Here is a chart of nominal GDP growth in the People's Republic of China from 1952 to 2005. The world has seen nothing like it.

Now here is the illuminating Econoday discussion of Bank of China rates. Look at the following: (i) at how relatively high these bank rates are (and have been) compared to the U.S., (ii) at China's powerful GDP growth from 1988 through 1998 when the PBOC bank rate was sent shooting up to a level from 8.5 to 12 pct, and (iii) China's GDP growth during the period of the terrible U.S. Bear market of 2000-2002.

As long as capital owners and managers can find economic opportunity in China " and they will for the next twenty years or more " they will invest in China.

They will invest in ports, shipbuilders, auto manufacturers, hotels, and so on.

And as long as unemployment in China remains at about 10 pct nationally (about 4 pct in the cities and ~20 pct in the rural areas), two important things will happen as rural unemployed people flock to the big cities: (i) wage inflation will be kept down, and (ii) demand for homes, office buildings, and infrastructure will remain very high.

The big picture situation today in China is somewhat like North America 50 to 100 or more years ago as the population moved to the cities seeking employment and a better quality of life. The economic growth at that time in North America was relentless, as it will be in China for many years.

Remember, during the time in America when huge populations flocked to the cities, there were relatively few people living in rural areas. To compensate, the U.S. and Canada appealed to Europe, Africa and then the Caribbean for immigration sources. China has no such problem, and the absolute size of the Chinese population that will make that move to find a better life in the city is enormous.

The story-tellers, of course, will change their pitch in order to push and pull on the emotions of traders, but the China growth story will not go away. China, not America, is now THE story.

I remember almost 50 years ago when a secondary school geography teacher first told the class about how big and economically powerful China would become. It took a long time to get started, but then the story finally happened. The process today is irreversible.

Traders know it, which is why capital continues to move into that country getting satisfactory returns, and the authorities can keep the bank rates, and hence the savings rates, so high.

"s_a_m_g_u" has started to add to the reader's comments, and knowing he/she is participating from the People's Republic of China, I encourage that dialogue. We are all here to learn and in addition to "Lessons of the Chinese Masters", which I keep close at hand, we can learn a lot from independent, individual Chinese traders who share their perspective.