For Pension Funds, Higher Fees Don’t Mean Higher Returns, Study Finds

July 2, 2013, 11:01 a.m. ET

For Pension Funds, Higher Fees Don’t Mean Higher Returns, Study Finds

Report on State Pension Funds Adds Fuel to Debate on Active Investment Managers

MICHAEL CORKERY

Public-employee pension plans paying the highest investment fees aren’t generating the highest returns, according to a new study by a pair of Maryland think tanks. In fact, just the opposite may be true, says the Maryland Public Policy Institute and Maryland Tax Education Foundation. On average, 10 states paying the most money-management fees had lower investment returns between June 30, 2007 and June 30, 2012 than 10 states paying the fewest fees.

Read more of this post

A Dizzying Condo Market: Toronto’s effort to create a livable city through densely populated neighborhoods is a roaring success, but to what end?

July 2, 2013

A Dizzying Condo Market

By IAN AUSTEN

TORONTO — Sandwiched between two rail lines in this city’s core, great factories once produced the finest Canada could offer the world: Magic baking powder, Brunswick bowling alley flooring and Massey Ferguson farm equipment.

Those factories and many others here have been long abandoned or demolished, but the area is bustling. It is now called Liberty Village and it is packed with high-rise condominiums, largely built over the last five years, with many more still under construction. Read more of this post

Worries of crash persist in Toronto’s condo alley

Worries of crash persist in Toronto’s condo alley

Ian Austen, The New York Times | 13/07/03 8:20 AM ET
Sandwiched between two rail lines in Toronto’s core, great factories once produced the finest Canada could offer the world: Magic baking powder, Brunswick bowling alley flooring and Massey Ferguson farm equipment.

What once was a no-brainer decision, locking in your mortgage rate for five years or even 10 years, now has a question mark attached to it. Read more

Those factories and many others here have been long abandoned or demolished, but the area is bustling. It is now called Liberty Village and it is packed with high-rise condominiums, largely built over the last five years, with many more still under construction. Read more of this post

Zhou Pulling China Punch Bowl Set to Shape Legacy as PBOC Chief

Zhou Pulling China Punch Bowl Set to Shape Legacy as PBOC Chief

Zhou Xiaochuan earned distinction as the G-20’s longest-serving central bank chief helping keep China out of a financial crisis the past decade. In the wake of June’s record liquidity squeeze, his legacy hangs in the balance.

Zhou and his colleagues at the People’s Bank of China left investors, bankers and market participants in the dark for four days after the overnight lending rate between banks hit a record 11.7 percent June 20 before releasing a week-old statement as the central bank’s first word on its objectives. Zhou himself kept mum until he reiterated a pledge to maintain market stability on June 28. Read more of this post

Tiger Moms Crave Diapers From Japan; Kao has a 30% market share in Japan compared with Unicharm’s 34%

July 3, 2013, 12:07 PM

Tiger Moms Crave Diapers From Japan

By Mayumi Negishi

Japan’s second-largest diaper maker is apparently struggling to meet surging demand from Tiger Moms.

Kao Corp.’s breathable Merries diapers have gained a reputation abroad for being good for a baby’s development, appealing to mothers who want to maximize the head start they give their children, Kao Chairman Motoki Ozaki said in a recent interview. Read more of this post

U.S. Prepares to Place Stricter Rules on 8 Biggest Banks

U.S. Prepares to Place Stricter Rules on 8 Biggest Banks

JPMorgan Chase & Co. (JPM), Wells Fargo & Co. (WFC) and Goldman Sachs Group Inc. are among eight U.S. banks facing a new round of domestic rules on capital and debt that would be even stricter than global standards approved today.

Regulators will push banks to maintain a leverage ratio of capital to assets that exceeds the 3 percent minimum set by the Basel Committee on Banking Supervision, Federal Reserve Governor Daniel Tarullo said today, and the Federal Deposit Insurance Corp. said a proposal may be published next week. Another measure “in the next few months” would compel banks to hold a set amount of equity and long-term debt to help regulators dismantle failing lenders, Tarullo said. Read more of this post

Tata to Ambani Vie for First India Bank Permits in a Decade

Tata to Ambani Vie for First India Bank Permits in a Decade

Tata Sons Ltd., which manages India’s biggest business group, and firms controlled by billionaires Anil Ambani and Kumar Mangalam Birla are among 26 seeking the country’s first new banking licenses in more than a decade.

The companies yesterday met the Reserve Bank of India’s deadline to apply for the permits, it said in a statement published on its website. Read more of this post

Junk-Loan Rates Soar on Record 43% on Debt as Buyers Balk; Investors are demanding more in interest to fund the $550 billion market for leveraged loans

Junk-Loan Rates Soar on Record 43% on Debt as Buyers Balk

Junk-rated companies agreed to boost interest rates on more U.S. loans than any time since at least 2011, as lenders extracted more compensation with prices of the floating-rate debt tumbling from a six-year high.

Drug distributor Valeant Pharmaceuticals International Inc. (VRX) to toothbrush-maker Water Pik Inc. were among companies that sweetened terms on $17.7 billion of loans in June, accounting for 43 percent of total deals, according to Standard & Poor’s Capital IQ Leveraged Commentary & Data. That’s 10 times greater than in May and the highest in data going back to January 2011. Twenty issuers failed to get loan financing, versus 22 for the first five months of the year, as the average price of the senior-ranking debt fell by the most since May 2012. Read more of this post

How Student Loans Subsidized the American Dream

How Student Loans Subsidized the American Dream

On July 1, the rate of a subsidized Stafford student loan doubled to 6.8 percent from 3.4 percent, after Congress shut down for the Independence Day holiday without taking action to prevent a scheduled increase. If lawmakers fail to reach a retroactive agreement before the August recess, the average Stafford borrower will have to pay back about $800 more than under the previous rate for every year of loans. Read more of this post

Cornell University Awash in Debt Chases Donors in ‘Pay-as-You-Go’ Expansion

Cornell Awash in Debt Chases Donors in ‘Pay-as-You-Go’ Expansion

David Skorton’s appointment as president of Cornell University seven years ago ushered in a $4 billion fundraising campaign, the school’s largest ever and first in more than a decade.

Skorton has since increased the goal to $4.75 billion and extended it four years to 2015. Now he’s preparing to kick-start a second effort to finance a $2 billion technology campus as the upstate New York Ivy League school expands on Roosevelt Island in Manhattan. Read more of this post