Flirting With Money-Market Madness; SEC proposals that would increase instability are worse than no reform at all

Flirting With Money-Market Madness

SEC proposals that would increase instability are worse than no reform at all.

ERIC S. ROSENGREN

Nov. 28, 2013 4:44 p.m. ET

Five years after the financial crisis, we know what caused much of the chaos. Many aspects of the financial system have been strengthened, reducing the likelihood of future problems. And yet for money-market mutual funds, fundamental reform has not been enacted. Unfortunately, some reforms proposed by the Securities and Exchange Commission might actually work against financial stability, instead of enhancing it. Read more of this post

European Banks Could Take Their Hits Early; Banks Face Up to Next Year’s Asset Review by ECB

European Banks Could Take Their Hits Early

Banks Face Up to Next Year’s Asset Review by ECB

ANDREW PEAPLE

Nov. 28, 2013 1:05 p.m. ET

European banks could be in for a painful end to 2013. European banks are already facing up to a huge potential capital shortfall next year, thanks to several regulatory pressures. The European Central Bank will carry out an asset quality review aimed at ensuring banks’ balance sheets conform to uniform rules in areas like bad loans; stress tests will examine how robust banks might be in a downturn. Read more of this post

Central bankers’ diverging paths could create damaging disharmony

November 28, 2013 12:01 pm

Central bankers’ diverging paths could create damaging disharmony

By Claire Jones and Ralph Atkins

For the past six years, the world’s main central banks have sung largely from the same hymn sheet – shoring up financial systems and printing money to support economies. Now, they are doing their own thing. Weak eurozone inflation data on Friday could fuel expectations of further stimulus measures from the European Central Bank. The Bank of Japan, meanwhile,has dropped heavy hints that if its aggressive asset purchase, or “quantitative easing” programmes do not drag the country out of deflation, it will step up action. Read more of this post

Cheap money feeds QE addiction and inequality

Cheap money feeds QE addiction and inequality
Friday, November 29, 2013
By Mike Dolan, Reuters

LONDON–The message is sinking in — economies of the rich world face super-easy money far into the future and central banks are now convinced it’s the least of all policy evils. Despite rumblings of dissent about the financial bubbles and iniquities associated with zero interest rates and money printing, 2013 is ending with a remarkable certainty among global investors that cheap money is around for the long haul. Read more of this post

Bitcoin under pressure: Virtual currency: It is mathematically elegant, increasingly popular and highly controversial. Bitcoin’s success is putting it under growing strain

Bitcoin under pressure: Virtual currency: It is mathematically elegant, increasingly popular and highly controversial. Bitcoin’s success is putting it under growing strain

Nov 30th 2013 | From the print edition

ALL currencies involve some measure of consensual hallucination, but Bitcoin, a virtual monetary system, involves more than most. It is a peer-to-peer currency with no central bank, based on digital tokens with no intrinsic value. Rather than relying on confidence in a central authority, it depends instead on a distributed system of trust, based on a transaction ledger which is cryptographically verified and jointly maintained by the currency’s users. Read more of this post

Bitcoin needs to learn from past e-currency failures

November 28, 2013 8:45 am

Bitcoin needs to learn from past e-currency failures

By Stephen Foley

Before Bitcoin, there was e-gold. In 1999, the Financial Times called it “the only electronic currency that has achieved critical mass on the web”. As it kept growing through the next decade, users ultimately opened more than 4m accounts, with more than $60m in deposits, backed by almost 4 metric tonnes of precious metal, and millions of dollars of transactions on a typical day. And then it all stopped. The founder of e-gold, an oncologist and economic history buff in Florida called Douglas Jackson, had hoped his gold-backed electronic currency would become a new base money to rival flawed fiat currencies. Read more of this post

Bank of England cuts mortgage support to avoid housing bubble

Bank of England cuts mortgage support to avoid housing bubble

8:10am EST

By David Milliken and Huw Jones

LONDON (Reuters) – The Bank of England moved to head off the risk of a bubble in house prices on Thursday, making a surprise announcement that it would put the brakes on a scheme launched last year to boost mortgage lending. Shares in British construction firms tumbled after the central bank said it would refocus the Funding for Lending Scheme (FLS) on helping small firms that find it hard to borrow. Read more of this post

Asset managers told to ‘be more visible’; Backlash feared unless industry presents a more human face

November 28, 2013 11:32 am

Asset managers told to come out of the shadows

By Gillian Tett

Backlash feared unless industry presents a more human face

In recent years Helena Morrissey, head of Newton, the asset management group, has attracted much attention. She is something of a rarity, being a truly senior woman in British finance, and she has used that platform to speak out on many issues including the 30 per cent campaign, which aims to get more women on British boards. But Ms Morrissey is currently promoting another cause: the profile of the British asset management industry. Earlier this month she delivered a speech to the CFA Institute in London, in which she urged fund managers to become far more vocal and visible. Read more of this post

“Quant” hedge funds: Computer says no; Hedge funds looking to spot and ride market trends are hoping for a fresh start

“Quant” hedge funds: Computer says no; Hedge funds looking to spot and ride market trends are hoping for a fresh start

Nov 30th 2013 | From the print edition

IF SOMETHING has not worked for five years, most people would conclude that it was broken. Tell that to the geeks managing “quant” hedge funds, who craft elaborate algorithms to profit from market movements. Once money-spinners, their prized formulae have misfired since 2009, losing money in four of the past five years. Unless their results improve markedly, the giant funds will finish this year as the worst-performing of the most common hedge-fund strategies. Read more of this post

No Pecan Pie? Thank China, Rain and Pigs

November 27, 2013

No Pecan Pie? Thank China, Rain and Pigs

By KIM SEVERSON

OCILLA, Ga. — It is a meager holiday in the pecan groves of the South, and the pain is stretching to kitchens across the country. A rare collision of ill-timed rain, marauding animals and a growing love affair between the Chinese middle class and the pecan has resulted in the worst pecan supply in recent memory. As a result, grocery store prices are up by about 30 percent, which is causing Thanksgiving bakers to think twice about their menus. Read more of this post

Chinese bad loan manager Cinda sits on its own debt mountain

Updated: Thursday November 28, 2013 MYT 8:10:23 AM

Chinese bad loan manager Cinda sits on its own debt mountain

HONG KONG: China Cinda Asset Management’s drive to crank profit out of bad loans has come at a cost – a debt mountain of its own. As it homes in on Hong Kong’s biggest initial public offering this year, the distressed debt manager’s borrowing has risen twenty-fold in the last three years to more than its maximum market value at listing. Read more of this post

China to Close a Lending Loophole; Draft Rules Would Limit Lenders’ Ability to Route Loans Through Shadow-Banking System

China to Close a Lending Loophole

Draft Rules Would Limit Lenders’ Ability to Route Loans Through Shadow-Banking System

Nov. 27, 2013 11:54 a.m. ET

BEIJING—A Chinese regulator is planning to make it harder for banks to use the nation’s sprawling shadow-banking system to get around lending limits, the latest salvo in its efforts to rein in credit growth. According to two bankers who have seen draft rules put together by the China Banking Regulatory Commission, the regulator wants to limit the ability of financial institutions to label corporate loans as loans between banks, which are typically of lower risk and subject to fewer restrictions. The process typically involves loans to trust companies—wealth-management companies that are the biggest nonbank lenders in China—that are then repackaged as so-called interbank assets. Read more of this post

China Has First Retail Store to Accept Bitcoin as Payment

China Has First Retail Store to Accept Bitcoin as Payment

11-28 14:23 Caijing

The move drew attentions from many Bitcoin lovers, but no transaction has been made so far.

China now has its first retail store willing to accept Bitcoin despite the country’s central bank has recently denied legitimacy of the growing popular virtual currency. The store in Harbin, the capital city in northeast China’s Heilongjiang province allows customers to pay by scanning QR codes in their Bitcoin wallet, a mobile phone app which can also covert Chinese Yuan into equivalent Bitcoin based on real-time exchange rate. Read more of this post

Cheng Kin-ming: ‘Emperor’ of China’s solar power industry

Cheng Kin-ming: ‘Emperor’ of China’s solar power industry

Staff Reporter

2013-11-27

Cheng Kin-ming, a solar energy and real estate investor from Hong Kong, has been dubbed “the emperor of the photovoltaic industry” in China after he became the most significant stockholder of the Hong Kong-listed Chinese solar panel manufacturer Shunfeng Photovoltaic International, the third-largest stockholder of LDK Solar, and a business partner of Hareon Solar Technology in the past year, reports the Chinese-language Beijing News.

Read more of this post

Burberry has lost rights to its signature tan, black and red plaid in China

Burberry has lost rights to its signature tan, black and red plaid in China

By Heather Timmons and Jennifer Chiu 7 hours ago

Burberry no longer holds exclusive rights to its iconic tan, black and red tartan known as the “Haymarket Check” in China, after the country’s national trademark office revoked the company’s copyright of the design last week. The decision is the latest and most momentous in a long-running legal battlebetween Burberry and Polo Santa Roberta, a Chinese bag and apparel maker from Foshan which has also faced off against Burberry in Hong Kong and Taiwan courts for its look-alike bags. Burberry’s sales in China have been more buoyant this year than other, higher-priced luxury goods makers like Louis Vuitton, in part because the brand is still a novelty there. An influx of Haymarket Check-patterned goods, which seems likely after the recent court decision, might make that company seem a lot less novel. Read more of this post

A Higher Ground for China Rates; Chinese Government-Bond Yields Are Rising, a Sign of More to Come as Beijing Revamps the Financial System

A Higher Ground for China Rates

Chinese Government-Bond Yields Are Rising, a Sign of More to Come as Beijing Revamps the Financial System

AARON BACK

Nov. 27, 2013 9:38 p.m. ET

Consider it China’s dress rehearsal for financial reform. Yields on Chinese 10-year government bonds rose to over 4.7% last week, their highest level since 2004. Rates have since come down a bit, but they remain high, more than a percentage point above where they were in the first half of the year, despite little change in the growth outlook. Read more of this post

Forge Group plunged a record 84 percent after forecasting a loss, leading declines among mining-services companies already struggling as mineral producers cut back spending

Forge Plunges as Cost Overruns Spur Loss Forecast: Sydney Mover

Forge Group Ltd. (FGE) plunged a record 84 percent at the close in Sydney trading after forecasting a loss, leading declines among mining-services companies already struggling as mineral producers cut back spending. Forge, whose clients include Rio Tinto Group, lost more than A$300 million ($274 million) in market value in Sydney today after saying cost overruns and poor management at two Australian projects also forced it to negotiate new debt terms. Read more of this post

With CBA finally paying commissions, Mozo founder claims he’s on way to being ‘SEEK of financial services’

Michael Bailey Deputy editor

With CBA finally paying commissions, Mozo founder claims he’s on way to being ‘SEEK of financial services’

Published 26 November 2013 16:02, Updated 27 November 2013 16:39

Looking for that elusive network effect: Mozo founder and unabashed SEEK fan, Rohan Gamble.Photo: Louise Kennerley

The founder of financial services comparison site Mozo, Rohan Gamble, makes no secret of his wish to emulate SEEK – he even tapped Andrew Bassat as an early investor – and is undertaking his first above-the-line marketing campaign to try and triple visitors to more than 1 million per month. Read more of this post

Leighton faces huge financial black hole in Middle East joint venture

Leighton faces huge financial black hole in Middle East joint venture

November 28, 2013

Richard Baker, Nick McKenzie

Leighton Holdings is sitting on internal advice that warns its troubled Middle Eastern joint venture will struggle to recover all of the $1.1 billion it claims to be owed for construction work. Fairfax Media can also reveal the Al Habtoor Leighton Group (HLG) joint venture has reached settlements with the owners of Middle Eastern developments which have not been publicly announced and have resulted in big losses. Read more of this post

Investors grow wary of Australia’s mining industry; Study highlights the potential problems for the country’s economy

November 27, 2013 7:02 pm

Investors grow wary of Australia’s mining industry

By James Wilson in London

Investment committed to resources projects in Australia has fallen sharply, according to a government report that underscores the potential problems for the country’s economy as the influence of the mining industry fades. The value of spending committed to oil, gas and mining projects stood at $240bn in October compared with A$268bn ($243.2bn) previous six months, according to a twice yearly snapshot of the stock of investment by the Bureau of Resources and Energy Economics. The volume of new projects getting to the stage of final approval was at its lowest in a decade at A$1.7bn. Read more of this post

Aluminium prices have slid to a four-year low, in a development that will heap pressure on the struggling smelting industry

November 27, 2013 6:26 pm

Aluminium prices slide to four-year low

By Jack Farchy Read more of this post

Billionaire Peter Woo Passes Wheelock Chairmanship to His Son

Billionaire Peter Woo Passes Wheelock Chairmanship to His Son

Wheelock & Co. (20), a Hong Kong-based real estate developer and parent of the city’s Wharf Holdings Ltd. (4), said billionaire Chairman Peter Woo, 67, will step down and his son will take over the role. Douglas Woo, who was appointed as managing director effective July 1, will start as chairman on Jan. 1, according to a filing to the Hong Kong stock exchange yesterday. Peter Woo will remain on Wheelock’s board as a director. Read more of this post

Li Ka-shing Laughs off “Divestment” Claims After HK$1.3Bln House Sales

Li Ka-shing Laughs off “Divestment” Claims After HK$1.3Bln House Sales

11-28 12:32 Caijing

The two conglomerates booked about HK$430 billion in gross revenue across the globe last year, but investment in overseas infrastructure this year only amounted to HK$13 billion – less than 2 percent of total income.

Asia’s richest man Li Ka-shing has been busing trying to shake off concerns that he is pulling off of China by offloading assets both in Hong Kong and the Chinese mainland. Read more of this post

Li Ka-shing Says Land Prices in China, Hong Kong Deter Purchases

Li Ka-shing Says Land Prices in China, Hong Kong Deter Purchases

Li Ka-shing, Asia’s richest man, said his companies have slowed land purchases in Hong Kong and China as prices have escalated to a high level. “Land prices in Hong Kong are high, and already showing signs of an unhealthy situation,” Li said, according to a statement from Cheung Kong Holdings Ltd., his flagship developer. “Land prices in China have surged, and we’re unable to win auctions for land.” Read more of this post

Coal-to-Oil $20 Billion Projects Said to Stall: Corporate India

Coal-to-Oil $20 Billion Projects Said to Stall: Corporate India

India will halt a $20 billion plan by Tata group and Jindal Steel & Power Ltd. (JSP) to turn coal into crude oil after scrapping rights to two mining blocks allotted to the companies, two people familiar with the matter said. The coal mines, located in the eastern state of Odisha, are part of 11 blocks to be cancelled because their development was lagging behind schedule, said the people, who asked not to be identified pending an announcement. New Delhi-based Jindal Steel and Strategic Energy Tech. System Ltd., a venture of Sasol Ltd. (SOL) and Tata, had planned to produce a combined 160,000 barrels of crude oil a day, valued at about $6.2 billion annually based on average Brent prices this year. Read more of this post

Tata Sons Withdraws Its Application for Banking License in India

Tata Sons Withdraws Its Application for Banking License in India

Tata Sons Ltd., which runs more than 1,000 companies that make cars to chemicals and salt, withdrew an application for a banking license in India, saying its current financial-services business best suits its needs. The Reserve Bank of India has accepted the withdrawal, according to a separate statement from the central bank. Read more of this post

On the trail of the Yakult Ladies; The Japanese group has an 80,000-strong sales force

November 27, 2013 4:21 pm

On the trail of the Yakult Ladies

By Ben Bland and Jonathan Soble

Sumarni, a 39-year-old Indonesian mother of three, trundles her pink bicycle through a wealthy Jakarta suburb every day, hawking Yakult probiotic yoghurt drinks door-to-door. Dressed in a red-and-white checked shirt with matching trousers and hijab, she is one of about 5,000 “Yakult Ladies” spearheading an expansion drive in Indonesia by the quirky Japanese company that makes the drinks. Read more of this post

“Instead of being a professional firm, KPMG Korea is becoming a political organization in which the CEO and his close aides are exploiting their authority in running the business for their own benefit”

2013-11-27 18:27

Samjong mired in internal feud

By Yi Whan-woo
Samjong KPMG, the country’s third-largest auditor, is embroiled in an internal conflict because followers of former CEO Yun Young-gak are up in arms with current CEO Kim Kyo-tae for Kim’s alleged attempt to weed out his predecessor’s supporters. Read more of this post

EU has included Korea in a preliminary list of illegal fishing nations. This is quite embarrassing for most Koreans, who take pride in their country’s status as one of the top-three deep-sea fishing nations in the world

2013-11-28 17:21

Illegal fishing nation

Following an example set by the United States, the EU has included Korea in a preliminary list of illegal fishing nations. This is quite embarrassing for most Koreans, who take pride in their country’s status as one of the top-three deep-sea fishing nations in the world, and regard illegal fishing as an issue for other countries, including China. Read more of this post