Tags: Biggs | China | Rebound | economy

Barton Biggs: China Rebound to be 'Positive Surprise in Months to Come'

Monday, 30 Apr 2012 07:22 AM

By Dan Weil

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While those selling China short, such as James Chanos of Kynikos Associates, have seen things go their way in recent months, that won’t continue, says Barton Biggs, managing partner of hedge fund manager Traxis Partners.

“They’ve been right so far, but I think China has pretty artfully created a soft landing and has stabilized growth at 7-8 percent, which is pretty darn good for the world’s second biggest economy,” he tells CNBC.

The World Bank expects China’s growth to slow to a 13-year low of 8.2 percent this year, following a 9.2 percent expansion in 2011.

“Markets are starting to suggest that China is effectively stabilizing their commercial real estate market,” Biggs says.

“I think China will be fine. It will be a positive surprise in months to come and will be a big plus for world markets.”

When it comes to the United States, Biggs sees the economy as quite healthy, despite the deceleration of GDP growth to 2.2 percent in the first quarter.

He’s particularly bullish on technology stocks. “We’re still in the second or third year of a five-to-seven-year technology capital spending boom,” Biggs says.

The World Bank concurs with Biggs’ assessment of China.

“With the economy slowing, the policy challenge is to ensure that this continues in a gradual fashion,” it says in a report cited by Bloomberg. “Sufficient policy space exists to facilitate an orderly adjustment and respond to downside risks.”



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