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Several reports are coming out of China that there is pressure on state-controlled organisations - notably the country's main sovereign wealth fund, China Investment Corporation (CIC) to rapidly build investment in non-Chinese enterprises. While the CIC itself, with apparent access to some $300 billion in funds - and the possibility of more from the government - may be concentrating on hedge funds and other investment entities, there is another sector for Chinese state-owned companies looking at major investment in commodities. Indeed with the funds available as China seems to be dumping its US dollars in favour of more concrete assets, virtually no minerals sector is safe from Chinese participation.
While CIC was set up only two years ago, funded with $200 billion in initial capital, a report to the U.S. Congress noted that according to top Chinese officials, it was created to improve the rate of return on China's $1.5 trillion in foreign exchange reserves and to soak up some of the nation's excess financial liquidity. Depending on its performance with the initial allotment of $200 billion, the CIC might be allocated more of China's growing stock of foreign exchange reserves - and this has already proved to be the case.
Probably the most interesting of the recent reports of what is happening with Chinese sovereign wealth fund investment outside China has come from Paul Mylchreest's Thunder Road Report where an ex-U.S. intelligence service member is quoted. He reports that he has a friend who is in the Chinese Sovereign Wealth fund sector who says - hearsay I know and it wouldn't stand up in court - indicated that the wealth fund analysts were working all hours of the day and night trying to put investment deals together - particularly in the oil and precious metals sectors. The conclusion is that China recognises that the U.S. dollar is going to tank and it wants to convert as much of its trillions of dollars of holdings into strategic assets as possible before the collapse really takes hold.
CIC has also worked to mitigate the risk of dealing in overseas markets through the action of its newly created International Advisory Council. The IAC contains such luminaries as Taizo Nishimuro, Chairman of the Tokyo Stock Exchange, and John Thornton, former President of Goldman Sachs, whose job is to help advise the fund on threats and opportunities coming out of overseas markets.
The renminbi black swan
Posted by Miles Johnson on Sep 03 19:16.
Take $1,500bn in Chinese dollar reserves, add generous dollops of concern about currency debasement, mix in a shopping spree by the Chinese state. Then scream.
At least, you should be screaming if your life savings are in dollars.
Recent Chinese buying of hard assets is by no means simple investment or long-term preparation for a rapidly growing population and economy, according to boutique brokerage Aviate Global.
No, the Chinese are buying, they say, because they are quietly tip toeing away from the dollar and hoping that no one else will notice:
The investment community is waking up to the reality that China is buying hard assets (gold, precious metals, oil, copper/ally etc) for more than simply industrial purposes. They have $1.5tn in $ reserves. They understand the $’s day as a reserve currency is over and hold the biggest key to future debasement: full Yuan convertibility.
“Full yuan convertibility” refers to what could be the end stage of a process of internationalising the renminbi by eventually allowing it to float freely against other currencies.
Originally posted by GreenBicMan
Isnt WFC a too big to fail?
Check out the options chain.. my cpu is running so damn slow I can only have 1 browser tab open lol
Originally posted by GreenBicMan
thats where you will see the $ flow first
Originally posted by GreenBicMan
reply to post by RetinoidReceptor
haha.. so weak compared to my vyvanse.. u would be running up walls lol - i would just keep an eye on the WFC options change if you believe in this theory
Originally posted by GreenBicMan
lisdex is vyvanse, and yes shire owns me lol
Originally posted by GreenBicMan
yeah it def. will.. you can join the no sleep club - makes for better overall knowledge in the long run IMO
Originally posted by GreenBicMan
reply to post by RetinoidReceptor
Well you know what I REALLY like.. that would be your savior if you didnt abuse it, really would.. just down follow my path
Originally posted by GreenBicMan
never ventured never gained
i eat things that pop outta cow manure, you must think i be ka ka ka krraaazy
Originally posted by GreenBicMan
I agree, at some point the worst is yet to come
Just like the best
lol