Business Channel 2007-10-10&10-12, 亚洲区增长预测

（单词翻译）

I spoke¹ earlier to Bob Parker who's the deputy chairman of Credit Suisse asset management. I asked him whether he's impressed by the new highs in Asia and whether those numbers can be sustained.

Well certainly it's justified² by the high levels of growth that we are seeing in Asia. And you know, we stick with our view that Chinese growth for example this year will be well above 10 % may actually come out to 12 %. Um, and it also is justified by the high level of savings³ which are now being transfered from bank deposits into equity⁴ markets. Now having said that the Asian markets which we have been long of and have been recommending to our clients for at least the last 2-3 years are now becoming expensive. That our pockets are undervaluation in Asia and I would highlight the Japanese market, Taiwan and possibly, Thailand and Malaysia. But over all Asia has a block that's gone from being cheap two years ago to now expensive relative to other equity markets.

So treat with caution but does that mean that we should be keeping on money mainly in Europe in the United States or in the United States or is there still a worry that we could see a slowdown which take the shine of those markets?

Well I think the first point to make is that on our models, globally equities⁵ are cheap relative to other asset classes. So I think the equity market rally that we have had this year with the interuption in August. Um, I think taking a 3-6 months view is still intact. Within equity markets the geographic⁶ markets which are the cheapest today are still a core Europe, Germany France Italy. And quite very interestingly Japan. Japan on our model is gone(So it sounds like terribly,I mean we had a very very bad year last year)it's been...(and not so good to stride there.)it's just been one of the worst performing equity markets for the year last 18 months. And Japan 9 months ago looked very expensive now Japan is moving up to being one of the cheapest equity markets.

In the last few days we have had 4 of the biggest banks, Merrilynch, Deutsche Bank, UBS and Citigroup announce huge write-downs in round numbers just those 4 are gonna write down 15 billion dollars in round numbers. Are you impressed with that? Does that draw the pain, draw the poison out of the subprime or equity crisis.

I think the simple anwser is yes. Having said that the subprime market is 700 billion US dollars and we estimate that going into 2008 the default rate on subprime could actually rise close to 20%. So I think the subprime crisis is not over. It's gonna take months if not years to sort out.

OK. What about the dollar though, I mean clearly we are looking at an ailing⁷ dollar. Does that suggest to you that there are a lot of imbalances and difficulties in the financial system of gain, of which we should beware as investors⁸?

Well I think the primary source of the problems for the US dollar is obviously the expectation that interest rates will come down further in the United States and I think that's right. And the trade and current account deficit⁹ one of the surprises going into the 2008 may well be the improvement in the trade uh, in current account position of the United States as we see an economy which is growing more moderately and therefore importing less. Against the Euro the dollar is clearly undervalued and I would be very surprised if we actually break out of this range of 140-145 one dollar Euro towards 150. I think we actually could be forming a base for the dollar against the Euro. It's a different question against the Asian currencies which I think appreciate on trend and one should obviously highlight the fact that the Japanese yen¹⁰ is probably now the most undervalued currency in the world.

Notes:

round numbers: A round number is a number that ends with one or more zeroes (0), meaning that they are multiples of 10, 100, 1000, and so on.