Excuse me DDDooo, I have been conducting a respectful discussion with you.Please do not use words such as absurd, when you very well know that you are using that word just to deviate and reduce the value of a point for just the sake to do so. As I told you in my previous post, if you have an agenda to defend someone else do it explicitely and in another thread. I do not want to enter a sterile discussion here. Friendship is shown with deeds. There is still time for others to make deeds that are in their interest, and which would also help the american banking system.
You and buzzy are the ones who are talking about "someone else", I've not mentioned Israel, or terrorism or madrassas, or Wahabism or 9/11 even though these things would be quite relevant to this discussion on whether the arabs are friends or foes. The only point I've been making was that it was a purely business transaction. It's well known that the Arabs had been heavily invested in Citibank for a long time so there is no surprise that they tried to prop up their investment and increase their stake. There is absolutely nothing wrong with that except that it's a business decision and has nothing whatsoever to do with friendship.
If you live in america, investing in treasuries will not help you. One needs a strong economy, and that requires a strong banking system. A weak banking system, means a weak economy, which means a weak job market, which also means weak tax revenues for America, which consequently means a weaker america at the international stage. Direct investment in balance sheets of american banks is of paramount importance.
Do you want to know what a true act of friendship would be? If they increased the production of oil by 10-15% (and don't tell me that they can't) that would solve virtually all financial problems overnight, in this country and all over the world. Do you hold your breath? I don't. A $10 bln investment in a freaking private bank or two is going to solve absolutely nothing.
Excuse me but it does. Anyone who would do it for investment reasons only is clearly not doing the right decision. The risk is high. There then must be another reason why they did it. And there is no other reason than to show that they believe in the capacity of a friend to rebound, and will share the risk and put money in the system. If you do not accept this, read the responses from others. All agreed that there is risk and it is about money. So why did they put money in what is clearly a tough and risky environment to invest in banks in America? They did it for other reasons than profits and risk calculations. Do not assume that these people are stupid. Remember Singapore is one of the best run countries in the world from an efficiency point of view. They know how to invest. By the way I did not hang on anything. Go back to your comments, and you will see that you have been focusing on Arabs (not singapore) in your defense and attacks. Let us move forward. This is a difficult time for America. But we will rebound. Why is it for instance that Trichet did not do anything about the strong EUR/USD? It does not take money, it does not take anything. Just a bold statement in front of reporters. If there is no statement, in the eyes of everyone, this means that the beating of USD vs EUR is regarded as deserved and/or welcome from the point of view of Trichet and the EUR central bank.
"The investment arm of Abu Dhabi viewed the depressed level of Citi as a value investment" after the bank's stock had fallen to less than $30 a share from more than $55 a year ago, said John Rocket Spinello, bond strategist at Jefferies & Co. It was not the first Arab investment in Citigroup, which is perhaps America's most visible bank worldwide, operating in far-flung places from Moscow to Buenos Aires. One of Citigroup's other large shareholders, with nearly a 4 percent stake, is billionaire Saudi Prince Alwaleed bin Talal. The Abu Dhabi Investment Authority also acquired stakes in the Carlyle Group private equity firm and chip-maker Advanced Micro Devices earlier this year.
I do not think that the reason of the price of Oil is the Arab. They have no interest in high price themselves as otherwise a new source of energy might be developed,and their Oil would less important and less consumed. The reason for a high price of Oil has to do with traders running the prices. It is a buble, and when it bursts it will fall like all bubbles have fallen. Speculation/bubble is a real problem in price-based markets.
March 5, 2008: OPEC to Maintain Current Production; Blames US for Economic 'Mismanagement' Oil prices surged for the first time past $104 a barrel after the OPEC announcement and the release of a U.S. government report showing a surprise drop in crude oil stockpiles. Some friends, huh?
F&G rules oil. Pure fear and greed. When stockpiles are at an all time high, crude oil trades higher. When stockpiles show a drop, crude oil trades higher. In anticipation of winter demand, crude oil trades higher. In anticipation of summer demand, crude oil trades higher. $1000/barrel here we come?
And if the US had not invested in Japan and Europe arrogant meat floggers like you would be lecturing about the heartless selfishness of the US. Lefty philosophy = infinite possiblities always reduced to the same conclusion, i.e., "Amerikkka bad."