Society

John Appruzzese, Chairman of the Investment Policy Committee at Evercore Wealth Management, has some very scary numbers about China’s very own QE2 that suggest a possible inflationary bubble that needs to be popped.

Total bank loans in China are $7 trillion– greater than the US economy, which is triple the size of China. In other words China’s inflation might well be “significantly higher” than the 4.4% claimed. More like the 10% inflation in Chinese food prices or more.

Appruzzese reckons that a significant risk from “continued high inflation in China will cause the country’s relative labor and production costs to increase, effectively generating the same result as an appreciating currency without the advantage of additional puchasing power for the imported natural resources.”

I say there’s just as much risky fallout from China’s “now slamming on the monetary brakes.” This is due to the ramifications of China’s slowing on the US, Europe and rest of Asia. Today, if China gets the flu it spreads to western stock markets. It used to be the other way around. It used to be that when New York got a cold, the rest of the world got pneumonia.

“You know, my friends and relatives in the states still believe that the U.S. is the greatest place in the world,” explained an American in Melbourne, Australia. “They think the rest of the world is full of poor people who can’t wait to emigrate to the U.S. They need to get out more.”

So we get out. We open our eyes. We look around, and what do we see? We see a whole world full of people who are hustling and bustling, schlepping and trying to gain an advantage, each looking for a way to get richer, faster.

The motivations all over the world are about the same. People generally want wealth, power and status and they want to get it in the easiest possible way but it can mean different things to different people. They go about it differently too. In the mature economies, they look for subsidies and angles. Tax breaks. Bailouts. Boondoggles. Sinecures.

“We have plenty of corruption here in India, too,” a colleague noted. “But most people know they can’t get much from the government. They have no choice. They have to start a business or get a job.”

China Petrochemical Group (Sinopec), China's largest oil refiner, said Friday it has agreed to purchase US Occidental Petroleum Corp's Argentinean subsidiary for $2.45 billion.

Sinopec said in a statement Friday the acquisition includes all assets of Occidental Argentina.

Occidental Argentina has gross proven and probable reserves of 393 million barrels of oil equivalent and an interest in 23 production and exploration concessions in Argentina, 19 of which the company operates, said the statement.

Occidental Argentina's production from 22 producing concessions totaled more than 51,000 barrels of oil equivalent per day last year.

The purchase is Sinopec's first investment in the Argentina's oil and gas sector. The move, another step in Sinopec's internationalization, aims to secure Chinese oil supplies, according to the statement.

Is China’s burgeoning movie industry about to enter the age of video game-as-film concept a la “Laura Croft: Tomb Raider”?

That possibility has taken a distinct step forward with the announcement yesterday that Huayi Brothers Media Corporation, China’s leading film and TV production house, is joining forces with Chinese online game developer Giant Interactive Group Inc.

The companies are in the process of forming a joint venture, Beijing Huayi Giant Information Technology Co., Ltd, with the aim developing 3D online games, according to a statement posted on Giant Interactive’s website (in Chinese). The statement says Huayi Brothers will eventually invest 70 million yuan, or roughly $10.5 million, in the new company for a 51% stake.

The joint venture company is already developing new content for Giant’s 3D online role playing game King of Kings III and has plans to develop new 3D games based on Huayi’s films and TV dramas in the second half of 2011, the statement said.