CHINESE STATE OWNED STEEL TRADER DEFAULTS

So much for state backed security.

Sinosteel Co. will delay an interest payment due Tuesday on 2 billion yuan ($314.5 million) of 5.3 percent notes that mature in 2017, according to a statement on Chinabond’s website Monday. The firm delayed payment as it plans to back the securities with stock of its unit Sinosteel Engineering & Technology Co., and that may affect issues related to interest payment, it said without elaborating. The failure to pay interest on time constitutes a default, according to Industrial Securities Co., Haitong Securities Co. and China Merchants Securities Co

Sinosteel has more than 100 billion yuan in debt. This was somewhat expected. Nevertheless, it highlights an inportant point that nothing in China is sacred, aside from plastic rice and BIDU, which is why I am long.

On that topic, nothing is more important than search for the development of a society, molding an entire country’s intellect, providing unprecedented access to information. What China did to Google (blocking them in favor of BIDU), other countries will copy. Google is only sacred within our borders. Once other tech companies start to lobby their host countries against GOOG, other BIDU’s and YNDX’s will materalize.

Sovereignty and nationalism is the ultimate moat.