U.S. Companies Deteriorate While Asian Companies Prosper

Tony Sagami discusses how U.S. companies are facing a deteriorating economic backdrop while companies in Asia are continuing to grow and prosper. Mr. Sagami also discusses kinds of businesses in Asia that he believes have growth potential.

The common problem all U.S. companies are currently facing is a deteriorating economic backdrop. Between the sub-prime crisis, a struggling real estate market, $140-a-barrel oil, rising inflation and a business slowdown, there's a lot of trouble out there. Meanwhile, Asian economies are showing no sign of slowing down. That is why Mr. Sagami continues suggesting paring down holdings in the vulnerable American economy and getting a bigger stake in rapidly growing Asian companies. In his opinion, the following areas are the kinds of businesses in Asia that look poised to grow:

The first area is construction. The country is throwing up giant skyscrapers, paving new roads and building new power plants. And Sagami believes this area will grow in activity after the 2008 Olympics later this summer. In fact, he believes there is still at least 10 years left in the Asian construction boom.

One trip to Wal-Mart will prove that China has become the world's

manufacturing center. Currently, just about everything on store shelves was made in China (or some other Asian country). But it's hard to consistently figure out who will make the next hot product. That's why Sagami likes companies involved in transporting the goods from factory floors to store shelves. And don't forget that the cargo business goes both ways. Asia needs the raw materials used to build the products it manufactures.

Asia is all about consumption. Every time Sagami visits, he's amazed by the sheer volume of shopping going on. Chinese yuppies are spending a lot of their disposable income on luxury items, so investing in companies that cater to them can also be very profitable.

According to Sagami there are ways to get a bigger stake in Asia's booming growth. Exchange traded funds is one popular way because they can give a diversified stake in a particular sector, index or country in one shot, including Asia. ETFs are great, but so are traditional, actively-managed mutual funds. They're a great way to get a diversified stake in Asia's best companies. Chinese companies on U.S. exchanges are a third way to invest in Asia. More than 100 Chinese companies are listed on the New York Stock Exchange and some of the largest and most profitable companies in all of China can be found on U.S. exchanges. However, Chinese companies on foreign exchanges work easily as well; all that's needed is a broker with an international trading desk and the ticker symbol of the stock. U.S. companies have been doing business in overseas markets for a long time. But these days, some American firms are getting the bulk of their revenues from outside the U.S. That is why U.S. companies doing business in China is another way to invest in Asia.

"The bottom line is that even carefully selected U.S. companies can give you very significant exposure to Asia. Which of these investments is right for you The answer depends on a lot of things, including how aggressive you are, whether you're more of a do-it-yourselfer, and how focused you want to get. But no matter what, I think you should take a serious look at increasing your stake in Asia because I think the region's shares can help your portfolio weather the downturn happening here in the U.S.," Sagami states.

To read this issue online, please visit:

http://www.moneyandmarkets.com/Issues.aspxFive-Investments-for-a-Tough-US-Stock-Market-1968

About TONY SAGAMI & MONEY AND MARKETS

Tony Sagami, a veteran investment advisor and a leading expert on Asian markets, is the owner and founder of Harvest Advisors, an investment research and money management company. Mr. Sagami has been managing money for more than 20 years and is one of the early pioneers in the application of technical and quantitative analysis to mutual funds and stocks. He is a featured contributor to Weiss Research's daily e-letter, Money and Markets and monthly Safe Money Report as well as the editor of Asia Stock Alert.

Prior to establishing his own firm, Mr. Sagami was managing director at W.E. Donoghue & Co, serving additionally as the director of investment. During his successful career, he also held the position of account executive at Merrill Lynch.

Mr. Sagami's views on Asian markets, specifically Chinese investments, have been featured in publications such as The Wall Street Journal, Barron's, Kiplinger's, Smart Money, Business Week, New York Times, Washington Post, Investors Business Daily, Bloomberg, Financial Planning Times, Mutual FundsMagazine, Chicago Tribune, and the LA Times, as well as on CNBC and CNBC Asia.

Mr. Sagami holds a degree in economics from the University of Washington.

Money and Markets (www.moneyandmarkets.com) is a free daily investment newsletter from Dr. Martin Weiss and Weiss Research analysts offering the latest investing news and financial insights for the stock market, including tips and advice on investing in gold, energy and oil. Weiss Research, Inc. is located in Jupiter, Florida. For more information about our editors, or to set up an interview, please contact Jennifer Moran at 561-627-3300 or visit www.moneyandmarkets.com.

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