Mick Weinstein The Week's Best Stock Blogs

As athletes continue to wow us from Beijing, the current medals count mirrors another global ranking. On a purchasing power parity basis, The People's Republic of China now has the second largest economy in the world after the U.S., with gross domestic product clocking in at over $6.9 trillion. Investors are well aware of China's massive expansion. Its economy is 10 times larger than it was 20 years ago, and continues to grow at a torrid 10 percent each year.

Enthusiasm for the domestic Chinese stock market and in Chinese stocks traded in the U.S. peaked around the fall of 2007, and it's been almost straight downhill since. As Bespoke Investment Group observes, with "Chinese growth and prosperity displayed on our TV sets each night throughout the Olympics, it's hard to imagine that China's stock market could be doing so poorly." Yet that market's shown a "classic bubble pattern," with the Shanghai Composite down 60% since last October. "Anyone hoping that the Olympics would give ailing Chinese stocks a boost has gotten a rude awakening." Bespoke's simple chart tells the story.

Yet given the very real and massive growth in China, the big selloff leaves many market bloggers wondering if now is the time to jump back into China.

• Jim Tripon, editor of the China Stock Digest, notes: "Historically, the Olympics host country's stock index captures a nice bounce following the event. Over the last six Olympiads, the average gain for host countries' stock indexes has been 19% in the six months following the games, and 26% in the 12 months after the games. None of that effect has been apparent in China yet, where markets continue to suffer in spite of robust economic growth. Both the Shanghai Market ETF (FXI) and the Hong Kong Market ETF (EWH) are down this week... [yet] from an investment viewpoint, many stocks in China are getting downright cheap."

• Portfolio manager Roger Nusbaum of Arizona's Your Source Financial sold his Chinese exposure early last year, and had been waiting for an opportunity to re-enter. Earlier this week, when Shanghai hit that 60% selloff point from its peak, Nusbaum bought a Chinese telecom stock. "I have never thought the mania in China was worse than the bubble in tech stocks, so I have always felt the decline would be less than 75%. Fifty percent declines don't occur that often, and so 60% seems like a reasonable overshoot of cutting in half."

• For outstanding macroeconomic insight on China, start reading the blog of Professor Michael Pettis of Peking University - China Financial Markets. This week, Pettis observed "sloppiness" and panic selling at the stock market in spite of the "festive" Olympic atmosphere. Pettis thinks there may now be "some government-inspired buying, or even patriotic Olympic-related buying, or more measures from the authorities aimed at propping up the markets, but if none of those, I think the very bad mood could be extended... expectations about the transformational consequences of the Olympics are unrealistically high, and I think there is bound to be some disappointment."

• Martin Hutchinson says that given the fact that Chinese manufacturing output will exceed that of the U.S. by next year, "a substantial part of any investor's portfolio should be in China and any other countries where manufacturing is growing as a percentage of the world total." In particular, Hutchinson encourages investors to look at Acer Inc., Dr. Reddy's Laboratory Ltd. and Aluminum Corp. of China Ltd. (ACH), an integrated aluminum smelter focused on the Chinese market.

• China market expert Shaun Rein recently stated that "while the Olympics is a great thing for China, and the world stage should applaud China for how far and fast it has come, do not overestimate how much two weeks can really positively impact the bottom-lines of companies... it might actually hurt revenue numbers." Rein disclosed holding just two China stocks traded in the U.S. - China Mobile (CHL) and Focus Media (FMCN).

• Finally, fund manager Zach Scheidt likes this Chinese medical company. Stockpickr predicts these five China stocks are "poised to double." The Sun reviews the July performance of 84 U.S.-traded Chinese ADRs. Stockerblog lists ten high-yielding Chinese stocks. And Justice Litle provides six reasons why China will soon be a buy again.

For ongoing coverage of China stocks, visit Seeking Alpha's China stock sector page.