In another non-surprising move, Taiwan is opening up more of itself to China. Looking at this from a purely market view, allowing more capital to flow into China benefits China first, not so much Taiwan. I find it hard to believe that practically no one is cautioning Taiwan on relying so much on China for an economic boost.
China is a bubble that has been years in the making, and with the Olympics finally here in less than a month, the chances of that bubble popping greatly increases after the Olympics. So what a perfect time for Taiwan to get invested in China, right at the top, right before the downfall.
Taiwan was late to the China game. While we still may see some upside in China investments, I'm afraid Taiwan is going to get "caught with its pants down" as many like to put it. It just doesn't make sense. Capital outflow will not help the TAIEX get any ground.
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