This will surely raise executive blood pressure at US Integrated Oil Companies.
www.nytimes.com/2009/09/10/business/global/10oil.html?ref=business
China knows where its bread is buttered, so they will continue with investments in commodities until over investment is an issue. They will also diversify away from US Assets just a little. Not a lot mind you, just enough to avoid having nuclear weapons pointed at Beijing.
Its classic "boom/bust" economics in every sense of the word.
This article shows more about how the Chinese Banking/Lending system works rather then about commodities. That in itself is very telling.
The entire Asia recovery was predicated around Chinese Bank Lending that has just exploded since the start of the year. This led to a global commodities rally, which led to risk assets being judged less harshly.
Now, just imagine if Exxon got $30 Billion in very low interest loans to go out and buy up everything in sight? What would the response be here?
No comments:
Post a Comment