GLOBAL RESOURCES ANALYSIS


EFFECTS | CORPORATE BAILOUTS


After the first Oil Crisis, the OPEC countries became in rapid speed very rich in the '70ties. They had huge capital surpluses and brought these loads of capital to banks in the Western World. Because the domestic capital demands where to low these banks lend this money to Latin American countries in to big volumes. The value of capital was to less for these countries and they invested these loans not economicly and we're not able to start repayments or even pay interest. This lead to the global banking crisis early '80ties. Banks than had to write down large losses on these loans. These days the OPEC countries (and other emerging hardworking countries like Singapore and China) have ones again a huge capital surplus, but they have learned their lessons of the early '80ties. They have build their own banks that hold their own capital. Again a market polarity change issue feed by PeakOil. Many of these often called Sovereign Wealth Funds sees the current subprime crisis in the financial world as an opportunity to purchase first minor, later on controlling positions in western banks. The western banks are silently more and more owned by emerging countries. The emerging world hereby gets financial brands, financial structures, financial knowledge and of course a billion new customers. The western banks will get different policies by these new ownerships: more global economy minded than pure nation's / customers interest focused. By enough market share in a market the new owners can adjust the economic behavior in that market by limiting money supply by credit. The neighbor than has become the real boss in the house. For chipmakers as AMD and many software companies these corporate buyout giving them new power to gain larger market shares with improved products. SCO is the latest example of these foreign corporate bailouts.


Author: Gijs Graafland


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