishness, and professional irresponsibility, of the highest order. To believe any of the research from bullish analysts, when there is now no way to do any real due diligence work is negligence.

The solution to this problem is simple, we in the West must vote with our wallets and deny the Chinese access to our capital and our capital markets.

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