Which country do you think will be the dominant economic superpower in the 21st century?

I ask this question a lot in my global investing seminars. The most popular answer is usually China, followed by the U.S., and India sometimes gets a few votes.

For much of the second half of the 20th century, the U.S. accounted for more than 40%—sometimes approaching 50%—of the world's total economic production. In other words, the U.S. economy was almost as big as the rest of the world combined. In the past five years, however, a 38% decline in the U.S. dollar and the superior growth of newly-emerging economies is changing the global distribution of economic power.

China and its neighbors, like Russia, Taiwan, South Korea, Singapore and Malaysia, will probably evolve into a new Asian economic bloc. It's likely that this fast-growing region will become the new global epicenter of wealth creation in the 21st century. There will be many investment opportunities throughout the region that are shielded from the economic problems of the U.S.

The stocks in our China Strategy portfolio fall into this category—many of them are already trading higher than they were before the November sell-off. Do you want to own companies that bounce back quickly?

Black Friday has been around since 1970s, but it hit the mainstream in a big way in 2002 and since then it has given institutional and private investors alike an important temperature reading on the market and what can be expected for the fourth quarter. Recently, another gauge has been added for investors—it's called Cyber Monday, and, for those who may not be familiar with it, this day falls on the Monday following Thanksgiving. While shoppers hit brick-and-mortar stores on the Friday after the holiday searching for deals, they go online on Monday to scour websites for further markdowns.

It was uncertain if shoppers would log on for "Cyber Monday," but they showed up in force and they opened their wallets to the tune of $733 million. Many analysts were closely watching retail sales from Black Friday and Cyber Monday to see what sort of mood consumers would be in this holiday season.

I'd like to talk about what these numbers, as well as a few others, are pointing to for the end of 2007. I think you'll be surprised by my conclusions, but hopefully you'll get a better idea of how the markets will perform through the end of the year—

I don't normally pay attention to commentary on U.S. economic trends from super models, but Gisele Bündchen made a statement recently that I couldn't agree with more.

Gisele announced that she will no longer accept U.S. dollars as payment for her modeling services.  Most people would dismiss this remark as the latest celebrity attention-grabbing move, but this is actually similar to what I advise you to do as well. Now I doubt that your employer is willing to pay you in euros like Gisele, but you should be looking to invest in companies that have assets not valued in U.S. dollars.

To put into perspective how far the dollar has fallen, you have to compare it to other currencies. In October, something happened that hasn't occurred since 1976. That was the year that one "loonie," or Canadian dollar, was equal to one U.S. dollar. Just like last time, Canadians are finding that goods are much cheaper to buy in the U.S. because their loonie can buy so much more than it used to. 

Since we're more focused on investments in China, let's see how the dollar stacks up there. The Chinese yuan has climbed more than 10% versus the U.S. dollar since the end of a fixed exchange rate in July 2005. This gives holders of companies with yuan-denominated assets an immediate 10% bonus because the value of their holdings didn't drop with the dollar. The China Strategy portfolio is loaded with companies that own yuan-denominated assets—

On October 19, the 20th anniversary of the Black Monday market crash, poor third-quarter earnings and a gloomy economic outlook gave the major U.S. indexes their worst day in weeks. The NASDAQ, S&P 500 and Dow all plunged 2.6% during Friday's trading session. And the indexes have been see-sawing ever since, dipping, recovering and starting the cycle all over again—sometimes within the same day! All of this action is making watchful investors dizzy and anxious.

I recently heard someone compare investing in China to "the Wild West." This is actually a very accurate description. China is the new frontier of investing, and it's a dangerous place for people who don't know the financial landscape. But for those of us who know the financial terrain, the culture, and have spent years investing in the region, China is a gold rush for investors.

A major driving force behind the Wild West analogy is the booming IPO market. I get asked about these types of investments all the time. There have been quite a few of them over the last two years, and there's likely to be many more to come.

One of the questions that I get most often from investors is "How can we tell if a newly offered China stock is worth buying?"

Evaluating an IPO is probably more of an art than an exact science. Because I've been doing it for so long, I've developed a rigorous process of evaluating these new listings.

It means big profits—fast—for China Strategy subscribers. Interested in learning more about these winning IPOs delivering large and rapid gains?

One month ago, the U.S. markets were in the thick of the credit crisis. On Thursday, August 16, the Dow experienced an extreme spasm of volatility, opening at about 12,860 and then dipping all the way down to 12,455 before finally closing just 15 points lower than the previous day.

China is now less than one year from its Olympic debut. As we'll see in a minute, this event is stimulating consumer spending throughout China to a stunning degree, but the leading beneficiaries of easy money in China are the companies actually building the Olympics infrastructure. And there's still a lot to build.