Any Benjamin Franklins in Asia? Bamboo Innovator is featured in, where value investing lives

Bamboo Innovator is featured in, where value investing lives:

Any Benjamin Franklins in Asia? May 9, 2013 (Weblink:


Charles Ellis on how much your money manager cost you and he worries about the challenges aging boomers face from low bond yields to uncertain stock returns, and dubious financial come-ons

How much does your money manager cost you?

By Penelope Wang @Money May 7, 2013: 6:01 PM ET

Charley Ellis, founder of Greenwich Associates, worries about the challenges aging boomers face from low bond yields to uncertain stock returns, and dubious financial come-ons.

Charley Ellis may not be a household name, but he commands the respect of many savvy investors.

He shook up Wall Street in 1975 with a landmark article in a financial trade journal that attacked the notion that professional money managers consistently beat the market. Nonprofessionals stand even less chance of outperforming the benchmarks, argued Ellis, so individuals need to rethink their approach to building wealth. That influential piece was the basis for Ellis’s classic investing book, Winning the Loser’s Game, the sixth edition of which is due in July. Founder of the financial consulting firm Greenwich Associates, Ellis has also served as a director of Vanguard. Today he still worries about investing costs, as well as the challenges that aging boomers face from low bond yields, uncertain stock returns, and dubious financial come-ons. Ellis, 75, spoke recently with MONEY editor-at-large Penelope Wang. Their conversation has been edited.

Read more of this post

Walter Robb: Whole Foods’ other CEO on organic growth

Walter Robb: Whole Foods’ other CEO on organic growth

By Geoff Colvin, senior editor-at-large @FortuneMagazine May 6, 2013: 9:31 AM ET

Company culture compels Whole Foods co-CEO Walter Robb to fly coach.

Selling groceries is a grinding, low-margin business — except forWhole Foods (WFMFortune 500). The world’s largest natural and organic grocer is a financial powerhouse with a market capitalization matching that of Kroger (KRFortune 500) which is eight times its size by revenue. Keeping the magic alive as Whole Foods (No. 232 on the Fortune 500) expands aggressively is partly the task of Walter Robb, 59, who shares the CEO job with founder John Mackey. Robb started a 1,000-square-foot natural and organic food market in 1977, not long after graduating from Stanford, then built a grocery business and sold it to Whole Foods in 1991. He talked recently with Geoff Colvin about making the chain more competitive on price, the power of its culture, flying Southwest Airlines in the middle seat, and much else. Edited excerpts: Read more of this post

Execs and investors from Pandora, IDEO, Andreessen Horowitz, SoundCloud, and Kleiner Perkins, among other masters of disruption, share the wisdom they’ve gathered on the way to the top




Looking at the success trajectories of today’s disruptors–from Pandora cofounder Tim Westergren to Wikipedia’s Jimmy Wales–it’s easy to think that they had everything figured out from a young age. But many of today’s success stories learned lessons later in life that they wished they had known as they were beginning their careers. The eight investors and entrepreneurs below share the advice they wish they had gotten in their early twenties.

Tim Westergren: Avoid the risk of not trying and the regret of wishing you had.
Tim Westergren, the founder and Chief Strategy Officer at Pandora, said if he could offer his younger self one piece of advice, it would be to realize from an early age that it’s far more haunting to live with the regret of having not followed your instincts–even when those instincts required a diversion from the beaten path–than to have followed your gut and failed. Luckily for Westergren, he was one of the few who did follow his passions and that pursuit led him to found a company with a market cap of $2.5 billion.

“Be sure to ‘notice’ ideas when you have them. Stop. Take the time to consider them seriously. And if your gut tells you they’re compelling, be fearless in their pursuit,” Westergren said. “For most people, the idea of chasing a personal passion or being entrepreneurial is simply something they don’t think of themselves doing. We’re so programmed to walk well-trodden paths. But, we live life only once. So, rather than avoiding the risk of trying, avoid the risk of not trying. Nothing is more haunting than thinking, ‘I wish I had…’.” Read more of this post

New book teaches children ABCs of Buffett’s Berkshire Hathaway

New book teaches children ABCs of Buffett’s Berkshire Hathaway

12:45pm EDT

By Jonathan Stempel

Handout photo of Chairman and CEO of Berkshire Hathaway Warren Buffett in an illustration on the cover of the book "My First Berkshire ABC"

OMAHA, Nebraska (Reuters) – Warren Buffett’s Berkshire Hathaway Inc invests in dozens of businesses, and a new book tries to explain it all to young readers, from A to Z. Two Omaha residents, author Nancy Rips and illustrator Tom Kerr, have teamed up on “My First Berkshire ABC” to teach children about one of the world’s best-known companies, and a little about the local billionaire behind it. More than 1,000 copies were sold at Berkshire’s annual meeting on Saturday, which draws thousands of people to Omaha, and where Buffett has a say on what gets sold. “You need something to bring home to your kids and grandkids to explain Berkshire,” Rips, who has also written three books about Jewish holidays, said in a joint interview with Kerr. Most pages show companies that Berkshire owns or invests in. G, for example, is for “Geico,” and features the car insurer’s talking gecko. And W is for “Wells Fargo”, and features the bank’s familiar stagecoach. The book’s theme changed at Buffett’s suggestion. “Our first effort was things like, ‘S is for sharing. Mr. Buffett believes in sharing. K is for being kind,'” Rips said. “I got an email back from Warren saying, it’s too laudatory, they will lampoon him in the news,” she continued. “And I wrote a whole new proposal: A is for Acme (Brick), B is for Borsheim’s (jewelry), C is for Clayton Homes, D is for Dairy Queen. I got an email back: ‘You’re in the show.'” Kerr has worked at many newspapers and drew McGruff, the Crime Dog for the National Crime Prevention Council. “Part of what Warren talks about is investing in things that you know,” he said. “Virtually everything in here is something that somebody can relate to and touch and understand.” Berkshire Vice Chairman Charlie Munger is shown under “Q,” stamping boxes of “quality” merchandise. Rips and Kerr have not heard from Buffett on whether he likes the book. Buffett’s assistant Carrie Sova had no comment on that question. Kerr depicted Buffett just four times, including on the cover holding his usual Cherry Coke. “This book is not all about Warren Buffett,” Kerr said. “I picked my spots. He’s so synonymous with Dairy Queen that I wanted him there, and obviously on the cover with Coca-Cola.” “Cherry Coke,” Rips interjected. “Yep,” Kerr said. “She had me change that.”

McKinsey: Amazon’s Dominance Of Retail Comes From These 3 Factors

McKINSEY: Amazon’s Dominance Of Retail Comes From These 3 Factors

Kevin Smith | May 8, 2013, 11:52 AM | 23,829 | 2

Consulting group McKinsey & Co. thinks it has figured out Amazon‘s “secret sauce.” In 2011, 13% of all U.S. online retail sales went through Amazon,McKinsey believes. The secret? Lower prices than its rivals, a greater product assortment, and better customer relations. Amazon’s domination of the retail market is bolstered by a “maniacal” tech investment strategy, according to the report. This deck shows why McKinsey believes Amazon is poised to capture even more U.S. retail market share, at the expense of its main street rivals.

jpg (15)jpg (7) Read more of this post

Chinese internet company Sohu CEO Charles Zhang says his generation has no value system or principles 张朝阳:我们这代人实际是没价值观也没原则


2013-5-9 8:10:00  云科技    阅读:1206

导读:张朝近日对话云科技程苓峰,谈到搜狐的发展,也谈到他个人如何战胜精神的苦难,学会与自己相处。以下是对话全文: Read more of this post

Panera Bread’s founder Ron Shaich: Every Leader’s Job: Discover Tomorrow Today

Ron Shaich

Founder, Chairman, & Co-CEO at Panera Bread

Every Leader’s Job: Discover Tomorrow Today

Alan Kay, the renowned computer scientist, put it memorably some forty years ago: “the best way to predict the future is to invent it.” Aside from masterful technologists like Mr. Kay, few among us have the capacity to actually create the future. But I have no doubt that the foremost responsibility of any leader is to discover where the world is heading and prepare the organization for tomorrow’s arrival.

We all look to innovation as a prime source of differentiation and growth. Discovery stands at the core of every innovation effort. Whether it’s a breakthrough technology, an emerging business opportunity, or a better way to work, every successful innovation starts with a novel insight that profoundly changes the way we do what we do and ultimately yields substantial value for its creators.

Think of the entrepreneur’s most valuable asset. It certainly isn’t money. After all, capital is a renewable resource. What’s far more valuable is the entrepreneur’s ability to discover an untapped market, unsullied by cutthroat competition, where outsize profits await. Successful entrepreneurs aren’t capitalists. They’re opportunists. They see the white spaces in the market that others don’t and exploit those opportunities. Read more of this post

Sir Alex Ferguson: “They gave me the confidence and time to build a football club, rather than just a football team”. Alex Ferguson’s managerial lessons stretch far beyond football; Despite his success, Sir Alex never kidded himself that he knew everything; He knew his players’ pre-match toilet habits (and checked if they were going more than usual).

May 8, 2013 8:33 pm

Manchester United’s global brand reaches crossroads

By Roger Blitz, Leisure Industries Correspondent

Like Margaret Thatcher’s death, the announcement that Sir Alex Ferguson wasretiring after 26 years as Manchester United manager had the capacity to shock.

Supporters of both knew their respective departures had been coming, had even braced themselves for the moment, yet still could not quite believe it when it came.

Where they differed was that Lady Thatcher’s death did not move the markets, whereas the retirement of Sir Alex, a life-long supporter of the left, did. Shares inManchester United fell 4.1 per cent when New York opened for business.

It is a mark of Sir Alex’s longevity and success, with an accumulation of 13 Premier League titles and 2 Champions League trophies, that his departure should strike at the core of a club as financially strong and dominant on the pitch as Manchester United.

As Emmanuel Hembert of consultancy AT Kearney said: “It’s like Apple losing Steve Jobs. What’s next is the big question.” Read more of this post

What Eyeware Startup Warby Parker Sees That Others Don’t

What Eyeware Startup Warby Parker Sees That Others Don’t

Published: May 08, 2013 in Knowledge@Wharton

Shortly after Neil Blumenthal launched Warby Parker, the e-commerce eyeware startup known for its $95 retro-cool frames, customers emailed asking if they could “stop by” the company’s Philadelphia headquarters and check out the glasses for themselves. There was just one problem: Warby Parker — the brainchild of Blumenthal and three Wharton classmates, Andrew Hunt, Jeffrey Raider and David Gilboa — didn’t have a showroom. So they improvised.

“We said, ‘Sure, you can come to our… apartment,’ and we laid the glasses on the dining room table,” Blumenthal says.

When those would-be customers visited the makeshift shop back in 2010, “something special happened,” according to Blumenthal, 32. “They saw us sitting on the couch working our laptops, responding to orders, talking on the phone with customers. They saw the people behind the brand, which is so rare,” he says. “We realized we could learn from those customers — what they liked and what they wanted. Those people became some of our best advocates.”

Today, Warby Parker is a beloved and booming brand. The company’s hipster eyewear, coupled with its customer-centric strategy and socially conscious business model, has won over shoppers and impressed top-notch investors. In February, Warby Parker closed a round of financing worth $41.5 million, including funds from Millard Drexler, the chief executive of J. Crew, and American Express. The retail world is watching as the company embarks on its latest venture — an expansive store in New York City’s Soho neighborhood, across from the Apple store and next to Ralph Lauren. Read more of this post

Converge: Transforming Business at the Intersection of Marketing and Technology

Converge: Transforming Business at the Intersection of Marketing and Technology [Hardcover]

Bob W. Lord (Author), Ray Velez (Author)


Publication Date: April 29, 2013

The leaders of Razorfish share their strategies for merging marketing and IT

To create rich, technologically enabled experiences, enterprises need close collaboration between marketing and IT. Converge explains how the merging of technology, media, and creativity is revolutionizing marketing and business strategy. The CEO and CTO of Razorfish, one of the world’s largest digital marketing agencies, give their unique perspective on how to thrive in this age of disruption. Converge shares their first-hand experience working closely with global brands—including AXE, Intel, Samsung, and Kellogg—to solve business problems at the collision point between media, technology, and marketing.

With in-depth looks at cloud computing, data- and API-enabled creativity, ubiquitous computing, and more, Converge presents a roadmap to success.

Explains how to organize for innovation within your own organization by applying the principles of agile development across your business

Details how to create a religion around convergence, explaining how to tell the story throughout the organization

Outlines how to adapt processes to keep up with and take advantage of rapid technological change

A book by practitioners for practitioners, Converge is about rethinking business organizations for a new age and empowering your people to thrive in a brand, new world. Read more of this post

Tales and fins from the heads of online ad agency Razorfish: Converge: Transforming Business at the Intersection of Marketing and Technology

May 8, 2013 5:38 pm

Tales and fins from the heads of Razorfish

Review by Emily Steel, US media and marketing correspondent

Converge: Transforming Business at the Intersection of Marketing and Technology
By Bob Lord and Ray Velez, Wiley, $29.95/£19.99

This story starts at a point in time that most observers predicted it would end. The year was 2002. The internet party was long over. and other high-flying digital darlings were defunct. It was the dark days for the few survivors of the dotcom bubble, and Razorfish was barely hanging on.

The brash online ad agency that had come to symbolise the arrogance and frivolity of the era had slashed its staff from 1,800 employees to just 230. The company was sold for $8.2m – a minuscule fraction of its $4.2bn market value just two years bef­ore. One journalist asked the new owner if he was nuts for buying the shop.

Razorfish kept its grip, however, convincing one corporation then another that the internet was not a passing business fad. The once separate worlds of marketing, media and technology had started to collide rapidly, offering fundamentally new ways for businesses to operate and connect with consumers. Read more of this post

It’s Becoming Increasingly Difficult To Fake A Great Corporate Culture

It’s Becoming Increasingly Difficult To Fake A Great Corporate Culture

Dan SchawbelThe Fast Track | May 8, 2013, 5:18 PM | 2,399 | 1

Corporate culture is becoming increasingly important in the war for talent and retention at companies of all types around the world. Corporate culture is the personality of a company and it can’t be faked. Through social networks, review sites and word-of-mouth, a company’s culture is revealed. If employees are happy and fit in the culture, then the company gets a strong name and more people want to work there.

Some of the elements of culture include management techniques, shared values and mission, work ethic, daily work practices and language. Companies are not only competing for customers and revenue, they are competing on the basis of how they treat their employees and what they represent. If you have a strong culture, people will not only want to work for you, but they won’t want to work for anyone else so it’s well worth the investment of money and time.

Here are three companies that are doing it right: Read more of this post

Why corporate giants fail to change

Why corporate giants fail to change

May 8, 2013: 12:18 PM ET

The sources of corporate failure are often prosaic and avoidable. Nokia’s experience is a case in point.

By Julian Birkinshaw

(TheMIX) — Last week, I taught a case study on the decline of Nokia to my MBA students. I asked them, “Why did Nokia fall from industry leadership to also-ran status in the space of less than five years?” Their answers were predictable:

  • “They lost touch with their customers.” True, but almost tautological — and interesting to note that this is the same Nokia that in the early 2000s was lauded for its customer-centric marketing and design capabilities.
  • “They failed to develop the necessary technologies.” Not really true — Nokia (NOK) had a prototype touchscreen before the iPhone was launched, and its smartphones were technologically superior to anything Apple (AAPL), Samsung, or Google (GOOG) had to offer during the late 1990s.
  • “They didn’t recognize that the basis of competition was shifting from the hardware to the ecosystem.” Again, not really true — the “ecosystem” battle began in the early 2000s, with Nokia joining forces with Ericsson (ERIC), Motorola, and Psion to create Symbian as a platform technology that would keep Microsoft (MSFT) at bay.

Through this period, the people at Nokia were aware of the changes going on around them, and they were never short of leading-edge technology or clever marketers. Where they struggled was in converting awareness into action. The company lacked the capacity to change in a decisive and committed way.

The failure of big companies to adapt to changing circumstances is one of the fundamental puzzles in the world of business. Occasionally, a genuinely “disruptive” technology, such as digital imaging, comes along and wipes out an entire industry. But usually the sources of failure are more prosaic and avoidable — a failure to implement technologies that have already been developed, an arrogant disregard for changing customer demands, a complacent attitude towards new competitors. Read more of this post

Ottavio Missoni, Founder of Italian Fashion House, Dies at 92. Missoni founded the fashion company in the 1950s with his wife Rosita

Ottavio Missoni, Founder of Italian Fashion House, Dies at 92

Ottavio Missoni, founder of the Italian fashion company known for its zig-zag knitwear, has died. He was 92.

Missoni died “peacefully” in his home in Sumirago, a town near the northern city of Varese, the company said in an e-mailed statement today. It didn’t give additional details. Missoni was released May 1 from a hospital in Varese after being treated for a respiratory problem, Corriere della Sera reported the same day on its website.

Missoni founded the fashion company in the 1950s with his wife Rosita. With designs worn by celebrities including Madonna and Jennifer Lopez, the fashion house has expanded its store networks and diversified its business by designing hotels and tableware. A lower-priced line, M Missoni, was introduced in 1998 to broaden the brand’s customer base. Read more of this post

Cucinelli Becomes Billionaire Knitting $1,920 Cardigans

Cucinelli Becomes Billionaire Knitting $1,920 Cardigans

Brunello Cucinelli, the 59-year-old founder of the luxury fashion house that bears his name, has become a billionaire.

Knitwear brand Brunello Cucinelli SpA (BC) has more than doubled in value since its initial public offering in Milan last April, giving Cucinelli a net worth of at least $1 billion, according to the Bloomberg Billionaires Index. He has never appeared on an international wealth ranking.

“From the beginning we hoped for a positive and gentle listing,” Cucinelli said by phone from his Milan showroom through a translator. “Investors appreciate our quality, our positioning in the absolute luxury market and our Italian heritage.”

The Solomeo, Italy-based company, which sells $4,530 suede jackets and $1,920 cashmere cardigans, had sales of $360 million in 2012, up 15.6 percent in a year. It forecast “modest double-digit” revenue growth for 2013, Bloomberg News reported in February.

“It is chic sportswear where the quality of the finishing is very high,” Armando Branchini, founder of Milan-based luxury consultant Intercorporate, said in a telephone interview. “Cucinelli offers couture finishing, elegance and sophistication and yet you can wear it in a very casual way.”

Cucinelli’s 63 percent stake is valued at $947 million. He collected more than $90 million selling shares in the IPO. Read more of this post

Chinese Women Aren’t Taking Buffett’s Advice on Gold; “It’s almost Mother’s Day. My mother bluntly told me to buy her gold.”

Chinese Women Aren’t Taking Buffett’s Advice on Gold

On Sunday afternoon, a microblogger in Beijing logged into Sina Weibo, China’s leading social media platform, to gossip about the “auntie” next door. It’s a broad term of respect for an older woman, and his followers understood precisely what he meant when he tweeted, “The auntie next door used all of her retirement savings to buy gold. When asked what she’d do if prices keep dropping, she replied that if everyone kept buying gold, the price wouldn’t drop…”

This might strike a conservative investor as reckless. But in China, where gold has long been a national obsession, a mid-April record crash in global gold prices has been seen as an unprecedented buying opportunity. According to reports in China, Chinese have purchased 300 tons of gold worth more than $16 billion since the crash. Read more of this post

SocGen: Nearly Every Company We Met ‘Admitted’ That Chinese Trade Is About More Than Moving Goods + Chart of the Day: China Exports to Taiwan

SocGen: Nearly Every Company We Met ‘Admitted’ That Chinese Trade Is About More Than Moving Goods

Sam Ro | May 8, 2013, 8:48 AM | 2,044 | 

The better-than-expected Chinese trade data has everyone crying foul. Nomura’s Zhiwei ZhangBank of America Merrill Lynch‘s Weijun Hu and Ting Lu, and Societe Generale’s Wei Yao have all pointed to discrepancies between China’s numbers and the numbers of its trading partners. Furthermore, all point to companies using inflated bills as a way to circumvent strict Chinese capital controls and move money in and out of the mainland. “In 1Q13, China’s export data were heavily distorted due to over-reporting by exporters who might bring in hot money through fake exports and arbitrage the differential between CNH/USD and CNY/USD by moving goods in and out of HK,” said BAML’s Hu and Lu. SocGen’s Yao is actually having a hard time finding people who aren’t engaged in this practice. “As for reasons, our observation from the trips to the mainland led us to believe that there is indeed a large amount of speculative capital flows,” wrote Yao in a note to clients. “Nearly all corporates we met admitted that they were conducting some forms of interest rate arbitrage on the expectation of further yuan appreciation.

CHART OF THE DAY: It Doesn’t Take A Genius To See Something Fishy In China’s Trade Data

Sam Ro | May 8, 2013, 7:29 AM | 4,509 | 4

Earlier today, China published its official April trade figures. And while the numbers for both imports and exports were much stronger than expected, experts have been left scratching their heads over the unusual discrepancies. For one thing, exports surged 14.7% year-over-year even as exports to the U.S. fell by 0.7%. Exports to the EU fell by 6.4%. In a note to clients, Nomura’s Zhiwei Zhang attributed it to companies trying to get around strict Chinese capital controls. “We believe exports to destinations like Hong Kong, a major financial hub, are likely being over-invoiced in an attempt to circumvent capital controls and bring foreign capital into China,” said Zhang who pointed out that exports to Hong Kong surged by 57.2%. Societe Generale’s Wei Yao agrees with Zhang.  “As for reasons, our observation from the trips to the mainland led us to believe that there is indeed a large amount of speculative capital flows,” wrote Yao in a note to clients. “Nearly all corporates we met admitted that they were conducting some forms of interest rate arbitrage on the expectation of further yuan appreciation.” But Hong Kong wasn’t the only discrepancy. Yao noted a whopper in the Taiwan numbers. “Head-scratching discrepancies in bilateral data comparison persisted on both sides of the ledger,” she wrote. “Compared with the data from Taiwan – the only economy besides China that has published the complete set of April data – growth of mainland exports to Taiwan was 57.7 ppt faster based on China’s data (+49.2% yoy vs. -2.7% yoy) and that of mainland’s imports from Taiwan was 58.6ppt faster (+55.7% yoy vs. -2.9% yoy)! The gaps narrowed only marginally from March.” No wonder people question the reliability of the data.


Corporate auditors would be required to look more closely at insider business deals, like those used in many Chinese company frauds, under a rule the US audit regulator has proposed

Thursday May 9, 2013

US audit watchdog wants more scrutiny

WASHINGTON: Corporate auditors would be required to look more closely at insider business deals, like those used in many Chinese company frauds, under a rule the US audit regulator has proposed.

The Public Company Accounting Oversight Board’s (PCAOB) rule takes aim at socalled “related party transactions,” or deals between a company and corporate insiders. These kinds of transactions have played a role in many accounting frauds. Read more of this post

All Malaysian-listed China firms end in the red after listing

Most Bursa-listed China firms end in the red


Published: 2013/05/09

KUALA LUMPUR: China-based companies listed on Bursa Malaysia mostly ended the trading day in the red yesterday, following HB Global Ltd’s investor alert announcement on Tuesday.

This is the first time a China company listed here has reported to the stock exchange a wide discrepancy between its unaudited results and that prepared by its external auditors. Bursa Malaysia leapt into action yesterday, directing HB Global to appoint a special auditor to probe the company’s affairs, particularly its financials, and identify any irregularities.

pix_bottom Read more of this post

Beijing Puzzles Over Urban Growth; Government Entertains Debate on How to Manage Population Gains as It Seeks Lift From Bigger Cities

Updated May 8, 2013, 7:55 p.m. ET

Beijing Puzzles Over Urban Growth

Government Entertains Debate on How to Manage Population Gains as It Seeks Lift From Bigger Cities



BEIJING—China’s new leaders are counting on urbanization to remake the economy but have tried to limit the flow to the country’s largest cities, fearing that a surge in migration could turn them into Latin American-style slums. Some urbanization specialists inside and outside China argue that the fear is largely misplaced. The problem with Beijing, Shanghai and other Chinese megacities, they say, is that they aren’t even more densely packed—or better planned. Adding more people to Beijing, for example—on top of the 18 million or so who already live here—would encourage better public transportation, boost land prices so high that factories would move away, and attract talented people with fresh ideas, according to these specialists. Imagine, say, Manhattan or Tokyo. “We have to let the market play a bigger role in the development of cities and dismantle barriers” to urban growth, said He Fan, a senior economist at the Chinese Academy of Social Sciences, the government’s most prestigious think tank. “People prefer to move to larger cities because there is more opportunity there.” Angel Gurría, secretary-general of the Organization for Economic Cooperation and Development, is another big-city booster. “When you see the situation in the large urban conglomerations, you say, ‘Let’s stop the growth,’ ” he said during an interview in Beijing. “But you probably don’t want to stop the growth [because] a well-organized, predictable process of urbanization allows for a much better allocation of resources.” Urban planners talk about “agglomeration” effects—the idea that cities gain by having people more tightly packed. That’s because travel by car becomes impractical and is replaced by public transportation. Also, old-line industries are forced to relocate because of rising prices, and lightly polluting service industries take their place. The influx of people brings an energy to a city that helps create new businesses and investment. Read more of this post

Galaxy’s secret sauce: Samsung components; “Samsung’s strength is this ability to in-source to itself”

May 8, 2013, 7:15 p.m. ET

Galaxy’s secret sauce: Samsung components


Samsung Electronics Co 005930.SE +1.01% .’s latest smartphone, the Galaxy S 4, takes advantage of the South Korean electronics company’s chip- and display-manufacturing prowess to get its material costs closer to Apple Inc AAPL +1.13% .’s costs for the iPhone 5. An analysis conducted by market-research firm IHS Inc. IHS +1.66% estimates Samsung’s cost of materials and manufacturing to produce the U.S. version of the S 4 is slightly above $237 a unit, according to a report expected to be released on Thursday. That is higher than Apple’s $217 production cost for a 32-gigabyte iPhone 5, which has a smaller and less-costly display screen. Without a two-year contract, the 16-gigabyte version of the Samsung phone sells for $639 at AT&T Inc., T +0.83%and the iPhone 5 with 32 gigabytes costs $749 at an Apple store.

MK-CD089A_GALAX_G_20130508185108 Read more of this post

Earnings Not Yet a Viral Sensation

ay 8, 2013, 7:48 p.m. ET

Earnings Not Yet a Viral Sensation


When Facebook Inc. FB +0.86% boss Mark Zuckerberg announced first-quarter results, he didn’t break the news with a Facebook post. He stuck with an old-fashioned news release. Across the U.S., earnings season came and went with few signs that companies are taking advantage of the Securities and Exchange Commission’s green light to tweet or post market-moving information. On April 2, the SEC announced that companies “can use social media outlets like Facebook and Twitter to announce key information…so long as investors have been alerted about which social media will be used to disseminate such information.” Since then, only about a dozen firms have said they might break news on Facebook, Twitter and the like. And few of those companies make much noise online. Read more of this post

‘Open Data’ Brings Potential And Perils for Government

May 8, 2013, 4:27 p.m. ET

‘Open Data’ Brings Potential And Perils for Government


Open Data: the very name is a virtuous pairing of transparency and science. No one is going to argue against openness, and data has the appeal of nonjudgmental objectivity.

Governments and public officials are rushing to embrace the concept, throwing open the vast panoply of publicly collected information for the digitally savvy to mine and exploit. The poster child of the movement is Mike Flowers, chief analytics officer for the City of New York. By mashing together all of the city’s numerous data sources, his team has more than doubled the hit rate for discovering stores selling bootlegged cigarettes and had a fivefold increase in the success rate of building inspectors looking for illegal conversions.

With that sort of track record, it is clear why Open Data is very appealing for politicians. At the last count almost 30 countries—mainly in Europe and other developed nations but also including Costa Rica, Kenya and India—plus a number of municipal areas have launched sites.

However, the use of government data throws up many issues surrounding privacy, policy-making and the uses to which the data has been put. These need to be tackled before simply opening up these digital to all comers. Read more of this post

Will Health-Care Law Beget Entrepreneurs? Thousands of would-be entrepreneurs want to start their own businesses, but are shackled to their current employer by the need for affordable health insurance

Updated May 8, 2013, 7:59 p.m. ET

Will Health-Care Law Beget Entrepreneurs?


Thousands of would-be entrepreneurs are itching to start their own businesses, but many are shackled to their current employer by health-care benefits they don’t think they could otherwise afford. Economists call this phenomenon “job lock,” or “entrepreneurship lock.”

But the pressure some Americans feel to cling to a corporate job chiefly for the health insurance could, conceivably, ease in coming years. Under provisions of the health-care law, new-business owners will be able to get coverage through public marketplaces, or “exchanges,” beginning in October, for policies that will take effect starting in January. Read more of this post

Yen’s Slide No Panacea For Japan Inc.

May 7, 2013, 10:59 p.m. ET

Yen’s Slide No Panacea For Japan Inc.


Japanese Prime Minister Shinzo Abe has weakened the yen and sent stocks soaring. Boosting long-term earnings growth for Japanese companies will be more difficult. Increasing domestic consumption is an important objective of Mr. Abe’s plan. But much depends on the impact of a weaker yen on Japan’s export-focused businesses. In the current fiscal year, companies on the main Tokyo stock exchange could see profits jump 30% to 40% year-over-year if the yen averages between 100 and 115 to the dollar, saysCitigroup C +2.45% . The yen’s slide has two main effects on corporate earnings. First, revenue earned overseas is immediately worth more in yen terms. Nomura’s survey of large Japanese nonfinancial companies that have reported earnings for the three months ended March 31 shows profits up 7.7% on the previous year. That is down from a 33.2% jump in the previous quarter, though some major companies haven’t reported yet. The second benefit is that Japanese companies should become more competitive as the cheaper yen means foreigners pay less for the country’s exports. While this should boost sales volumes, not all exporters will be able to take advantage.

Take Canon 7751.TO -0.29% . Revenue from its imaging business fell 1.8% year-over-year in the three months to March 31. The fall would have been 14% but for the effect of the weakening yen. But Canon faces fundamental problems that can’t be fixed by currency movements. The company’s core digital-camera business is in decline because amateur photographers can now snap photos with increasingly high-resolution smartphones. In addition, because Canon mainly competes with other Japanese camera makers like Nikon 7731.TO -0.14% and Olympus7733.TO -1.10%its rivals will also benefit from the yen’s slide. Read more of this post

Weeds Grow in the Stock Market’s Yield of Dreams; Investors’ intense focus on dividends could yield problems for them later on

May 7, 2013, 5:35 p.m. ET

Weeds Grow in the Stock Market’s Yield of Dreams


Investors’ intense focus on dividends could yield problems for them later on.

Usually when the Federal Reserve is in easing mode, investors set their sights on the stocks of companies whose fortunes are most likely to rise fastest with rising economic growth. But with the Fed sopping up $85 billion in Treasurys and mortgage bonds each month—and driving yields across a spectrum of bonds lower in the process—the hunt for investments that can provide a modicum of income has intensified. So the shares of companies with a history of paying dividends, which investors more typically eschew when the Fed’s foot is on the gas, have been in favor. Read more of this post

Mao Zedong’s granddaughter and her husband appear on the latest rich list as survey suggests that who, not what, you know is still important

Mao Zedong granddaughter on rich list, prompting debate

Thursday, 09 May, 2013, 12:00am

Cary Huang in Beijing

Mao Zedong’s granddaughter and her husband appear on the latest rich list as survey suggests that who, not what, you know is still important

The addition of the granddaughter of Mao Zedong to a list of the richest Chinese – along with a survey suggesting that graduates from well-connected families tend to find better jobs – has triggered fresh debate about political connections and personal wealth.

With family assets estimated at 5 billion yuan (HK$6.25 billion), Kong Dongmei , granddaughter of the late leader, and husband Chen Dongsheng are 242nd on the 2013 New Fortune 500 Rich List [1], media reports said yesterday. Read more of this post

HK vs Beijing: A Battle to Become Art Capital of China

May 8, 2013

A Battle to Become Art Capital of China


BEIJING — The sometimes-tense relationship between Hong Kong and Beijing appears set to move to another front: the world of art.

With the National Art Museum of China — or Namoc — planning to open in a new building in 2017, and Hong Kong projected to open its M+ museum in a new cultural district about the same time, the cities could emerge as twin titans of contemporary Chinese culture.

Namoc attracted some of the world’s leading architects, including Zaha HadidFrank Gehry and Jean Nouvel, to its design contest for the new museum in Olympic park in Beijing. Xie Xiaofan, a deputy director at Namoc, informally announced at theE.U.-China High Level Cultural Forum in November that Mr. Nouvel’s design had been selected, although the decision is subject to the approval of China’s new leadership. Read more of this post

HP and Autonomy: how to lose $8.8bn

May 8, 2013 9:29 pm

HP and Autonomy: how to lose $8.8bn

By Robert Armstrong and Stuart Kirk

Hewlett-Packard appears to be in a difficult position whatever the court rules on its disastrous purchase of the software group


Making $8.8bn disappear is not easy.Hewlett-Packard managed it, and quickly, when it bought the information management software company Autonomyin 2011 for $11.6bn and wrote off 80 per cent of the purchase price a year later. HP’s history is rife with self-inflicted injuryand the Autonomy affair is, in part, a depressingly familiar story: a company in crisis overpaying for an acquisition it can tout as transformative. Heads have already rolled. Léo Apotheker, HP’s boss at the time of the deal, departed almost immediately afterwards and Raymond Lane, the board’s chairman at the time, and two other directors followed him last month. HP, however, attributed more than $5bn of the writedown to “accounting improprieties, disclosure failures and outright misrepresentations”. It alleges that low-margin hardware sales were disguised as high-margin software sales and that products were sold into the distribution channel when there was no buyer. Read more of this post

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