Breakthrough in China... Ease One Child Policy

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Nov. 15 (Bloomberg) -- On today's "Insight & Action," Adam Johnson looks at changes in China on "Street Smart." (Source: Bloomberg)

Breakthrough in china.

It looks like frida is -- freedom is good for business.

Insight and action.

Amazing announcement came out of the new agency in china over the past 24 hours.

Let me share them with you.

I am just showing you three of the major announcements.

They are easing the one child policy and initiating land rates.

That is huge.

Number three, they are expanding private investment.

Equally huge.

I actually showed you the symbol in chinese for progress.

This is massive progress.

Earth shattering progress.

The kind stephen, formerly the head of morgan stanley, is talking about for years.

China is shifting from an infrastructure based economy to a consumer driven-based economy.

Here is why china needs to do this.

It is at a crossroads.

Look at tremendous gdp growth you have seen in china over the past decade at the -- as they have build out their infrastructure.

Meanwhile, look at population growth.

It has been flattening out in part because of the one child policy.

You cannot have a continued rise in gdp unless you have a similar gain in population.

Population is also allowed to go up.

It means consumption.

Consumption means growth.

If you want to talk about growing your economy, that is the way.

The question is, how do we as investors play at?

All of the chinese etf tentatively focus on infrastructure blowout when you talk about all of these infrastructure -- that is old news and does not work anymore.

We learned that lesson from a number of different people.

Now -- now what we have got to do is focus on consumers.

There is a new one put out by global funds.

The ticker is ch iq.

32% of it is retail and 20% is food and 14% is auto, lodging, internet, etc.. all the stuff the middle class in china wants to consume.

That is where the growth is and that is where china is telling you the growth will be.

It is about consumption and not

This text has been automatically generated. It may not be 100% accurate.

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