Whither Rio Tinto?
Rio Tinto, Kenecott's parent, is being hit hard by the downturn in metals prices. Shedding about 15,000 employees worldwide (250 here in Utah) wasn't enough. Selling mining and processing assets last week to raise $1.75 billion wasn't enough. It is now prepared to sell a big chunk of its iron ore and aluminum business to Chinalco, the Chinese state-owned aluminum company. Chinalco already owns 9% of Rio Tinto, and this sale would probably turn it into the major player in RT's ownership.
People have been wondering what China was going to do with all the Yankee Dollars it was piling up. I've been saying for some time it was going to do two things: 1) shower it in places where China wants to make friends and influence people (Look at China's aid and development programs in Asia, Africa, and South America.), and 2) buy up real assets in its deficit trading partners (See for example my 9 October entry about liquidity and solvency.). It's happening. Well, maybe Utah can get stronger direct ties with China out of it.