The Life of China’s Communist Party; A campaign for communist discipline confronts a generation focused on personal fulfillment

The Life of China’s Communist Party

A campaign for communist discipline confronts a generation focused on personal fulfillment

ROWAN CALLICK

Oct. 18, 2013 8:57 p.m. ET

The scene evokes memories of a more certain and compliant era. Xi Jinping, the General Secretary of the world’s most powerful organization, sits with his arms folded, leaning watchfully on a conference table at which members of the committee of the communist party in China’s Hebei province are writing “self-criticisms.” Mr. Xi, the party’s chief and the nation’s president (the latter being the lesser role), has been touring the country, ensuring that party members everywhere bow their heads in the face of the Maoist “mass line” campaign he is directing. This will restore discipline to the party, Mr. Xi believes, and regain the respect of ordinary folk who have become skeptical in the face of corruption, a soaring wealth gap and an aristocratic attitude among officials. Read more of this post

Are You Prepared for the Next Crash? Saturday marks 26 years that the market suffered its worst one-day crash ever. Another crash of that magnitude is inevitable

Are You Prepared for the Next Crash?

Saturday marks 26 years that the market suffered its worst one-day crash ever. Another crash of that magnitude is inevitable.

MARK HULBERT

Updated Oct. 18, 2013 6:47 p.m. ET

On this 26th anniversary of the 1987 stock-market crash, the worst one-day drop in U.S. history, it’s worth asking whether such an event could happen again. According to a number of researchers, the answer is yes. And that is a sobering thought indeed, since the Dow Jones Industrial Average fell 22.6% on Oct. 19, 1987. An equivalent drop today would take more than 3,400 points off the Dow in a single session. Read more of this post

As stock splits wane, more may follow Google to $1,000

As stock splits wane, more may follow Google to $1,000

4:17pm EDT

By Julia Edwards

NEW YORK (Reuters) – With its surge on Friday, Google Inc became the latest member, though not likely the last, of a tiny fraternity of companies that boast $1,000 share prices. In a market where stock splits have become rarer, there may be more of this to come than just the two stocks with four-digit stock prices in the Standard & Poor’s 500 index – Google and Priceline.com, which hit $1,000 earlier this year. Historically, once share prices got too high – even around $125 a share – companies split shares to make them more accessible to Main Street investors. But splits have become few and far between, and big numbers are more the norm for familiar names like Apple Inc, Chipotle Mexican Grill Inc, Netflix Inc and Visa Inc. Stock splits peaked in 1986 and 1987, when there were 114 and 111 splits, respectively, and they surged again in the go-go days of the dot-com bubble, with 102 splits in 1997, back when retail investors hungrily chased the tech boom, according to S&P Dow Jones Indices. Read more of this post

China’s Corruption Drive Shifts Gears

October 18, 2013, 8:05 PM

China’s Corruption Drive Shifts Gears

By Russell Leigh Moses

The detention of Nanjing Mayor Ji Jianye earlier this week might seem like just the latest move in Chinese leader Xi Jinping’s drive clean up the Communist Party ranks by going after both “tigers” and “flies.” In fact, the Nanjing case marks a departure from Beijing’s usual method of coping with corruption by Party members, in a number of important ways. Typically, announcements of an investigation and confinement of a high-ranking cadre that appear in the state-controlled press are terse and uninformative. That’s how the Nanjing media covered the event (in Chinese). Read more of this post

China’s Growth Trajectory Depends on Political Calibrations

China’s Growth Trajectory Depends on Political Calibrations

Xi’s Plans to Shift From Growth-at-Any-Cost Strategy as Big a Factor as Economic Conditions

BOB DAVIS

Oct. 18, 2013 1:01 p.m. ET

China’s growth accelerated, with gross domestic product growing 7.8% in the third quarter from a year earlier. But Louis Kuijs of Royal Bank of Scotland tells Deborah Kan why it will be difficult for the country’s economy to keep up the pace of growth during the fourth quarter.

BEIJING—Chinese President Xi Jinping‘s plans to shift the economy away from a growth-at-any-cost strategy means that China’s GDP rise over the coming year will depend as much on political decisions as on economic conditions at home and abroad. After China said Friday that its third quarter GDP growth accelerated to 7.8%, year over year, from 7.5% in the prior quarter, Chinese officials said the country would have trouble sustaining the faster pace. Read more of this post

Foreign investors are stampeding into South Korea, snapping up stocks in the longest buying spree on record

Foreign Investors Pile Into South Korea

Foreign investors are stampeding into South Korea, snapping up stocks in the longest buying spree on record.

KANGA KONG and DANIEL INMAN

Updated Oct. 18, 2013 7:06 a.m. ET

Foreign investors are stampeding into South Korea, buying up stocks for 36 straight trading days to mark the longest buying spree on record as cheap equities and the nation’sstrong finances attract buyers. Since the start of the second half there’s been $13.1 billion of inflows, more than reversing the $9.4 billion that was yanked out in the first six months of the year. The cash has fuelled a 16% rally in stocks since the end of June to touch this year’s high on Friday, while the currency has also advanced. Much of the allure lies with the country’s solid economy, recording trade surpluses for 19 months that both analysts and investors say bodes well for future economic growth. Unlike previous buying from overseas that has usually centered just on a handful of Korea’s largest companies like Samsung Electronics005930.SE +0.62% and Hyundai Motor,005380.SE -3.02% this time investors are also venturing into smaller and lesser known firms. Read more of this post

Families With Kids Go Homeless as U.S. Rents Exceed Pay: Economy

Families With Kids Go Homeless as U.S. Rents Exceed Pay: Economy

When Montoria Freeland separated from her husband of 15 years in 2008, she left a four-bedroom house and economic security. Before long, her pay and hours as a pharmacy technician were cut and she found herself and her son facing homelessness. Freeland lived with family for a time, she said, and four months ago moved into transitional housing funded by the city government in Washington, D.C., while searching for work that pays more than her $8.25-an-hour retail job. Having lost her oldest son in a 2000 homicide, Freeland said she insists on looking for housing in a safe neighborhood for her surviving one, now 17. She found that’s available only at an increasingly steep price. Read more of this post

China warns of slowing demand after the latest trade data showed sales to South-East Asia slowed sharply in September

Updated: Friday October 18, 2013 MYT 8:45:33 AM

China warns of slowing demand

BEIJING: China’s exporters face a difficult time in coming months as demand from emerging markets slows, the Chinese trade ministry warned after the latest trade data showed sales to South-East Asia slowed sharply in September. But China is ready to take measures to support its exporters to ensure the trade sector grows 8% this year as targeted, Commerce Ministry spokesman Shen Danyang said, allowing exporters to see “mild growth” in the next few months. Read more of this post

Elite French winemakers seek elusive Chinese blend to get China market

Updated: Friday October 18, 2013 MYT 1:19:50 PM

Elite French winemakers seek elusive Chinese blend to get China market

PENGLAI, China: The world’s fine winemakers have exacting standards for soil, climate and cultivation to produce the perfect grape. And they are looking to recreate that unlikely blend in China – better known for cheap mass production. The potential harvest will be more drinkers in the world’s most populous country, where wine consumption more than doubled in the four years to 2011 and is set to rise another 40 percent by 2016, according to the industry’s top trade-fair organiser Vinexpo. Read more of this post

Nissan’s failed ‘Taxi of Tomorrow’

Nissan’s failed ‘Taxi of Tomorrow’

By Alex Taylor III, senior editor-at-large  @FortuneMagazine October 18, 2013: 8:50 AM ET

Nissan’s Taxi of Tomorrow is soon to be yesterday’s news in New York.

Hail a yellow cab in New York City today, and you could be stepping into a dog’s breakfast of vehicles, ranging from a cavernous Toyota (TM) Sienna minivan to a claustrophobic Ford Escape crossover. After climbing into the rear seat, you may find yourself nostalgic for a yellow Crown Victoria, an obsolete sedan that had been in production for 20 years when Ford (F, Fortune 500) discontinued it in 2011. But chances are you won’t be sliding your fanny into very many Nissan NV200s, the one-time “taxi of tomorrow” that now has only a slim chance of becoming a taxi of today.

The Nissan cab, which was supposed to replace nearly all of the 16 different models currently certified as New York City taxi-worthy, found itself detoured by a combination of technical shortcomings, city hall bumbling, and plain old political hardball. For Nissan, the failure of the NV200 to take over the entire fleet represents a financial loss of $50 million, a missed marketing opportunity, and a very public embarrassment. Read more of this post

Li Ka-Shing Companies to Sell Shanghai’s Lujiazui Financial District Project for $1.16B

Li Ka-Shing Companies to Sell Lujiazui Project for $1.16B

Billionaire Li Ka-shing’s Hutchison Whampoa Ltd. and Cheung Kong Holdings Ltd. (1) will sell a project in Shanghai’s Lujiazui financial district to buyers including China Everbright Ltd. for $1.16 billion. The companies will each sell a 50 percent stake in Extreme Selection, the owner of the company developing the project at Lujiazui Ring Road, Hutchison said in a statement to Hong Kong’s exchange. HYZL Development Co. and HYZL Investment Co. will each buy 47 percent, while Diamond Gate Group Ltd., a China Everbright Ltd. (165) subsidiary, will take the remaining 6 percent, according to an Everbright statement today. Hutchison and Cheung Kong announced in October 2006 that they would spend 1.74 billion yuan ($285 million) to develop real estate in Lujiazui. Some 64 overseas companies had their regional headquarters in the 31.8 square-kilometer district, according to a government website for the area. The Oriental Morning Post reported in August that Cheung Kong planned to sell the Oriental Financial Center office building, the only property with a Lujiazui address listed in the company’s annual report.

To contact the reporter on this story: Eleni Himaras in Hong Kong at ehimaras@bloomberg.net

Hutchison Stops Shopping ParknShop; Li Ka-Shing’s Conglomerate Had Hoped to Reap As Much as $4 Billion for the Supermarket Chain

Hutchison Stops Shopping ParknShop

Li Ka-Shing’s Conglomerate Had Hoped to Reap As Much as $4 Billion for the Supermarket Chain

PRUDENCE HO

Oct. 18, 2013 10:29 a.m. ET

HONG KONG— Hutchison Whampoa Ltd. 0013.HK +0.78% , controlled by Asian’s richest man, Li Ka-shing, has decided not to sell its ParknShop supermarket chain, after concluding the private sale at this time wouldn’t deliver maximum value to shareholders. The conglomerate also said Friday that it is considering expanding a strategic review of retail arm A.S. Watson & Co.—which includes ParknShop—to include possible public offerings of all or part of the business, though it wouldn’t relinquish any control. Read more of this post

Transparency becoming major issue for global oil market, says expert, with concerns that prices are subject to manipulation

Updated: Thursday October 17, 2013 MYT 3:38:35 PM

Transparency becoming major issue for global market, says expert

SINGAPORE: Political and public interest in oil markets remains high with concerns that prices are subject to manipulation, delegates at the World Energy Congress were told Thursday.  The concern comes even though recent academic studies suggest that oil prices are driven primarily by the fundamentals of supply and demand. A panel of industry experts at the congress held in Daegu, South Korea on Tuesday noted that shifts in global and regional oil markets, trading of oil futures in emerging financial markets such as Dubai and Shanghai, growing Russian energy exports to Asia and booming US shale oil production could have a significant impact on price discovery. Read more of this post

Europe’s bold vision hits trouble

Europe’s bold vision hits trouble

7:53am EDT

By Luke Baker and Paul Carrel

BRUSSELS/FRANKFURT (Reuters) – Barely a year after European leaders set out an ambitious vision for the euro zone’s future, progress has all but stalled and pressure is building for what may amount to a ‘make or break’ moment for the union. The idea of a roadmap setting out steps towards the deeper integration of the euro zone came about in early 2012, when the debt crisis was at its peak and there were legitimate fears that Greece could be forced out of the currency union, or that the whole European project could disintegrate. Read more of this post

Loans with fewer protections are a warning sign

Last updated: October 18, 2013 5:17 pm

Loans with fewer protections are a warning sign

By Tracy Alloway in New York

The growth of ‘cov-lite’ may point to overheating in credit

The government shutdown temporarily hit markets from stocks to bonds to the $4.5tn “repo market” that underpins the US financial system. But one asset class was curiously immune to the two-week gridlock in Washington – leveraged loans. Read more of this post

Asia’s Animators Draw Inspiration From Japan’s Miyazaki

Asia’s Animators Draw Inspiration From Japan’s Miyazaki

By Mathew Scott on 2:28 pm October 16, 2013.

A scene from Hayao Miyazaki’s hit film ‘My Neighbor Totoro.’ (Photo courtesy of Studio Ghibli)

Busan. As Oscar-winning animator Hayao Miyazaki heads into retirement, industry watchers say the next generation of Asian filmmakers stepping out of his shadow will struggle to match the Japanese master’s box office domination. “The view here is that there will be no ‘second Miyazaki,’” Tokyo-based author and film critic Mark Schilling told AFP. The market for Asian animation is dominated by children’s films, Schilling said, and not the more adult-themed productions Miyazaki became famous for, such as his Oscar-winning “Spirited Away” in 2002. The 72-year-old director last month shocked the industry — and his legions of fans — by announcing he was walking away from directing. Read more of this post

Victoria’s Secrets’ Parent L Brands Coach ‘Cut Their Own Throat’ With Discount Stores; Physical stores among top Victoria’s Secret attributes

LIMITED BRANDS CEO: Coach ‘Cut Their Own Throat’ With Discount Stores

HAYLEY PETERSON OCT. 17, 2013, 12:44 PM 1,562 4

The CEO of Victoria’s Secret parent L Brands Inc. blasted Coach on Wednesday for seeking “easy money” by becoming a discount outlet, the Wall Street Journal reports.  “Coach became a discount outlet,” L Brands CEO Les Wexner said at an analyst meeting in New York. “They cut their own throat. The outlet business is easy money, [but] discounting yourself is the beginning of the end. I can’t find the exception. It’s hard to have a dual identity. Outlet doesn’t build a brand. We don’t milk it.” Coach’s net income dropped a staggering 12% in the second quarter as the luxury handbag maker faces intense competition from Michael Kors, Kate Spade and Tory Burch. Coach’s outlet stores have grown to 60% of its retail sales in North America from about 30% in 2006, The Journal reported in July. The outlets have become more profitable for the brand than its full-price stores, bringing in about $600 more in sales per square foot.  Wexner said Wednesday that L Brands is moving Victoria’s Secret in the opposite direction with plans to close one of the lingerie brand’s four outlet locations.

Physical stores among top Victoria’s Secret attributes: L Brands CEO Wexner

October 16, 2013, 4:10 PM

By Andria Cheng Read more of this post

Soft drinks in Mexico: Fizzing with ragel A once-omnipotent industry fights what may be a losing battle

Soft drinks in Mexico: Fizzing with ragel A once-omnipotent industry fights what may be a losing battle

Oct 19th 2013 | MEXICO CITY |From the print edition

LA MANSION steakhouse inside Mexico’s lower house of Congress has become the headquarters of a lobbying effort the likes of which congressmen say they have never seen before. There is so much wining and dining that one lawmaker, proposing a bill on October 15th to regulate the lobbyists, claimed he was talking to a half-empty floor because his colleagues were too busy being schmoozed at La Mansion. Read more of this post

The Hong Kong dollar: Buy now at 1983 prices; After 30 years, Hong Kong’s peg to the American dollar is still going strong

The Hong Kong dollar: Buy now at 1983 prices; After 30 years, Hong Kong’s peg to the American dollar is still going strong

Oct 19th 2013 | HONG KONG |From the print edition

“WHATEVER exchange-rate system a country has, it will wish at some times that it had another one,” according to Stanley Fischer, a former central banker. Many countries find it hard to cope with a floating currency and even harder to stick to a fixed one. It is therefore remarkable that Hong Kong this week celebrated the 30th anniversary of its currency’s peg to the dollar. Read more of this post

Petrobras: Unfulfilled potential; Fuel subsidies have thwarted the Brazilian state oil company’s ambitions to become a global power

October 17, 2013 6:55 pm

Petrobras: Unfulfilled potential

By Samantha Pearson and Joe Leahy

Fuel subsidies have thwarted the Brazilian state oil company’s ambitions to become a global power

Pharaoh’s motel in the industrial outskirts of São Paulo is typical of Brazil’s 5,000 secretive “love hotels” found in the suburbs of big cities. Just visible from the 10-lane highway that runs to the coast, rows of secluded, air-conditioned lodges offer the usual combination of round beds and thematic quirks – in this case, murals of Cleopatra and a selection of hieroglyphs. However, Pharaoh’s biggest, and perhaps dirtiest, secret is locked away in one of the back rooms: a diesel-guzzling generator. Like other remote hotels cut off from the main gas system, it runs on a generator at peak times to avoid expensive electricity tariffs, taking advantage of diesel prices that are kept artificially low in Brazil. Read more of this post

Tata Looks to Public Transportation in Indonesia

Tata Looks to Public Transportation in Indonesia

By Muhamad Al Azhari on 10:43 am October 18, 2013.

Tata Motors Indonesia president director Biswadev Sengupta with the recently introduced Tata Super Ace model. (GA Photo/Suhadi)

Tata Motors Indonesia, the local unit of Indian automotive giant Tata Motors, has announced it is eyeing a piece of the domestic small-engine commercial and public transportation vehicle market. The company’s planned Indonesian public transport and commercial foray follows the company’s introduction of passenger car models last month. “We feel that Tata Motors is well placed. With the right approach, we can provide good solutions [for Indonesia],” said Biswadev Sengupta, president director of TMI. The company, established a year ago, serves as the sole distributor of Tata Motors vehicles in the archipelago. Read more of this post

Sweeping Civil Service Reform Gathers Pace in Indonesia; ‘To clean up a very dirty place, you have to use a special method’: Azwar

Sweeping Civil Service Reform Gathers Pace in Indonesia

‘To clean up a very dirty place, you have to use a special method’: Azwar

By Anastasia Winanti Riesardhy on 9:47 am October 18, 2013.
The government has vowed to minimize political influence in the civil service, particularly in the appointment of senior bureaucrats, including ministers. Azwar Abubakar, the minister for state administrative reform, said on Thursday that the new measures would be enshrined in the civil service bill, currently being deliberated at the House of Representatives to eventually replace the 1999 and 1974 laws on the civil service. Read more of this post

Suddenly people are talking about dynasties in Indonesia

Keep It in the Family

By Yanto Soegiarto on 10:24 am October 18, 2013.
What’s wrong with dynasties? Suddenly people are talking about dynasties in Indonesia. Everybody’s making comments, even the president. Lawmakers argue for amendments. Activists demand the arrest of the governor of Banten. The magnitude of the controversy about dynasties seems to be overshadowing the real issues the nation is facing: how to deal with such mega-scandals as the Constitutional Court bribery case, Bank Century and Hambalang. Read more of this post

Jakarta Property Slowdown Takes Effect

Jakarta Property Slowdown Takes Effect

By Francezka Nangoy & Dion Bisara on 8:20 am October 18, 2013.
The once hot property market in Jakarta showed signs of cooling during the third quarter, with demand for office space in the central business district down as some companies delayed their expansion plans, and sales of condominiums weakening under new regulation, according to J ones Lang LaSalle Indonesia . Anton Sitorus, head of research at the property consultancy firm’s Jakarta office, told reporters on Thursday that net take-up for office space — which measures the change in occupied space — in the July-September period fell to 61,000 square meters from 93,400 square meters in the second quarter. The decline was caused by the economy slowing this year, a depreciating rupiah and rising borrowing costs. Read more of this post

A new business idol: Why Indian firms are rooting for Narendra Modi

A new business idol: Why Indian firms are rooting for Narendra Modi

Oct 19th 2013 |From the print edition

INDIAN industry is in a funk and has decided that one man is the answer. “We’re waiting for NaMo,” says a tycoon. It is only a slight exaggeration to say that almost everyone in a suit and with a pulse in the private sector wants Narendra Modi, the chief minister of Gujarat state, to become prime minister after elections due by May 2014. Private-equity types, blue-chip executives and the chiefs of India’s big conglomerates all think he can make the trains run on time. Some Western investors hope Mr Modi, the son of a tea-stall owner, will be India’s Margaret Thatcher, a populist reformer who forces through measures that put the economy on a higher growth path. Bankers in Mumbai reckon the stockmarket will jump by 20% if Mr Modi wins. Read more of this post

The revised Asean Corporate Governance scorecard will be adopted in Thailand next year in an effort to boost listed companies’ attractiveness in the eyes of foreign investors

Scorecard ‘to spruce up Thai listed firms’

Varin Trino
The Nation October 18, 2013 1:00 am

The revised Asean Corporate Governance scorecard will be adopted in Thailand next year in an effort to boost listed companies’ attractiveness in the eyes of foreign investors, according to the Thai Institute of Directors (IOD). Listed companies would be evaluated in five main categories – the same as the scorecard currently in use, but the evaluation will be given greater depth, as the number of questions will be raised from 148 to 243, said IOD president Bandid Nijathaworn.  Read more of this post

Two Taiwanese fund managers suspected of making personal fund investments after being entrusted to handle the investments of labor pension funds were indicted by the Special Investigation Division (SID)

SID indicts fund managers on insider trading, costing government NT$3.8 billion

By Katherine Wei,The China Post
October 17, 2013, 12:03 am TWN

TAIPEI, Taiwan — Two fund managers suspected of making personal fund investments after being entrusted to handle the investments of labor pension funds were indicted by the Special Investigation Division (SID) yesterday. Former JihSun Funds (日盛投信) manager Chen Ping (陳平) and former Yuanta Funds (元大寶來投信) manager Chu Nai-cheng (瞿乃正) were accused of buying stocks under the names of relatives, friends and employees when they were responsible for investing in the nation’s labor pension funds. After Chen and Chu secured a large amount of stocks in the market, they introduced the pension funds and sold their private stocks when the prices rocketed, allegedly benefiting enormously from the procedure. Read more of this post

Rich Americans Snap Up Irish Castles for Love and Discounts

October 15, 2013

Rich Americans Snap Up Irish Castles for Love and Discounts

By KERRY HANNON

FIRST-TIME visitors to Humewood Castle in Kiltegan, County Wicklow, can’t help it. They simply say, “Wow.” It’s that big, that stunning — that, well, fairy tale. It’s vast and turreted, and the view toward the mountains looks like a Hollywood backdrop. Humewood, an Irish estate on 427 acres, roughly a 90-minute drive from Dublin, includes 15 bedrooms, a ballroom, a banqueting hall and a billiards room, among other amenities. And an American, John Malone, now owns it. Last November, the 72-year-old billionaire chairman of the cable and telecom giant Liberty Global got it for a song. Read more of this post