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To: xcr600 who wrote (24697)	7/6/2005 10:54:05 PM
From: xcr600	Respond to of 48461

From 50% gains thread.. good reading-- LONG & SHORT By JESSE EISINGER Lost in the Fuss About Unocal Bid Is That China Is the Savings Winner July 6, 2005; Page C1 If Congress wants to become hysterical about China, Cnooc's bid for Unocal hardly is the place to start. China adds enough to its foreign-exchange reserves to buy a Unocal every month. Brad Setser, senior economist for the boutique firm Roubini Global Economics, estimates that the amount of foreign assets the Chinese accumulate each month by exporting more than they import is valued at around $20 billion, just over the $18.5 billion that Cnooc, which is 70%-owned by the Chinese government, is bidding for Unocal. Worrying about China taking over one company seems muddle-headed when the country has become the most vital creditor of the debt-laden U.S. But somehow that fact has failed to concentrate the congressional mind. When the Chinese want to buy "our" companies, members of Congress are better able to discover reasons to object. "It's because they're Communists! Well, now they are, when they want to buy our companies. They are OK when they want to buy our debt," says Northern Trust economist Paul Kasriel. The outcry over the Cnooc bid reflects the struggle the U.S. is having with the emergence of China as a major financial player on the global scene. It also shows how difficult it will be for the U.S. to come to grips with the economic choices it has made over the past several years, choices that have led to ballooning deficits and a lack of personal savings. The Cnooc bid "strikes people that we really are mortgaging our future, when in reality we are anyway" already, says Lehman Brothers economist Ethan Harris. "Either way, we are giving away part of our national wealth. But when they buy a company, the symbolism is more tangible." In a world in which the U.S. has outsourced savings to China, in Mr. Setser's phrase, the Chinese will take those savings and try to buy attractive assets. China holds $700 billion to $750 billion in foreign reserves, estimates Mr. Setser, depending on whether one counts China's infusions to state-owned banks. China doesn't break it out, but about two-thirds to four-fifths of that figure is in dollars, he estimates. The country will add at least $250 billion this year to its reserves and probably will do the same next year. It is only natural that China would want to diversify its dollar holdings. That means it would switch out of owning Treasurys and other debt and into companies, such as Unocal and Maytag, which is the subject of a bid from Chinese appliance maker Qingdao Haier. That can be viewed positively, in economic terms. Foreign direct investment is regarded as less prone than Treasury investment to being pulled away quickly with negative economic repercussions. Says Mr. Kasriel: "Someone is showing an interest in wanting to hold something other than our debt, seeing some value in American real assets." If the Chinese do end up bowing to U.S. pressure and letting the yuan revalue upward, the country's ability to buy U.S. companies will only increase. Because the yuan is undervalued, Cnooc's offer arguably is more generous than a comparable dollar-based offer would be. In a minor sense, that also makes it a winning transaction for the U.S. economy; at least Unocal shareholders probably think so. Of course, strategic interests sometimes can override economic interests, and the U.S. has the right to exert diplomatic pressure to ensure that China adheres to the rules of the global economy. The level of Chinese reserve accumulation and intervention in the global exchange markets is unprecedented, says Mr. Setser. "I don't think there's any question that China is challenging the norms that govern international economic relationships," he says. But Unocal doesn't make nuclear-weapons technology. Unocal's main assets are Asian natural-gas fields that already are fueling Asia. And the U.S. would certainly rather that China buy Unocal than invest in, say, Iranian gas fields. If the U.S. were to block the bid, it could put the two countries' relations on a much more confrontational footing, potentially reducing the amount of cooperation the U.S. can get from China on other trade issues. Some economists argue that China, perhaps bowing to internal political considerations from exporters who profit from a cheap yuan, as well as hard-liners, already has missed plenty of opportunities to revalue. It is far from clear that it is healthy for China to be so dependent on U.S. demand for its goods. Any U.S. diplomat would be more effective in pointing that out if relations aren't further inflamed by the Cnooc flap. The Unocal bid brings into stark relief just how much the U.S. is partying today. The country has spent future earnings streams -- from, say, Asian energy resources -- already and now must start paying for it. So far, the Chinese have been "willing to sacrifice so we can enjoy the good life," says Mr. Kasriel. "The challenge comes later when they decide they would like to enjoy the good life. That means we'll be working harder and enjoying it less." It's the U.S.'s role as a massive debtor to China that should dominate debate. Not the possible acquisition of a second-tier energy company.

To: xcr600 who wrote (24697)	7/7/2005 3:51:55 PM
From: Skywatcher	Respond to of 48461

CAFTA is another SICK JOKE on indigenous peoples of Central America.... Salvadoran Riot Police Attack Student Protestors, Seriously Injuring and Detaining High School Students Tell Congress: Salvadoran Government Continues Violating Human Rights on Eve of CAFTA Vote! Riot police attacked a student protest in San Salvador yesterday, seriously injuring four students and detaining five. The high school students had shut down the streets in front of the University of El Salvador (UES) in a peaceful protest against the recent increase in bus fare in El Salvador. When the police attacked, the students took refuge inside the gates of the University, but the riot police followed them, setting off bombs of tear gas and opening fire on the students with what they claim were "safe" bullets. Rafael Lopez Portillo is currently hospitalized with serious head wounds, while Izai Arevalo Flores has doctors working to repair his crushed chin. Two other high school students also remain hospitalized. Iris Claribel Navas, a university student, and 4 other students from San Salvador¹s public high schools Juan Alexander Escobar Vasquez, Gustavo Peñate, Walter Ernesto Quintero, and Walter Armando Lemus have been detained. The Human Rights Ombudswoman blamed the government for the attack and for causing the protests. The refusal of the government to respond to the proposal of the transportation sector to subsidize the rising cost of diesel has pitted bus riders against small-business bus owners. Both the Ombudswoman and the President of the University, Maria Isabel Rodriguez, denounced the attack. Rodriguez reported that more than 50 passers by were wounded in the police attack. "If attacks like this continue, nobody is safe. The police have captured high school girls and boys, and they won¹t even tell us where they¹ve taken them. This is a barbarity," said Rodriguez. This is the first time since the end of the civil war in 1992 that police have entered and attacked the National University. Student organizations are calling for international solidarity to denounce the attack and pressure the government for the immediate release of the detained students. Send faxes to Rene Figueroa, the head of the government ministry that oversees and gives the orders for police repression. TAKE ACTION! 1. Fax or email Minister of the Interior René Figueroa to denounce the attacks by the Salvadoran riot police and demand immediate release of the captured students. (see below for sample letter) Interior Minister René Figueroa: Fax - 011.503.2281.5959 or email - marina.orellana@gobernacion.gob.sv 2. Call your Congressional Representative at 866-3409281 (toll free) and report to them about the continued violations of human rights in El Salvador. Ask that they make public their vote against the DR-CAFTA agreement, and that they relate their opposition to the repression of workers and students in Central America.