
The US Government Blocks MoneyGram’s $1.2B Sale to Alibaba’s Ant Financial - dragon1st
https://techcrunch.com/2018/01/02/moneygram-ant-financial-alibaba-deal-collapses/
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adventured
It's an extremely reasonable, ideal way to deal with China's one-way economic
behavior.

They don't allow foreign corporations to buy up their domestic companies. They
place foreign companies at an intentionally severe disadvantage. You can
hardly operate in the country at all without selling a big part of your
operations to a domestic entity (or otherwise being the minority partner).
Every developed nation is beginning to approach China similarly on this issue.
It'll keep getting worse for China on this issue until they begin dismantling
their extreme protectionism.

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nipplesurvey
Indeed, hearing China nag US for protectionism is some serious pot calling the
kettle black.

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Tzedek
I feel like I am going full dumb dumb here, but: how is this actually bad?

I read: "US government prevents Chines company from owning yet another piece
of our ass" _excuse the french_

Not trying to troll, really interested in what the downsides are.

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omarforgotpwd
China has a lot of capital and the blocking of sales for national security
reasons should theoretically put downward pressure on valuations due to
reduced demand for certain US assets. However blocking sales for national
security reasons is nothing new, and just "the way it is" for now. Would be
great if our relationship with China was as strong as our relationship has
traditionally been with countries like the UK and France.

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toomuchtodo
China’s ambitions prohibit the US and China from being partners (such that the
US is with the UK and France).

As a US citizen, I’d prefer we not sell off all of our assets for short term
gain, only to be sharecroppers to China in the long term.

Warren Buffet warned us about this years ago:
[https://youtu.be/vx5XPvQO4pI](https://youtu.be/vx5XPvQO4pI)

~~~
omarforgotpwd
I think this economic us vs them mentality is backwards. I'm a US citizen, but
both China and the US are populated by humans. In a fair world, Americans
should be able to make money in China while Chinese make money in America. If
I sell AMC theaters to a Chinese citizen, and use that money to start a self
driving car company, is that sharecropping or is it just a deal that both
parties found personally advantageous? Does it make any difference to AMCs
investment and hiring in the US? Is that Chinese citizen even that much less
likely to spend the profits from AMC on US goods and services than an American
citizen? Human innovation is not a zero-sum game and separating the world into
competing nation-teams actually just holds both parties back, in my opinion.

~~~
toomuchtodo
Your premise would hold water if the Chinese government was not so entrenched
via state sponsorship in its corporate entities, but that’s not the case.
China exerts its influence thorough these economic activities, and I argue
that the US government does not to the same extent.

These are not traditional M&A activities. It’s an economic Cold War. The US is
not innocent entirely, but we do not pour government dollars into the Rand
Corp and go about buying influential concerns in other countries.

Edit: thisisit mentions this is a comment further down:

“> In a document, the US Government Accountability office specifically singled
out the rise of Chinese companies with state ties as worthy of more scrutiny,
noting that some acquisitions might ultimately be bad for competition.”

~~~
omarforgotpwd
Yes, that's true. What i'm describing is a perfect world but what we have in
reality is the largest scale market intervention in human history, most
likely. An economically and politically free China would reshape the global
economy.

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thisisit
> Back in September, a private equity group was blocked from purchasing
> Lattice Semiconductor due to potential security risks. Prior to the Trump
> administration, just three deals had been blocked over the past 27 years.

Does anyone know how many acquisitions (and not deals) like these happen
during last 27 years?

I tried searching and found this article from Obama's administration:

[https://qz.com/863997/chinas-decades-long-acquisition-
spree-...](https://qz.com/863997/chinas-decades-long-acquisition-spree-in-the-
us-could-soon-come-to-an-end/)

Most of it talks about acquiring stakes but not outright acquisition. But the
interesting parts is here

> In a document, the US Government Accountability office specifically _singled
> out the rise of Chinese companies with state ties as worthy of more
> scrutiny_ , noting that some acquisitions might ultimately be bad for
> competition.

> Meanwhile, in November, President Obama played a direct role in blocking
> China’s Fujian Grand Chip from purchasing the German semiconductor firm
> Aixtron.

~~~
abiox
> > In a document, the US Government Accountability office specifically
> singled out the rise of Chinese companies with state ties as worthy of more
> scrutiny

i suppose you could say this about almost anywhere, to varying degree, but
especially in a place like china: isn't that basically every company? (re:
'state ties')

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booleanbetrayal
Here's a recent primer on Ant Financial's relationship with social status
ranking and government relations --

[https://www.wired.com/story/age-of-social-
credit/](https://www.wired.com/story/age-of-social-credit/)

~~~
xster
It was a fun read but I feel like the article is also partly re-invoking your
imagination on assumed stereotypes you already had.

I'm by no means an expert but from playing around with it a bit, it seems no
different from something like Klout which came and past in that it takes your
scores and mostly uses it to send you lame in-house 'benefits' promos that are
more like normal ads.

Something like [https://epic.org/algorithmic-transparency/crim-
justice](https://epic.org/algorithmic-transparency/crim-justice) is far more
impactful and interesting.

~~~
booleanbetrayal
I think the article is just illustrative of what data is sloshing about, how
it's being gathered, who is taking an interest in it, and an indulgence into
the possible motives fueling it all.

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baybal2
Economic war it is, plainly and simple.

Just like UK was ripping of India with trade in fabrics, so does China now
with the rest of the world. And so did USA with countless countries in the
past, now they are just surprised how unexpectedly fast they ended up on the
other end of the barrel.

~~~
aphextron
>Economic war it is, plainly and simple.

Sure beats the hell out of war war.

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crb002
Just buy a gross revenue share. They can't block that easily.

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r00fus
I googled this and can't find references? Can you explain what this means?

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gigatexal
How is this an issue of national security?

~~~
lerie82
Something about Alibaba being tied to terrorist organizations? but I've been
wrong before

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wmf
Clearly they should have done the acquisition on the blockchain instead.

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craftyguy
Who gets blamed if MoneyGram folds as a company since this deal was blocked?
It seems like another pyrrhic victory for donald and his friends.

~~~
antishatter
Please, MoneyGram will fold because they are often caught assisting money
launderers and fraudsters in addition to their exploitative fee structure.

~~~
Consultant32452
Conspiracy theory time: Some US TLAs use MoneyGram to launder money for off-
books activities and the US gov't doesn't want all that "evidence" in the
hands of the Chinese.

