I was surfing my regular news sites this morning, when I came across the following article on BBC News:

“Obama speech censored in China.”

Authorities didn’t like Obama’s references to communism and silent dissent, according to the article. And certain parts were omitted from Chinese translations, like the following:

In “Recall that earlier generations faced down fascism and communism not just with missiles and tanks, but with sturdy alliances and enduring convictions,” the word communism was removed for Chinese translations.

And “To those who cling to power through corruption and deceit and the silencing of dissent, know that you are on the wrong side of history.” This sentence was deleted entirely.

It’s hard not to take offense to China deleting whole sections of our new president’s first speech. But it also serves as a blunt reminer…

As the world becomes an ever-flatter place, and emerging markets gain ground and find an equal spot at the table, it’s easy to forget that there are real differences in ideology in the world… And that those differences aren’t just limited to religious fanatics hunkered down on the border of Afghanistan and Pakistan; or a lone group of political reformists on some secluded compound in Montana. They’re engrained in the policies of some of our biggest trading partners, and some of the biggest economies in the world.

China is the largest holder of U.S. debt in the world, with $681.9 billion by the end of November 2008. That’s an increase of 48.6% over November 2007’s debt.

In fact, our debt to all other countries jumped by 32.2% in that same timeframe. But our debt to oil exporters jumped 43.5%…

As President Obama takes office, will the world work through these differences? Or will they lead to an increase in strained relations? There is no doubt that we are dealing with fundamental differences in entire systems… It will take compromise without compromising on our values.

Is that even possible?

I welcome your comments, and also, since I’m not a fan of censorship, here’s a link to President Obama’s speech, and here’s a translator for our Chinese friends… Choose English to Chinese in the drop-down menu.

With cash-strapped companies coming cup-in-hand to their equally cash-strapped governments, the world over is looking for Warren Buffett-sized checkbooks to help ease the credit crunch.

Increasingly, the world is looking to China and its $1.9 trillion in reserves.

Should China whip open its gigantic checkbook to bailout the global financial system?

Does it even want to?

China’s been burned before with its investments in the U.S. financial sector. It has a 9.9% stake ($5 billion) in Morgan Stanley (MS:NYSE) that has been pummeled by the industry-wide downturn. And some Chinese leaders believe that the U.S. and Western Europe should clean up their own mess.

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With banks dropping like flies here in the U.S., one must accept that this shake-up cannot be contained within U.S. borders.

Indeed, banks in Western Europe are already following U.S. institutions into the dark abyss, and now the European Union must decide if some “bailouts” will be allowed. For example, the EU is now reviewing its decision to allow a $7 billion bailout of German bank West LB.

And some regions are looking to preemptively bail out its banks.

Ireland has just announced that it will guarantee all deposits, bonds and debts for the country’s six largest banks for the next two years.

It’s a controversial decision that some say will give these Irish banks - with international branches - an edge over other banks. But it’s also in line with what the European Commission has been wanting… Well, sort of.

The EC wants banks to, in essence, hoard cash. Like a rainy day fund, just for times like these.

According to the Commission, banks should put away more cash in order to be able to cover its riskier investments.

Of course, that makes sense, but I don’t think a lot of banks will be able to pull that off in this type of environment. In fact, this may have a negative effect. If banks take more liquidity out of the markets, there will be less money to lend, and less revenue for the bottom line.

So should governments step in and foot the bill, or should the responsibility rest solely on the shoulders of the financial institutions?

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About four months ago, China’s sovereign wealth fund, China Investment Corp., announced that it would up the amount of money it pours into foreign investments by 30%. Now, CIC has about $90 billion to spend on assets abroad.

CIC has some complex dealings with internal state-owned banks, like the Agricultural Bank of China and China’s Development Bank. Not surprising, since on of CIC’s major funtions, indeed, the reason it was formed at all was to provide financial stability for China’s state-owned banks.

Near the end of last week, China’s Development Bank signed a $100 million loan contract with Banco de Chile (BCH:NYSE).

BCH is Chile’s second largest bank, and has also signed an agreement to open joint credit lines with CDB. According to the press release, CBD wants to invest in Chile’s “ports, bioceanic corridors and junior mining companies.

Chile is a major producer of copper, which is of great import to China. In fact, China’s capital investment in infrastructure like roads, factories, and property climbed 27.3% in the first half of 2008. That’s more than was expected, and this continued growth is sure to keep demand high for industrial metals like copper.

This should come as no surprise to any of you who have been keeping up with the sovereign wealth fund story. Barely a month ago, Kuwait announced it would boost investments in stocks, bonds and real estate in China, India and Japan.

But I did find one interesting story…

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