American capitalism - it's so great even the Chinese Communist government loves it!
That's sounds like it ought to be a bumper sticker, but the January 16 "NBC Nightly News" advised it is something we should be cautious of.
Foreign investors have been on a buying spree in the U.S. stock markets - as stock prices have fallen with all the skittishness in the wake of the credit crunch.
"So far foreigners buying chunks of Wall Street has not triggered the same political uproar as a Dubai company's ill-fated effort to take over operations of U.S. ports, perhaps because politicians know the alternative could be painful," NBC correspondent Lisa Myers said.
And, turning foreign investment away would have dire consequences in short-term, as CNBC's Erin Burnett pointed out.
"If they could lay off a lot more people, lose a lot more money, put the financial system at risk; or they could get the money being offered by Asians and Arabs," Burnett said in the report. "Right now that's by far, of the two, the better choice."
The lack of foreign investment would have a short-term impact on the economy. Unfortunately, what the "Nightly News" left out is why it makes sense for the foreign entities to invest in the United States. It's not to have a controlling stake in the U.S. economy, but because the American free enterprise system gives them the benefit to make the most money.
"The Chinese aren't investing in America, the Arabs aren't investing in America because they like us," said George Freidman, founder of Strategic Forecasting, Inc., a private intelligence company, on the Dec. 17, 2007, Dennis Prager radio program. "They are making very careful choices about where they're likely to make the most money by investing. And what the Chinese are saying is, ‘I don't want to invest in China. I don't care if it's got 10, 12 percent growth. This is a dangerous climate. If I want to put my money into long-term growth, I'm going to do it in the United States.' And the Arabs are saying the same thing."
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A note of history
January 17, 2008 - 18:58 ET by Lame CherryNations which invest in America long term always make good profits. Nations which swoop in with too much cash always end up holding the bag.
I ask readers to recall the Japanese dumping all their balance of trade into America buying worthless things in New York as Landmarks........and after the prices busted........they were left with junk.
This "bail out" of corporations like Citibank is nothing but a moving of US debt once again which nations who have dollars are basically donating the money back. That is the way things always work.......the Dutch and English have owned US for centuries and are doing great. The hole pluggers are the ones just plugging holes.....has nothing to do with foreign investment.
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When the foreign investors
January 17, 2008 - 19:39 ET by tcm22When the foreign investors stop investing is when we should get worried. This is what the global marketplace is all about. We should embrace it. Foreign capital infusing cash into the US economy right when credit is tight seems like a good thing. It's the mercantilistic attitude of the press and the unedumacated public that is hyperventilating over this stuff.
if our economy is doing so
January 17, 2008 - 19:52 ET by crsheddif our economy is doing so great (as i constantly read on this site), why aren't americans investing? why are big companies going to asia for investors?
Foreign investment as a
January 17, 2008 - 21:31 ET by Jeff PoorForeign investment as a percentage is very small overall.
Interdependence is good.
January 18, 2008 - 01:58 ET by Parker1227Why would China or Russia even consider nuking the U.S. if they both had huge investments here?