With more than 7,600 pharmacies and the largest U.S. chain of retail health clinics, CVS is one of the country’s largest health-care companies


Healthy Gains Ahead for CVS


With more than 7,600 pharmacies and the largest U.S. chain of retail health clinics, CVS is one of the country’s largest health-care companies.

Smokers who quit the habit can look forward not only to pinker lungs but also fatter wallets. CVS Caremark, which announced on Feb. 5 it will stop selling tobacco by October, may also win more profit than it loses from the move. Its profit comes increasingly from health plans, which aren’t keen on carcinogens. Consider: CVS’ tobacco decision is expected to subtract six to nine cents from its yearly earnings per share. But a prescription deal with the Federal Employee Health Program, which expires at year’s end, is worth 16 cents to 21 cents a share, estimates investment bank Mizuho Securities. For CVS (ticker: CVS), a good chance at renewal just became better, and there’s plenty more business to be won. Read more of this post

Lease-to-own instalment provider Singer Thailand has been stung by a rising number of non-performing loans, with most attributed to farmers who are suffering from long-delayed payments under the government’s rice-pledging scheme

Farmers’ plight driving up Singer Thailand’s NPLs

Sucheera Pinijparakarn
The Nation February 15, 2014 1:00 am

Lease-to-own instalment provider Singer Thailand has been stung by a rising number of non-performing loans, with most attributed to farmers who are suffering from long-delayed payments under the government’s rice-pledging scheme.

The company’s managing director, Boonyong Tansakul, said farmers accounted for 25 per cent of its portfolio. Read more of this post

How to Make Yourself Work When You Just Don’t Want To; Reason #1 You are putting something off because you are afraid you will screw it up

How to Make Yourself Work When You Just Don’t Want To

by Heidi Grant Halvorson  |   12:00 PM February 14, 2014

There’s that project you’ve left on the backburner – the one with the deadline that’s growing uncomfortably near.  And there’s the client whose phone call you really should return – the one that does nothing but complain and eat up your valuable time.  Wait, weren’t you going to try to go to the gym more often this year?

Can you imagine how much less guilt, stress, and frustration you would feel if you could somehow just make yourself do the things you don’t want to do when you are actually supposed to do them?  Not to mention how much happier and more effective you would be? Read more of this post

Mindfulness in the Age of Complexity

March 2014

Mindfulness in the Age of Complexity

An Interview with Ellen Langer by Alison Beard

Over nearly four decades, Ellen Langer’s research on mindfulness has greatly influenced thinking across a range of fields, from behavioral economics to positive psychology. It reveals that by paying attention to what’s going on around us, instead of operating on auto-pilot, we can reduce stress, unlock creativity, and boost performance. Her “counterclockwise” experiments, for example, demonstrated that elderly men could improve their health by simply acting as if it were 20 years earlier. In this interview with senior editor Alison Beard, Langer applies her thinking to leadership and management in an age of increasing chaos. Read more of this post

John Maynard Keynes, Investment Innovator

Journal of Economic Perspectives—Volume 27, Number 3—Summer 2013—Pages 213–228cle Citation

Chambers, David, and Elroy Dimson. 2013. “Retrospectives: John Maynard Keynes, Investment Innovator.” Journal of Economic Perspectives, 27(3): 213-28.
John Maynard Keynes made a major contribution to the development of professional investment management. Based on detailed archival research at King’s College, Cambridge, we describe Keynes’ investment philosophy, his investment performance, and the evolution of his investment approach as the manager of a large educational endowment. His portfolios were actively managed and unconventional. He was an investment innovator both in making a substantial allocation to the then new institutional asset class of common stocks as well as in championing value investing.

Why Writers Are the Worst Procrastinators; “Work finally begins when the fear of doing nothing exceeds the fear of doing it badly.”

Why Writers Are the Worst Procrastinators

By Megan McArdle

Like most writers, I am an inveterate procrastinator. In the course of writing this one article, I have checked my e-mail approximately 3,000 times, made and discarded multiple grocery lists, conducted a lengthy Twitter battle over whether the gold standard is actually the worst economic policy ever proposed, written Facebook messages to schoolmates I haven’t seen in at least a decade, invented a delicious new recipe for chocolate berry protein smoothies, and googled my own name several times to make sure that I have at least once written something that someone would actually want to read. Read more of this post

What I Learned From Ray Dalio: Lessons from the world’s greatest macro investor.

What I Learned From Ray Dalio: Lessons from the world’s greatest macro investor.

By Samuel Lee | 02-11-14 | 06:00 AM | Email Article

A version of this article was published in the December 2013 issue of Morningstar ETFInvestor. Download a complimentary copy here.

I try to learn from the best. Ray Dalio is one of them. He founded Bridgewater Associates, one of the biggest hedge funds in the world. Many retail investors have not heard of him, probably because his funds are open only to big institutions. It’s a terrible mistake to limit yourself to listening only to the musings of mutual fund managers. Doing so means that you will ignore many of the best investors.

Dalio’s perspective is invaluable. He’s willing to entertain seemingly loony ideas. For example, in 2001 he had his firm develop a depression gauge. In 2003, Nobel Prize-winning economist Robert Lucas declared that the “central problem of depression prevention has been solved, for all practical purposes, and has in fact been solved for many decades.” Five years later, in late 2008, Dalio’s depression gauge went off. Bridgewater was one of the few firms that anticipated and successfully navigated the financial crisis and its aftermath. Unlike many other money managers, Bridgewater predicted low interest rates and low inflation even after the Federal Reserve and other central banks worldwide embarked on rounds of massive and unconventional monetary stimulus.

A great deal of Dalio’s success owes to his admirable willingness to admit error and self-correct. He expects the same of his workers. He says, “At Bridgewater people have to value getting at truth so badly that they are willing to humiliate themselves to get it.”

In many respects, Dalio is the anti-Warren Buffett. Buffett makes big bets on a handful of companies. Dalio makes many small bets on currency pairs, commodities, bonds, and, to a much lesser extent, equities. Buffett grants his subordinates plenty of autonomy and lets them figure out their own way. Dalio imposes a set of principles that his subordinates are to live by and heavily monitors them. Buffett doesn’t give much thought to economic cycles. Dalio’s investing style is based on identifying and navigating them. Buffett doesn’t like gold. Dalio thinks everyone should own a little bit of it.

Because Dalio’s found success in such an unconventional way, his methods are a rich vein to mine for lessons. After all, successful investing requires delinking your perspective from the consensus. Here are some of the most important lessons I learned from Dalio and his colleagues at Bridgewater.

The long- and short-term debt cycles are the biggest reasons the economy deviates from trend-line growth.
According to Dalio, the economy’s behavior can be largely explained by three forces: trend productivity growth, the long-term debt cycle, and the short-term debt cycle. Productivity growth occurs due to technological progress and is the most important force over century-long scales. Exhibit 1 is a chart reproduced from Dalio’s paper, “How the Economic Machine Works.” It shows trend growth of per-capita income has been steady, especially after World War II.


Over, say, five to seven years, the short-term debt cycle dominates. It occurs when the central bank tightens and loosens credit. It’s also known as the business cycle. When credit and money grow faster than real economic production, inflation rises, spurring the central bank to raise interest rates and tighten credit, leading to a recession. When inflation is under control, the central bank lowers interest rates and loosens credit to spur economic growth. Many investors focus on where they are in the short-term cycle.

So far, Dalio’s model is conventional. His key insight is observing that there’s a long-term debt cycle, which operates over decades. During the leveraging phase of the cycle, debts rise faster than incomes in a self-perpetuating manner. Households and firms borrow money, which they spend. Because someone’s spending is another’s income, overall spending—the economy—grows. Asset prices go up. With greater incomes and more valuable assets, firms and households borrow even more and lenders are eager to lend. And the cycle continues. Part of the growth in incomes and asset prices during this phase is illusory; rising leverage has the effect of pulling forward wealth from the future.

While the process can go on for a long time, debts cannot rise faster than income forever. The process hits a wall when the central bank can no longer stimulate the economy because the short-term interest rate required to restore full employment is below zero.


According to Dalio, deleveragings are achieved through four channels: 1) debt write-downs; 2) the transfer of wealth from the haves to the have-nots; 3) austerity; and 4) money printing. The first three channels are deflationary. Money printing is inflationary.

How a deleveraging evolves depends on the relative contributions of deflationary and inflationary forces. Because deleveragings occur once a lifetime, policymakers don’t know how to manage them. Guided by conventional wisdom, they usually turn to austerity and debt restructurings to bring down debt levels. The result is an “ugly” deleveraging, during which the economic pain is worsened and the debt/income ratio actually rises because incomes fall faster than debts. Policymakers see that their medicine isn’t working and turn to fiscal stimulus and money printing to ease the burden. This is what occurred in the U.S. in the 1930s and in Europe in the aftermath of the financial crisis.

If authorities balance deflationary interventions with the right amount of money printing, the deleveraging enters a “beautiful” phase. The pain of debt write-downs is spread out. Growth is subdued, as the economy must rely on productivity improvements to grow. The United States is undergoing the most beautiful deleveraging in history, according to Bridgewater. This puts Bridgewater in an unusual camp. Of Ben Bernanke and America’s central bankers, Bridgewater co-president David McCormick has said, “History will look back on them as having responded in a way that was both necessary and heroic.”

Deleveragings take decades to work themselves out. According to this model, we’ve still a long way to go before short-term interest rates rise.

Study distant times and distant places to understand what’s going on today and how events will probably transpire in the future.
Many investors were caught flat-footed by the financial crisis and the way assets behaved in its after-math. They assumed the ghost of the Great Depression or post-bubble Japan would never visit the U.S.

Dalio, on the other hand, studied the great inflation of Weimar Germany, the Great Depression in the U.S., Latin America in the 1980s, post-1990 Japan, and other economic disasters. He seriously considered whether such events could transpire again and what caused them.

Conventional economists and investors on Wall Street focus on post-World War II data for several reasons. First, many believe old data is misleading because the economy has changed so much. Second, many data sets begin only in the 1960s or 1970s. Finally, the possibility of extreme outcomes implied by the historical record and foreign experience is frightening and easy to rationalize as irrelevant.

There’s no such thing as correlation.
Many investors diversify their portfolios based on historical correlations between asset classes. Bridgewater argues that correlation is not a real thing. It is a statistical artifact of the idiosyncratic economic shocks that affected the assets examined in the past.

It makes perfect sense. Different asset classes react in rational, fairly predictable ways to different economic conditions. Assuming a historical correlation will hold going forward is a bet that future economic conditions will, on average, look like the past. This is rarely true, which is why correlations are fairly unpredictable.

Exhibit 3 shows the rolling five-year correlation of the monthly returns of the S&P 500 and the Ibbotson Associates Intermediate Treasury Bond Index. The sign doesn’t switch randomly. There seem to be long-lived regimes.


According to Dalio, stocks and bonds are both positively correlated when inflation expectations are more volatile than growth expectations, and negatively correlated when they’re not. This makes sense, as inflation uncertainty strongly affects the market’s discount rate. When discount rates rise, both stocks and bonds are hurt, and vice versa.

Bridgewater calls this type of analysis the “structural” approach to correlation. Based on it, Dalio invented the now-famous “risk parity” strategy, which attempts to balance a portfolio’s exposures to rising growth, falling growth, rising inflation, and falling inflation such that it’s not severely hurt when the economic environment changes


AussieCommerce heads up-market, eyes IPO

AussieCommerce heads up-market, eyes IPO

Published 13 February 2014 09:48, Updated 14 February 2014 09:07

James Hutchinson



Jeremy Same and Adam Schwab of Deals.com.auPhoto: Josh Robenstone

The chief executive of fast-growing online retail outfit AussieCommerce, Adam Schwab, says the company is moving away from group-buying deals as it mulls a public listing on the Australian Securities Exchange. Read more of this post

Business is not a decathlon: why entrepreneurs should concentrate on one thing at a time

Business is not a decathlon: why entrepreneurs should concentrate on one thing at a time

Published 13 February 2014 08:54, Updated 14 February 2014 09:07

Vaughn Richtor

If there’s one thing entrepreneurs tend to excel at, it’s identifying opportunities.

Asking the question “what if . . . ?” and coming up with creative ideas are an entrepreneur’s forte, and the cornerstone on which many great businesses are built. The question is: if so many businesses start with great ideas, then why do so many businesses fail? Read more of this post

How I built Roses Only, why I sold it, and what’s next: founder James Stevens; Roses Only: The $30 million reason Jack Singleton is looking forward to Valentine’s Day

Caitlin Fitzsimmons Online editor

How I built Roses Only, why I sold it, and what’s next: founder James Stevens

Published 13 February 2014 11:56, Updated 14 February 2014 09:07+font-fontprintEmail page


RosesOnly founder James Stevens is “bullish about Asia”. Photo: Nic Walker

For James Stevens, the sale of Roses Only in Australia and New Zealand to Jack Singleton’s FlowersCorp is only the end of the beginning.

Stevens retains the right to the Roses Only brand and owns the associated domain name in every market outside Australia and New Zealand and he has big growth plans for Asia. Read more of this post

Turkish next-gens are placing greater importance on corporate governance and professionalisation of their family businesses than preceding generation



Turkish next-gens are placing greater importance on corporate governance and professionalisation of their family businesses than preceding generations, according to new research released today.

In total only 52% of family businesses in the country have a succession plan for the next generation, and only 23% have an estate plan, according to Turkish wealth builders: Family businesses cultivate economic growth, completed by Campden Wealth in conjunction with UBS. Read more of this post

Ummm, what are we doing this year?: big disconnect between managers and staff; If the boss has a plan, one-third of empoyees don’t know what it is.

Fiona Smith Columnist

Ummm, what are we doing this year?: big disconnect between managers and staff discovered

Published 12 February 2014 12:23, Updated 13 February 2014 08:57

If the boss has a plan, one-third of empoyees don’t know what it is.

A survey taken last week finds that 83 per cent of leaders and managers claim to have a business plan for 2014, but only 66 per cent of employees agree.

The survey was conducted by Leadership Management Australasia and its CEO, Andrew Henderson, says it is concerning that one-third of employees says their organisations have started the new work year without a plan. Read more of this post

Age and Scientific Genius

Age and Scientific Genius

Benjamin Jones, E.J. Reedy, Bruce A. Weinberg

NBER Working Paper No. 19866
Issued in January 2014
Great scientific output typically peaks in middle age. A classic literature has emphasized comparisons across fields in the age of peak performance. More recent work highlights large underlying variation in age and creativity patterns, where the average age of great scientific contributions has risen substantially since the early 20th Century and some scientists make pioneering contributions much earlier or later in their life-cycle than others. We review these literatures and show how the nexus between age and great scientific insight can inform the nature of creativity, the mechanisms of scientific progress, and the design of institutions that support scientists, while providing further insights about the implications of aging populations, education policies, and economic growth.


Why major creative breakthroughs happen in your late thirties; Genius, it seems, happens when a seasoned mind sees a problem with fresh eyes

Why major creative breakthroughs happen in your late thirties

By Olga Khazan, The Atlantic an hour ago

James Murphy, the former frontman of the band LCD Soundsystem, made what he called the biggest mistake of his life at 21, when he turned down a writing job on a sitcom that was about to launch.

The sitcom’s name was Seinfeld. Read more of this post

Graduate glut: 12,000 new lawyers every year in Australia

Graduate glut: 12,000 new lawyers every year

February 14, 2014

Edmund Tadros

Law students are being urged to look beyond the legal field for career options, as a massive oversupply of graduates floods into a tough job market.

The number of law students has doubled in the past decade, with more than 12,000 graduates now entering a job market that comprises about 60,000 solicitors each year. Read more of this post

Why New Zealand is the new Ireland; New Zealand’s economy has been the subject of plenty of hype lately, but some say a reality check is coming, and it’s going to hurt

Why New Zealand is the new Ireland

February 14, 2014

New Zealand’s economy has been the subject of plenty of hype lately, but some say a reality check is coming, and it’s going to hurt.

New Zealand is “like Ireland in 2007” and it’s only a matter of time before its currency takes a hit according to one analyst. Read more of this post

The fumbles that led to Forge Group’s demise: CEO David Simpson, a former rugby player, was tripped by projects that cost him the game

The fumbles that led to Forge Group’s demise

February 15, 2014

Brian Robins

CEO David Simpson, a former rugby player, was tripped by projects that cost him the game.

For David Simpson, it was pretty much the dream job: his first gig as chief executive of his own public company.

After an extensive background in the construction sector, working for ABB and Leighton, he had most recently run UGL’s resources arm, a $1 billion business. So stepping up to run his own show was the opportunity of a lifetime. Read more of this post

Australia needs to smarten up its act with manufacturing exports; The decline of large-scale manufacturing leaves a gap for hungry small businesses to fill

Australia needs to smarten up its act with manufacturing exports

February 15, 2014

Georgia Wilkins, Ruth Williams.

The decline of large-scale manufacturing leaves a gap for hungry small businesses to fill


Hybrid Electronics is the kind of business that has been touted as the future of local manufacturing.

The Melbourne-based company’s highly skilled workforce makes high-tech products for a niche market. Read more of this post

A self-titled foundation established to leave a legacy in the world used to be the prerogative of the very wealthy, but increasingly philanthropists are abandoning their vanities in favour of high-impact spend-out models for their trusts.



The study of philanthropy is an imprecise science and there is no formula that can predict why a wealthy individual would decide to give and to which causes, much less why they would decide it’s time to stop. Read more of this post

Deloitte Anjin faces credibility crisis; Accounting firm suspected of “deliberately” inflating Ssangyong Motor’s losses

2014-02-14 16:50

Deloitte Anjin faces credibility crisis

Accounting firm suspected of inflating Ssangyong’s losses

image003 Accounting firm suspected of inflating Ssangyong’s losses

By Na Jeong-ju
Deloitte Anjin is at risk of losing market trust because of allegations that it “deliberately” inflated potential losses of Ssangyong Motor to help it cut more than 2,600 jobs in 2009.
Last week, an appeals court ruled that the layoffs were invalid because it was based on the accounting firm’s “wrong” evaluation of Ssangyong’s value. If the ruling is upheld by the Supreme Court, the fired Ssangyong workers will get their jobs back. Read more of this post

Once upon a time, China anointed a ‘King of Japan’

Once upon a time, China anointed a ‘King of Japan’


FEB 15, 2014

In 1401, barely a century after the Mongols’ aborted invasions of Japan, and 600-odd years before Japan and China fell out over the Senkaku islets, a Chinese emperor conferred upon a Japanese shogun the title “King of Japan.” Read more of this post

The power behind Olympic glory: IOC soaked in stupendous wealth, mystery and controversy

The power behind Olympic glory: IOC soaked in stupendous wealth, mystery and controversy

Jen Gerson | February 14, 2014 | Last Updated: Feb 14 11:25 PM ET

It’s impossible not to marvel at the spectacle and camaraderie of the Olympics — to be awestruck by athletes who have devoted their lives with monomaniacal intensity to perfecting a sport.

Yet behind the dramas and heartbreak that catch the world’s attention, few wonder how the games are run and funded. Read more of this post

The ‘Made in Canada’ brand: Does it even make any economic difference?

The ‘Made in Canada’ brand: Does it even make any economic difference?

Armina Ligaya | February 15, 2014 7:00 AM ET

Canada enjoys an enviable reputation around the world for being a stable and friendly economic powerhouse with wide expanses, and, of course, a hockey-loving, maple-syrup churning, multicultural population. Read more of this post

China’s Risky Reforms

Ian Bremmer is President of Eurasia Group and the author of Every Nation for Itself: Winners and Losers in a G-Zero World.

David Gordon, a former director of policy planning in the US State Department, is Chairman and Head of Research at Eurasia Group.

FEB 14, 2014

China’s Risky Reforms

NEW YORK – When it comes to economic reform, China’s leaders no longer believe that time is on their side. With a new sense of urgency, President Xi Jinping and his inner circle are attempting one of the most ambitious economic and social-policy reform plans in history. Read more of this post

Hooked: A Guide to Building Habit-Forming Products

Hooked: A Guide to Building Habit-Forming Products Paperback

by Nir Eyal  (Author) , Ryan Hoover (Contributor)


Why do some products capture our attention, while others flop?
What makes us engage with certain products out of habit?
Is there a pattern underlying how technologies hook us?
This book introduces readers to the “Hook Model,” a four steps process companies use to build customer habits. Through consecutive hook cycles, successful products reach their ultimate goal of bringing users back repeatedly — without depending on costly advertising or aggressive messaging.  Read more of this post

The Ernest Hemingway App For Writers Who Can’t Write Good

The Ernest Hemingway App For Writers Who Can’t Write Good

ON FEBRUARY 14, 2014

It’s one thing to write something, another thing to draft something memorable and eloquent. Quite obviously this is what separates the legends from those of us who write endless drivel. But is good writing something that’s programmable? Two brothers seem to think so. Or at least want the world to think they think so. Read more of this post

China $160 mln investment vehicle misses four scheduled payments, as fears grow that potential financial sector defaults could roil markets in the world’s second-biggest economy

Updated: Friday February 14, 2014 MYT 4:05:51 PM

China $160 mln investment vehicle misses payments

SHANGHAI: A US$160mil investment vehicle sold by China’s second-largest bank has missed four scheduled payments, state media reported, as fears grow that potential financial sector defaults could roil markets in the world’s second-biggest economy.

The “Songhuajiang River No.77” product, which raised a total of 972.7 million yuan (US$160mil) in six tranches, had failed to repay investors’ capital and interest four times by early February, the 21st Century Business Herald reported late Thursday.

Investors were also informed by Jilin Province Trust, which structured the product, that they will not receive the fifth payment due on February 19, according to the report.

China Construction Bank promoted the scheme, which funded a coal company, as a “risk-free and high-yield” investment, promising annual returns of 9.8 percent, investors told the paper.

The news comes after a possible default on a $500 million investment product, sold by the country’s largest bank ICBC and also backed by a loan to a debt-ridden coal firm, was averted in late January just three days ahead of deadline.

Analysts worry that China likely faces further problems in the trust sector.

A total 5.3 trillion yuan worth of trust products will mature this year, up 50 percent from 2013, state media have reported, citing research from Haitong Securities.

Default on such investment products would send a shockwave through China’s multi-trillion dollar “shadow banking” system – a massive network of lending outside formal channels – in the world’s second-largest economy, analysts said.

With the “Songhuajiang River No.77” product, the coal firm it was supposed to fund, Shanxi Liansheng Energy, filed for bankruptcy reorganisation in November last year after incurring around 30 billion yuan of debts.

“As far as we know, there’s no problem with the firm’s assets. The firm is negotiating with investors,” 21st Century Business Herald cited Jilin Province Trust as saying.

“We are all very anxious,” the official Shanghai Securities News on Wednesday quoted an investor as saying ahead of the February 19 maturation. Read more of this post

Hong Kong’s financial future hangs on getting the right mix

Published: Saturday February 15, 2014 MYT 12:00:00 AM
Hong Kong’s financial future hangs on getting the right mix


Hong Kong’s financial future hangs on getting the right mix

HONG Kong is currently engaging the public on its population policy. The policy paper is a very informative and educational document, full of useful statistics and asks what the citizens want for their own people, in terms of quantity and quality. Read more of this post

Johor chokes on property; The property market in Johor, particularly Iskandar Malaysia, might be a case of too much too soon.

Updated: Saturday February 15, 2014 MYT 10:34:05 AM

Johor chokes on property


The extra property supply would not pose an issue if foreign developers were attracting foreign buyers rather than targeting only domestic buyers.

THE property market in Johor, particularly Iskandar Malaysia, might be a case of too much too soon. Read more of this post

%d bloggers like this: