Funds Stick With Bets Against Chinese Banks; Wagers that midsize lenders’ share prices will fall remain at high levels

July 19, 2013, 7:41 a.m. ET

Funds Stick With Bets Against Chinese Banks

Wagers that midsize lenders’ share prices will fall remain at high levels

MIA LAMAR

HONG KONG—Short-sellers are sticking to heavy bets against China’s banks a month after a cash crunch gripped the country’s banking system, reflecting their belief that there is more stress to come even as banking shares rebound.

The wagers by hedge funds and other alternative funds started building in Hong Kong in June as a sudden shortage of cash among mainland lenders spooked investors. Banks scrambled to raise money to meet a wide range of funding demands, dumping short-term bonds, pushing interbank rates up to as high as 30% and sending the Shanghai benchmark stock index to a four-year low. Read more of this post

Li Ka-Shing’s Hutchison May Sell ParknShop supermarket chain for $2 Billion because the industry is mature and growing slowly; ParkNShop and Dairy Farm had a combined 73 percent market share in HK

Hutchison May Sell ParknShop for $2 Billion, WSJ Reports

Hutchison Whampoa Ltd. (13), controlled by Hong Kong’s richest man Li Ka-shing, is looking to sell its ParknShop supermarket chain for between $1 billion and $2 billion, the Wall Street Journal said yesterday. The company, which operates businesses from global ports to telecommunications, has hired Goldman Sachs Group Inc. and Bank of America Merrill Lynch to handle the sale, the WSJ said, citing unidentified people. Read more of this post

Fake wines in China may be on rise

Fake wines in China may be on rise

Mr Charles Gaudfroy, a manager of a French restaurant, showing a bottle of fake Romanee-Conti which was found at a wine shop in southern China. According to Mr Gaudfroy, “Vin Blanc” (white wine) and “Vin Rouge” (red wine) should not be printed on the same label.

Liquor stores, restaurants and supermarkets in China wage a constant battle against fake wines. -TNP

Fri, Jul 19, 2013
The New Paper

CHINA – The cellar master at a vineyard in China can’t stop laughing while describing a bottle of supposedly French wine a friend gave him two years ago. It’s white wine, with a label proclaiming it is from the vineyards of Romanee-Conti, the bottle bearing the logo that is on bottles of Chateau Lafite-Rothschild. It declares its origin as Montpellier in southern France. Domaine de la Romanee-Conti, better known for highly prized and highly priced vintages from France’s Burgundy region, makes only a tiny amount of white wine, labelled Montrachet. It has nothing to do with the equally prestigious Lafite, which is from the Bordeaux region, and neither brand is produced anywhere near Montpellier. Read more of this post

Chow Tai Fook, the world’s largest listed jewelry chain, Among Shanghai Jewelers in Price-Fixing Probe

Chow Tai Fook Among Jewelers in Probe: People’s Daily

Chow Tai Fook Jewellery Group Ltd. (1929), the world’s largest listed jewelry chain, and other gold shops in Shanghai are being probed by Chinese regulators for price manipulation, the official People’s Daily reported online, citing unidentified people.

Chow Sang Sang Holdings International Ltd. (116) was also named as one of several companies “rectifying” their practices, after a National Development and Reform Commission investigation found wrongdoing, according to the report, which was reposted on a website controlled by the Ministry of Commerce. Chow Sang Sang isn’t being probed and doesn’t know why it was named in the report, Cathy Tam, a spokeswoman, said by phone today. Read more of this post

How Europe’s Bank Crisis Swamped Pescanova Seafood Empire; The downfall of Spanish fishing company Pescanova is a cautionary tale of the still-rippling European banking crisis

Updated July 18, 2013, 11:04 p.m. ET

How Europe’s Bank Crisis Swamped Pescanova Seafood Empire

Ripples of Region’s Credit Crunch Led to Downfall of Spain’s Fishing Giant

MATT MOFFETT

REDONDELA, Spain—The downfall of Manuel Fernández de Sousa, who builtPescanova SA PVA.MC -19.26% from a provincial Spanish fishing company into a multinational giant, is a cautionary tale of the still-rippling European banking crisis. His troubles began at a Feb. 27 board meeting where Pescanova’s two newest directors grilled him about the company’s proposed financial results. Read more of this post

The Rise of the Intangible Economy: U.S. GDP Counts R&D, Artistic Creation

The Rise of the Intangible Economy: U.S. GDP Counts R&D, Artistic Creation

By Peter Coy on July 18, 2013

On July 31, the U.S. Bureau of Economic Analysis will rewrite history on a grand scale by restating the size and composition of the gross domestic product, all the way back to the first year it was recorded, 1929. The biggest change will be the reclassification—nay, the elevation—of research and development. R&D will no longer be treated as a mere expense, like the electricity bill or food for the company cafeteria. It will be categorized on the government’s books as an investment, akin to constructing a factory or digging a mine. In another victory for intellectual property, original works of art such as films, music, and books will be treated for the first time as long-lived assets. Read more of this post

China’s test; controlled slowdown or unemployment nightmare

China’s test; controlled slowdown or unemployment nightmare

Thu, Jul 18 2013

By Kevin Yao

BEIJING (Reuters) – The success or failure of China’s efforts to revamp its giant economy may rest with workers like Hu Zhao and Deng Jindong.

They were both at a job fair in Beijing this week. Hu, a 30-year-old former factory worker, was looking for a higher paid office job. Deng, a sales manager with Ping An Insurance Co, was trying to hire sales people to sell financial products. They represent two ends of a massive shift in the world’s second-biggest economy being engineered by President Xi Jinping and Premier Li Keqiang, who are trying to manage a slowdown in growth to reduce a reliance on the investment that has made the country the factory to the world. China’s leaders hope to orchestrate the shift without creating a surge in unemployment by building up the services sector to take up the economic slack as factories close down. Read more of this post

What the ‘Unofficial’ Data Say About China’s Slowdown

July 18, 2013, 5:19 PM

What the ‘Unofficial’ Data Say About China’s Slowdown

Top of Form

With doubts about China’s official data as numerous as government censors at a Weibo convention, China Real Time is committed to uncovering the truth about the world’s second-largest economy. The latest plan: Hire an intern to mine data from statistics officials’ Renren accounts. On the off chance the National Bureau of Statistics aren’t big users of social media, here’s our illustrated guide to what the best private indicators say. Read more of this post

Combined market cap of Wells Fargo and JP Morgan ($440bn) exceeds that of every Energy and Materials company in BRIC; Less than three years ago, those two banks were valued at less than half the market cap of the BRIC commodity sectors, indicating how quickly market leadership has rotated away from China to the US real estate story

How the mighty have fallen: EM edition

David Keohane

| Jul 18 11:03 | 2 comments | Share

Today, the combined market capitalization of Wells Fargo and JP Morgan ($440bn) exceeds that of every Energy and Materials company in Brazil, Russia, India and China ($420bn). Less than three years ago, those two banks were valued at less than half the market cap of the BRIC commodity sectors, indicating how quickly market leadership has rotated away from China to the US real estate story. Read more of this post

Investment firm raided in Qatar now being set up in Singapore

Investment firm raided in Qatar now being set up in Singapore

July 18th, 2013 |  Author: Online Press

The QFCRA warned investors against dealing with investment firm Portable Fund. (16 July) – Qatar has warned Singaporean authorities of an investment firm which has moved its headquarters to the Asian country days after Qatari authorities raided its Doha offices and arrested the CEO over false claims the firm was licensed to offer investment advice. Qatar Financial Centre Regulatory Authority (QFCRA) last week warned investors against dealing with investment firm Portable Fund, stating the company had falsely claiming it was licensed by the Qatar Financial Centre Authority (QFCA). “The QFCRA took swift action after becoming aware that Portable was falsely claiming to be regulated by the QFCRA and licensed by the QFCA. In order to protect consumers and investors the QFCRA issued an alert and directed the company to remove these false claims from its website, as well as the false claim that it operated from Tornado Tower in Doha,” a QFCRA spokesperson said in a statement. Christina Miller, a Portable Fund customer service official, told Arabian Business the fund was in the process of renewing its licence when its offices were raided and its CEO arrested by police: “We were providing service to the investors from all over the world from our Qatar office. “Our license was expired recently and we were having issues with QFC to renew the license… But suddenly police came and asked to shut down the office and arrested the CEO Alex Russman.” Miller confirmed Russman had been released from custody and was now in Singapore setting up the company’s new office. A QFCRA spokesperson confirmed it “has taken steps to alert Singaporean regulatory authorities to the claims of Portable Fund.” “In relation to any allegation of fraud or criminal enquiry in Qatar, that is a matter for the law enforcement authorities… The QFCRA repeats its warning to investors and consumers to avoid any dealings with Portable,” the statement added. According to its website, Portable Fund was established in Qatar in April 2007, has paid up capital of $50m and, as of May 2013, managed more than $200m worth of funds. It claimed it had investors from all over the world and was pursuing opportunities in the Middle East, Africa, Turkey, South Asia and South-East Asia. It states it’s new office is located at 21 Maxwell Road, 069113 Singapore.

Singapore Has The Biggest Pay Gap Among Developed Countries

Singapore Has The Biggest Pay Gap Among Developed Countries

July 18th, 2013 |  Author: Contributions

Roy * The author blogs at http://thehearttruths.com

Read more of this post

Asia Has World’s Biggest Pay Gap

Jul 15, 2013

Asia Has World’s Biggest Pay Gap

By Riva Gold

In Asia, middle managers such as department heads make more than 14 times as much as operational employees such as clerical workers–the biggest such pay disparity in the world, according to a report by global management consulting firm Hay Group. The difference in pay in Asia is far greater, for example, than in North America (3.5 times) and Europe (2.9 times), and somewhat bigger than in the Middle East (11.9 times) and Central and South America (10.2), other regions comprised mostly of emerging markets, the report said. Read more of this post

Indonesia faces daunting obstacles in value chain; Country needs to do more than export raw natural resources it has in abundance

July 18, 2013 3:15 pm

Indonesia faces daunting obstacles in value chain

By Henny Sender

Country needs to do more than export raw natural resources it has in abundance

Asia desperately wants to believe it is relatively immune to the darker clouds over the world today and nowhere is that hope more passionate than inIndonesia, one of the principal victims of the Asian financial crisis 15 years ago. That hope is grounded partly in the fact that since Indonesia did go through a crisis, today its banks are independently run, better managed and have fewer vulnerabilities than at that time. It is also based on the fact that unlike its neighbours to the north, Indonesia’s demographics are favourable. Analysts love to trumpet a young population whose demand will propel the Indonesian economy. Read more of this post

3 Korean retail giants put in hot water; Lotte, Shinsegae, CJ under scrutiny for unfair practices in abusing their dominant market position, a business practice against President Park Geun-hye’s drive for “economic democratization

2013-07-18 17:14

3 retail giants put in hot water

Lotte, Shinsegae, CJ under scrutiny for unfair practices
By Kim Tae-jong
Tensions are high in the retail industry because the nation’s leading retail companies have become the target of intensive probes by multiple government agencies in recent months. Market insiders believe that the government is investigating retail giants because they have often been criticized for abusing their dominant market position, a business practice against President Park Geun-hye’s drive for “economic democratization.”Tensions are high in the retail industry because the nation’s leading retail companies have become the target of intensive probes by multiple government agencies in recent months. Read more of this post

Pepsi chief pursues snack innovation

July 18, 2013 6:08 pm

Pepsi chief pursues snack innovation

By Shannon Bond in New York

While Nelson Peltz and other investors arepushing PepsiCo to split its portfolio of snacks and drinks brands, chief executive Indra Nooyi has something else on her mind – drinkable oatmeal. The company’s Quaker unit sells an oat-based drink in Latin America, and Ms Nooyi has pointed to the product as the possible future of “drinkified” snacks. “The lines between snacks and beverages are blurring,” she told an investor conference in May. “We keep talking artificially about snacks and beverages only because some people used to track this industry differently. I think that’s over. This is convenience.” Read more of this post

Flagship UK pension scheme hit by £1.4m fraud

July 17, 2013 11:45 am

Flagship UK pension scheme hit by £1.4m fraud

By Josephine Cumbo

The body behind the government-run pension scheme, the National Employment Savings Trust (Nest), has been forced to tighten its security controls after falling victim to a £1.4m fraud. The Nest Corporation, a trustee body that operates at arm’s length to the UK government and runs the Nest pension scheme, disclosed the loss in its annual accounts, presented to parliament on Tuesday. Read more of this post

Why Everybody Loves Tesla

Why Everybody Loves Tesla

By Ashlee Vance on July 18, 2013

The Tesla Motors (TSLA) design studio in Los Angeles is a huge open space that usually has a couple of prototype cars on the floor and parts scattered along the walls. Tonight, it’s a lounge, with red lighting, white leather couches dotting tiered plateaus of AstroTurf, Daft Punk on the sound system, and women in little black dresses serving cocktails. A few hundred guests mingle and snap photos. Most are local owners of the Model S, the luxury sedan Tesla introduced last year to near-universal acclaim.

The crowd parts for the star of the evening, Elon Musk, Tesla’s chief executive officer, and closes behind him as he works the room. After about an hour, Musk, wearing a black velvet jacket, hops onto a stage outfitted with the kind of wheel guides and drive-over repair pit you’d see at a Jiffy Lube. He tells them they’re about to witness history: a refueling contest between gasoline and electricity. “You’re here for the title fight!” he says. Read more of this post

PepsiCo, Others Bet Hummus Can Be the Next Salsa

PepsiCo, Others Bet Hummus Can Be the Next Salsa

By Duane Stanford on July 18, 2013

For most guys looking for a quick bite, salted snacks reign supreme. But Ronen Zohar wants man caves everywhere to give hummus a place of honor, right up there with salsa and beer. The chief executive officer of PepsiCo’s (PEP) Sabra Dipping venture recently launched its first national television commercials. One instructs consumers to “dip life to the fullest” by dunking all-American staples—think chicken wings and potato chips—into the mashed chickpea paste. And Sabra soon will kick off as the National Football League’s official dips sponsor, putting the brand squarely in the sights of male fans for whom snacking is also a national pastime.

While the goal is to make the Middle Eastern dip accessible to Middle America, Zohar faces a lot of work to make it a fixture at Super Bowl parties. Annual U.S. salsa sales are about $1.1 billion, more than twice those of flavored spreads like hummus. Still, the spreads are growing at a 14 percent pace as Sabra and its main rivals, Nestlè’s (NSRGY) part-owned Tribe and Kraft Foods Group’s (KRFT) Athenos, appeal to Americans’ desire to eat healthier. “Most of the people in the U.S. never tasted hummus,” the Israeli-born Zohar says. “You have to change their mind-set that even if the name is strange and the brown color of the hummus is not as appetizing, it tastes wonderful.” Read more of this post

Book Publishers Try to Sell Chinese Fiction in Translation

Book Publishers Try to Sell Chinese Fiction in Translation

By Christina Larson on July 18, 2013

Although China is now the world’s second-largest economy, few Chinese writers are read outside the country or inform the global conversation. In 2012, American publishers purchased translation rights for just 453 foreign titles, about 3 percent of the total books published in the U.S. Of those, just 16 were books first published in Chinese, according to records kept by Chad Post, publisher of New York-based Open Letter Books press. (The percentages for translated books in the U.K. are similar, according to Open Letter.) “China has the largest reading public in the world, but until recently we’ve had relatively little access to its literary scene,” says Post. Yet he is optimistic about the future of translated Chinese works in America. “People are more familiar with China. The pitch for a book doesn’t have to rely on painting China as exotic and crazy anymore.” Read more of this post

SEC staff morale low, atmosphere marked by distrust: study

SEC staff morale low, atmosphere marked by distrust: study

Thu, Jul 18 2013

By Sarah N. Lynch

(Reuters) – The Securities and Exchange Commission is not the best place to work among federal agencies in Washington, according to a new study by a government watchdog. The SEC’s organizational structure “has not been conducive to motivating and encouraging a high level of performance,” concluded the Government Accountability Office in a report released on Thursday. “Many staff indicated that morale is low and a significant percentage characterize the atmosphere of the agency as one of distrust,” the GAO said. Read more of this post

China Communist Party Fate Seen Resting on Farmers’ Land Rights

China Communist Party Fate Seen Resting on Farmers’ Land Rights

China’s growth and the future of the Communist Party rest on giving farmers their land and allowing equal rights for migrants in cities, according to the state researcher who wrote a reform road-map.

“Land and hukou reform is the cornerstone for future economic growth and political-system reform,” said Yuan Xucheng, of the China Society of Economic Reform, who was the lead author of a report submitted to top officials. Yuan spoke in an interview in Singapore last week. Hukou is the term for a household registration system which limits migrants’ rights. Read more of this post

Chipotle under attack by noodles and clones

Chipotle under attack by noodles and clones

7:43pm EDT

By Lisa Baertlein

LOS ANGELES (Reuters) – Chipotle Mexican Grill (CMG.N:Quote, Profile, Research, Stock Buzz) is one of the restaurant industry’s hottest stocks, but fickle diners and an ever-expanding selection of entrepreneurial eateries threaten to make it harder for the upscale burrito seller to keep delivering the explosive growth investors savor.

After two decades without significant direct challenges in the “fast-casual” category, Chipotle is bumping up against a bevy of new rivals that also sell $10 meals made right before diners’ eyes in the open assembly-line kitchens it popularized. Read more of this post

Oreo, Meet Dorito: Does Merging PepsiCo and Mondelez Make Sense? Nelson Peltz Thinks So

Updated July 18, 2013, 8:43 p.m. ET

Oreo, Meet Dorito

Does Merging PepsiCo and Mondelez Make Sense? Nelson Peltz Thinks So

MIKE ESTERL and JULIE JARGON

Activist investor Nelson Peltz thinks PepsiCo Inc.’s PEP +1.83% salty snacks go better with the sweet snacks at Mondelez International Inc. than soda and Gatorade. Wall Street isn’t as enthusiastic about Mr. Peltz’s suggestion, made Wednesday, that PepsiCo buy Mondelez in an $80 billion deal and then spin off PepsiCo’s beverage business. Shares of Mondelez inched up 0.3% to $30.58 on Thursday, still far below the $35 to $38 a share that Mr. Peltz said PepsiCo should pay for Mondelez, indicating investors see such a deal as far from certain. PepsiCo shares rose 1.8% to $86.80, a sign that investors are chewing over Mr. Peltz’s idea but not too sure of where it might go. The megadeal—envisioned in a white paper from Mr. Peltz’s Trian Fund Management LP—could generate synergy and scale by putting PepsiCo chip brands such as Lay’s, Doritos and Tostitos on the same trucks as Mondelez’s Cadbury chocolate bars, Oreo cookies and Trident gum around the world. Read more of this post

Buffett’s Washington Post is buying Forney Corp., a supplier of products for industrial boilers, an usual acquisition for a media and education company

Updated July 18, 2013, 7:35 p.m. ET

Washington Post Diversifies… Into Boilers

Publishing Company Buys Industrial Unit from United Technologies

WILLIAM LAUNDER

It’s not uncommon for an industrial company to seek some glitz by buying into media and entertainment. Washington Post Co. WPO -0.11% may be the only media company going in the other direction—adding soot and grease. The company on Thursday said it is buying a maker of parts for industrial furnaces from United TechnologiesCorp. UTX +0.48%. The decidedly un-glitzy deal is in keeping with a strategy of investing in companies that have strong earnings potential, said Post Chairman Donald Graham. Read more of this post

Once a Bridge to Renewable Energy, Shale Gas Is Now Cheap and Widely Available

July 18, 2013, 8:46 p.m. ET

So What’s the Matter With Shale Gas, Anyway?

Once a Bridge to Renewable Energy, Shale Gas Is Now Cheap and Widely Available

JOHN BUSSEY

Sometimes it seems as if the environmental movement has been left behind by the sheer speed of America’s shale energy revolution. That may be because a resource—natural gas—that environmental groups once saw as part of the solution has become part of the problem, at least as they see it. Shale gas and oil are widely viewed as one of the biggest forces to hit the U.S. economy in modern history. Total U.S. gas production has rocketed 33% since 2008 and oil 46%, driving down energy costs. The expanding shale industry supported 1.7 million jobs in 2012 and produced $62 billion in state and federal tax revenue, according to IHS/CERA, the energy consultancy. Read more of this post

Detroit Failed Because It Didn’t Do What Cities Do; Detroit forgot the economic case for cities: When you put different industries and different people with different ideas in close contact with another, magical things happen

Detroit Failed Because It Didn’t Do What Cities Do

Detroit’s city government filed today for Chapter 9 bankruptcy after years of financial trouble and industrial contraction. It’s easy to think that the city’s fault was going all in on auto manufacturing. Detroit made a bet, and the bet went bad. No surprise, then, that Detroit went bad, too. Including, in this case, its municipal debts.

Detroit’s dependence on cars, though, wasn’t exactly the problem. It was dependence itself. Cities should never go all in on any industry, cars or otherwise. It didn’t realize that until it was too late.

Detroit forgot the economic case for cities: When you put different industries and different people with different ideas in close contact with another, magical things happen.

“Magical things” is, of course, the technical term economists use for a number of spillover benefits created by urban areas. Their work suggests that the magic happens mainly from the mix of ideas. Read more of this post

Frustrated by Indian Policy, Foreign Investors Pull Back; Frustrated With Indian Policies, Wal-Mart, Berkshire Hathaway, Others Pull Back on Investment

July 18, 2013, 3:22 p.m. ET

Frustrated by Indian Policy, Foreign Investors Pull Back

Frustrated With Indian Policies, Wal-Mart, Berkshire Hathaway, Others Pull Back on Investment.

SEAN MCLAIN, SHEFALI ANAND and BIMAN MUKHERJI

NEW DELHI—A series of high-profile withdrawals of foreign investment across several industries this week have highlighted growing frustration with the Indian government over weak public policy as the economy slows.

Global retail giant Wal-Mart Stores Inc., WMT +0.18% insurer Berkshire HathawayInc. BRKB +0.79% and steel companies Posco 005490.SE -0.80% and ArcelorMittalMT +2.18% all pulled back on Indian investment plans this week. Read more of this post