Congratulations Nexen shareholders.

[unicas]

For selling their assets the Chinese at gigantic premium, just like many former owners of Vancouver home did. 66% is almost at bribery level in the corporate world.

Now make sure you guys make good use of the money. Don’t blow it.

http://www.theglobeandmail.com/globe-in ... le4435247/

[jesse1]

66% is almost at bribery level in the corporate world

They know what they're doing. Long term thinking, just like Vancouver property. This is a real estate talkie forum after all.

[vanpro]

And...does Chinese over-paying for assets (i.e. as Unicas stated: "gigantic" premium to current market value) make the Chinese smart or dumb business people or just naive (having only recently entered free market business system and attempting to run state-controlled capitalist system that has never been successfully run in all of history by any country)?

[Geyser]

Perhaps they just figure that fiat currencies are overvalued and it makes more sense to own "stuff".

[vanpro]

Perhaps they just figure that fiat currencies are overvalued and it makes more sense to own "stuff".

Yes, but the key is always: "at what price?"

i.e. Gold is traditionally a hedge against inflation, but if you pay $1.0M/ounce, it will most likely NOT be a hedge against anything.....

[unicas]

by Geyser » Mon Jul 23, 2012 9:04 am Perhaps they just figure that fiat currencies are overvalued and it makes more sense to own "stuff".

Exactly, $15 billion is about one week worth of the country's current account surplus increase, instead of buying U.S. treasury, they turn to real assets instead.

[eyesthebye]

For selling their assets the Chinese at gigantic premium, just like many former owners of Vancouver homers did. 66% is almost at bribery level in the corporate world.

Now make sure you guys make good use of the money. Don’t blow it.

http://www.theglobeandmail.com/globe-in ... le4435247/

If I'm offered a 66% premium on my property I'm taking it and hauling ass. If anyone knows such a buyer I'll give them a 50K finders fee

[fishguy15]

If I'm offered a 66% premium on my property I'm taking it and hauling ass.

You didn't take it and run when you had the apparent +$1M offer....

[eyesthebye]

If I'm offered a 66% premium on my property I'm taking it and hauling ass.

You didn't take it and run when you had the apparent +$1M offer....

that's not nearly a 66% premium

[vanpro]

by Geyser » Mon Jul 23, 2012 9:04 am Perhaps they just figure that fiat currencies are overvalued and it makes more sense to own "stuff".

Exactly, $15 billion is about one week worth of the country's current account surplus increase, instead of buying U.S. treasury, they turn to real assets instead.

Right...and just as they way over-paid for US treasuries pushing them to record low nominal yields (negative real yields), they are now doing the same to other assets paying "gigantic" premiums to current market value (as per Unicas' assessment in the OP).....my question remains: smart or dumb or naive?

[timber2012]

First, what does this have to do with real estate?

Second, Chinese never make a mistake... this is clearly brilliant on their part.

[registered]

Perhaps they just figure that fiat currencies are overvalued and it makes more sense to own "stuff".

But not that paying rational prices means owning 60% more "stuff". What a sparkly universe you inhabit.

[Taipan]

Careful boys, youll have the Geezer police in here calling you all racists!

[Geyser]

Careful boys, youll have the Geezer police in here calling you all racists!

No, I'd only do that with the really extreme and unrepentant examples like you. You know, the ones that rant on about "genetic inferiority" and "programmed to fail", not the mildly insulting slip-ups just the deliberate, hateful, vicious stuff.

[unicas]

by vanpro » Mon Jul 23, 2012 9:29 am

Chinese having only recently entered free market business system and attempting to run state-controlled capitalist system that has never been successfully run in all of history by any country)?

Vanpro, you need to take a test on your economic literacy and you pick the absolute wrong time to preach free market economies. The world stage is now littered with bankrupted economies with dysfunctional governments and hopeless societies. Don't tell me you haven't taken notice of these members of your free market business system. In fact, such system is already bankrupt.

And your comment that state capitalism never succeeded is absurd. You ever heard of Singapore? Singapore is one of the most, if not the most economically successful countries, as well as the the most economically competitive and most innovative country. State owned firms take up 60% of Singapore's GDP. Why do you think you see billionaires denounce citizenships in U.S. or Australia and move there? In my opinion, it is also the best managed country in the world and a brilliant success story as a society.

In fact, Singapore, South Korea, Taiwan, Japan and now China are all examples of well managed state capitalism that avoid the fallacies of the free market economy. Jim O'neil, Chairman of Goldman Sachs has recently singled out South Korea as one that West should learn everything from, both as a economic model and as a model for society. And China has taken the extra step to use size of its market and its 3 trillion dollars reserve to acquire strategic assets across the globe.

Is it smart or dumb? It is Canada's loss to let go companies like Nexen, doesnt matter to whom. For the Chinese, $15 billion is a drop in the ocean. They have a 100 year agenda, they want strategic assets. Period. You tell me who is dumb.

by vanpro » Mon Jul 23, 2012 9:40 am

just as they way over-paid for US treasuries pushing them to record low nominal yields (negative real yields), they are now doing the same to other assets paying "gigantic" premiums to current market value (as per Unicas' assessment in the OP).....my question remains: smart or dumb or naive?

You forget to give credit to Uncle BEN and his QEs. Just one more reminder the market is not as free as you think.