My Take | US Steel, Mao and myself make a terrible investment combination
- Proposed sale of company makes yours truly delve into history of steel production in two countries after a disastrous personal shares episode
Here’s an interesting statistic. In 1957, the year before the Great Helmsman launched his disastrous Great Leap Forward, communist China’s steel output was 5.35 million tonnes.
By comparison, in the mid-1950s, production at iconic US Steel peaked at 35.8 million tons alone.
I wonder if Mao Zedong had known this stat, he would still have boasted how the Great Leap Forward would overtake the United States by 1967, with production of 150 million tonnes of steel a year. That might have spared the lives of millions.
I came across these numbers because the century-plus-old company, once the symbol of America’s industrial might – originally founded by Andrew Carnegie and then merged by J.P. Morgan and Charles Schwab – is in all the news again.
Nippon Steel, Japan’s largest steelmaker, has offered a whopping US$14.1 billion, or US$55 a share, to take over US Steel. That has caused me enormous pain. Yours truly sold his shares in X, the steel company’s trade symbol, less than two months ago at US$33 after holding them since the last global financial crisis when I bought at US$50.
The news sent shares to US$50 overnight!