World’s post offices look to reinvent selves

World’s post offices look to reinvent selves

AFP-JIJI

JUL 29, 2013

PARIS – There was a time when your local post office would mainly sell stamps and deliver letters. No longer. To counteract the turmoil brought on by email and text messages, postal services worldwide have reinvented themselves, taking on the technological revolution that once looked to cripple them. Traditional mail service has dropped sharply in recent years, though emerging countries are a notable exception. According to the Universal Postal Union, global letter and light parcel delivery dropped 3.7 percent in 2011 from a year earlier, and by 5.1 percent when just counting Europe and the former Soviet Union. Read more of this post

Essilor, the world’s biggest producer of eyeglass lenses by sales is buying a 51 per cent stake in Transitions Optical from partner PPG Industries for $1.73bn

July 29, 2013 4:39 pm

Essilor buys majority stake in Transitions Optical for $1.73bn

By Adam Thomson in Paris

Essilor International, the world’s biggest producer of eyeglass lenses by sales is buying a 51 per cent stake in Transitions Optical from partner PPG Industries for $1.73bn.

The acquisition will hand Essilor full ownership of Transitions Optical, the inventor of plastic lenses that darken in ultraviolet light, and increase the French company’s exposure to a segment that is growing twice as fast as the overall optics industry. Read more of this post

BMW Launches Its First Mass-Production Electric Car

Updated July 29, 2013, 10:18 p.m. ET

BMW Launches Its First Mass-Production Electric Car

Auto Maker Needs to Boost Sales of Electric Cars to Meet Regulatory Requirements

JOSEPH B. WHITE

BMW unveiled Monday its first mass-production electric car, the i3. The German car maker says the car can accelerate from 0-60 miles an hour in just over seven seconds and says the basic model has a range of 100 miles. The new i3 is expected to be priced at $41,350 before incentives.

BMW AG BMW.XE -0.26% Chief Executive Norbert Reithofer unveiled on Monday the auto maker’s first mass-production electric car, saying his company would need to boost sales of plug-in and battery electric vehicles dramatically by 2025 to meet regulatory requirements. The BMW i3 is expected to go on sale in the U.S. in the second quarter of 2014 where it is expected to be priced at $41,350 before federal tax and other incentives. An optional “range extender”—a small gasoline motor—will likely boost the price tag to $45,000. Mr. Reithofer said he is taking a long view on the potential of electric vehicles. “If you build such a car…you have to look into the future, 10, 15, 20 years,” Mr. Reithofer said. “If you look around the world, [at] the emissions regulations, in the United States, in the European Union, even in China…cars like the BMW i3 are a must.” Read more of this post

China, whose airline market is dominated by state-owned carriers noted for inefficiency and poor service, will study policies to encourage the budget-carrier model that is sweeping Asia

Updated July 29, 2013, 8:30 a.m. ET

China’s Air Regulator Will Consider Ways to Boost Budget-Carrier Market

Having Lifted Ban on New Independent Airlines, Government Pushes Low-Cost Model

JOANNE CHIU

SHANGHAI—China is taking steps to jump-start the budget-airline business, say people familiar with the situation, a sign of further liberalization in one of the nation’s most tightly regulated sectors. Li Jiaxiang, head of the Civil Aviation Administration of China, told a semiannual CAAC working meeting this month that the regulator plans to study new policies to promote low-cost carriers in the second half of the year, according to people there, who included airline executives. Mr. Li also urged the nation’s smaller airlines to look into the budget model, and established airlines to learn from successful low-cost airlines to improve management standards and operating efficiency, the people said. Read more of this post

China’s top stock-market regulator Xiao Gang Turns Gray as China IPO Freeze Precedes New Rules

Xiao Turns Gray as China IPO Freeze Precedes New Rules

Four months after taking over as China’s top stock-market regulator, Xiao Gang showed up at a government meeting in July with gray hair at his temples.

The salt-and-pepper look provoked debate, even poetry, on China’s Weibo microblog service. Commentators argued whether the challenges of overseeing Asia’s worst-performing major stock market had aged him or if he had stopped dyeing his hair.

Xiao, 54, is stuck between more than 700 companies waiting to raise funds and Chinese leaders led by Xi Jinping who have pledged to clean up corruption. The China Securities Regulatory Commission, under pressure from investors to avoid exacerbating a 25 percent slump in the Shanghai Composite Index (SHCOMP) since July 2010, is drafting rules to curb misconduct that would establish stiff penalties for investment banks before ending an almost 10-month freeze on initial public offerings. Read more of this post

Myanmar’s Yangon More Expensive Than NYC Sparking Boom

Yangon More Expensive Than NYC Sparking Boom: Real Estate

Sean Danley has spent the past six months scouting office space in Yangon after being sent to establish the Myanmar branch of his U.S.-based employer.

He looked in the city’s three sole 1990s-era towers, where annual rents have climbed to more than $100 a square foot, compared with less than $75 in downtown Manhattan, according to broker CBRE Group Inc. Too expensive, he said.

The villas he considered either didn’t have safety exits, weren’t clean, required sharing space with other companies or were in odd locations — all unsuitable to the image of his $29 billion in revenue engineering and construction company, which he said he wasn’t authorized to identify. After seeing 10 places and losing one possibility to someone faster with his “bag of money,” Danley is still looking. Read more of this post

U.S. says JP Morgan manipulated market; settlement seen

U.S. says JP Morgan manipulated market; settlement seen

7:47pm EDT

WASHINGTON (Reuters) – The U.S. power regulator outlined its case of market manipulation against JPMorgan Chase & Co on Monday as industry sources said a final settlement on the issue should come on Tuesday. Traders used improper bidding tactics in California and the Midwest to boost profits, officials said in a statement that brought to light some details of an extensive investigation. Reports of that probe have circulated for months and a deal with the regulator could put an end to a distraction for JPMorgan Chief Executive Jamie Dimon. The U.S. Federal Energy Regulatory Commission (FERC) staff has found “eight manipulative bidding strategies” used by a JPM affiliate in 2010 and 2011, the regulator said. Read more of this post

Taiwan says may tighten tax rule on property trading

Taiwan says may tighten tax rule on property trading

Monday, Jul 29, 2013

Reuters

TAIPEI – Taiwan does not rule out the possibility of tightening a tax rule on trading properties and luxury goods, as it aims to narrow the gap between the rich and the poor. Speculation has helped drive up property prices on the island, especially in the capital Taipei and some other northern cities, and worsened affordability at a time when growth is slowing. Taiwan’s Finance Minister Chang Sheng-ford told reporters over the weekend that studies show the tax has received positive feedback as it has helped curb property turnover and narrowed the gap between rich and poor. The government introduced the so-called luxury tax almost two years ago. Properties that are sold in less than two years after being bought are taxed. A 15 per cent tax applies to properties sold within a year of purchase and 10 ppercent to those sold within two years. A 10 per cent tax applies on sales of luxury goods worth at least T$3 million (S$126,405). One possibility is to collect the tax from buyers, which is what Hong Kong and Singapore have done, Chang said. Another option is to extend the tax-free period to three or four years from the current two years, the minister added.

China has at least 36 local governments with as much debt, on average, as Detroit

China has at least 36 local governments with as much debt, on average, as Detroit

By Jake Maxwell Watts @jmwatts_ 4 hours ago

China’s National Audit Office announced on Sunday that it is conducting a comprehensive review of all local government debt, which has long been considered a potential time bomb that threatens for China’s economy. But how bad is the debt really? An audit that took a sample of 36 local governments at the end of 2012 (15 provinces, their capital cities, the municipalities of Tianjin, Shanghai and Guangzhou, and one district from each municipal city) found that those authorities had taken on a total of 3.85 trillion yuan ($628 billion) in debt, up 12.9% from 2010. That works out to $17.4 billion each—just under the $18 billion in debt held by the US city of Detroit, which filed for bankruptcy earlier this month. Read more of this post

Small Stocks Are in Eye of the Index; Inclusion in Russell 2000 May Distort Some Stock Values

July 28, 2013, 6:46 p.m. ET

Small Stocks Are in Eye of the Index

Inclusion in Russell 2000 May Distort Some Stock Values

JUSTIN LAHART

The Russell 2000 is the benchmark for small-capitalization stocks. But some stocks in it aren’t that small. This may pose a problem for investors, even as the index has been hitting all-time highs. The argument for small stocks is clear. Research has consistently shown that over long stretches small-cap stocks beat their bigger brethren. A driver has been the fraction of fast-expanding small companies on their way to becoming large ones. Yet some of them may no longer be in the Russell 2000. Which stocks Russell designates as small cap counts. The iShares Russell 2000 ETF, IWM -0.40% the ninth largest of all exchange-traded funds, has about $25 billion under management. More than 400 mutual-fund portfolios, with over $370 billion under management, use the Russell 2000, or its subindexes, as benchmarks, said Morningstar. Read more of this post

Startups Take Off in South Korea; Successful Entrepreneurs Reinvesting in Fledgling Companies

Updated July 29, 2013, 12:07 a.m. ET

Startups Take Off in South Korea

Successful Entrepreneurs Reinvesting in Fledgling Companies

JAEYEON WOO

A package for expectant moms in their early pregnancy

SEOUL—When Paek Jin-joo was pregnant with her first baby, it was challenging for her to figure out what she needed to know and buy as an expectant mother. Spending hours looking up the Internet was too time consuming. “I thought to myself how convenient it would be if someone could offer tips and help shop for products necessary for pregnant women,” says the 35-year-old Ms. Paek, who was an office worker at an online education company in Seoul before setting up her own company, 10Box, in October last year. As the U.S. startup scene experiences a slowdown this year, South Korea is one place that is booming. The country is one of the most wired nations in the world with broadband penetration at over 100%. The number of Korean startups has nearly doubled to 28,193 in 2012 from just 15,401 in 2008, according to data from the Korean Venture Capital Association. Steady growth in the number of startups in South Korea in recent years is getting a fresh push from successful entrepreneurs reinvesting in fledgling companies, as well as commitment from the government to provide backing. But competition and scaling the business have been major challenges for some of the country’s startups. Read more of this post

China 3% Growth Risk Seen by Barclays Signals Likonomics Anxiety

China 3% Growth Risk Seen by Barclays Signals Likonomics Anxiety

A copper price collapse of more than 60 percent, zinc cut by up to a half and oil down to $70 a barrel. That’s the fate facing world commodity markets should China’s growth dip to 3 percent in the next three years — a scenario economists at Barclays Plc (BARC) are now examining.

They’re not the only ones building models based on a steep decline in growth in the world’s second-biggest economy. Nomura Holdings Inc. (8604) estimates a one-in-three chance of a sharp drop by the end of 2014, and Societe Generale SA sees a “non-negligible risk” of less than 6 percent growth this year and an outside chance of 3 percent average expansion for this half and next. Read more of this post

How Much Slowdown Can Beijing Tolerate? The notion of a bottom line for growth and stability is a myth. The truth is more complex

How Much Slowdown Can Beijing Tolerate?

July 22, 2013

By Minxin PeiABOUT THE AUTHOR

The notion of a bottom line for growth and stability is a myth. The truth is more complex.

The once-mighty Chinese economy is now headed in one direction only – downward. GDP growth was 7.5 percent in the second quarter of this year, down slightly from 7.7 percent in the first quarter. In the last quarter of 2012, the Chinese economy grew 7.9 percent. The deceleration from 7.9 to 7.5 percent may seem relatively minor – only 0.4 percentage point in six months. However, when annualized, this figure means that the Chinese economy has lost about one-tenth of its growth momentum since last year. Read more of this post

China Plans Urgent Audit of Public Debt

July 28, 2013, 6:43 a.m. ET

China Plans Urgent Audit of Public Debt

Burgeoning Borrowing Adds to Stress on China’s Financial System

PAUL MOZUR and TOM ORLIK

BEIJING—China will conduct an urgent review of overall public debt, highlighting concerns about burgeoning official borrowing that are adding to stress in China’s financial system and limiting Beijing’s capacity to support flagging growth. In a one-line statement on Sunday, China’s National Audit Office said it would carry out an examination of total government debt, acting on the orders of the State Council, China’s cabinet. A separate article in the Communist Party mouthpiece People’s Daily said the order came Friday and that work would begin on the audit on Monday. The article, citing unnamed sources, said the Audit Office would temporarily suspend other projects to begin work on the audit, suggesting the urgency of the task. Read more of this post

End game in property wait; Hong Kong Monetary Authority announced 27 cases of negative equity involving residential mortgage loans, the first time that negative equity has reared its ugly head since June last year

End game in property wait
Mary Ma
Monday, July 29, 2013
The Hong Kong Monetary Authority announced that as at the end of June, there were 27 cases of negative equity involving residential mortgage loans. This is the first time that negative equity has reared its ugly head since June last year. It would be imprudent to say the resurgence of negative equity cases is alarming, as they mainly related to mortgages with unusually higher loan- to-value ratios. But it’s still a development that shouldn’t be ignored. Following the property market crash during the 2003 SARS outbreak, many homeowners were trapped in negative equity. Nobody wants to see that again. Now, everyone is asking the same question – have home prices peaked? Read more of this post

Peter Drake gave himself a $26 million loan before his $3 billion mortgage fund empire, LM Investments, collapsed in March.

LM fund gave loan to Drake

July 29, 2013

Michael West

Peter Drake gave himself a $26 million loan before his mortgage fund empire, LM Investments, collapsed in March.

Adding this to other loans, including a $16 million loan to a Hong Kong company controlled by the Kiwi-born businessman, and it appears that Drake owes LM at least $46 million and is headed for bankruptcy. Drake brought a defamation action against Fairfax Media and the author of this story before the collapse of his $3 billion fund empire. Read more of this post

Investors Are Lab Rabbits in Central Bank Experiments

Investors Are Lab Rabbits in Central Bank Experiments

The European Central Bank and Bank of England are emulating Ben S. Bernanke’s experiment in offering monetary-policy guidance to financial markets. Investors could well end up being the guinea pigs. Bond prices have fluctuated during the last three months, with the yield on the 10-year Treasury note swinging from 1.63 percent to 2.74 percent, the fastest jump since 2010, as the Federal Reserve chairman struggled to provide a clearer picture of when and why the central bank will reduce and then end its asset purchases.

“If this is science, then we’re the little white lab rabbits,” said Vincent Reinhart, chief U.S. economist for Morgan Stanley in New York, who served as the Fed’s chief monetary-policy strategist from 2001 to 2007. Read more of this post

The Benefit of Hindsight: New rules allow ETFs to market back-tested data, but the practice is mired in murky practices that don’t benefit most investors

SATURDAY, JULY 27, 2013

The Benefit of Hindsight

By SARAH MAX | MORE ARTICLES BY AUTHOR

New rules allow ETFs to market back-tested data, but the practice is mired in murky practices that don’t benefit most investors.

Hindsight is 20/20. So it’s easy to see why investors might be kicking themselves for not investing in the PowerShares S&P 500 Low Volatility Portfolio (ticker: SPLV) in 2008. Over the past five years, the index this exchange-traded fund tracks has returned 11.7% a year — considerably better than the S&P 500’s 8.5%. There’s just one hitch: That index didn’t exist five years ago, and those returns are mostly hypothetical. Read more of this post