OP-ED: 'The Next Globalization Backlash: Wait Till the Kremlin Starts Buying Our Stocks,' By Sebastian Mallaby, June 25, 2007; Page A19
Great piece by Mallaby, who's almost always stunningly solid and well-reasoned--sans unnecessary hyperbole or fear-mongering.
I read the piece and remember how the 1990s signaled the oncoming and neverending currency crises that would decimate globalization.
Except the system learned and adjusted and globalization spread even faster. Now, one of those adjustments,the stockpiling of reserves to guard against runs, presents new phenomena that will include both great challenges (to include a new form of "crisis," I guarantee, that will be sure to signal globalization's "dooooooooom!") and new solutions that drive the process ever more forward into terra incognita but likewise more pacifica.
This is a great age to be a grand strategic thinker.
Thanks to Bill Millan for sending this.
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Comments (2)
I would guess that the first result of this would be the creation of a law in Congress designed to blunt the authority of foreign governments (specifically) over corporations. I would further suspect that the first attempt will be fairly hamfisted and cause a momentary blip in the markets, but ultimately not be too much more damaging than Sarbanes-Oxley.
But on the other hand, with the increased authority, doesn't there also come increased shareholding? Wouldn't a China or a UAE doing this need to reason carefully about the benefits of sabotaging something that's paying them hard cash dividends and that they can sell later?
All the future safegaurding laws need to do is tip the balance sufficiently that that sort of shennanigans becomes very rare.
Posted by Marcus Vitruvius![[TypeKey Profile Page]](http://www.thomaspmbarnett.com/weblog/nav-commenters.gif)
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June 25, 2007 2:21 PM
I'd look for China to buy stock in companies like Delta, FedEx and UPS. Use of those China approved U.S. carriers will help the near term balance of payments problem, and China will get a good long term and stable investment return.
A few hundred years back the Dutch East India Company yielded Far East Trade to the newer British East India Company, but then invested in that company to share in the profits England earned from third party trade. The Dutch still exported cheaper tea to England's North American colonies through back door contacts.
Posted by Lou Heberlein | June 25, 2007 3:11 PM