Why Hong Kong could be set to soar

Hong Kong's stock market has a very close relationship with US interest rates. As rates go down, the Hang Seng goes up. And with US interest rates near zero, stocks could take off in Hong Kong.

Ben Bernanke has cut short-term interest rates in the US to essentially zero, the lowest rate we've ever seen. He's doing this, of course, to 'juice' the economy to give it a jumpstart. He doesn't know (or care, actually) that this action will inadvertently (but undoubtedly) cause one particular stock market to go absolutely nuts.

This stock market I'm talking about is Hong Kong. Today, we have the ultimate recipe for stocks in Hong Kong to skyrocket. The Fed has cut interest rates to essentially zero (causing Hong Kong rates to be next to zero in its unique money system). And yet Hong Kong stocks are incredibly cheap. They bottomed a month ago at a single-digit price-to-earnings (P/E) ratio.

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