Eoin Treacy's view New ideological frameworks develop during times of great social change as people attempt to make sense of their new circumstances. China has experienced remarkable change over the last century; moving from an imperial through communism to the current command capitalist system. The industrial revolution of the 1800s saw the evolution of ideologies such as Capitalism, Marxism and Romanticism and all of these are being reinterpreted from a Chinese perspective.

One doesn't have to look far for signs of capitalist or Marxist policies in a state which has been ruled by the Communist Party for 60 years and where economic liberalism and can do/will do attitudes to business have fuelled massive economic expansion. However, what became abundantly clear on this trip were the first signs of social change. For the first time, I heard people talking about a work/life balance and about the need for spiritual nourishment rather than aiming completely for material fulfilment. Don't get me wrong, materialism is still a major aspect of the developing middle class. Most of Mrs. Treacy's friends and acquaintances were keen to show off their homes, cars, modern conveniences and domestic servants.

The spate of school children killings that have rocked the country over the last year has resulted in armed guards being posted outside schools and has perhaps fuelled a questioning of social morality. I'm pretty sure I noticed more people wearing overt signs of their religious affiliation on this trip than on any other.

During the UK's industrial revolution, romanticism gained popularity with city dwellers idealising the simplicity and purity of rural living. A similar pattern appears to be developing in China where well-to-do urban dwellers go to the countryside for the weekend or have a second home in the hinterland. I know people who have bought land outside Beijing and planted trees in an effort to do their bit for re-forestry. Today's green movement could be compared to Victorian romanticism and more Chinese appear to be paying attention to the environmental consequences of their actions.

China's infrastructure development continues to impress. Both Beijing and Shanghai have spent billions on improving their cities for the Olympics and Expo respectively and both cities have cleaned up significantly since our last visit in 2007. One of Mrs. Treacy's former colleagues as ThyssenKrupp, now a senior executive told us that the Chinese arm of the company continues to grow ahead of expectations with demand from infrastructure and car manufacturing fuelling growth. He expressed scepticism about the government's efforts to curb excess steel supply because the individual states have a vested interest in continuing to produce. He also said that the whole sector has been squeezed by the continued high price for iron-ore and their inability to pass on higher costs to their customers.

Car ownership continues to increase and while a car or two are status symbols, the associated traffic problems are a headache. Shanghai's overhead network of motorways is efficient and traffic issues are relatively minor. Beijing traffic is very slow moving at least in part because the inner two ring roads get heavily congested and the Forbidden City is a major obstacle around which traffic has to pass. The traffic reduction measures based on the last digit of one's car registration number are ineffectual and there is serious talk of a congestion charge similar to that in London.

We also had dinner with an executive director at Citic Securities (disclosure: I am a shareholder). The joint venture talks with Credit Agricole are continuing and Citic Securities are hoping to get 50% of CLSA as part of the deal. He shared many of our views on the Chinese market and agreed that improving standards of healthcare were essential if China's massive savings were to be put to more productive uses. He pointed out that most of the government's increased spending in healthcare has been focused in the countryside rather than the cities. This is helping to narrow the gap between services available in the hinterland versus the larger cities. He also pointed out that inflation remains a concern for policy makers and identified the difficult balancing act of increasing consumption with measures to contain prices.

Gold in Yuan remains in a relatively consistent uptrend and would need to sustain a move below CNY7000 to question the integrity of the 10-year uptrend. It is possible to buy gold bars and silver "yaun bao" at ICBC branches, I assume it is possible to buy them in other banks as well. Chinese investors are taking more of an interest in precious metals at least in part because they are an alternative asset class to A-Shares, property and government bonds and because gold prices are appreciating.

KFC is winning the fast food war in China. They are everywhere and because the food is comparatively expensive by Chinese standards, eating at 'Western restaurants' is seen as a status symbol. The Chinese arm of Yum Brands which owns both KFC and Pizza Hut is its fastest growth market and could become its biggest in a couple of years if the trajectory of growth continues. The share price continues to consolidate in the region of the 2008 high and has reverted to the mean, defined by the 200-day MA. A sustained move below $37 would be required to question scope for some continued higher to lateral ranging.

I left China with an undiminished sense of optimism about the long-term outlook for the country and its people. No economic advance is linear and China will invariably have its share of challenges but I continue to believe that the trajectory of China's development will remain towards improvement. I would also like to extend our thanks to a subscriber for a very educative tour of the Shanghai financial district and convivial dinner.