Is China a buy or isn’t it?

Last week, Taipan Daily editor Justice Litle gave six reasons why the China bears are wrong. Justice says continued growth, the recent correction in oil and the country’s personal savings rate mean China’s fundamentals are strong.

However, J. Christoph Amberger in Today’s Financial News says analysts who predict Armageddon for America based on a 20% drop in the Dow and discount a 60% drop in the Shanghai Stock Exchange may just have sand in their slide rules. 

Ian Davis in The Growth Stock Wire says it’s a tale of two contests in China…

Even with the arrival of the much-hyped Beijing Olympics, the Chinese stock market remains on a serious downer.

Yesterday, China’s benchmark Shanghai Composite Index dropped 5.2 percent after economic data revealed wholesale price inflation jumped to its highest level in 12 years in July.

However, Taipan Daily editor Justice Litle says China’s long-term outlook remains strong - and some China plays look more favorable than they have in years. Here are Justice’s six reasons why the China bears are wrong…

The recent devastating earthquake in China will push record food prices in the country even higher. However, experts say the earthquake will not slow economic growth.

“There will be less supply of pork, less supply of rice,” said Sun Mingchun, a Hong Kong-based economist at Lehman Brothers Holdings, speaking to Bloomberg. “It’s not causing supply to decline drastically but it is definitely less. The impact on inflation is more than its impact on growth.”

Chinese stocks dropped further 3.9% this morning, sending the Shanghai Composite Index to 50% below its October peak. The index includes all the 862 companies on the larger of China’s two stock exchanges.

“Even while China’s export growth is slowing as a result of the economic slowdown in the West,” says Chris Mayer in The Daily Reckoning, “its economy is continuing to hold up remarkably well as domestic and regional demand picks up — and the country’s appetite for imports is helping the emerging markets to withstand the US slump.”

It’s the highest price ever paid for a single lot of wine, reports Reuters.

The buyer? An anonymous Chinese billionaire.

According to the report: “The anonymous Chinese entrepreneur bought a mix of vintages of Romanee Conti, a Burgundy wine and considered to be among the world’s most exclusive with only 450 cases produced each year.”

China is booming, despite the recent sell-off of Chinese stocks, but how do US investors profit from the China story without getting burnt?

Last year, the Chinese stock market turned in one of the greatest performances in stock market history. The Shanghai Composite Index climbed as high as 128%… and finished the year with a 97% gain.