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Daily Bamboo Innovator Insight (Macro & Country): Thursday 13 Nov 2014 – Wison Stock Collapses After Halt Lifted And Billionaire Chairman Charged

Greater China

Wison Stock Collapses After Halt Lifted And Chairman Charged: Bloomberg

China’s Property Market Bottoming Out? Not So Fast: WSJ

Hong Kong fund managers eye Shanghai stock linkup as China investment quotas run out: Reuters

China Hunger for Clean Energy to Leave No Rooftop Behind: Bloomberg

19 Chinese provinces to reform and securitize state-own businesses: WantChinaTimes

China transforming from world’s factory into world’s investor: WantChinaTimes

In China, small potatoes corrupt big: OffBeat

Japan and Korea

Yen Capitulation Awakens Intervention Ghosts: Chart of the Day: Bloomberg

Japan actions risk igniting currency war; Devaluation is becoming a habit in an economy that has lost its edge: FT

Japan firms overwhelmingly want Abe to delay tax hike: TheStar

Honda grandees chide CEO over quality, recalls: TheStar

Novelis, the world’s leading aluminum rolling and recycling company, has recycled 20 billion aluminum beverage cans in Korea; Novelis recycles about 50 billion used beverage cans a year across the globe. KoreaTimes

ASEAN

Vietnam Tightens Valuations to Clean Up Bad Debt: Southeast Asia: Bloomberg

Singapore to Face Fire Sales With Home Curbs, Developer Says: Bloomberg

Joko Widodo — CEO of Indonesia Inc. JakartaPost

‘Thailand could become financial hub’ rivalling Singapore, Malaysia: Nation

Shedding light on a company that is increasingly subject to public scrutiny. From humble beginnings, the company is on its way to becoming a leading player in Malaysia’s real estate sector: TheStar

Pelikan is transferring RM1.05bil assets to its 71.32%-owned Germany-listed subsidiary Herlitz AG at a discount, as the struggling stationery maker seeks to boost current stock valuations and raise fresh funding for future growth: TheStar

To lure the bull, SGX must look beyond the China shop: BT

Shanghai-HK link leaves a Singapore divide: BT

Bakries say ‘no easy fixes’ to Bumi default: JakartaPost

Myanmar Paper Replays Junta’s Tunes; Makeover for State-Run New Light of Myanmar Appears to Be Short-Lived: WSJ

Australia

Million-Dollar Homes in Sydney Highlights RBA’s Dilemma: Bloomberg

Macro

Italians Say No to Risk as Slump Takes Toll on Startups: Bloomberg

The US is a huge hedge fund: FT

An imperfect plan for fixing the next crisis; In a serious crunch, it would be every bank regulator for itself: FT

Tim Geithner reveals in the raw how Europe’s leaders tried to commit financial suicide; Taped transcripts of the former US Treasury Secretary expose a catalogue of errors that will haunt Europe for years, made worse by misplaced righteousness: Telegraph

Japan-China Face Off in Asian Currency War; A snap Japan election may undermine reforms and put Asia’s two economic titans on a collision course. Barron’s

The Wolves of Forex; Foul-mouthed traders aren’t the biggest manipulators of currency markets. WSJ

Asian Companies Flock Into Aircraft Leasing; Li Ka-shing, Chinese Players, Japanese Seek Assets: WSJ

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Chairman of everything: Xi Jinping consolidates his power, and officials are quaking in their boots

Chairman of everything: Xi Jinping consolidates his power, and officials are quaking in their boots

Jul 5th 2014 | BEIJING | From the print edition

CHINA’S president appears to have killed two eagles with one arrow in bringing down one of the nation’s highest-ranking military men. On June 30th General Xu Caihou was stripped of his Communist-Party membership and handed over to prosecutors on corruption charges. State media said he took money and other loot in exchange for arranging promotions. Until last year, General Xu was one of the two dozen most powerful men in the country.

His fall helps consolidate Xi Jinping’s control over the army and at the same time burnishes his credentials as an anti-corruption crusader. The party announced the expulsion of six more figures this week, including a former vice-minister, a former senior manager at a state-owned oil firm and a former head of a government watchdog. All of them were connected to Zhou Yongkang, until 2012 the head of state security and formerly one of China’s nine most powerful men. In a separate announcement, the party dismissed Wan Qingliang, a rising star who was party boss of Guangzhou, one of China’s largest cities.

Read more at  http://www.economist.com/news/china/21606318-xi-jinping-consolidates-his-power-and-officials-are-quaking-their-boots-chairman-everything

 

Despite Democratic Endorsement, SBY Spares No Praise for Prabowo; “If you lead, you will have to lead everyone, including those who didn’t vote for you,” Yudhoyono said. “A leader should not keep his anger and grudges.”

Despite Democratic Endorsement, SBY Spares No Praise for Prabowo

By Ezra Sihite & Carlos Paat on 04:03 pm Jul 05, 2014

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President Susilo Bambang Yudhoyono, right, meets with presidential candidate Prabowo Subianto at Yudhoyono’s private residence in Cikea, Bogor, on July 4, 2014. (Antara Photo/Setpres-Abror Rizki)

  1.  President Susilo Bambang Yudhoyono met with Great Indonesia Movement (Gerindra) Party presidential candidate Prabowo Subianto and his coalition team on Friday evening at Yudhoyono’s house in Bogor.

“I received a letter from the Prabowo-Hatta campaign team saying they wanted to meet me,” Yudhoyono said at his residence in the Cikeas neighborhood. “It was directed to me as an individual, not as the president, so it was right and legal for me to meet them.”

The meeting was filmed by local TV stations, as President Yudhoyono said he wanted the encounter to be open to the public.

Read more at http://www.thejakartaglobe.com/news/despite-democratic-endorsement-sby-spares-praise-prabowo/

The Rise of China’s Shadow Banking System

It is hard to believe that just almost a decade ago, almost all types of lending made in China was done by conventional banks. Now, as Satyajit Das rightly puts, China’s burgeoning Shadow Banking system has exacerbated the worsening debt situation of China, where debt is 210% of China’s GDP as of 2013.

Easy credit has certainly helped to fuel China’s economy, and despite capital regulations imposed on banks earlier this year, all the regulations have done is to tip lending into the shadow banking system’s favour, where trusts and wealth management products (WMPs) can promise returns as high as 12%. While many analysts believe that the increasing debt would not translate into a harsh landing for China, the risk of the pricking of a property bubble in a nation where many properties serve as collaterals as loans and other forms of debts, would result in an alarming slowdown in China’s economy.

It looks like investors of China’s promise should look to increase their level of caution when it comes to investing in Chinese firms and always always, check on the management, any red flags in the annual report before pouring their money in.

Read the original article of how Shadow Banking has evolved at http://forbesindia.com/printcontent/38108

Customers Say Company Founders of Kexun, a P2P lending site which received a credit endorsement from Internet giant Baidu, Vanished with Money

Customers Say P2P Company Founders Vanished with Money

Kexun, a P2P lending site which received a credit endorsement from Internet giant Baidu Inc., has been hit by a string of fraud complaints. At least 958 people had filed complaints by the morning of June 25 for possible investment losses worth nearly 57 million yuan in total, China Business News reports. Several customers allege the owners of the company have disappeared with the company’s funds as the site has been closed under the name of maintenance since June 9. The highest single investment was more than 2 million yuan from a Zhejiang investor. “Kexun” was a platform rated by Baidu’s Credibility V Project, a network credit system that determines a website’s comprehensive credit by collecting data including its business entity qualification, authenticity and word of mouth evaluation.

Read more at http://www.yicai.com/news/2014/06/3977165.html

“The irony of Sarbanes-Oxley was that it was intended to prevent more Enrons and Worldcoms but it ended up being a gigantic tax on small companies.”

‘The Sarbane-Oxley Act has ironically made the stock market less attractive instead of a safe haven for the average investor.’ 

Gone are the days where companies are going public with cheap valuations. This article from AVC.com rightly states that following the regulatory acts, companies such as Facebook and Twitter would choose to wait for themselves to be worth multi-billions, before engaging in public offerings. Unlike that of the past, where we saw Microsoft, IBM and Apple with cheap valuations, companies such as Dropbox are moving towards private financing, with amounts as large as $10 billion.

Such a trend is definitely not healthy, and would definitely affect the options value investors would have in the market should it continue. Read the original article at http://avc.com/2014/06/the-law-of-unintended-consequences/

Tide turning against buybacks ahead of the market top

FT reports that there has been a change in corporate buyback behaviors, as companies prefer not to deploy their cash to buy back their stocks. While traditionally, companies that engage in buyback behaviors are often rewarded during post-crisis rally, it has been reported that TrimTabs, the US research group, shows that money spent on buying back stock in each of the last two months has been the lowest since January 2013.

And one possible reason is that companies fear that their own company’s stocks may be overvalued. This comes at a time when there are more new offerings in the market, with notable ones being GoPro’s IPO in recent weeks. This begs the question, how long more would the equity rally continue?

Read more at http://www.ft.com/intl/cms/s/0/da7af7d6-fe16-11e3-acf8-00144feab7de.html#axzz36CcgBUKt

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