South Korea’s $21bn alternative to Seoul lacks transport and soul

November 19, 2013 3:56 am

South Korea’s $21bn alternative to Seoul lacks transport and soul

By Simon Mundy in Sejong City, South Korea

Stretching from the top of the transport ministry to that of the prime minister’s office, the undulating rooftop garden lends a futuristic touch to South Korea’s new government complex in Sejong City, 150km south of Seoul. But Lee Dae-young casts a lonely figure as he makes his way through the park. Like many other civil servants, the 53-year-old accident investigator left his family behind in Seoul when he moved to Sejong late last year, and now sees his two children only at weekends. Read more of this post

Reforms to shift Japan’s huge pension fund towards riskier investments

Reforms to shift Japan’s huge pension fund towards riskier investments

4:15pm EST

By Chikafumi Hodo and Noriyuki Hirata

TOKYO (Reuters) – The world’s biggest pension fund is preparing its most ambitious overhaul since its creation more than a decade ago, a process that will eventually see more of Japan’s $2 trillion in public funds invested in stocks and other riskier assets and relatively less cash parked in government bonds. An advisory panel to the government of Prime Minister Shinzo Abe, in a highly anticipated report on Wednesday, will propose far-reaching reforms to the Government Pension Investment Fund (GPIF), encompassing fundamental change to its governance and investment strategy. Read more of this post

Made in Japan’ not so big in Japan

Made in Japan’ not so big in Japan

Wednesday, November 20, 2013 – 03:02

au Boon Lai, Japan Correspondent In Tokyo, The Straits Times

Mr Makoto Miyazaki swears by the made-in-Japan office furniture he sells at a store in Tokyo’s suburban ward of Taito. “They are better than the China-made ones as they are more solidly built,” he said. But despite his spirited attempts at explaining to customers why they should pay about 30 to 50 per cent more for a Japan-made cabinet, it is those that were made in China that fly off the shelves, leading to a three-month wait in some cases. Read more of this post

Japan IPOs Surge to Most Since 2007 as Each Climbs on First Day

Japan IPOs Surge to Most Since 2007 as Each Climbs on First Day

Japan’s biggest equity rally in four decades is driving a boom in initial public offerings, with new listings this year poised to reach the most since 2007 and every stock rising on its debut. About 60 companies have gone public in 2013 or plan to do so by year-end, the most since 121 offerings in 2007, according to projections by Nomura Holdings Inc. The 36 IPOs since December have climbed on their first trading day, the longest streak of gains since 39 listings advanced in 2006, data compiled by Bloomberg show. The average opening-day advance this year was 131 percent, according to the data. Reprocell Inc., a stem-cell medical research company, soared more than fivefold in June for the largest of the year. Read more of this post

Honda to Nissan Bet Small Is Profitable With Minicar Push: Cars

Honda to Nissan Bet Small Is Profitable With Minicar Push: Cars

Japan’s automakers are betting that small will be the next big thing.

At the Tokyo Motor Show opening this week, Honda Motor Co. will unveil the two-seat S660 convertible, its first mini sports car since 1996. Daihatsu Motor Co. has a rival model with panels that can be changed like an iPhone cover. More than a third of the show’s debuts will be mini vehicles, up from about 14 percent in 2011, data compiled by Bloomberg show. Read more of this post

The rediscovery of India; Is diversity an excuse for disunity? CNN’s Fareed Zakaria says Indians must embrace their common ambitions if the nation is to fulfill its tremendous potential

The rediscovery of India

Is diversity an excuse for disunity? CNN’s Fareed Zakaria says Indians must embrace their common ambitions if the nation is to fulfill its tremendous potential.

November 2013 | byFareed Zakaria

Is India even a country? It’s not an outlandish question. “India is merely a geographical expression,” Winston Churchill said in exasperation. “It is no more a single country than the Equator.” The founder of Singapore, Lee Kuan Yew, recently echoed that sentiment, arguing that “India is not a real country. Instead it is thirty-two separate nations that happen to be arrayed along the British rail line.” Read more of this post

Multiplexes rake in the rupees in Bollywood-mad India

Multiplexes rake in the rupees in Bollywood-mad India

4:06pm EST

By Nandita Bose and Abhishek Vishnoi

MUMBAI (Reuters) – For a country that produces twice as many movies a year as Hollywood, India has a problem that’s making cinema theatre operators beam: a shortage of modern multi-screen cinemas and plenty of increasingly affluent film fans. Multiplex operators like PVR Ltd, Inox Leisure, Reliance Mediaworks and Mexican chain Cinepolis are scrambling to set up theatres targeting the rapidly growing number of middle-class Indians willing to pay to watch Bollywood movies in more comfortable surroundings. Read more of this post

Billionaire Birla Said to Delay Idea Share Sale: Corporate India

Idea Said to Delay $482 Million Share Sale After Stock Declines

Idea Cellular Ltd. (IDEA), India’s second-largest listed mobile-phone operator, delayed plans to raise as much as 30 billion rupees ($482 million) in a stock sale after its shares fell, said two people with knowledge of the matter. The company, controlled by billionaire Kumar Mangalam Birla, may start the sale to institutions next year after originally aiming to complete it this month, said the people. They asked not to be identified because the deliberations are private. Idea shares dropped as much as 17 percent from an Oct. 15 all-time high before rebounding in the past week. The stock is still down 7.5 percent from last month’s 188.40 rupees peak, data compiled by Bloomberg show. Mumbai-based Idea had aimed to shell shares for least 190 rupees each, one person said. Bank of America Corp., Citigroup Inc., Morgan Stanley, Standard Chartered Plc, JPMorgan Chase & Co. and Axis Bank Ltd. are managing the share sale, the people said. Rajat Mukarji, a spokesman for Idea, declined to comment. Idea announced plans in August to raise money through a share sale to institutional investors. The company will also sell as much as 7.5 billion rupees of stock to an existing shareholder, Malaysia’s Axiata Group Bhd., according to a statement at the time.

To contact the reporter on this story: George Smith Alexander in Mumbai at galexander11@bloomberg.net

China’s slowdown is not just affecting the mainland – its shift in economic gears has also put a brake on the velocity of the Hong Kong stock market

November 19, 2013 6:45 pm

Hong Kong’s gears grind slowly

By Paul J Davies in Hong Kong

China’s slowdown is not just affecting the mainland – its shift in economic gears has also put a brake on the velocity of the Hong Kong stock market. This velocity measure – the turnover of the market divided by its total value – is close to its weakest level in a decade, according to Morgan Stanley. For the exchange itself, this is bad news – holding back its earnings both last year and this to a level below that recorded in 2011. Read more of this post

Wenzhou fake tycoon Lin Chunping gets life in jail for fraud

Wenzhou fake tycoon Lin Chunping gets life in jail for fraud

Wednesday, 20 November, 2013, 3:48am

Jeremy Blum jeremy.blum@scmp.com

The Wenzhou rice trader who invented a fictitious US bank which he claimed to have bought last year has been sentenced to life imprisonment yesterday for the separate crime of issuing fabricated tax documents. Lin Chunping during trial in the Wenzhou Intermediate People’s Court. Photo: Screenshot via Sina WeiboLin Chunping, 43, was accused of making 1,266 false value-added tax invoices worth 520 million yuan (HK$658 million) and selling them to companies across the country between September 2011 and May last year for profit, Xinhua reported, citing the city’s intermediate court verdict. Read more of this post

To Curb Graft, Party to Consider Changes to Official Housing System

11.20.2013 15:25

To Curb Graft, Party to Consider Changes to Official Housing System

Professor’s idea to provide homes for more leaders – then make sure they move out after they leave office – made it into plenum document

By staff reporter Zhou Tian

(Beijing) – The ruling Communist Party will explore ways to provide housing to officials as a way of trying to curb property-related graft, a document released after a major party meeting says. The idea for the system comes from Wang Yukai, a professor at the Chinese Academy of Governance, an institution in the capital that trains government officials. Wang proposed the idea to the party’s 18th Central Committee in July. His ideas were presented in an essay that explored how officials’ housing was handled abroad and in ancient China, and the feasibility of implementing new approaches. Read more of this post

The Booming Bottled Water Business Represents Everything That’s Wrong With Government Regulation In China

The Booming Bottled Water Business Represents Everything That’s Wrong With Government Regulation In China

MAMTA BADKAR NOV. 19, 2013, 4:49 PM 1,663 3

The bottled water business has boomed in China as concerns about contaminated water sources persist. Sales of bottled water are expected to surge to $16 billion by 2017, from $9 billion last year, according to Euromonitor International. “This water story illustrates how much China’s economy is distorted by unhealthy government power,” writes Andy Xie, independent economist and former Morgan Stanley chief Asia-Pacific economist, in Caixin Online. Read more of this post

Jim Rogers: I’m Buying Chinese Stocks Including HollySys And Fab Universal

Jim Rogers: I’m Buying Chinese Stocks Including HollySys And Fab Universal

November 19, 2013

In this episode of China Money Podcast, returning guest and veteran investor Jim Rogers, chairman of Rogers Holdings, talked with our host Nina Xiang on his reading of China’s third plenum meeting, why China should open its financial markets completely “this afternoon”, and what Chinese stocks he has been buying lately.

Q: The just completed third plenum meeting provided a road-map for China’s future reforms. It created this renewed sense of optimism about China’s future. Do you share that feeling?

A: I was quite delighted to see what they said. The one overriding point is that the market is going to make the final decision. That is contrary to what is happening in the U.S., and that is why the world is moving to Asia. Read more of this post

Chinese Skeptics Deepening Biggest A-Share Discount in 3 Years

Chinese Skeptics Deepening Biggest A-Share Discount in 3 Years

China’s largest package of economic reforms since the 1990s is getting a bigger vote of confidence from foreign investors than from the nation’s own citizens. The benchmark index for Chinese stocks traded in Hong Kong has jumped 6.2 percent, more than twice the Shanghai gauge, since policy makers led by President Xi Jinping pledged to ease China’s one-child policy and liberalize interest rates on Nov. 15. That left mainland shares valued at a 5.8 percent discount, the most in three years, according to the Hang Seng China AH Premium Index. Read more of this post

China’s top leaders are giving the go-ahead to create new, privately held banks, opening up a sector that has been mostly off-limits to private capital and indirectly acknowledging that the current system isn’t working.

China Clears a Path for New Banks

Government, Seeking to Expand Access to Credit, to Permit Creation of Lenders

DINNY MCMAHON

Updated Nov. 19, 2013 9:57 p.m. ET

BEIJING—After decades of relying on state banks, China’s top leaders are giving the go-ahead to create new, privately held banks, opening up a sector that has been mostly off-limits to private capital and indirectly acknowledging that the current system isn’t working. A program endorsed last week by the Communist Party leadership calls for letting private investors that meet certain as-yet-undefined requirements set up small and medium-size banks and other financial institutions. Read more of this post

China To Ban Another Off-Balance Sheet Bank Channel

China To Ban Another Off-Balance Sheet Bank Channel: Press

Created on Monday, November 18, 2013 – 21:54 EST

BEIJING (MNI) – New rules limiting borrowing and lending practices in the Chinese interbank market may not be as draconian as previously feared but will still close off a channel which currently allows banks to transfer assets off their balance sheets, according to Caijing magazine. The weekly says that, according to newly finalized rules from the China Banking Regulatory Commission (CBRC), banks will no longer be allowed to use tri-party agreements to transfer those assets off, but won’t ban the agreements outright as the interbank market had rumored. Read more of this post

China Has ‘High’ Chance of Small Bank Failure, Official Says

China Has ‘High’ Chance of Small Bank Failure, Official Says

One or two small Chinese banks may fail next year as they face pressure from their reliance on short-term borrowing, a Communist Party economic official said. Small banks get about 80 percent of their funding from interbank markets and deposits in savings vehicles known as wealth management products, Fang Xinghai, a bureau director at the Central Leading Group for Financial and Economic Affairs, said at a conference in Beijing today. They face risks from the mismatch with their long-term loans to borrowers such as local-government financing vehicles, he said. Read more of this post

China Central TV: champion of the people with a blurred picture

November 20, 2013 3:15 am

China Central TV: champion of the people with a blurred picture

By FT reporters

At the end of October, a young journalist in handcuffs, green prison jacket and a freshly-shaved head appeared on China Central Television, the state-owned national broadcaster, and confessed to taking bribes in exchange for writing negative articles about a large Chinese company. Just days earlier, the newspaper that employed Chen Yongzhou, 27, had published front-page banner headlines calling for his release, while human rights groups had mobilised to defend him. But after his admission on national television, the issue quickly died away. Read more of this post

China banks forced to delay or dramatically reduce Chinese bond issues as the impact of a tight onshore credit market begins to be felt

November 19, 2013 9:34 am

China banks forced to delay bond issues

By Paul J Davies in Hong Kong and Simon Rabinovitch in Shanghai

China Development Bank and fellow state policy lender Agricultural Development Bank of China have had to delay or dramatically reduce Chinese bond issues as the impact of a tight onshore credit market begins to be felt. The China Railway Corporation, another state entity, was forced to delay a deal recently, while well-known private companies including the electric carmaker BYD and internet company Baidu also saw deals delayed over the summer, according to bankers familiar with the situation. Read more of this post

China baby boom fears outweigh evidence of falling fertility rates

November 19, 2013 1:32 pm

China baby boom fears outweigh evidence of falling fertility rates

By Lucy Hornby

Fears of a baby boom are leading China to keep a tight grip on family size, with only a minor relaxation in the Communist party’s one-child policy despite evidence that birth rates have already fallen faster than intended. The party announced on Friday that couples where one spouse is an only child may have a second child, a policy change that could result in about 1m additional births a year but still fundamentally limits most couples’ ability to choose. Read more of this post

CBRC Promotes Interbank De-leveraging; Interbank business is just another channel for banks in their never-ending quest to circumvent regulatory controls, which is becoming increasingly complex and hidden

CBRC Promotes Interbank De-leveraging

11-19 14:15 Caijing

Interbank business is just another channel for banks in their never-ending quest to circumvent regulatory controls, which is becoming increasingly complex and hidden.

By staff reporters Dong Yuxiao and You Xi

Interbank financing has surged in China in the past few years, spurring banking regulators to introduce regulatory policies that will tighten their grip on interbank operations and limit growth of banks’ off-balance sheet assets. Caijing learned that relevant authorities at the China Banking Regulatory Commission (CBRC) have drafted the Interbank Financing Management Rules for Commercial Banks (the “Rules”). The Rules are expected to be approved and implemented in Feb. 2014 after being submitted to CBRC leadership in November. Read more of this post

Anger and Angst in Hospitals Where Doctors Die; Another deadly stabbing has forced soul-searching over China’s overcrowded hospitals and their underpaid doctors

11.20.2013 15:51

Anger and Angst in Hospitals Where Doctors Die

Another deadly stabbing has forced soul-searching over China’s overcrowded hospitals and their underpaid doctors

By staff reporters Lan Fang, Li Yan, Luo Jieqi, Ren Zhongyuan and Lin Jinbing and intern reporter Han Xiaomei

(Beijing) – There was a time when the words of the Hippocratic Oath meant a lot to Dr. Wen Mei. She’ll never forget standing proudly with her classmates, each in a sparkling white coat, and reciting the oath in unison on their first day of medical school. Wen’s idealistic school days are long gone. Like many hospital doctors in China, she’s had to change her perspective in the face of harsh workplace conditions, including dangers posed by angry patients, overcrowding that some experts say is behind a patient rage phenomenon in China, and puny salaries. Read more of this post

Will China and India Destroy the World?

Will China and India Destroy the World?

As Lawrence Summers makes a splash with a new research report about China and India, I’m reminded of a chat we had in Japan in May 2007. We were in Kyoto, where the Asian Development Bank was holding its annual meeting. I moderated a panel discussion, and Summers was asked to join us for the last 30 minutes to offer his take on the next wave of Asian tiger economies. Summers isn’t known for subtlety, and he bluntly questioned whether it was wise for rich nations to be shored up financially by developing ones in Asia that could crash at any time. The crowd was aghast. It was as if he’d belched into the microphone. Read more of this post

Tsunami-Blocking Mangroves Lure Carbon Investors: Southeast Asia; “Where the mangroves are, the people are happy”

Tsunami-Blocking Mangroves Lure Carbon Investors: Southeast Asia

Replanted mangrove trees in Southeast Asia are getting credit for protecting against deadly tsunamis and typhoons such as Haiyan in the Philippines and cutting greenhouse gas emissions. Mangrove regeneration in Northern Samar, about 100 miles (160 kilometers) north of the worst-hit Philippine city of Tacloban, helped minimize damage from the Nov. 8 storm, according to the Trowel Development Foundation, which oversaw the plantings. On Indonesia’s Sumatra island, where a 2004 tsunami killed 170,000 residents, companies including Danone and Credit Agricole SA (ACA) have put up about $4 million in exchange for tradable carbon offsets tied to the reforestation. Read more of this post

Large Investors Find Asian Hedge-Fund Options Limited

Large Investors Find Asian Hedge-Fund Options Limited

Asian Hedge Funds Are Performing Well, but Large Ones Are in Short Supply

MIA LAMAR And CHAO DENG

Updated Nov. 19, 2013 9:06 p.m. ET

Large overseas investors can’t get enough of big-name Asian hedge funds. Too bad there aren’t more of them. Deep-pocketed pension and endowment funds—many from the U.S.—are coming to Asia in droves, ready to put cash in the region’s hedge funds as the industry rounds out what is shaping up to be a second straight year of outperforming peers in the U.S. and Europe. Read more of this post

Asia’s New Aging Rich Break Family Bonds for Gilded Retirement

Asia’s New Aging Rich Break Family Bonds for Gilded Retirement

After P.S. Ramachandran turned 80, he and his wife decided it was time to stop living alone. Rather than take the traditional path of moving in with their son, the Ramachandrans chose an option once rare in India: a retirement community. “We wanted to be independent,” said Ramachandran, now 85, a former government official who moved to the Brindavan Senior Citizen Foundation’s retirement village overlooking the Nilgiri hills near Coimbatore city in southern India. “We have company and everything we need here, and activities to keep us busy as long as we’re physically able.” Read more of this post

CHANOS: Big Oil Companies Are The Next Value Trap

CHANOS: Big Oil Companies Are The Next Value Trap

KATYA WACHTEL, REUTERS NOV. 19, 2013, 10:08 PM 3,741 9

NEW YORK (Reuters) – Short-seller Jim Chanos said Tuesday it is time for typical equity investors to be “a little more cautious” even as the stock market may continue to rise. Chanos, speaking the Reuters Global Investment Outlook Summit in New York said his fund Kynikos Associatesis “very bearish on coal” and he is “pretty much short” all the U.S. leveraged coal companies. Chanos also said he was bearish on national oil companies and the integrated majors like Exxon-Mobil, which he said are experiencing a “dropping return on capital” that “is really ominous.” The famous short-seller said Exxon-Mobil and other oil companies like it increasingly look like “value trap.” He also said investors would be “well warned” to analyze Caterpillar Inc’s financial unit.