Replies to post #131345 on Value Microcaps Motherboard

[SAMNOTSAMUEL]

China/sskillz1:

It is a good point. If an individual Chinese company is both real and in a strong financial position, the company needs to consider strong dividends. CCME has mentioned a weak dividend. The good companies with strong insider holdings need to look carefully at how to grow their own insider personal wealth for the long term. Time will tell if they have savvy. So far not so good.

sam

[hweb2]

I'm guessing the short attacks will continue as long as investors are quick to panic sell and the stocks plunge on their reports. Easy money for them. Reminds me of the movie Wall Street when Bud asks Gordon Gekko "Why did you need to wreck this company?". Answer..."Because it was wreckable!"

[10 bagger]

China Stocks..

I have position in GEBD and had a position in ENHD.. Both from China and both touted on the boards.. Thought I had done my homework and in the case of GEBD the president and largest shareholder wanted his company back so he took it and just gave the shares back that he got for it.. His explanation was it was his and didn't want to be public anylonger.. I'm long almost 90K of this POS.. ENHD who I followed the young wiz kid from Princeton in,, the same one that wrote up the P&D on CCME above $20.00 on Cramer's web site and it went black.. He say's they will have to pay up to get his stock .. Lost a bunch on 36K after selling out in the$0.40 range.... I could go on to CIVS,, NEP and others but what's the sense..

Stocks from China may go up but as a group they have more promoters that act like GFCI than BIDU.. I'll buy again because there are real companies in China,, but not until I not only understand the company thru Chinese eyes but believe they have a company that came from sweat and hard work and not a checkbook.. I bought EESC yesterday @ $1.62...

[cl001]

SSK, Sorry to see you came down to this. I have been warning people for many years not to buy China micro stocks. I remember some folks were very upset about my warning. I was very surprised to see the conservative investors like you and Len were deeply into these very risky China stocks.
The bottom line for China stocks is not the company behind is real or not real, most companies are. The question is if you own 100% of a Chinese company can you take over the company and install new management team? The answer is no.
The China things are very complicated and very hard to imagine by western investors. For example, there are common practice to reduce tax. So the filing to the Chinese authority usually show much lower profits than the US filing. If you ask a western standard accounting firm to do it, it would be very difficult to sign off. There are lot of local accounting firms that are willing to do it, but do you trust the reports?
Almost every Chinese stock has some untold stories behind it. You need to really know the company before investing in it. Recently there are development that good Chinese companies are starting to go private and re-list in Shanghai or Hongkong. I think it is a good trend. However, then the problem is the not so good companies are left behind. I was looking at a few China companies that I knew well recently but decided to pass, maybe everyone on this board gives up on China companies it is a better time to buy :-)
My investment philosophy is very simple, buy the resources that China needs instead of buying China companies. There are a lot of resource companies very undervalued these days, come to JM, JE and FA boards you will find many good opportunities.