China: official stock-buying didn’t work before and won’t work now; Central Huijin’s purchase of shares is good for sentiment, but its impact on the market is likely to be small due to the effect of diminishing returns

China: official stock-buying didn’t work before and won’t work now

Jun 18, 2013 10:50am by Lydia Guo

Central Huijin Investment, a Chinese state-owned investment company, has bought stakes in six of the country’s largest financial groups in a bid to deliver a confidence boost to the tumbling domestic stock market in a slowing economy with interbank liquidity problems. Read more of this post

Directors Refuse to Go Naked for Chinese IPOs; cost of insurance to cover directors and officers of Chinese companies against lawsuits has skyrocketed, with premiums reaching as high as $100,000 per $1 million coverage

Directors Refuse to Go Naked for Chinese IPOs

By Noah Buhayar – Jun 17, 2013

Stephen Markscheid holds one of the riskiest jobs in the world — or so say insurers.

The 59-year-old former banker, a Mandarin-speaking American, sits on the boards of five U.S.-listed Chinese companies, includingJinkoSolar Holding Co. (JKS)

The group of about 500 Chinese firms came under scrutiny over the past two years as a rash of accounting scandals and irregularities sent shares tumbling, sparked investor lawsuits and halted new stock offerings on U.S. exchanges. The U.S. Securities and Exchange Commission has revoked more than 50 Chinese company registrations since early 2011. Read more of this post

Elders is a bit like the rural services version of Billabong – an iconic brand with a business that strategically misstepped, bought the wrong assets, paid too much for them and is now lumbered with too much debt

Thanks but no thanks, says Elders, now it’s time for plan B

June 19, 2013

Elizabeth Knight

Elders is a bit like the rural services version of Billabong – an iconic brand with a business that strategically misstepped, bought the wrong assets, paid too much for them and is now lumbered with too much debt.

Both have spent the past year (or more in Billabong’s case) looking for a buyer. And neither could find one. Elders looks like it will find a home for its automotive division, but the centrepiece, the rural services business, has been left on the shelf. Read more of this post

Wall Street REIT Success Gives Investors Hangover Part II

Wall Street REIT Success Gives Investors Hangover Part II

Investors in companies buying mortgage bonds are discovering that coming late to the party can still leave them with the biggest hangover.

Mortgage real-estate investment trusts raised $7.4 billion in the first quarter by selling new shares, the most in two years, just before a plunge in the value of the firms. American Capital Agency Corp. (AGNC) has declined 17 percent since offering $2 billion in February and Armour Residential REIT Inc. (ARR) has slumped 24 percent after raising $444 million that month. Read more of this post

China Carbon Permits Trade 22% Below Europe on Market Debut

China Carbon Permits Trade 22% Below Europe on Market Debut

China traded its first carbon dioxide permits for 22% less than today’s price in Europe as the nation inaugurated the Shenzhen Emissions Exchange as part of its plan to limit heat-trapping gases linked to climate change.

The permits were priced from 28 yuan to 30 yuan ($4.90) a metric ton, according to Chen Hai’ou, chief executive officer and president of the exchange. That compares with 4.70 euros a ton ($6.30) today for European Union permits on London’s ICE Futures Europe exchange, the world’s biggest carbon market by traded volume. Read more of this post

Americans Exporting More Oil First Time Since ’70s

Americans Exporting More Oil First Time Since ’70s

The U.S. oil boom is moving Congress closer than it has been in more than three decades to easing the ban on exporting crude imposed after the Arab embargo.

Advances such as hydraulic fracturing are leading to record production that may outstrip refinery capacity within 18 months to three years, said Benjamin Salisbury, a senior energy policy analyst at FBR Capital Markets Corp. in Arlington, Virginia. Net petroleum imports now account for about 40 percent of demand, down from 60 percent in 2005, according to the U.S. Energy Information Administration, the Energy Department research unit. Read more of this post

Australia eyes Buddha and baccarat to lure Chinese tourists

Australia eyes Buddha and baccarat to lure Chinese tourists

Mon, Jun 17 2013

By Jane Wardell

SYDNEY (Reuters) – Australia’s coastal Wyong region outside Sydney, a pretty stretch of pristine beaches and wildlife-filled wetlands, isn’t high on the travel agenda of most Chinese tourists.

But the local mayor and a Chinese businessman have big plans to change that – by building a A$500 million ($480 million) theme park that will include a full-size replica of Beijing’s Forbidden City and a nine-storey temple housing a giant Buddha. Read more of this post

China Insiders Sell Most Shares in May in 4 Years, UBS Says

China Insiders Sell Most Shares in May in 4 Years, UBS Says

Major shareholders, senior management and individuals with stakes of more than 5 percent sold a net 24.7 billion yuan ($4 billion) of Chinese A shares in May, the most for a month since June 2009, UBS AG said.

The biggest sales were in computer-related shares, media and “special equipment” sectors, UBS strategists including Qin Xia wrote in a report dated today. Net stakes rose only in chemical raw materials and telecom operations, while the sell-off in smaller companies as a percentage of the free-float reached new post-2008 highs, they wrote.

Insiders sold as the Shanghai Composite Index climbed 5.6 percent in May, the biggest advance since December, and as more locked-up shares became tradable. The benchmark index has slumped 6.5 percent in June as data from exports to industrial production pointed to slowing growth and higher money-market rates signaled tighter liquidity. Read more of this post

China Foreign-Investment Gains Ease as Economic Slowdown Deepens

China Foreign-Investment Gains Ease as Economic Slowdown Deepens

Foreign direct investment in China rose in May by the least in four months, a sign of concern that growth is slowing in the world’s second-biggest economy.

Inbound non-financial investment increased 0.3 percent from a year earlier to $9.26 billion, the Ministry of Commerce said today in a statement in Beijing, after a 0.4 percent gain in April. China’s outbound investment rose 20 percent in the first five months of the year to $34.3 billion, compared with a 27.4 percent pace in January-April.

The report follows data indicating capital inflows slowed last month while growth decelerated in exports, industrial production and lending. Confidence is fading in an economic rebound this quarter, with investment banks from Morgan Stanley to Barclays Plc cutting their 2013 expansion forecasts. Read more of this post

GM Vows to Show China That Cadillac of Autos Isn’t Audi

GM Vows to Show China That Cadillac of Autos Isn’t Audi

As Vincent Qiu weighed his options for buying a new sport-utility vehicle in Beijing, he was drawn to the Cadillac SRX.

The SUV’s aggressive chrome grille, massive vertical headlamps and sharp creases along the body make the vehicle unique on China roads, where the rounded and organic shapes of Volkswagen AG (VOW)’s Audi and General Motors Co. (GM)’s Buick are popular.

“You can easily spot Audis on the roads, but not Cadillacs,” Qiu, 41, who runs an office-supply company, said last week in an interview. “But it is a big-ticket purchase and in the end my wife talked me into playing it safe and buying something that is more popular.” He bought an Audi Q5. Read more of this post

China Emission Trading Experiment Unlikely to Ease Cities’ Smog

China Emission Trading Experiment Unlikely to Ease Cities’ Smog

China’s plan to set up markets to trade emissions will make it second only to Europe in efforts to put a price on pumping carbon into the atmosphere. For cities choking on the nation’s smog, expect little relief.

Seven pilot carbon-trading programs are scheduled to start this year, with the first opening today in Shenzhen, followed by Beijing, Shanghai, Guangdong, Tianjin, Chongqing and Hubei. They are set to regulate 800 million to 1 billion tons of emissions by 2015 in the world’s biggest cap-and-trade program after Europe’s, according to Bloomberg New Energy Finance. Read more of this post

Craft Brewers Chug Away Heady Pressure by Bankers to Sell

Craft Brewers Chug Away Heady Pressure by Bankers to Sell

SweetWater Brewing Co. Chief Executive Officer Freddy Bensch gets plenty of solicitations from potential acquirers.

One stands out: a handwritten note with a crisp $50 bill from a banker begging for a meeting. The greenback was so pristine and odd a gesture that Bensch wondered if it was real.

“We took that $50 bill over to the pub and spent it on beers and they accepted it,” said Bensch, who co-founded the maker of hoppy 420 Extra Pale Ale and chocolaty Exodus Porter with a college roommate. “We didn’t accept the meeting. We toasted him when we were buying beers with his 50.” Read more of this post

Rubber Poised for Record Glut as Shippers End Curbs

Rubber Poised for Record Glut as Shippers End Curbs: Commodities

Rubber is headed for the biggest glut on record, prolonging the bear market that began in April, as supply exceeds demand for a third year and Southeast Asian exporters ended curbs on shipments.

The surplus will expand 57 percent to 490,000 metric tons this year, enough to meet U.S. demand for six months, according to RCMA Commodities Asia Group, the Singapore-based company that has traded rubber for nine decades. Futures in Tokyo, a global benchmark, will drop at least another 4.9 percent to 225 yen a kilogram ($2,373 a ton) by the end of December, according to the median of 16 analyst estimates compiled by Bloomberg. Five anticipate 200 yen, a price last seen in 2009. Read more of this post

EU Car Sales Fall to 20-Year Low as Joblessness at Record

EU Car Sales Fall to 20-Year Low as Joblessness at Record

European Union car sales in May fell to a 20-year low as rising joblessness caused by a recession in the euro region contributed to falling demand at PSA Peugeot Citroen (UG), Renault SA (RNO) and General Motors Co. (GM)

Registrations in the 27-member EU dropped 5.9 percent to 1.04 million vehicles from 1.11 million cars a year earlier, reaching the lowest level for the month since 1993, the Brussels-based European Automobile Manufacturers’ Association, or ACEA, said today in a statement. Including figures from Switzerland, Norway and Iceland, sales in May fell 5.9 percent to 1.08 million cars. Read more of this post

Protests Show Brazilian Dream Fading as Rousseff Popularity Ebbs

Protests Show Brazilian Dream Fading as Rousseff Popularity Ebbs

Francisco Soares, a 32-year-old Brasilia electrician, felt good about life two years ago when he started commuting in his first car, blasting the music and passing packed buses. Since then, bills started piling up, the cost of living jumped and last week he had to sell his wheels.

After a decade that saw 40 million people rise from poverty, Brazil’s middle class finds itself squeezed by faster inflation, rising debt and a weaker currency. Consumers are spending less at supermarkets and hairdressers as the classic weekend event, a prime cut barbecue, becomes a stretch for some. Continuing a wave of protests sparked by an increase in bus fares, demonstrators surrounded Congress in Brasilia yesterday and set a car on fire in Rio de Janeiro as tens of thousands marched in major cities. Read more of this post

Road building revival offers rare hope for India infrastructure overhaul

Road building revival offers rare hope for India infrastructure overhaul

Mon, Jun 17 2013

By Matthias Williams and Swati Pandey

NEW DELHI/MUMBAI (Reuters) – K. Ramchand, managing director at one of India’s biggest road builders, is doing something unusual to help dispel the gloom pervading much of the country’s infrastructure sector today: bidding for new projects.

His company, IL&FS Transportation Networks Ltd (ILFT.NS: Quote, Profile, Research, Stock Buzz), signed a $300 million contract in April to build a six-lane highway. The project will link an eastern industrial zone afflicted by some of India’s worst traffic snarls to mining districts such as Dhanbad, the nation’s coal capital. Read more of this post

Analysis: Companies may turn to courts on U.S. natural gas export push

Analysis: Companies may turn to courts on U.S. natural gas export push

1:59am EDT

By Ayesha Rascoe

WASHINGTON (Reuters) – U.S. companies hoping to export natural gas are frustrated by lengthy delays and rule changes as they await U.S. Department of Energy approval of their applications and may turn to the courts to speed up the process.

Both the slow pace of decisions on applications to ship U.S. liquefied natural gas abroad and the process for making those decisions could be challenged, legal sources say.

Potential strategies could be laid out during a House of Representatives panel on Tuesday, which will focus on the current impediments to U.S. LNG exports. Read more of this post

How old-economy firm Haier succeeded without Western-style razzmatazz

How old-economy firm succeeded without Western-style razzmatazz

Created: 2013-6-18

Author:Bill Fischer, Umberto Lago, and Fang Liu

LESS than 30 years from near-bankruptcy to global leadership; reinvention at least three times; trusting nearly 80,000 people to accept leadership roles in self-organizing, autonomous work units. Is it yet another new economy, Silicon Valley razzamatazz success story? Not at all.  This is about a Chinese company making home appliances, and it’s an incredible story about what is possible in old-economy, commodity markets.
Read more of this post

Online financial services threaten China’s traditional banks

Online financial services threaten China’s traditional banks

Kung Chun-jung and Staff Reporter

2013-06-16

The rapid emergence of the internet industry in China, which provides a broad range of online financial services, has posed a severe threat to the traditional banking and financial sectors, the money page of Chinese internet portal NetEase reports.

The emerging trend of online third-party payments, peer-to-peer (P2P) lending and P2P microfinance services has significantly eaten into the benefits offered by the established financial sector, the report said. Read more of this post

Foreign fast food chains in China experiencing confidence crisis

Foreign fast food chains in China experiencing confidence crisis

Staff Reporter

2013-06-18

Foreign fast food chains are facing a series of challenges that have hit their sales in China, which has become a key market after the companies’ rapid expansion in the country, the financial site of Chinese portal Tencent reported.

Yum Brands, which owns chains including KFC and Pizza Hut and controls 0.2% of the fast food market in China, posted a 13% drop in same-store sales at its over 5,200 outlets across the country in March, and forecast a further fall of 29% in April. Read more of this post

Chinese regulators seek to increase the public’s role in rooting out IPO fraud

Tuesday, June 18, 2013

Chinese regulators seek to increase the public’s role in rooting out IPO fraud

China likes to keep its business to itself, often going so far as to label some corporate finances as state secrets. Few places have been more secretive than the securities market, where the China Securities Regulatory Commission (CSRC) passes opaque judgments on which firms get to IPO, and when.

After years of poor performance of mainland exchanges, where companies are frequently found to be ridden with fraud, China’s top securities regulator has finally deigned to give the public a glimpse of the companies they could buy into.  Read more of this post

Canada has more Subway stores per capita than it does in the United States and store traffic in Canada is higher than at U.S. outlets

Subway thrives in Canada while avoiding beverage wars

Hollie Shaw | 13/06/17 | Last Updated: 13/06/17 5:29 PM ET

Peter J. Thompson/National PostFred DeLuca, president and co-founder of Subway at the franchise’s 127 Bremner Boulevard Toronto location. Mr. DeLuca borrowed US$1,000 to start the business with a friend in 1965.

TORONTO • Subway Restaurants keeps growing steadily in Canada even though the fast-food sandwich purveyor has not followed rivals McDonald’s and Tim Hortons in appealing to coffee-loving Canadians. Read more of this post

Case study: Li-Ning lost out to foreign rivals in China

June 17, 2013 4:56 pm

Case study: Li-Ning lost out to foreign rivals in China

By Hellmut Schütte, Sumelika Bhattacharyya and Jocelyn Probert

The story

Gymnast Li Ning became a Chinese hero in 1984 when he won six medals at the Los Angeles Olympics, the country’s first appearance at a summer games in 32 years. By 1990 he had set up his own sportswear company, Li-Ning. It was an immediate hit, and in 1999 the company’s revenues in China reached Rmb700m, more than twice Nike’s Rmb300m and Adidas’s Rmb100m.

The challenge

The growing spending power of China’s middle-class consumers and their appetite for foreign brands, combined with the surging popularity of basketball and football – with which Nike and Adidas were associated – helped the two overseas companies win more sales in China than Li-Ning. Read more of this post

Myanmar’s old friend China is left wondering where it went wrong; President Thein Sein said he personally despises Beijing’s influence over its smaller, poorer neighbour

June 17, 2013 1:04 pm

Myanmar’s old friend China is left wondering where it went wrong

By Jamil Anderlini in Naypyidaw

In the surreal Burmese capital Naypyidawit’s hard to miss the gleaming convention centre built by a Chinese state-owned construction company and donated to the military junta a few years ago in a gesture of bilateral amity.

But earlier this month, as more than 900 executives from across the globe gathered in the complex for Burma’s first ever World Economic Forum, the Chinese presence was conspicuously absent. According to the official WEF list, only 16 participants were from mainland China.

For decades after the founding of the People’s Republic, American foreign policy was obsessed by the question of “who lost China?” Read more of this post

Samsung’s Kitchen ambition; Can the Korean electronics giant pull a smartphone-like win in the home?

Samsung’s Kitchen ambition

June 17, 2013: 10:25 AM ET

Can the Korean electronics giant pull a smartphone-like win in the home? 

By Stephanie N. Mehta, deputy managing editor

FORTUNE — Can Samsung Electronics conquer kitchen appliances in the same way it has conquered televisions and smartphones?

The Korean tech conglomerate, already the market leader in sales of TVs and mobile phones with advanced computing capabilities, says it also aims to be the world’s No. 1 purveyor of home appliances by 2015. That’s a lofty goal considering that today it is the No. 5 player in refrigerators and automatic washer/dryers, according to market share data from Euromonitor International, and isn’t in Euromonitor’s top 5 in dishwashers, ovens or microwaves.

But Boo-Keun Yoon, co-CEO of Samsung Electronics, believes the company can win over global consumers by bringing innovation and a high-tech approach to refrigerators, ovens, air conditioners, and washing machines. “These are products that consumers are very emotional about, but there’s a lot of room for innovation in home appliances.” Yoon says. Read more of this post

How big companies can beat the patent chaos of India

How big companies can beat the patent chaos of India

June 17, 2013: 1:59 PM ET

There are several companies that are doing well in India by adapting to the market instead of the other way around.

By Ravi Venkatesan

FORTUNE — Multinational pharmaceutical companies agree on one thing — that India is one of the hardest places in the world for Big Pharma to compete thanks to price controls, compulsory licensing of drugs, poor intellectual property protection, and a host of capable generic competitors.

The recent decision by India’s Supreme Court to deny patent protection to Novartis (NVS) for a reformulated version of an anticancer drug has just added more fuel to the fire, provoking drug companies and the U.S. Chamber of Commerce to unleash angry warnings that it would cut off investment to the world’s most populous democracy and ultimately limit access to lifesaving medications. The judgment adds to a growing list of trade tensions between India, the U.S., and Europe at a time when India desperately needs more foreign investment to restart its slowing economy. Read more of this post

Korea rising: From rags to riches

2013-06-17 20:33

Korea rising: From rags to riches

This is the final of a 10-part series of Korean history from its mythological, ancient beginning until the present day. This project is sponsored by several companies and public agencies including Merck Korea, eBay Korea, Daewoo Securities and Korea Post. ― ED.

By Kim Tae-gyu and Kevin N. Cawley
The end of World War II on Aug. 15, 1945 brought about the independence of Korea after 35 years of brutal Japanese colonial rule. However, the initial euphoria of the people did not last long.

Against the will of the Korean people who sought to have their own government ruling the entire Korean Peninsula, a United Nations arrangement led to its division along the 38th parallel ― a demarcation that lasts until today. Read more of this post

Abenomics for Women Undermined by Men Dominating in Japan

Abenomics for Women Undermined by Men Dominating in Japan

By Isabel Reynolds and Takashi Hirokawa – Jun 17, 2013

Japanese Prime Minister Shinzo Abe has vowed to elevate the role of women in the world’s third-largest economy. He might start with his own party.

Abe called for women filling 30 percent of senior positions in all parts of society by 2020, in an April 19 speech showcasing his growth strategy. Now, his Liberal Democratic Party is fielding nine female candidates out of 79 for next month’s election to the upper house of parliament — about 11 percent. Read more of this post