Remember when the Japanese were buying up the United States? Fueled by their stock market boom in the late 1980s, Japanese companies began gobbling up prime real estate on the West Coast and in Hawaii, and then started acquiring operating companies by the fist-full. It made people pretty nervous.

Will China follow suit? How will Western countries react?

There are many differences, of course. Most importantly, the stock markets of China are still far from mature, and do not begin to compare with those in Japan. Inflated stock market valuations prompted the Japanese spending spree, as did an unhealthy confidence in the superiority of Japanese industry.

The Chinese do not have access yet to such “funny money,” and they are not yet arrogant about their management expertise. However, an improved regulatory climate and booming earnings growth are expected to boost markets meaningfully in coming years. And, the Chinese are quickly earning their black belt in finance.

The stock market development may not even matter much, because the Chinese do have plenty of cash. When the state-owned oil company CNOOC made its run at Unocal last year, the offer was $18.5 billion in cash. It caused a furor, with the House of Representatives finally requesting that the White House block the deal for “security” reasons.

That did not sit well with the Chinese, who have been scolded continuously for not pledging allegiance to free markets, and especially for maintaining an undervalued currency.They naturally felt that America was demonstrating a double standard. Some observers feel that they retaliated by barring Carlyle Group’s effort to purchase a majority stake in Xugong Group Construction Machinery earlier this year.

For some insight into this issue, we sought out Virginia Kamsky, head of the eponymous advisory firm. For decades, Ms. Kamsky has been the “go to” person for doing business in China. She has helped scores of American companies conclude deals worth billions of dollars, and has met along the way nearly everyone worth meeting in China’s hierarchy.

Ms. Kamsky has earned her position. As a youngster she studied Chinese. In her senior year at Dalton she arranged to meet, unbeknownst to her mother, the Roman Catholic cardinal of Taiwan. Before long (and before actually graduating), he had convinced her to attend his Fujen Catholic University in Taiwan.

Unfortunately, he hadn’t bothered to clear this invitation with his housing department. She consequently spent a year living with three nuns in a convent room, through the slatted and private windows of which she could barely see the surrounding rice paddies and water buffalos.

She loved it, and her excitement about everything Chinese has never waned.

Today Ms. Kamsky splits her time between Manhattan and Beijing, where the larger of her two offices is located. Her main message to Sino-prone American managers is: “Don’t leave your common sense at the border.” She has seen far too many companies enter into deals with Chinese companies that they would never have accepted at home.

“Companies think China is different, and that their usual business judgment doesn’t apply.They think that they need a joint venture partner, and that there is only one that is suitable.” On the contrary, according to Ms. Kamsky, “Competition is alive and well in China.” There was a time when 85% of Ms. Kamsky’s business entailed the unraveling of joint ventures which had gone sour.

These are just a few of the insights gleaned from a lifetime spent traveling back and forth to China, and edging ever-nearer the inner circle of power in that country. Her first visit to mainland China was in 1978, accompanying William Butcher, then head of Chase Manhattan Bank. After landing at Beijing’s rudimentary airport, the group traveled by car into the city. On either side of the road, soldiers were shooting down birds flying overhead. Mao had just decreed that birds were bourgeois.

China has come a long way since those days, as has Ms. Kamsky. Today much of her time is spent advising American companies and private equity firms on acquisitions. With the Chinese government adopting a somewhat tougher position on foreign takeovers, Ms. Kamsky’s familiarity with the country’s bureaucracy is crucial.

However, she is at a crossroads. She has never advised a Chinese company, but that self-imposed rule may change. For the first time, the interest of Chinese companies in acquiring foreign firms is beginning to compete with the rush of money into the country. Also, she sees a likely surge in takeovers within China. In some sectors like retail, consolidation opportunities abound.

Still, it is the government’s ambition to line up strategic resources that will likely fuel further acquisition efforts outside of China’s borders. Commodity price inflation has been directly tied to China’s growth; long-term supply contracts or acquisitions to secure access to raw materials are a high priority, according to Ms. Kamsky. The Unocal deal was an example of this; there will be more to come. Probably, many more.

Accordingly, we will likely see further acquisition efforts overseas, and undoubtedly we will see resistance. This tussle will be played out cautiously, certainly, before the Beijing Olympics. All China watchers agree that the government is determined that nothing detract from this great debut on the world’s stage.

The opening ceremonies are scheduled for August 8, 2008. Why? Because eight is a lucky number of course. If you didn’t know that, you’d better consider hiring Ms. Kamsky before you set a single foot in China.