The reckoning: Why India is particularly vulnerable to the turbulence rattling emerging markets

The reckoning: Why India is particularly vulnerable to the turbulence rattling emerging markets

Aug 24th 2013 | MUMBAI |From the print edition

ON THE morning of August 17th most of India’s economic policymakers gathered in the prime minister’s house in Delhi. They were there to launch an official economic history of 1981-97, a period which included the balance-of-payments crisis of 1991. The mood was tense. India, said Manmohan Singh, the prime minister, faced “very difficult circumstances”. “Does history repeat itself?” asked Duvvuri Subbarao, the outgoing head of the Reserve Bank of India (RBI). “As if we learn nothing from one crisis to another?” Read more of this post

Gallup Unemployment Vs BLS Unemplyment: Polled Unemployment Soars To March 2012 Levels

BLS, We Have A Problem: Polled Unemployment Soars To March 2012 Levels

Tyler Durden on 08/22/2013 09:27 -0400

Gallup tracks daily the percentage of U.S. adults, aged 18 and older, who are underemployed, unemployed, and employed full-time for an employer, without seasonal adjustment. Due to the lack of Arima-X ‘magic’ the results are specifically not comparable to the BLS data, but, as the chart below suggests, the correlation is high. What is most worrying about the latest data is the rapid rise in both unemployment and underemployment that the Gallup poll finds (to 8.9% unemployment and 17.9% underemployment. Unemployment rates have jumped notably in the last month to their highest in 13 months. Will the Fed ‘allow’ this data to filter into the BLS data and ‘avoid the Taper’ or are there non-economic reasons (G-20, deficits, technicals, sentiment) that the Fed needs to SepTaper.

China industry body quizzes medical device makers over pricing

China industry body quizzes medical device makers over pricing

Wed, Aug 21 2013

By Megha Rajagopalan

BEIJING (Reuters) – A Chinese industry group is collecting information on the pricing and business practices of foreign and local makers of medical equipment for the government in a survey that sources said was unusual in the amount of detail it sought.

Two industry sources who have seen the questionnaire said it was unclear if regulators were about to investigate China’s $20 billion medical devices market following multiple probes into corruption and possible price fixing in the pharmaceuticals sector. Read more of this post

Options Market Suffers Biggest Disruption Since April

Options Market Suffers Biggest Disruption Since April

When Scott Maidel of Russell Investments answered the phone 20 minutes after the start of U.S. equity trading on Aug. 20, there was a Goldman Sachs (GS) Group Inc. employee on the line with a request: stop sending orders for stock options.

Confusion was sweeping trading desks as prices for equity derivatives swung without reason, leading to speculation a computer program had gone haywire at one of the 12 U.S. options exchanges. Contracts traded for $26 one minute and $1 the next. Read more of this post

Proving CEOs Overpaid for Luck Helped Stir Pay Backlash

Proving CEOs Overpaid for Luck Helped Stir Pay Backlash

Marianne Bertrand helped unleash a shareholder backlash against CEO pay with research she began while still in graduate school.

In a 2001 paper based on her work as a Ph.D. candidate at Harvard University, the 43-year-old labor economist documented that chief executive officers at U.S. oil companies got raises when their company’s fortunes improved because of changes in global oil prices beyond their control. The same pay-for-luck phenomenon occurred with multinational businesses when currency fluctuations, rather than management strategies, boosted results, she found. Read more of this post

India’s Richest Man Loses $5.6 Billion as Rupee Stumbles

India’s Richest Man Loses $5.6 Billion as Rupee Stumbles

Mukesh Ambani, India’s richest man, is the biggest loser among the country’s billionaires as the rupee’s slump to record lows erased 24 percent of his fortune.

The chairman of Reliance Industries Ltd. (RIL), operator of the world’s biggest oil refinery complex, has lost $5.6 billion of his wealth since May 1, as the rupee’s plunge accelerated. The 56-year-old is left with a net worth of $17.5 billion, according to the Bloomberg Billionaires Index. Read more of this post

Indonesia Stocks Enter Bear Market After Losing 20% Since May

Indonesia Stocks Enter Bear Market After Losing 20% Since May

Indonesian stocks fell, with the benchmark index entering a bear market after losing 20 percent from a record high three months ago.

The Jakarta Composite Index (JCI) declined 1.1 percent to close at 4,171.41, the lowest since Sept. 13, 2012. Animal feed producer PT Charoen Pokphand Indonesia dropped 13 percent and was the biggest drag on the index. PT Bank Rakyat Indonesia, the country’s second largest lender by assets, fell 4.4 percent.

A record current-account deficit in the second quarter and worse-than-expected economic growth and inflation data spurred investors to offload stocks and send the rupiah to its weakest level since April 2009. Foreign investors sold a net of $434.7 million worth of equities this week through yesterday. Read more of this post