Chinese Supremacy

[Papa Carl]

I hope you find this, good reading, and potential for debate among members.

 

This was not intended to provoke discussion about whether one country is better or worse than another country, simply how "inter dependent" we have become on each other.

 

It was also meant as a follow on from another topic, which was about the "armed forces" and bases here in the Philippines, American support, and the current relevant situation in the seas off the Philippines.

 

This was written by a US citizen by the name of Michael Snyder.  I have not confirmed any of these "Facts", however believe if not accurate, the general presentation of Chinese investment in the US, and other countries to be true.

 

In future China will employ millions of American workers and dominate 
thousands of small communities all over the United States. Chinese 
acquisition of U.S. businesses set a new all-time record last year, and 
it is on pace to shatter that record this year.

The Smithfield Foods acquisition is an example.  Smithfield Foods is 
the largest pork producer and processor in the world.  It has 
facilities in 26 U.S. states and it employs tens of thousands of 
Americans.  It directly owns  460 farms and has contracts with 
approximately 2,100 others.  But now a Chinese company has bought it 
for $ 4.7 billion, and that means that the Chinese will now be the most 
important employer in dozens of rural communities all over America.  

Thanks in part to our massively bloated trade deficit with China, the 
Chinese have trillions of dollars to spend. They are only just starting 
to exercise their economic muscle.

It is important to keep in mind that there is often not much of a 
difference between "the Chinese government" and "Chinese corporations"�. 
 In 2011, 43 percent of all profits in China were produced by companies 
where the Chinese government had a controlling interest in.  

Last year a Chinese company spent $2.6 billion to purchase AMC 
entertainment, one of the largest movie theater chains in the United 
States.  Now that Chinese company controls more movie ticket sales than 
anyone else in the world.  

But China is not just relying on acquisitions to expand its economic 
power.  "Economic beachhead"� are being established all over America. 
For example, Golden Dragon Precise Copper Tube Group, Inc. recently 
broke ground on a $100 million plant in Thomasville, Alabama.  Many of 
the residents of Thomasville, Alabama will be glad to have jobs, but it 
will also become yet another community that will now be heavily 
dependent on communist China.

And guess where else Chinese companies are putting down roots? Detroit. 
Chinese-owned companies are investing in American businesses and new 
vehicle technology, selling everything from seat belts to shock 
absorbers in retail stores, and hiring experienced engineers and 
designers in an effort to soak up the talent and expertise of domestic 
automakers and their suppliers. If you recently purchased an 
"American-made" vehicle, there is a really good chance that it has a 
number of Chinese parts in it. Industry analysts are hard-pressed to 
put a number on the Chinese suppliers operating in the United States. 

China seems particularly interested in acquiring energy resources in 
the United States.  For example,  China is actually mining for coal in 
the mountains of Tennessee.  Guizhou Gouchuang Energy Holdings Group 
spent 616 million dollars to acquire Triple H Coal Co. in Jacksboro, 
Tennessee.  At the time, that acquisition really didn't make much news, 
but now a group of conservatives in Tennessee is trying to stop the 
Chinese from blowing up their mountains and taking their coal.  

And pretty soon China may want to build entire cities in the United 
States just like they have been doing in other countries. Right now 
China is actually building a city larger than Manhattan just outside 
Minsk, the capital of Belarus. 

Are you starting to get the picture? China is on the rise. If you doubt 
this, just read the following:

# When you total up all imports and exports, China is now the number 
one trading nation on the entire planet.

# Overall, the U.S. has run a trade deficit with China over the past 
decade that comes to more than 2.3 trillion dollars.

# China has more foreign currency reserves than anyone else on the 
planet.

# China now has the largest new car market in the entire world.

# China now produces more than twice as many automobiles as the United 
States does. After being bailed out by U.S. taxpayers, GM is involved 
in 11 joint ventures with Chinese companies.

# China is the number one gold producer in the world.

# The uniforms for the U.S. Olympic team were made in China.

# 85% of all artificial Christmas trees the world over are made in 
China.

# The new World Trade Center tower in New York is going to include 
glass imported from China.

# China now consumes more energy than the United States does.

# China is now in aggregate the leading manufacturer of goods in the 
entire world.

# China uses more cement than the rest of the world combined.

# China is now the number one producer of wind and solar power on the 
entire globe.

# China produces 3 times as much coal and 11 times as much steel as the 
United States does.

# China produces more than 90 percent of the global supply of rare 
earth elements.

# China is now the number one supplier of components that are critical 
to the operation of any national defense system.

# In published scientific research articles, China is expected to become 
number one in the world very shortly.

And what we have seen so far may just be the tip of the iceberg. For 
now, I will just leave you with one piece of advice - learn to speak 
Chinese.  You are going to need it !

(I'm not sure I agree with his last statement, to my knowledge, English is the fastest growing language in China, more Chinese citizens are learning English, than The US, UK, Canada, Australia and New Zealand combined. That is a fact! and can easily be confirmed by doing a simple Google search of your own.)

 

Papa Carl

 

 

[JJReyes]

Part of the reason the moneyed Chinese are investing in the United States and other countries is the China economic bubble may burst soon. While the export industry contributed to growth, it was the domestic spending on real estate projects that created spectacular results on paper. Entire industrial complexes, residential housing, shopping centers, towns, cities, etc. were constructed. The problem is they are unoccupied because the general population cannot afford to pay rents. Cheap money was loaned by government banks to a favored few, who then loaned the money at huge interest rates with little or no collateral. 

 

Something similar happened with the Japan bubble economy not too long ago. Let's see what happens with China.

[robert k]

Papa Carl, from my own research, China is also buying heavily into the natural gas production in the US. Joint ventures with companies like Chesapeake, Devon and others are not only allowing the Chinese to buy our energy resources but also allowing the Chinese to learn our drilling and hydraulic fracturing techniques. Someone amused me by saying China is going to take the US natural gas starving us of energy and I had to tell them that would not happen and they were missing the point, the Chinese will produce it and sell the US their own mineral riches. True, the Chinese bought a lot of dry holes and wells that today will not recover the cost of drilling, but in the distant future when natural gas will bring prices in the US that matches what the world pays, those wells will pay. Most of the leases under those wells can be held without producing indefinitely for $1 per acre per year, so even a bad investment could become a good one over time. The short sighted US domestic energy producing companies do not look more than a handful of years ahead and so are creating a new OPEC like power in their own land, by the name of SINOPEC. Some people just can't take a hint. :hystery: The US companies are greedy enough to not care anyway if there is profit for the next few years, beyond that the future can take care of itself.

[Tukaram (Tim)]

As i read this I can't help but be amused at expats who complain that we can't own businesses here in the PI's... and also see that it is a perfectly reasonable rule I kind of wish we would follow in the US ha ha  :tiphat:

[jpbago]

USA and other "foreign" countries have also invested heavily in China. There is a large market there. 

[JJReyes]

China is also buying heavily into the natural gas production in the US. Joint ventures with companies like Chesapeake, Devon

 

I had previously invested a small amount of our retirement money in companies like Chesapeake and Encana (Canadian). The problem is there is so much natural gas being produced that prices have plunged. The utility companies are willing to convert to natural gas, but they want fixed price contracts for 20 or more years. The producers don't want long contracts knowing that prices will eventually rise. I switched our investment to the electric utility side of the equation because new equipment coming on line allows for the burning of multiple fuel sources. 

 

The most fascinating development is in micro electric generators. A forum member sent me a PM about one company. After investigation and research, they did have a viable technology under development. It's one of those "high risk - high reward" situations worth gambling a few dollars. The good news is the company will start production soon. If the manufactured equipment is reliable and reasonably price, it can be used for rural electrification in countries like the Philippines, India, Myanmar, etc. Only 65% to 70% of the barangays have electric power. Usually, it is a diesel generator turned on four to six hours in the evening. 

 

Except for corporations with strong government connections, the Chinese are not permitted to invest outside their country. What you will see is a flurry of British Virgin Islands, Nederland Antilles, Cayman Islands, Panama, etc. corporations buying. Again, this is smart money betting against their own country. China is scheduled for an implosion. We just don't know when. Unfortunately, their internal problems will impact the global market.

[FlyAway]

Something similar happened with the Japan bubble economy not too long ago. Let's see what happens with China.

 

My exact thoughts when reading the post. I remember hearing something about having to learn Japanese because they would be taking over the world economically. Japanese used to own a lot of expensive real estate in New York and other places.  It was later sold for pennies on the dollar.

 

All this is one big transaction and shifting of cash from one place to another. Only reason money has value is because we say and think it does.

[JJReyes]

Learning a second or third language is not a bad idea. Our granddaughter goes to a school that requires all students to learn in English, Spanish and Chinese. It is based on the Scandinavian education model where students learn four languages.

Edited September 8, 2013 by JJReyes