David Kirkpatrick

November 18, 2010

Rare earth mineral news

I’ve blogged about this more than once, but if you need the ultra-quick version — China supplies pretty much the entire world with rare earth minerals, elements that are used to manufacture vital electronics and computing parts, because it’s been doing so very, very cheaply for a long time. Recently the nation has used its rare earth monopoly as an economic bludgeon, most notably against Japan and the United States.

We know the U.S. and Australia, among other countries, have rare earth element resources. Now that we know just how rare earth rich the U.S. is, it’s time to seriously ramp up domestic production and get off the cheap Chinese teat.

From the fourth (and last) link:

Approximately 13 million metric tons of rare earth elements (REE) exist within known deposits in the United States, according to the first-ever nationwide estimate of these elements by the U.S. Geological Survey.

The report describes significant deposits of REE in 14 states, with the largest known REE deposits at Mountain Pass, Calif.; Bokan Mountain, Alaska; and the Bear Lodge Mountains, Wyo. The Mountain Pass mine produced REE until it closed in 2002. Additional states with known REE deposits include Colorado, Florida, Georgia, Idaho, Illinois, Missouri, Nebraska, New Mexico, New York, North Carolina, and South Carolina.

“This is the first detailed assessment of rare earth elements for the entire nation, describing deposits throughout the United States,” commented USGS Director Marcia McNutt, Ph.D. “It will be very important, both to policy-makers and industry, and it reinforces the value of our efforts to maintain accurate, independent information on our nation’s natural resources. Although many of these deposits have yet to be proven, at recent domestic consumption rates of about 10,000 metric tons annually, the US deposits have the potential to meet our needs for years to come.”

REE are a group of 16 metallic elements with similar properties and structures that are essential in the manufacture of a diverse and expanding array of high-technology applications. Despite their name, they are relatively common within the earth’s crust, but because of their geochemical properties, they are not often found in economically exploitable concentrations.

October 20, 2010

Update on the rare earth mineral/China issue

Filed under: Business, Politics — Tags: , , , , — David Kirkpatrick @ 1:34 pm

I blogged about this topic a couple of times last month, and now it looks like the issue is already coming to North American shores. Not exactly sure what China is up to here, but it is very serious economic saber-rattling, and in a media world full of manufactured bogeymen, this is an issue to actually be concerned about.

From the third (and final) link:

Last month, the New York Times reported that the Chinese government clamped down on its exports of rare earth metals, which are used in the manufacture of all kinds of electronics, to Japan. Now, it appears that a similar thing is happening with Western countries like the United States, the Times reports, though Chinese officials deny it.

The Chinese action, involving rare earth minerals that are crucial to manufacturing many advanced products, seems certain to further intensify already rising trade and currency tensions with the West. Until recently, China typically sought quick and quiet accommodations on trade issues.

But the interruption in rare earth supplies is the latest sign from Beijing that Chinese leaders are willing to use their growing economic muscle. “The embargo is expanding” beyond Japan, said one of the three rare earth industry officials, all of whom insisted on anonymity for fear of business retaliation by Chinese authorities.

They said Chinese customs officials imposed the broader restrictions on Monday morning, hours after a top Chinese official summoned international news media Sunday night to denounce United States trade actions.

As we said last time, the mechanics of any rare earth metal embargo is important to manufacturers and suppliers, but hard to pin down. What’s important, policy-wise, is that we could have a domestic rare earth metal industry in the United States, but we have refused to support it in the belief that the market would always deliver what we needed from low-cost Chinese suppliers.

 

September 27, 2010

China, already cracking the rare earth metal whip

Filed under: Business, Politics, Technology — Tags: , , , , — David Kirkpatrick @ 1:57 pm

I know I’m over half a week late on this (and yes, I’m aware I haven’t blogged well over a week — been crazy around these parts of late), but since I covered the topic earlier this month I thought it was interesting it’s already hit the front pages.

The issue is China essentially controlling the world’s supply of 17 rare earth metals — critical for the manufacture of electronics and military parts, to name two key examples — and how that power might be wielded. I blogged that everyone fretting about Chinese ownership of U.S. Treasuries was completely misplacing their concern. That advice has already been borne out now that China has used that control as a political bludgeon against Japan. I’m betting this is just the opening kickoff of a very serious game of political football. (Couldn’t help the metaphor there, I’m still pretty excited the NFL season is in full swing.)

From the second link:

Sharply raising the stakes in a dispute over Japan’s detention of a Chinese fishing trawler captain, the Chinese government has blocked exports to Japan of a crucial category of minerals used in products like hybrid cars, wind turbines and guided missiles.

Chinese customs officials are halting shipments to Japan of so-called rare earth elements, preventing them from being loading aboard ships at Chinese ports, industry officials said on Thursday.

September 2, 2010

Food for not so easy thought

Everyone thought the biggest threat from China was the sheer volume of Treasuries held by that nation and the potential stranglehold it has over the U.S. economy. Realistically that has never been a real issue because as such a heavy investor in the U.S. economy, China has a vested interest in our financial sector remaining strong.

Now squeezing us on manufacturing vital elements of computing and electronics by taking complete control over rare earth metals is a different angle of attack altogether. You know the U.S. government is taking this very seriously when it has both the energy department and the DoD on the job.

The release:

China’s monopoly on 17 key elements sets stage for supply crisis

China’s monopoly on the global supply of elements critical for production of computer hard disc drives, hybrid-electric cars, military weapons, and other key products — and its increasingly strict limits on exports — is setting the stage for a crisis in the United States. That’s the topic of the cover story of Chemical & Engineering News (C&EN), ACS’ weekly newsmagazine.

C&EN Senior Editor Mitch Jacoby and Contributing Editor Jessie Jiang explain that the situation involves a family of chemical elements that may soon start to live up to their name, the “rare earths.” China has virtually cornered the global market on them, and produces most of the world’s supply. Since 2005, China has been raising prices and restricting exports, most recently in 2010, fostering a potential supply crisis in the U.S.

The article describes how the U.S. is now responding to this emerging crisis. To boost supplies, for instance, plans are being developed to resume production at the largest U.S. rare-earth mine — Mountain Pass in southern California — which has been dormant since 2002. The U.S. Department of Energy and the Department of Defense are among the government agencies grappling with the problem.

###

ARTICLE FOR IMMEDIATE RELEASE “Securing the Supply of Rare Earths”

This story is available at http://pubs.acs.org/cen/coverstory/88/8835cover.html

August 20, 2010

Is the US in danger of losing its nanotech hegemony?

Via KurzweilAI.net — Not just yet, but there are a number of countries putting money and other resources into nanotechnology. One place the United States could stand to see a lot of improvement is commercializing the nanotech developments going on right now.

From the link:

U.S. Risks Losing Global Leadership in Nanotech

August 20, 2010 by Editor

The U.S. dominated the rest of the world in nanotech funding and new patents last year, as U.S. government funding, corporate spending, and VC investment in nanotech collectively reached $6.4 billion in 2009. But according to a new report from Lux Research, countries such as China and Russia launched new challenges to U.S. dominance in 2009, while smaller players such as Japan, Germany and South Korea surpassed the United States in terms of commercializing nanotechnology and products.

The report, titled “Ranking the Nations on Nanotech: Hidden Havens and False Threats,” compares nanotech innovation and technology development in 19 countries in order to provide government policymakers, corporate leaders and investors a detailed map of the nanotech’s international development landscape. Overall, the report found global investment in nanotech held steady through the recent financial crisis, drawing $17.6 billion from governments, corporations and investors in 2009, a 1% increase over 2008’s $17.5 billion. Only venture capitalists dialed back their support, cutting investments by 43% relative to 2008.

“Part of what motivated our research was the emerging possibility that ambitious new government funding in Russia and China represented a threat to U.S. dominance in nanotech innovation,” said David Hwang, an Analyst at Lux Research, and the report’s lead author. “But while the field certainly gained momentum in both countries as a result of the increased funding, both countries have economic and intellectual property protection issues that prevent them from being real threats just yet.”

To uncover the most fertile environments for technology developers, buyers, and investors, Lux Research mapped the nanotech ecosystems of select nations, building on earlier reports published from 2005 through 2008. In addition to tracking fundamentals, such as the number of nanotech publications and patents issued, the report also inventoried direct and indirect spending on nanotech from government, corporate and venture sources. Among its key observations:

  • The U.S. continues to dominate in nanotech development… for now. Last year saw the U.S. lead all other countries in terms of government funding, corporate spending, VC investment, and patent issuances. But its capacity to commercialize those technologies and leverage them to grow the economy is comparatively mediocre. U.S. competitiveness in long-term innovation is also at risk, as the relative number of science and engineering graduates in its population is significantly lower than it is in other countries.
  • Other countries stand to get more bang for their nanotech buck. Japan, Germany, and South Korea continued their impressive trajectories from 2008, earning top spots in publications, patents, government funding, and corporate spending. Compared to the U.S., all three also remain more focused on nanotech and appear more adept at commercializing new technology. The relative magnitude of the technology manufacturing sectors in these three countries are the world’s highest, meaning their economies stand to benefit the most from nanotech commercialization.
  • Russian and Chinese investment in nanotech yields slow progress. While both governments launched generous nanotech investment programs last year, the technology hasn’t gained momentum in either country’s private sector, both of which have a history of skimping on R&D. The relative lack of momentum was further underscored by the abysmal number of new nanotech patents for either country last year.

“Ranking the Nations on Nanotech: Hidden Havens and False Threats,” is part of the Lux Nanomaterials Intelligence service. Clients subscribing to this service receive ongoing research on market and technology trends, continuous technology scouting reports and proprietary data points in the weekly Lux Research Nanomaterials Journal, and on-demand inquiry with Lux Research analysts.

More info: Lux Research

April 2, 2010

The latest on Google and China

Filed under: Business, Technology — Tags: , , — David Kirkpatrick @ 2:51 pm

The whole story is full of twists, turns and more than a little Kabuki theater (yeah, I know Kabuki isn’t Chinese).

Here’s the latest:

The Chinese government apparently slowed access to Google (GOOG) Web sites earlier this week, as the search giant last night backed off earlier statements that access to the site was blocked by changes Google made to the engine’s search parameters.

Google had disclosed early this week some users in China were unable to complete Google searches or had intermittent trouble accessing any of Google’s Chinese-language sites.

That disclosure prompted some immediate speculation that China was blocking access to the sites because of Google’s decision to stop censoring search results in the country.

The speculation abated yesterday afternoon when Google announced that it had accidentally caused the blockage itself.

A spokeswoman told Computerworld then that access to the Chinese site, now run out of Hong Kong, was blocked because its programmers had added a series of letters — gs_rfai — to the Web addresses of Google search pages. The spokeswoman explained that “rfa” is associated with Radio Free Asia, a site that China has long blocked. Therefore, adding them automatically caused Google’s site to be blocked there.

Now, Google says that something in China’s Internet filter, or “great firewall,” caused the site to be blocked.

March 28, 2010

Believe it or not, Volvo is now a Chinese company

Filed under: Business — Tags: , , , , — David Kirkpatrick @ 5:07 pm

Sands of time, twists of the wheel, etc. etc. …

From the link:

China’s Zhejiang Geely Holding Group Co. bought Volvo cars from Ford Motor Co. on Sunday for $1.8 billion, a landmark agreement designed to elevate the Chinese company’s profile onto the global automotive stage.

Geely’s acquisition of Volvo offers the latest illustration of how China’s economic rise is reshaping large swaths of global business, as its huge market and increasingly powerful companies play a growing role in industries from cars to natural resources to telecommunications equipment. The Volvo deal, which comes after China surpassed the U.S. last year as the biggest auto market, puts a Chinese company for the first time in charge of a major global car brand.

March 24, 2010

Google and China …

Filed under: Business, Technology — Tags: , , , , — David Kirkpatrick @ 3:11 pm

… a good move? Looks like at least some analysts think it’ll help Google’s image.

From the link:

People using Google.cn are now redirected to Google.com.hk, where they are given uncensored search results in simplified Chinese. Google is running Google.com.hk off of servers located in Hong Kong.

“Google made a smart move,” said Augie Ray, an analyst at Forrester. “Rather than unilaterally pulling out, they took an action that puts the ball back into China’s court.”

“While Google feels redirecting Chinese users to their Hong Kong site and search results is ‘entirely legal’, it seems unlikely the Chinese government will see this as anything other than an attempt to bypass their laws and direction. Given the impasse that Google and China came to on the issue of censorship, this move by Google seems a little less brave than inevitable,” Ray said.

Google had taken its lumps for agreeing earlier to follow Chinese law and censor search results in China . That wasn’t a popular move with critics in the West.

Monday’s move, however, may go a long way to cleaning some of that tarnish off its image. “Google is generating a great deal of press for taking on an issue that many in the U.S. care deeply about,” Ray said.

March 19, 2010

DVD recommendation — “Red Cliff”

Filed under: Arts, Media — Tags: , , , , , , , — David Kirkpatrick @ 1:04 am

I’m going to go way out on a limb here and recommend John Woo’s “Red Cliff” before I’ve even finished watching the film. It’s a two-parter that clocks in somewhere in the ballpark of five hours, so I’ve only finished part one. That much is enough to highly suggest you check this out. The tale is epic in every sense of the word — the battle scene action is excellent, the storyline is great and the movie itself is gorgeous. If you don’t see an update to this post sometime tomorrow night it means part two was not a let down. I don’t expect it to be.

February 12, 2010

Can China’s computer manufacturing industry be trusted?

A very good question, and the current answer is a bit unsettling.

From the link:

Is it safe to buy Chinese-made computer equipment?With Google and the National Security Agency now teaming up to investigate supposed Chinese hacking and most of our PC hardware coming from China, it’s a fair question. And a hard one to answer with certainty.

It is made more urgent by a report in the Sunday Times newspaper that Chinese spies in the U.K. have been handing out bugged memory sticks and cameras to targeted businesses in an attempt to steal the companies’ intellectual property.

Headlined, “China bugs and burgles Britain,” the story quotes a classified report from MI5–their equivalent of our CIA–and says, “The gifts–cameras and memory sticks –have been found to contain electronic Trojan bugs which provide the Chinese with remote access to users’ computers.”

My friend, security blogger Steven J. Vaughan-Nichols, yesterday posted an item suggesting it wouldn’t be too difficult for Chinese PC manufacturers to build backdoors into their products and use them to spy on pretty much anyone.

“If China’s government really is hell-bent on keeping an eye on American and European businesses, why not just incorporate 21st century backdoors into their products? Then, you could just have them automatically call home to do a data dump of documents. If there’s anything interesting in the files, it can be set to monitor its user on a regular basis,” Vaughan-Nichols wrote.

“There’s nothing difficult about doing this. Not only are backdoors easy to create, running an automatic check for words of interest, even in terabytes of documents, just requires some servers. After all,Google does it every day with far more data than such a plot could ever uncover.”

January 25, 2010

China doesn’t restrict internet freedom?

Filed under: Politics, Technology — Tags: , , , , , , , , — David Kirkpatrick @ 12:31 pm

Could have fooled its citizens, and companies forced to comply with government censorship demands to operate in the nation, I guess.

This is a hole Chinese officials might as well stop digging.

From the link:

China on Friday slammed remarks made by U.S. Secretary of State Hillary Clinton promoting Internet freedom worldwide, saying her words harmed U.S.-China relations.

China resolutely opposes Clinton’s remarks and it is not true that the country restricts online freedom, Chinese Foreign Ministry spokesman Ma Zhaoxu said in a statement on the ministry’s Web site.

Clinton’s speech and China’s response both come after Google (GOOG) last week said it planned to reverse its long-standing position in China by ending censorship of its Chinese search engine. Google cited increasingly tough censorship and recent cyberattacks on the Gmail accounts of human rights activists for its decision, which it said might force it to close its offices in China altogether.

Click here to find out more!China blocks Web sites including Facebook, Twitter and YouTube, and has long forced domestic Internet companies to censor their own services. Blog providers, for instance, are expected to delete user posts that include pornographic content or talk of sensitive political issues.

January 20, 2010

China claims hacker victimhood …

Filed under: Business, Politics, Technology — Tags: , , , , — David Kirkpatrick @ 3:42 pm

not malfeasance.

Not likely.

From the first link:

China on Tuesday denied any role in alleged cyberattacks on Indian government offices, calling China itself the biggest victim of hackers.When asked about Google’s (GOOG) allegation that cyberattacks launched from China hit the U.S. search giant, foreign ministry spokesman Ma Zhaoxu said Chinese companies were also often hit by cyberattacks.

“China is the biggest victim of hacking attacks,” Ma said, citing the example of top Chinese search engine Baidu.com being hacked last week.

January 14, 2010

Is China committing massive corporate cyber espionage?

Filed under: Business, Politics, Technology — Tags: , , , , , — David Kirkpatrick @ 4:34 pm

Looks like all that recent Google news has a bit deeper, and broader, roots than first reports indicated.

From the second link:

It’s a problem that the U.S. lawmakers have complained about loudly. In the corporate world, online attacks that appear to come from China have been an ongoing problem for years, but big companies haven’t said much about this, eager to remain in the good graces of the world’s powerhouse economy.

Google, by implying that Beijing had sponsored the attack, has placed itself in the center of an international controversy, exposing what appears to be a state-sponsored corporate espionage campaign that compromised more than 30 technology, financial and media companies, most of them global Fortune 500 enterprises.

The U.S. government is taking the attack seriously. Late Tuesday, U.S. Secretary of State Hillary Clinton released a statement asking the Chinese government to explain itself, saying that Google’s allegations “raise very serious concerns and questions.”

“The ability to operate with confidence in cyberspace is critical in a modern society and economy,” she said.

January 12, 2010

More on Google and China

Filed under: Business, Media, Politics, Technology — Tags: , , , , , , — David Kirkpatrick @ 6:10 pm

Who’d a thunk I’d be doing two posts on Google and China today? First Google apologizes for a copyright breach issue in China (?!), and now the Mountain View company is threatening to pull out of China because of claims the Asian behemoth breached Google email accounts of human rights activists. Whatever else is going on here, I don’t see any changes to China’s overarching attitudes toward individual privacy or intellectual property — well, at least the intellectual property of non-Chinese citizens.

I understand Google wanting to do business with such a massive market, but it made serious concessions regarding censorship when it went into China so it can’t be all that shocked when China decides to just go out and do whatever it wants.

(Quick joke for Robot Chicken fans — Darth Vader: I’ve changed the terms of our deal. Pray I don’t change it further. Lando: Man, this deal keeps getting worse all the time.)

From the second link:

The company disclosed in a blog post that it had detected a “highly sophisticated and targeted attack on our corporate infrastructure originating from China.” Further investigation revealed that “a primary goal of the attackers was accessing the Gmail accounts of Chinese human rights activists,” Google’s post said.

Google did not specifically accuse the Chinese government. But the company added that it is “no longer willing to continue censoring our results” on its Chinese search engine, as the government requires. Google says the decision could force it to shut down its Chinese site and its offices in the country.

A word/concept combo you don’t see very often …

Filed under: Arts, Business, Media, Technology — Tags: , , , , — David Kirkpatrick @ 4:02 pm

China and copyright protection.

From the link:

Google (GOOG) has apologized to a Chinese authors’ group over its scanning of books by local writers into an online search system, moving to defuse copyright concerns around the project in China.

November 6, 2009

China fears microblogging

Filed under: Media, Politics, Technology — Tags: , , , , , , , — David Kirkpatrick @ 2:38 pm

Doesn’t the leadership know information wants to be free — even at 140 Modern English alphabet characters a pop.

Jokes aside, here’s a bit from the first link:

A Chinese government watchdog plans to push Twitter-style Web sites to censor their content, the country’s latest move to block Internet users from posting certain politically sensitive information online.The government-linked Internet Society of China plans to compose “self-discipline standards” for microblogging services, a group representative said in an e-mail. The representative declined to give details, but the group has released similar guidelines for other Web sites before. A document the group released for blog providers calls for them to delete “illegal or harmful information” as it appears on their sites, or simply to cease blog service for infringing users. Chinese authorities have used the term “harmful information” to describe online content including pornography and discussion of politically sensitive topics such as Falun Gong, a spiritual group banned in the country.

Twitter and Facebook have been blocked in all of China since July, when deadly ethnic riots in the country’s western Xinjiang region led it to crack down on communication tools that could be used to gather people at a given location. Authorities also blocked all Internet service and text messaging in Xinjiang after the rioting, which state-run media say killed nearly 200 people.

Some Chinese-language Twitter rivals also went offline after the rioting. One of the bigger sites, Digu, came online again last month, but rival service Fanfou is still down.

July 7, 2009

China is a quick study …

Filed under: Politics, Technology — Tags: , , , , — David Kirkpatrick @ 11:43 am

… when it comes to cracking down on unruly citizens. After watching Twitter rise above other communications in Iran during the ongoing green wave, China made certain to fix that state control bug during its recent Uighur riots.

From the link:

“They cut off the Internet to shut down communications,” said Wu’er Kaixi, an ethnic Uighur who fled China after helping lead pro-democracy protests there twenty years ago. The Uighurs are a minority concentrated in Xinjiang province that China has struggled to assimilate.

Beijing did not want Internet users to upload pictures and videos like they did after deadly riots last year in Tibet, Wu’er said.

China locked down communications much faster this time, he said.

Twitter became inaccessible in China around 3 p.m. local time Monday, according to complaints posted by users on the site. Users of Twitter and similar Chinese sites had been posting messages about the riots through the services. The Chinese sites were not blocked on Monday afternoon.

Twitter and other foreign Web sites, including Flickr and Microsoft’s Bing search engine, were blocked for several days last month. The period included the date when China brutally suppressed the 1989 protests that Wu’er helped lead, an anniversary the government hoped would pass quietly.

December 23, 2008

And now it begins …

Filed under: Business, Politics — Tags: , , , — David Kirkpatrick @ 3:05 pm

China is laying its legal case against the US in preparation for calling all its notes. Maybe not, but this does merit some attention.

Eight years of the Bush 43 regime has left the US in a very precarious position economically and militarily.

From the link:

China has asked the World Trade Organization to investigate whether the United States is illegally taxing Chinese goods such as steel pipes and off-road tires.

It’s the first time Beijing has ever sought a WTO panel in a trade dispute.

Washington delayed the panel’s establishment at a meeting of the WTO’s dispute body on Monday, but an investigation will likely be launched early next year.

The Geneva-based body can authorize trade sanctions if countries fail to comply with rules.

China says U.S. charges on some Chinese goods violate numerous trade agreements.

The U.S. says the goods are being exported at below-market value and that it is lawfully defending American manufacturers.

September 29, 2008

There’s a lot of solar action in China right now

Filed under: Media, Politics, Science — Tags: , , , , — David Kirkpatrick @ 1:03 pm

A press release from this morning:

Kunming, ‘Spring City’, to Build the Biggest Solar Energy Production Base in China

KUNMING, China, Sept. 29 /Xinhua-PRNewswire/ — Dou Jinming, Development and Reform Commission deputy director of Kunming, Yunnan said today that Kunming will take the lead in developing the solar energy industry ( http://www.new-energy-supply.com/ ) in China, thereby popularizing it across the whole country. Kunming is aiming to become a solar energy demonstration city with the characteristics of a solar energy industry base in China.

(Logo: http://www.newscom.com/cgi-bin/prnh/20080605/CNTH022LOGO )

Dou Jinming said that Kunming is rich in solar energy resources ( http://www.new-energy-supply.com/buying_leads/ ): the average annual amount of sunshine is more than 2250 hours, and the average annual solar radiation ( http://www.new-energy-supply.com/products/ ) is over 5400 MJ/m. Photo-thermal application of solar energy is also at the top of the whole country in Kunming, with more than a hundred techniques and enterprises to support its production.

To solve energy shortages and improve the urban environment, Kunming’s Government has released “Advice on renewable energy development and utilization”. According to the “Advice”, around the Kunming Dianchi Lake basin, up to 2920 square kilometers of area will be used to utilize solar light and heat ( http://www.new-energy-supply.com/companies/ ). This will achieve a penetration rate of 50% by 2010. The first demonstration zone will achieve 70% utilization. Urban construction with integration of solar energy application should be present in 90% of new architecture. The percentage of urban area that will utilize solar energy will reach 60%, with the percentage in rural areas reaching 20%. The government says that by 2015 the solar light and heat utilization area will amount to 6,000,000 square meters, with solar photovoltaic applications of up to a hundred megawatts or more.

At present, Kunming High-tech Zone has been planning to provide 3 square kilometers of land to build solar thermal ( http://www.new-energy-supply.com/ ) production bases, solar battery production bases and equipment to stimulate the development of solar energy companies.

It is estimated that after the implementation of these initiatives, electricity production will be highly increased and 200,000 tons of diesel oil and 150,000 tons of gasoline will be saved. The production value is up to 17,900,000,000 yuan. By 2015, it will save 300,000 tons of diesel and petrol, and the production value will reach 27,000,000,000 yuan.

Source: Tootoo.com
 

Web site: http://www.tootoo.com/

September 19, 2008

Guess who else is handling …

Filed under: Business, Politics — Tags: , , , , — David Kirkpatrick @ 7:56 am

… financial market problems by bailing out failing banks — yep, you guessed it. China.

From the Wall Street Journal link:

After monetary policy easing earlier this week failed to lift markets, Beijing has acted more directly to boost shares: cutting stamp duty, getting a state investment fund to buy stock in the country’s top three banks, and instructing state-owned companies to buy back some of their shares.

When even a government in as avowedly free market a nation as the U.S. is busily nationalizing financial institutions, it’s hardly surprising a country like China follows suit.

January 18, 2008

James Fallows on Chinese US investment

Filed under: Business, Politics — Tags: , , , , , — David Kirkpatrick @ 5:12 pm

James Fallows has an excellent article titled “The $1.4 Trillion Question” in the January/February 2008 Atlantic. He covers the controversial subject of China’s investment in the United States, particularly in T-bills.

He also blogs at the Atlantic’s website and posted a follow-up to the story here. This post is titled “The $1.53 Trillion Question” to reflect the increase in China’s foreign holdings between the time he authored the magazine article and when the issue hit the stands.

China is now investing about $1 billion each day and if that trend continues one fact in the article would substantially change. He wrote China’s US investment is the equivalent of each American borrowing $4000 from the Asian nation. The revised figure, according to Fallows, means, ” … on average, each American would not have borrowed about $4,000 from China; the figure would be closing in on $6,000.”

On the whole this shouldn’t be a great concern because as many economic analysts have opined, clearly China has a very vested (or should it be invested) interest in the stability of the US dollar and economy.

On the other hand, Chinese politics are extremely opaque throwing a great deal of uncertainty over any future. And the article notes the Chinese do pay attention to our government and media. Fallows goes on to cite an example of Lou Dobbs on CNN criticizing “Communist China” and Chinese officials being “shellshocked” their investment in the US might be resented.

I recommend reading both Fallows’ blog post and the entire article for a thorough rundown of this issue and its implications.