Warren East, who led ARM Holdings from start-up to near monopoly designer of smartphone chips, with its processors at the heart of Apple’s iPhone and Samsung’s Galaxy, is to step down as chief executive after 12 years. A pound invested in the company’s shares 10 years ago would be worth about 18 pounds now, and the company itself is valued at nearly 13 billion pounds ($19 billion).

ARM’s CEO Warren East to step down after 12 years

10:32am EDT

By Rosalba O‘Brien and Paul Sandle

ARM CEO East speaks during a Samsung Electronics keynote address at the CES in Las VegasARM

LONDON (Reuters) – Warren East, who led ARM Holdings from start-up to near monopoly designer of smartphone chips, with its processors at the heart of Apple’s iPhone and Samsung’s Galaxy, is to step down as chief executive after 12 years.

Group president Simon Segars will replace 51-year-old East from July, the British company said on Tuesday.

Since East, an engineer, joined in 1994, ARM has evolved from one processor product line to be the dominant player in mobile computing, providing microprocessors that run nearly all the world’s smartphones, and around a third of all consumer devices.

“After you’ve been doing it for 12 years you do get a bit tired (…) and think ‘Maybe that’s a bit of a brake on the business and somebody else should have a go’,” he told Reuters.

ARM licenses its processor designs to chipmakers including Apple, Samsung, Qualcomm and Texas Instruments. Its low-power processors have enabled it to dominate mobile computing, leaving rival Intel far behind in the sector.

In Cambridge, ARM has been at the heart of the so-called ‘Silicon Fen’, a cluster of high-tech firms at the southern tip of the English Fenland, about an hour’s drive north of London. Founded in 1990, ARM now employs 2,300 people, with 2013 revenues forecast at around $1.03 billion.

“We’ve built a global company based here in the UK, proving it can be done in technology, and I intend to do a bit more of that,” said East, who eschews the casual clothes and colorful style of California’s Silicon Valley in favor of smart suits and a sober manner.

East, whose total pay including share awards and long-term incentives was 7.6 million pounds in 2012, said it was too early to talk about his next move, but that another executive role was unlikely in the short term.

A pound invested in the company’s shares 10 years ago would be worth about 18 pounds now, and the company itself is valued at nearly 13 billion pounds ($19 billion). Read more of this post

Incheon named World’s Best Airport for eighth time; The process of departure takes only 19 minutes and arrival 12 minutes, far quicker than the global standard of 69 minutes and 45 minutes.

Incheon named best airport for eighth time

Wednesday, Mar 13, 2013

img_visual incheonbest

Mr Hong-Yeol Choi, VP Marketing at Incheon International Airport (left) receives the World’s Best Airport Award from Mr Edward Plaisted, Chairman of SKYTRAX (right), during the World Airport Awards held at Passenger Terminal EXPO in Vienna.

By Lee Ji-yoon
The Korea Herald/Asia News Network
Wednesday, Mar 13, 2013

KOREA – Incheon International Airport said Tuesday it won the World’s Best Airport title again this year for the eighth consecutive time.

The non-profit Airport Council International conducted a survey of 350,000 passengers over the past year and Incheon Airport earned the highest scores in service quality.

The airport also topped two other categories – best airport in Asia-Pacific and best among those with 25-40 million users annually.

It is unprecedented for an airport to win the industry’s top honour eight times, officials said. Read more of this post

KOREA: THE IMPOSSIBLE COUNTRY, by Daniel Tudor, charts the improbable rise of South Korea from the devastation of war and impoverishment to rapid development and prosperity

The rising of a nation

BY JEFF KINGSTON

MAR 17, 2013

KOREA: THE IMPOSSIBLE COUNTRY, by Daniel Tudor. Tuttle, 2012, 320 pp., $22.95 (hardcover)

This superb book charts the improbable rise of South Korea from the devastation of war and impoverishment to rapid development and prosperity, and from brutal dictatorship to the most vibrant democracy in Asia. It is “impossible” in terms of its economic and political achievements, “the most unlikely and impressive story of national building of the last century,” Daniel Tudor writes.

The Korean War (1950-53) claimed the lives of 3 million people, including 2.5 million Korean civilians, at a time when the combined population of the entire peninsula was only 30 million. In the mid-1950s GDP per capita was less than $100 and the average life span was 54 years old, compared to $32,000 and 79 as of 2012. This phoenix-like rise from the ashes was based on hard work, sacrifice and extensive state support for industry. The economy was foundering until Park Chung Hee (the current president’s father) took over in a coup in 1961 and ruled with an iron fist until gunned down by the head of the KCIA intelligence service in 1979. He is credited with the “miracle on the Han,” the era of phenomenal economic growth that was largely based on nurturing national champions. Famously, Park called businessmen “corrupt swine,” but enriched those who did his bidding.

Samsung, the star of Korea Inc., accounts for 20 percent of GDP and has a stake in virtually all market sectors where there are profits to be made, from Apple-beating mobile phones and Sony-trumping electronics to resorts, real estate, insurance and shipbuilding. This “ginormous” influence is a mixed bag; there is intense pride that a Korean firm has taken on the world’s best firms and won, but Koreans are ambivalent about its stifling omnipresence and political influence at home. Journalists criticize the behemoth at their peril as Tudor explains that libel laws in South Korea stack the deck and even if scandalous allegations are proven true, damages are awarded if the court decides that reputations have been sullied. So much for freedom of the press.

Tudor provides a primer in Korean history then launches into the modern era by examining the role of shamans and the spiritual world. He wryly compares English teachers to shamans, noting that both are paid relatively large sums of money based on an exaggerated faith in their powers.

South Korea’s problems are so similar to Japan’s that many passages read as if the country names are interchangeable. Korea has a higher suicide rate, a similarly low birth rate, a rapidly aging society, wealth without prosperity, growing disparities and just like Japan over one-third of the workforce is hired on fixed term contracts as nonregular workers with low pay, few benefits and no job security. But the differences are also stark as South Korean firms and their government adjusted quickly to changing global markets while Japan, Inc. appears relatively stodgy and complacent. Read more of this post

Taxation to be introduced for China’s e-commerce industry

Taxation to be introduced for China’s e-commerce industry

Staff Reporter 2013-03-19

China’s State Administration of Taxation announced measures for the administration of online invoices on March 7, which include a trial electronic invoicing system. The measures will come into effect from April 1.

The measures are seen by many as a step towards taxing the country’s emerging e-commerce industry, reports Time Weekly in Guangzhou.

The weekly quotes sources saying that online shops which make more than 240,000 yuan (US$38,000) a year will be required to pay taxes. Read more of this post

Causes and Consequences of Disaggregating Earnings Guidance

Causes and Consequences of Disaggregating Earnings Guidance

Baruch Lev  New York University – Stern School of Business

Benjamin N Lansford affiliation not provided to SSRN

Jennifer Wu Tucker affiliation not provided to SSRN

January/February 2013
Journal of Business Finance & Accounting, Vol. 40, Issue 1-2, pp. 26-54, 2013 

Abstract: 
Whether managers should provide earnings guidance, especially quarterly guidance, has been a hotly debated policy issue. Influential organizations have urged firms to stop providing earnings guidance to reduce earnings fixation and short‐termism in the capital markets. Little attention has been paid to an alternative proposal: instead of ceasing earnings guidance, companies could provide disaggregated earnings guidance. No archival evidence exists regarding the determinants of disaggregated earnings guidance and its effects on the firm and its information environment. We find that once managers provide guidance, the decision to disaggregate this guidance is primarily driven by demand‐and‐supply factors that exhibit little change from year to year rather than by strategic factors. We find more timely analyst forecast revisions (with no compromise of forecast accuracy), a greater magnitude of revisions, and a larger reduction in analyst disagreement for disaggregating firms than for non‐disaggregating firms. These findings suggest that disaggregation enriches a firm’s information environment. We also find that disaggregation helps managers align analyst expectations with their own, but firms are punished by investors for providing multiple performance targets but missing them.

Real and Accrual Earnings Management and IPO Failure Risk

Real and Accrual Earnings Management and IPO Failure Risk

Mohammad Alhadab University of Leeds – Leeds University Business School (LUBS)

Iain Clacher University of Leeds – Leeds University Business School (LUBS)

Kevin Keasey University of Leeds – Division of Accounting and Finance

February 26, 2013

Abstract: 
This paper analyzes the relationship between real and accrual earnings management activities and IPO failure risk. Recent research shows that IPO firms manage earnings upward around the offer year utilizing real and accrual earnings management activities (e.g., Wongsunwai, 2012) and that these activities have severe negative consequences for future stock returns and operating performance (e.g., Cohen and Zarowin, 2010; Kothari et al., 2012). Thus, we predict IPO firms that engaged in higher levels of real and accrual earnings management will exhibit a higher probability of failure and lower survival rates. We test this hypothesis based on a sample of 570 IPO firms that went public over the period 1998-2008. We find evidence that IPO firms manipulate earnings upward utilizing real and accrual earnings management around the IPO. We also find that IPO firms with higher levels of real and accrual earnings management during the IPO year have a higher probability of IPO failure and lower survival rates in subsequent periods.

Agencies warn of global TB “powder keg”, funding gap; In some countries, including regions of Russia, up to 35 percent of new cases are multi-drug resistant

Agencies warn of global TB “powder keg”, funding gap

Mon, Mar 18 2013

By Kate Kelland and Stephanie Nebehay

LONDON/GENEVA (Reuters) – Deadly strains of tuberculosis that are resistant to multiple drugs are spreading around the world, and authorities urgently need another $1.6 billion a year to tackle them, global health officials said on Monday.

Donors should step up with “significant funding” to help experts track down all existing cases and treat the most serious ones, the World Health Organization (WHO) and the Global Fund to Fight AIDS, TB and Malaria said in joint statement.

Margaret Chan, WHO director general, said nearly 4 percent of people newly infected with TB worldwide were resistant to multiple drugs from the start – signaling that resistant forms of the disease were being transmitted directly from person to person.

In some countries, including regions of Russia, up to 35 percent of new cases are multi-drug resistant.

“This gives you an idea of powder keg we are sitting on,” Chan told a news briefing in Geneva, where both agencies are based. Read more of this post

Samsung Preparing Wristwatch as It Races Apple for Sales

Samsung Preparing Wristwatch as It Races Apple for Sales

Samsung Electronics Co. (005930) is developing a wristwatch as Asia’s biggest technology company races against Apple Inc. (AAPL) to create a new industry of wearable devices that perform similar tasks as smartphones.

“We’ve been preparing the watch product for so long,” Lee Young Hee, executive vice president of Samsung’s mobile business, said during an interview in Seoul. “We are working very hard to get ready for it. We are preparing products for the future, and the watch is definitely one of them.” Read more of this post

Earthquakes and the Mind-Bending Laws of Markets; Power laws are immensely important for proper risk management, for assessing the likelihood of large market upheavals

Earthquakes and the Mind-Bending Laws of Markets

Like the devastating Japanese earthquake of 2011, the stock market crash of Oct. 19, 1987, came as a total shock to most people. Yet the crash wasn’t entirely without warning. Five days before, the Dow Jones Industrial Average dropped 95 points, which was then an all-time record. Two days later, it closed down another 108 points. Just like others crashes — 1929, for example — and all major earthquakes, the 1987 crash was preceded by significant rumblings.

The comparison of tectonic and market shocks goes far beyond metaphor and analogy. Consider, for example, how much the prices of stocks and other financial instruments change over a certain time interval — say a few minutes, a single day, or a week. In the early 1960s, French mathematician Benoit Mandelbrot carried out a landmark study of such changes in the prices of cotton and found that the statistics of large market returns follow an inverse power law very much like the Gutenberg-Richter law for earthquakes. More than 30 years later, physicists found that this law-like pattern holds for intervals varying from a second up to a month and in different kinds of markets — stocks, foreign exchange, futures — as well as in many different countries. Read more of this post

China’s Tallest Tower Builder Assures Quality Amid Sand Scandal

China’s Tallest Tower Builder Assures Quality Amid Sand Scandal

China State Construction Engineering Corp. (601668), which is building the country’s tallest tower, said materials used in all its projects meet quality standard as the southern city of Shenzhen conducted inspections on builders.

Samples from buildings, including the 660-meter Ping An Finance Center due to be completed in 2015, were tested, according to Shenzhen’s Housing and Construction Bureau. The industrywide inspection in the city last week followed a China Central Television newscast on March 14 that investigated the use of substandard concrete by some developers in Shenzhen that used low-quality sea sand instead of river sand. Read more of this post

Singapore’s property trusts, the second-best performers in Asia in the past year, may have to diversify funding sources as they aren’t prepared for an “interest rate shock,” according to Fitch Ratings.

Singapore REITs to Vary Funds on Interest Rates: Southeast Asia

Singapore’s property trusts, the second-best performers in Asia in the past year, may have to diversify funding sources as they aren’t prepared for an “interest rate shock,” according to Fitch Ratings.

The city’s real estate investment trusts or REITs have been increasing short-term debt with record-low interest rates, according to Johann Kenny, director of corporates at Fitch. They face refinancing risks when borrowing costs rise, and may be pushed to sell assets or shares to boost their funding, he said.

“Singapore REITs are not really well equipped to withstand an interest rate shock,” Kenny said in a phone interview from Sydney yesterday. “When a rating agency looks at a company, we look at the long-run average through the cycle of the interest rate environment and we don’t see the current low interest rates as a sustainable model from a macro-economic perspective.”

Singapore REITs, the biggest fundraisers in the city’s initial public offering market in the past year, had relied on short-term debt to reflect the length of commercial leases, Kenny said. Their funding costs in the past six years don’t reflect the challenges in a “normalized” interest rate scenario, he said. Read more of this post

Indian gold funds are shrinking as investors in the biggest bullion- consuming nation follow billionaire George Soros in pulling money from products backed by the precious metal.

India Gold ETF Sales Mimic Soros as Goldman More Bearish

Indian gold funds are shrinking for the first time since June as investors in the biggest bullion- consuming nation follow billionaire George Soros in pulling money from products backed by the precious metal.

Exchange-traded funds in gold saw outflows of 80 million rupees ($1.5 million), data from the Association of Mutual Funds in India show. Investments in sovereign-debt funds rose by 4.46 billion rupees, the sixth straight month of inflows. Gold prices in India have slid 4.3 percent this year, while rupee bonds returned 2.7 percent, the second-highest gains in Asia.

“Globally we are seeing a decelerating gold trend, and overweight investors will be adjusting asset allocations,” Lakshmi Iyer, Mumbai-based head of fixed income and products at Kotak Mahindra Asset Management Co., which oversees about $6 billion of assets, said in a March 14 telephone interview. “We should see some interest-rate easing over the next two or three quarters,” encouraging people to seek capital gains in bonds, she added.

Soros cut his holdings in SPDR Gold Trust, the largest exchange-traded gold product, by 55 percent last quarter, and Goldman Sachs Group Inc. predicts the metal’s 12-year rally will end as a U.S. economic recovery gathers momentum. The Reserve Bank of India will lower its benchmark repurchase rate to 7.50 percent from 7.75 percent today, according to 30 of 35 economists in a Bloomberg survey. Five predict no change. Read more of this post

Quest Diagnostics’ 5-in-1 Demential Test May Help Rule Out Alzheimer’s

Quest 5-in-1 Demential Test May Help Rule Out Alzheimer’s

As Baby Boomers age, those everyday questions of life — Where are the car keys? What was her name again? — are increasingly followed by another: Can this be Alzheimer’s disease?

Today, Quest Diagnostics Inc. (DGX), in the midst of a company reorganization that seeks to cut costs and boost revenue with improved service, will introduce a panel of tests at the American Academy of Neurology meeting that combines five screens into one to pinpoint potentially treatable conditions.

The concept is that, by simplifying the process and making it more accessible, an increasing number of family doctors will use the test and, in some rare cases, ease the mind of patients by ruling out Alzheimer’s.

“It’s sort of a simple idea, but dementia is a common presentation to primary-care doctors,” said Joseph Higgins, medical director for Quest’s neurology unit, in a telephone interview. “Sometimes they’re at a loss for what type of blood test to perform. This panel puts them all together in one place, with one report.”

Quest, the biggest U.S. operator of medical labs, could use a boost. Its sales have come under pressure as hospitals have sought fewer tests and reimbursement has become more stringent, said Frank Morgan, an analyst with RBC Capital Markets. Read more of this post

Alzheimer’s Kills More in U.S. as Advocates Seek Funding

Alzheimer’s Kills More in U.S. as Advocates Seek Funding

Deaths linked to Alzheimer’s have increased in the last decade while those for stroke, breast cancer and HIV have dropped, said researchers calling for more funding for the memory-robbing disease.

Without treatment breakthroughs, the number of people in the U.S. ages 65 and older whose memories and personalities are claimed by the disease will more than double to 13.8 million in 2050, according to a report released today by the Alzheimer’s Association.

The U.S. in recent years has taken action to address a looming public health crisis tied to the aging of the Baby Boomers, the generation born from 1946 to 1964. While the National Alzheimer’s Project Act was signed into law in January 2011 to coordinate efforts to treat and prevent Alzheimer’s, funding hasn’t caught up, advocates and researchers said. Read more of this post

Drug-Resistant Tuberculosis Spreads as $1.6 Billion Needed

Drug-Resistant Tuberculosis Spreads as $1.6 Billion Needed

Low and middle-income countries need an additional $1.6 billion a year to fight tuberculosis, threatening progress made against the world’s second-deadliest infectious disease, health officials said.

About $3.2 billion will be spent annually through 2016 combating the disease in 118 such nations and $4.8 billion is needed, the World Health Organization and the Global Fund to Fight AIDS, Tuberculosis and Malaria said in a joint statement today. The additional funds may enable treatment for 17 million people and save 6 million lives from 2014 to 2016, they said.

Tuberculosis killed 1.4 million people in 2011, the two Geneva-based organizations said. Among infectious diseases, only AIDS killed more. While TB can be cured with antibiotics, strains of the bacterium that resist most drugs afflict about 630,000 people globally, threatening to undermine a target of halving the TB death rate between 1990 and 2015.

“If we don’t act now, our costs could skyrocket,” Mark Dybul, the Global Fund’s executive director, said in the statement. “It is invest now or pay forever.” Read more of this post

Delhi needs to sell the idea of the market; Indians say their country ‘grows at night while the government sleeps’, writes Gurcharan Das

March 18, 2013 7:01 pm

Delhi needs to sell the idea of the market

By Gurcharan Das

Indians say their country ‘grows at night while the government sleeps’, writes Gurcharan Das

When the Indian government presented its budget last month, the people were expecting giveaways, subsidies and bribes for votes. But it turned out to be a surprisingly responsible settlement that capped the fiscal deficit at 4.8 per cent of economic output. It was a sensible budget, but it will not get India growing again.

Meanwhile, the day before the budget, Sugata Mitra, a researcher at Newcastle University, won the TED (Technology, Entertainment and Design conference) prize of $1m to run Schools in the Cloud from India. The scheme aims to empower teachers and parents towards self-directed learning by children.

To Indians, the contrast between the budget and the prize confirms their perception of the country’s “bottom-up” success, driven by people, in contrast to China’s “top-down” success, induced by state investment. Prosperity is spreading, despite appalling governance in the world’s biggest democracy. Read more of this post

Baby-shaped pears freak out shoppers at Beijing supermarket; “It’s obvious that the pears were grown in a mold to control their shape.”

Baby-shaped pears freak out shoppers at Beijing supermarket

Staff Reporter

2013-03-19

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Baby-shaped pears: marketing ploy or mythical fruit? (Internet Photo)

A photo posted on China’s Twitter-like Sina Weibo shows a box of pears for sale at a supermarket where the fruits resemble a human baby, with face and all, reports the Chinese-language Beijing Morning News.

Netizens said they thought the pears looked creepy and felt as though the “babies” could open their eyes at any time.

“I saw scary pears today at Sam’s Club (supermarket). I felt they were interesting, so I took a photo of them and uploaded it on Sina Weibo. A box cost 20 yuan (US$3),” said a netizen surnamed Wang. Read more of this post

Chinese Operator Saw Losses in Text & Voice Businesses, Worried About Tencent’s WeChat

Chinese Operator Saw Losses in Text & Voice Businesses, Worried About WeChat

By Tracey Xiang on March 18, 2013

Last week rumors circulated that the big three Chinese operators were in talks with Tencent about WeChat’s snatching their text and voice businesses. One rumor went as far as the big three were going to charge WeChat users separately or even Tencent, WeChat’s parent company. Tencent denied the latter.

But what’s true is China Mobile, one of the three, acknowledged threat from WeChat. President of China Mobile, Li Yue, talked on a couple of occasions that their conventional telecom businesses were suffering the consequences of the rise of over-the-top services, especially WeChat. The carrier saw losses in text messages, local and international calls in terms of both usage and revenue.

Data sales cannot compensate for the loss in text messages.

China Mobile saw the annual revenue from text messages decreased by 2.2 billion yuan ($35mn) , 5%, year-over-year as of 2012, according to the the annual earnings results released last week. The ARPU reached the lowest in the past five years.

Although its mobile Internet business increased 54% with a 188% increase in data sales, it seems not enough to compensate for the loss in text messages. The company could make one hundred yuan from 1000 test messages but no more than ten yuan if those messages were sent out through WeChat, Li Yue said at the press conference after the earnings release. Read more of this post

Oh, the joys of screwing up: People (and companies) learn best by accelerating the failure cycle, not by avoiding it

Oh, the joys of screwing up

March 18, 2013: 11:46 AM ET

People (and companies) learn best by accelerating the failure cycle, not by avoiding it.

By Jeff DeGraff

(TheMIX) — Innovation poses two problems for most leaders, given the way they are trained to think. First, its value diminishes over time; it goes sour, like milk. This year’s “must-have” gadget will end up in a landfill next Christmas or at least be overwritten by version 2.0.

Second, innovation only pays off in a future for which you presently have no data. As Kierkegaard put it “Life can only be understood backwards; but it must be lived forwards.”

So, you can’t answer the two questions that will determine the value of your clever initiative: How much? How fast? The speed and magnitude of an innovation is situational. If you don’t time the market right, anticipate the new breakthrough tech, or if you sell your product in the wrong color, you’re out. And there is that other little challenge of having competitors, known and otherwise, conspiring to cut you off at the pass.

A leader who is in denial about this uncertainty might collect excessive data, a passive aggressive form of resistance, instead of launching a wide array of experiments that will accelerate the path to failure and provide real information.

Leaders ought to focus on the highly ambiguous situations where uncertainty not only elicits new ideas but provokes new ways of thinking. Artists call this sensation defamiliarization — meaning seeing common things in uncommon ways.

A company’s culture, competencies, and practices will largely determine the vision, values, goals and even processes it pursues. Sure, your team did that assessment of personality types at your last leadership retreat but, when push comes to shove, everyone needs to do things the right way: your way, your boss’ way, your client’s way. Forget the breakthroughs that come from the tension of accepting diverse approaches to solve problems. It’s time to get with the program. You don’t have time, money, or patience for this constructive conflict nonsense.  Read more of this post

As Crop Prices Surge, Investment Firms and Farmers Vie for Land

March 18, 2013

As Crop Prices Surge, Investment Firms and Farmers Vie for Land

By JULIE CRESWELL

From the potato fields of Michigan to the high prairies of Kansas, farmers are receiving record prices for their land — but economists and banking regulators warn that this boom, like so many before it, could end badly.

Across the American heartland, farmland prices are soaring. In places like Waco, Neb., and Chickasaw County, Iowa, where the boom-and-bust cycle of farming reaches deep into the psyche, some families are selling the land that they have worked for generations, to cash in while they can.

Behind the rush is the age-old driver of farm booms: high crop prices. Corn, in particular, has been soaring, reflecting demand overseas and, domestically, for ethanol. High prices mean good profits for farmers, and many are using their growing incomes to bid for land. Sensing opportunity, investment firms are buying, too. David Taylor, of Oskaloosa, Kan., said he was saddened to sell his family’s farm but that the prices were too good to resist. Four generations had planted corn and soybeans on the 146-acre spread. But after living through the Midwest farm crisis of the 1980s, when land values plunged, and realizing that his children would not follow in his footsteps, he sold the farm at auction in December.

“I bawled like a baby,” Mr. Taylor, 59, said. His crop-producing fields sold for $10,100 an acre. Read more of this post

A Plan to Chart Heart Risk in 1 Million Adults in Real Time; Researchers will marshal the power of smartphones and other personal technologies in an effort to develop new strategies for preventing and managing heart disesase

March 18, 2013, 6:54 p.m. ET

A Plan to Chart Heart Risk in 1 Million Adults in Real Time

By RON WINSLOW

PJ-BN188_HEARTB_G_20130318152919

Where It All Started: Patricia McNamara sits for a test in 1952 as part of the Framingham Heart Study. The Health eHeart Study hopes to build off the advances made by that 65-year-old program, which continues today.

Researchers are launching a major study that will marshal the power of smartphones and other personal technologies in an effort to develop new strategies for preventing and managing heart disease.

The project, called the Health eHeart Study, will use tools such as smartphone apps, sensors and other devices to gather data on a wide variety of measures associated with cardiovascular health—including blood pressure, physical activity, diet and sleep habits—all in real time.

The study aims to enroll up to one million participants. Researchers will sift through the huge, accumulating banks of data, looking for patterns that might give advance warning of a heart attack or predict the onset of a dangerous irregular heart beat. Read more of this post

Economists: China Mirrors U.S. on Eve of Financial Crisis

March 18, 2013, 5:20 PM

Economists: China Mirrors U.S. on Eve of Financial Crisis

The same three warning lights that preceded America’s real estate crash and financial crisis are now flashing over China, two economists say, leaving the government limited time to get out of trouble.

In a research note published on Saturday, Nomura economists Zhiwei Zhang and Wendy Chen outline the way that elevated property prices, a rapid build-up of leverage and a slide in the country’s potential growth rate could lead to a systemic crisis.

House prices in the U.S. racked up an 84% rise between 2001 and 2006, Mr. Zhang and Ms. Chen say, citing the Case-Shiller housing price index. The Nomura economists have their doubts about China’s official index, which shows a “rather benign” 113% rise in the major cities from 2004 to 2012. They argue that it is too broad, including older, lower-quality property across the nation. By contrast, a recent academic paper taking into account these quality differentials found prices climbed 250% from 2004 to 2009, they say.

“The government obviously recognizes the risks in the property sector,” Mr. Zhang and Ms. Chen write. “It has introduced a series of progressively tighter policies to contain property prices over the past several years… The pattern has been for house prices to initially dip after tightening policies are introduced, then to rebound, which suggests that the risks have not been mitigated.” Read more of this post

Magazine-Cover Curse Takes on New Meaning in Asia

Magazine-Cover Curse Takes on New Meaning in Asia

Will Shinzo Abe’s plan to revive Japan suffer the magazine-cover curse? Might Benigno Aquino meet the same fate in the Philippines?

What both leaders have in common is everyone slapping the “-nomics” suffix onto their growth strategies. “Abenomics” has excited investors, not to mention the pundit class, with its aim of ending 15 years of deflation. The same is true of “Aquinomics” in a country long deemed the sick man of Asia, now an investment darling.

Such bouts of euphoria often end in tears: “Reaganomics,” “Rubinomics” and “Bushonomics” in the U.S.; “Thatchernomics” in the U.K.; “Berlusconomics” in Italy; and “Thaksinomics” in Thailand. Sometimes the reckoning comes in short order; other times it takes decades. The track records of all too many of these supposedly new formulas for prosperity are questionable.

The problem is hype versus real change. Having one of these splashy appendages added to your ideas tends to have the same reverse karma payoff as being on the cover of a large- circulation magazine. By the time a trend or ideology is popular enough to warrant such a tribute, the game is already up. So, is the buzz about the Japanese and Philippine economies overdone? It will be if leaders put too much stock in their own press. Read more of this post

Pimco’s Kiesel Says Corporate Bondholders ‘Wake Up’ to Risks

Pimco’s Kiesel Says Corporate Bondholders ‘Wake Up’ to Risks

Investors are “finally” acknowledging the risks of holding corporate bonds with yields hovering at about record lows as the Federal Reserve holds benchmark interest rates at close to zero for a fifth year, according to Pacific Investment Management Co.

“Bondholders are finally starting to wake up to the fact that easy monetary policy for an extended period can also have adverse consequences,” Mark Kiesel, global head of corporate bond portfolios at the manager of the world’s biggest bond fund, wrote today on the firm’s website. “This trend has helped reignite shareholder activism and corporate animal spirits.” Read more of this post

Ex-Calpers CEO Buenrostro Indicted Over Apollo Investment

Ex-Calpers CEO Buenrostro Indicted Over Apollo Investment

Ex-California Public Employees’ Retirement System Chief Executive Officer Federico Buenrostro was charged with conspiring to trick the pension fund into paying millions of dollars in fees for a $3 billion investment into funds managed by Apollo Global Management LLC. (APO) Read more of this post

Iceland’s Lost Billionaires Unmourned as Riches Draw Ire; “Greed can’t again lead the way,” said Prime Minister Johanna Sigurdardottir. “We’ve taken that route before with terrible consequences for this nation and its people.”

Iceland’s Lost Billionaires Unmourned as Riches Draw Ire

Iceland, a country with a $13 billion economy, had six dollar billionaires before the financial crisis struck in 2008. Now it has none.

Five of the men — including former West Ham soccer team owner Bjorgolfur Gudmundsson and Baugur Group hf founder Jon Asgeir Johannesson — have lost all, or most of, their fortunes after building empires on loans from banks that used the island’s investment bubble to stretch their assets to 10 times the size of gross domestic product.

At least three of Iceland’s ex-billionaires are, or have been, the subject of financial misconduct probes. Johannesson, who once flew around in a pin-striped private jet and owned luxury apartments in New York and London, received a suspended one-year jail sentence in February for violations including accounting fraud. He and Gudmundsson, who filed for bankruptcy in 2009, personified the boom-to-bust cycle that dragged Iceland away from fishing and tourism and turned it into a center for high finance.

“Greed can’t again lead the way,” said Prime Minister Johanna Sigurdardottir, 70, whose Social Democrat-led government took over from the coalition that led Iceland into the crisis just over four years ago. “We’ve taken that route before with terrible consequences for this nation and its people.” Read more of this post

Traders Short Junk-Bond ETFs as Gains Top 100%: Credit Markets

Traders Short Junk-Bond ETFs as Gains Top 100%: Credit Markets

Wall Street’s biggest credit brokers are for the first time using exchange-traded funds as a way to wager that junk bonds are overvalued.

Bank of America Corp. (BAC) traders who helped dealers move $1.5 trillion of credit-default swaps index contracts last year began offering clients the ability to trade blocks of bond ETF (HYG) shares in February, according to three people familiar with the trading and an e-mail sent to customers. Shares borrowed to make bearish bets on State Street Corp. (STT)’s $12 billion speculative-grade bond ETF soared to a record 11.5 percent of the total outstanding on March 1, up from 4 percent at year-end. Read more of this post

Sweden Laments ‘Crazy’ Devaluations Amid Krona Strength

Sweden Laments ‘Crazy’ Devaluations Amid Krona Strength

Sweden took another step to distance itself from policies targeting competitive devaluations as exporters were told a strong krona provides opportunities to make their businesses more efficient.

“It’s good for companies that they need to understand that they have to compete with real tools rather than the imaginary tool that the exchange rate is,” Financial Markets Minister Peter Norman said in a March 15 interview in the Swedish town of Karlstad, where his Moderate Party laid out the foundations for its 2014 election campaign.

While Swedish exporters have warned that continued krona appreciation will force them to cut jobs, the government and central bank have repeatedly rejected talk of boosting trade competitiveness through the exchange rate. And while policy makers from France to Japan argue in favor of weaker currencies, the Swedes have praised their krona’s strength. Central bank governor Stefan Ingves in an interview last month said he was “happy” with the currency’s gains.

Sweden didn’t always have such a hands-off approach. Between 1976 and 1981, when the krona was linked to the Deutschmark and later to a basket of currencies dominated by the U.S. dollar, it was devalued four times. In 1982, its value was again cut, by 16 percent. After the Riksbank was unable to defend the fixed exchange rate inside the European Exchange Rate Mechanism — even resorting to a 500 percent marginal interest rate in 1992 — the peg was scrapped and a free float was introduced. Read more of this post

China’s Largest Mass Merchant Auchan/RT-Mart Turns to Its Own Brands for Growth

China’s Largest Mass Merchant Turns to Its Own Brands for Growth

Sun Art Retail Group Ltd. (6808), China’s largest operator of big-box stores, will boost its own brand offerings and add higher-margin items to increase sales after opening new stores helped raise 2012 profit by half.

The company’s RT-Mart and Auchan chains will add at least 700 more own-label products including stationary and cutlery this year and reduce local brands in favor of higher-end lines, Peter Huang, executive director, said in an interview. The retailer plans to boost own-brand sales to 10 percent of revenue in two years from 8 percent now, he said.

Huang’s shift to higher-end products is intended to help the Shanghai-based venture between Taiwan’s RT-Mart and France’s Groupe Auchan SA maintain its lead over Wal Mart Stores Inc. (WMT) and Carrefour SA (CA), its biggest rivals. Retailers can earn gross profit margins of between 10 percent to 25 percent on own branded non-food items, said Nice Wang, an analyst with Yuanta Securities HK Co. Read more of this post

Big Mac Fights Subway Shrimp in Russia Fast-Food Fracas

Big Mac Fights Subway Shrimp in Russia Fast-Food Fracas

More than two decades after McDonald’s Corp. (MCD)’s outlet on Moscow’s Pushkin Square began offering a golden-arched alternative to grey communist eateries, the fast-food pioneer is on the defensive.

McDonald’s, which virtually created the market for burgers and fries in the country and convinced Russians it’s okay to eat with their hands, must fend off a growing challenge from rivals Burger King Worldwide Inc. (BKW), Subway Restaurants, Yum! Brands Inc. (YUM) and Wendy’s Co. (WEN)

“A huge number of Subways have appeared in Moscow in recent years, I pass about five of them on my way home,” said Dmitry Mikhailov, a 30-year-old consultant. McDonald’s “is crowded — it’s just for pigging out quickly and running away.” Read more of this post

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