The Abu Dhabi Investment Authority’s $7.5 bil buy into Citigroup got all the publicity, but Singapore bought a $10 bil chunk of UBS recently, too. It’s striking to note that both purchases were made on terms that put the American companies’ stock valuation at little above junk-bond status.
So, what’s next? A tightening of the lending spigots. Singapore didn’t get to the level of development it has today by throwing around nickels like manhole covers.
Maybe, the venerable Singaporean practice of caning will get exported the boardrooms of UBS and other American financial institutions while we’re at it. It couldn’t hurt.
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