[FoRK] Sleeping With The Enemy...
Ian Andrew Bell FoRK
Mon Jun 27 14:20:53 PDT 2005
In the "you reap what you sow" category, China is buying fewer U.S.
Bonds and has turned its attention to strategic acquisitions. And
despite what U.S. regulators may feel, they really are in a position
to call the shots.
Deny their bid to buy Unocal and they might decide to stop buying
those bonds altogether or (worse) sell them.
Allow the transaction to go through and you're pretty-much fucked for
buying oil outside of OPEC if China ever stops supplying through
Unocal, which specializing in harvesting oil in far-flung,
politically "hot" countries.
While the U.S. attempts to secure its future through the use of boots
and hillbilly armour, China secures its future using (U.S.) Dollars.
June 27, 2005
The Chinese Challenge
By PAUL KRUGMAN
Fifteen years ago, when Japanese companies were busily buying up
chunks of corporate America, I was one of those urging Americans not
to panic. You might therefore expect me to offer similar soothing
words now that the Chinese are doing the same thing. But the Chinese
challenge - highlighted by the bids for Maytag and Unocal - looks a
lot more serious than the Japanese challenge ever did.
Unocal sounds, in other words, like exactly the kind of company the
Chinese government might want to control if it envisions a sort of
"great game" in which major economic powers scramble for access to
far-flung oil and natural gas reserves. (Buying a company is a lot
cheaper, in lives and money, than invading an oil-producing country.)
So the Unocal story gains extra resonance from the latest surge in
If it were up to me, I'd block the Chinese bid for Unocal. But it
would be a lot easier to take that position if the United States
weren't so dependent on China right now, not just to buy our
I.O.U.'s, but to help us deal with North Korea now that our military
is bogged down in Iraq.
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