Where will the "foreign/soverign" investment in US Financial firms (Citicorp, SHL etc.) lead to?
Over the next decade where can we expect the investment in our Financials by foreign governments or government sponsored institutions to propell the likes of BoA, Shearson, Citigroup etc.? UP DOWN SIDEWAYS?
Answers
653 points
DaveDiggz answered 11 months ago …
I'm not sure where the shares will go, it's too dependent on the financial performance of those particular institutions. However, what I do know is that we're giving away our most prized possessions. I feel like Europe after WWII - we're borrowing a TON of money to finance our war, our social welfare programs are degrading by the minute and foreign countries are buying our most prized assets - our financial institutions.
These non-majority investments may not mean much now, but what about 50 years from now when they're able to accumulate control in these companies. Or even in the near term, we're sending the economic benefit of these institutions overseas. The money may be made here in America, but all the dividends and capital gains are being given to the shareholders. If the majority of those shareholders end up being foreign bank/financial institutions, then we're essentially financing THEIR growth, not our own -- the reap the benefits of the seeds we've sewn.
As you can tell from my tone, this is an issue I firmly stand against.
1130 points
sundarkambam answered 11 months ago …
Dylan Jovine has pointed out the pitfalls of these foreign investment in his articles in tycoonreport .
" How to Destroy Your Child's Financial Future (and Yours)"
and
"Who's Your Financial Daddy?"
2703 points
MNSL answered 11 months ago …
World is fast changing. Last couple of years it was private equity fund world wide who dominated financial and stock markets. Actually after buying up some public companies traded in stock exchanges by some private equity funds stock market investors lost valuable opportunity to invest in those valuable companies. Now it is sovereign wealth funds from who have dominated stock market through out the world. They are waiting to invest whenever there is an opportunity be developed country or an emerging country. Time to come there will be more investment funds due to rapid development in countries like China, India, and Korea etc. Now not only sovereign funds but also companies from above countries have started to invest globally. So investment pattern has changed a lot. According to some reports by 2050 USA, China and India will be major economies in the world. I will give below web site and an article for your reading.
http://www.nzherald.co.nz/section/3/story.cfm?c_id=3&objectid=10487454
Abu Dhabi buys stake in Anzo
7:30AM Friday January 18, 2008
The Abu Dhabi Investment Authority is buying 19.9 per cent of AMP NZ Office Trust, and is entering into an arrangement with AMP Capital Investors in which the partners will own 24.9 per cent of the company Haumi Company, owned by the investment authority, will buy the stake from AMP Capital Investors for $178.2 million, or $1.30 a unit.
The units last traded at $1.15, up 3c, after the news. The sale will take place by early next week, when the partnership is formed. The agreement includes Haumi's purchase of a 50 per cent shareholding in AMP Office Trust's manager, AMP Multiplex Management.
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