'The year is 2050...
'The Middle Kingdom, formerly known as the People's Republic of China, is the richest, most powerful nation on the planet. Thousands of factories hum 24/7, cranking out 60 percent of the world's textiles, sophisticated electronics and computers for the world's IT industry, and over 40 percent of all cars...including the largest auto company in the world...
'General Motors Inc. a Chinese blue chip! So writes MoneyWeek regular Dan Denning in his new book 'The BULL HUNTER'. But as it turns out, China may not take 50 years to buy up America's iconic automaker, after all.
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Case in point, a Bloomberg column by William Pesek last week: 'Could GM and Microsoft end up in Chinese hands?'
"China's strategic desire for natural resources, global brands, and a short cut to international markets," writes Pesek, "combined with unprecedented access to cheap money from the country's state-owned banks - means its companies are ready to outbid just about anybody on the planet! This isn't the Japanese binging on Monet, as they did at New York fine art auctions while the Nikkei doubled and then trebled in the '80s. It's aggressive Chinese businessmen gunning for their share of the world's natural resources. And investors everywhere are sitting in a front-row seat whether they like it or not.
"In contrast to the Japanese acquisitions of New York's Rockefeller Center, the Pebble Beach golf course, and Hollywood studios," Pesek explains, "Chinese companies seem more interested in industrial businesses than trophy assets."
In The BULL HUNTER, Dan Denning outlines several Western "industrial giants" that are likely targets of rich Chinese businessmen. CNOOC's bid for Unocal is just the latest sign of what Denning calls the 'money migration' the flood of capital and cash from West to East. Consider:
In late 2004, China's metal-trading giant China Metal Corp. made a bid for Noranda, Canada's largest miner, and the world's leading supplier of zinc and nickel.
The previous year, Chinese companies invested $33 billion in 7,740 foreign firms in over 160 countries worldwide.
China's Shanghai Automotive the company that may now own rights to the MG Rover brand beat China National Bluestar Corp. to buy Ssangyong Motor Co., South Korea's fourth largest automaker.
Sanjiu Enterprise Group, China's biggest drug manufacturer, bought a majority stake in Toa Seiyaku Inc., a midsize Japanese pharma company.
The strategy is clear. As the China Post newspaper reported earlier this year, 'Unlike Japanese purchases of French Impressionist masterpieces in the late 1980s, China's deals have been low-profile and focused on stakes in vital resources: oil, gas, minerals, timber even fish. More than 2,200 Chinese-owned fishing vessels [now] ply the world's oceans.'
How can investors profit from this money migration, and the reshaping of the global investment map? Denning reckons one of the best ways to play China, without the risk, is through Exchange Traded Funds which allows investors to buy whole countries and sectors with just one stock. They're the new Mutual Funds, although they come at much lower costs and with greater potential for short-term gains.
While touring the world while researching The Bull Hunter, Denning also discovered a number of interesting tips. As an example, in Hong Kong, Denning learned that China's east coast could soon sprout 10 to 20 new cities with populations of 15 to 30 million each. The result? China is potentially going to guzzle even more raw material than it currently does, and will need to find the resources to satisfy the country's demand.
Moreover, while spending Christmas in Paris, Dan came up with a unique way to measure dollar risk. In the process he managed to calculate how close the world is to a complete dollar meltdown, which will help investors know when to make the right investment.
In all, The Bull Hunter reveals looks at a number of major trends that are currently driving the global economy, and he also delves into the strategies that investors can use to profit from them, right down to naming the specific companies. Denning also covers the secret history of how Britain led the world into the Industrial Revolution, while taking a fascinating look at the truth about the surging Indian economy.
If you are interested in The Bull Hunter, written by MoneyWeek regular Dan Denning, click here for more: https://www.wiley.com/trackthrough?urlcode=454314
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