Home > Biz wanderings, For thoughts.., GeoIdeas > China hottest IPO??? Nope, World’s largest IPO!!

China hottest IPO??? Nope, World’s largest IPO!!

China got its financial champion!!! It is largest than Exxon and General Electric, the two biggest companies in the World and symbols of a certain economic and corporate power, it grew 160+% on its first trading day, to reach the stunning level of £1,000bn, you put down all the necessary “zeros” .. PetroChina blasted the financial community!

So, the Celestial Empire has got its necessary muscles, there should be plenty of cash (the IPO raised $9bn, another record..) to foster and support further “deals” across the World, and we should expect some subtle geopolitical imbalances.. China, as already mentioned, represents for part of the World a substantial threat, a problem, an economic conundrum to some, a natural hazard, a menace.. mainly, it is rather a physical formula that makes China something to watch out for, kinetic energy

E_k = \frac{1}{2}mv^2

OK, the physicists amongst you will immediately surge in disgust for my using this formula in such an improper context, but bear with me, the idea is about a great mass taking up unprecedented speed… it will be difficult to stop, as it will be to direct it to a spectacular and sustainable growth path. There are some structural variables of the Chinese phenomena which are not yet displaying their full potential (either supportive or destructive, it depends) but, considering the size, those variables will play a massive role in setting the pace and the faith of the Asian giant and furthermore the destiny of the geopolitical balance of the area (if not considering it could be a global influence we are talking here..). Wealth imbalances, working conditions, energy supply, environmental hazards, financial stability, coherence with social standard at global level, and above and beyond civil rights and freedom, those are aspects that the Chinese bridge commanders have or will have to analyse pretty thoroughly.. and sort out properly.

According to Friedman’s theory of the Golden Arches

No two countries that both had McDonald’s had fought a war against each other since each got its McDonald’s

China and US should be going along if not nicely, at least in a bearable fashion, but as already pointed out there is an issue here about the notion of war… economic, cyber, political, social… are all new forms or permutation of the old mankind sin????

My argument is about the viral destructive power wealth unbalances may have in an unprepared social system, particularly when supported by an increase in communication and permeability to “inputs” on “how it should be” (aka knowledge).. to sustain growth a system has to increase the level of preparedness and thus approach the “capitalist” factors (including productivity, innovation, financial strength) and leverage on those.. but the more you dig into being a capital fortress, the more you older system values crumble down to be replaced by the newest.. if transition is not perfectly driven by the “governors”, an uneven social fabric may be the breeding ground for system instability. This seems to be the case of China, as of today.

From a Western standpoint, the PetroChina IPO is a stunning event, from a geopolitical observation, this is a potential new nail into some unspecified coffin… but the slamming of the hammerhead is quite distinct. And it is unclear who’s working it.

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