China has been stockpiling commodities, particularly oil and iron ore. Unlike Americans, the Chinese think long-term. Rather than worry about next quarter or next week, China plans decades in advance – and it has over a billion people to house, clothe, feed, and transport to work each day.
Buying resources makes perfect sense if you have even a broad idea of the resource crisis that's approaching. The problems we have today may seem big, but at least they can be solved by money. The coming resource shortage cannot. China's method of using money to accumulate resources is now one of a few possible answers. As the fable goes, they are the ants, and we unfortunately are the grasshoppers.
China is the ants, West is the grasshoppers
Via The Oil Drum, Dr. Stephen Leeb opines that resource scarcity means commodity-rich countries (the "BRACCs", Brazil/Russia/Australia/Canada/China) are the soundest long-term investment. Not sure I would go quite that far, but I do like this quote on China's recent pursuit of resources:
Subscribe to:
Post Comments (Atom)
Would love your comment on the Oil Drum. I have an uncle who's obsessed with it whom I argue with all the time.
ReplyDeleteMost things I've seen on the site are alarmist, don't understand economic adjustment paths, and don't cite reputable people.
http://peopleandresources.blogspot.com/2009/07/oil-drum.html
ReplyDelete