Selloff next week?

[Grieve]

That cheaper here part is going to be a bottleneck to chinas growth, especially if they continue to not cater to the lower end. The Nouveau Riche in Shanghai love their expensive toys (these are the people that support a mall that is entirely higher end designer shit - Gucci, Prada, Hermes - in a city where you can get the exact same articles with one miniscule different stitch down the road on chi pu lu...),

I found the same thing when I was in Bangalore. I was a 5 star hotel next a super-high end mall (with machine-gun toting guards outside), and literally a few yards away were these incredible slums.

but the average Chinese in the cities that aren't shanghai are going to have a hard time jumping on that bandwagon when you can get so many knockoffs or other brands much cheaper. I've never seen so many bootleg ghetto tablets as I did last time I visited the folks.

I don't think Apple will go very low end, but they are rumored to be coming out with a 7" tablet for $200-250 later this year. And they will probably keep dropping the price of the iPhone 3GS.

I was reading an article the other day about the Chinese tradition of "Guanxi" ("begging the cow's butt"!), where workers are almost compelled to buy their boss expensive gifts (like iPhones or iPads) in order to gain favor and promotions, as well as "mianza" ("maintaining face"). It also pegs the number of upper class elite at 70 million. Here's the article - a good read:

http://seekingalpha.com/article/516541-w...nate-china

Also, the bigger a player apple becomes in China the more fun its going to have dealing with the government. Google can testify to how fun that is.

They are already having fun with the government, via the Foxconn "controversy" and the Proview case. They are handling both pretty well I think, though. You also have to look at this way. Apple indirectly is responsible for the employment of hundreds of thousands of Chinese. Do you think the government there wants to risk Apple moving operations to somewhere else and putting all those people out of a job?