Munger’s Wisdom and Comments on LKY in Notes on Daily Journal’s Shareholder Meeting
April 1, 2015 Leave a comment
Bamboo Innovator Daily Insight: 1 Apr (Wed) – What a tree’s name taught me about Lee Kuan Yew; Stockholm: the unicorn factory; Sweden’s capital has a disproportionate number of tech triumphs
April 1, 2015 Leave a comment
Life
- Why experiencing awe is actually an essential part of our lives: BI
- The pioneering business leader’s endless variety; There is no single attribute to the revolutionary businessperson: FT
- The cost of confusing shareholder value and short-term profit; The biggest rewards should go to managers who think long-term: FT
- In need of good luck? Change your handwriting; The way you write may just seal your fate: KH
- Aussie Treasurer Joe Hockey vows to tax profit-shifting multinational ‘thieves’: BRW
- What a tree’s name taught me about Lee Kuan Yew: AsiaOne
- Inspired by Mr Lee’s love for his wife: AsiaOne
- Lee Kuan Yew’s role in shaping India: JP
- Mr Lee spotted China’s growth potential early; He was the only one who personally met all five of modern China’s top leaders, and kept friendly relationships with them. BT
- How Being a Worrywart Helps at Work; Pessimism and Anxiety Can Improve Performance: WSJ
- Tiger Woods Slumps to 104th, Lowest Golf Ranking Since 1996: Bloomberg
- Former ABC Learning CFO James Black escapes maximum penalty with $2000 fine: TheAge
LKY’s Choice of the Most Influential Invention of the Millennium – and the Heart of its Technology
April 1, 2015 Leave a comment
| “Bamboo Innovators bend, not break, even in the most terrifying storm that would snap the mighty resisting oak tree. It survives, therefore it conquers.” |
| BAMBOO LETTER UPDATE | March 31, 2015 |
Bamboo Innovator Insight (Issue 75)
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| Dear Friends,Can You Guess This Asian Wide-Moat Company?LKY’s Choice of the Most Influential Invention of the Millennium – and the Heart of its Technology
When a group of the very best leaders were asked by the Wall Street Journal in 1999 to pick the most influential invention of the millennium, the late Mr. Lee Kuan Yew alone shunned the printing press, electricity, the internal combustion engine and the internet and chose something odd: the air-conditioner. He explained that, before air-con, people living in the tropics were at a disadvantage because the heat and humidity damaged the quality of their work. Now, they “need no longer lag behind”. LKY was obsessed with productivity and driven to do his best in crafting his own greatest invention in Singapore. More than 25 years ago, there was an Asian company who was producing and selling air-conditioner with a productivity level that would have made LKY proud. And they were so good that the Japanese manufacturers got worried and tried lobbying to impose anti-dumping duties on the company’s imports into Japan. That didn’t work. Then the Japanese got clever, really clever. They drastically restricted the number of the most important Component X in the air-conditioner shipped to the company’s country. Overnight, the company’s impressive productivity machinery grinds to a halt. In the words of Mr. C, the chairman of the company: “That was when we realized deeply that if we lack the heart of the aircon, the X, the heart of technology, having sales orders is pointless since production cannot take place. That was when we decided to undertake the task of having control over the technological know-how in X and the new spinoff company was established with the vision of technical independence. Only with technical independence can you build for the long-term.” Our latest monthly Moat Report Asia for April 2015 examines an Asian company that is the world’s #4 air-conditioner X manufacturer with 10% market share, up from 3.5% in 2000. Regionally, the company is #1 in its domestic market with 39% share, 30% in North America, 12% in Europe, 9% in Japan, 13% in South America. The company also has niche dominance in X for the recreational vehicle (RV) market in North America with 60% market share and over 90% market share in a new application in X (“Y”) for a niche household appliance in Europe in partnership with Bosch. The company’s annual X capacity is 15m units and has plans to expand by 6m units to 21m units in 2H15. The company has a diversified customer base that include Carrier-United Technologies, Goodman-Daikin, Bosch, Electrolux, Miele, Haier, TCL, Midea, Sharp, Sanyo,. The company’s strategic shareholders include a Japanese electronics giant with equity stake of 4.86%. What makes It a wide-moat business? We are impressed with its advanced production and technological know-how: (1) Grinding: The company has developed deep intangible know-how in grinding technology for X, in which metals need to be ground to micrometer-level precision, thinner than a human hair. The company is able to achieve exceptional production efficiency of 68 ppm i.e. out of every 1 million units, only 68 are rejected, possibly the best quality standard in the industry. (2) Inverter controller: It is not possible to create an energy-saving air conditioner with satisfactory performance by attaching an inverter procured from an electronics parts maker to a conventional air conditioner. Making an energy-saving air conditioner requires knowledge that cannot be easily imitated, such as the ideal number of motor revolutions under certain operating conditions. Sophisticated control technologies are required to optimally control the temperature in multiple rooms with multi-split air conditioners. Above all, the company has superior R&D capabilities to leverage upon technology and know-how to enter into new higher-margin business, including adopting the open innovation business model to co-develop new products with external strategic partners. As a result, the company’s gross margin has risen from 12.97% in 2010 to 16.5% in 2013. These new businesses have promising market potential and scalability, including (1) higher-spec air-conditioner X for recreational vehicles (RV) in which the company has 60% market share in North America; (2) “Y” co-developed with Germany’s Bosch in which the company has >90% market share in Europe, and potential new customers in dish-dryer; (3) “Y” for commercial and residential applications; (4) breaking the Japanese dominance in high efficiency Brushless Direct Current (BLDC) motor product, (5) air-purifier in partnership with Sharp, (6) mini-X in portable fire extinguisher, mini-dehumidifier, portable aircon. Management shared that they have mid-to-long-term plans to develop BLDC motors for vehicles, DC inverter controller and high-end X for medical applications. The company pursued a vertical integration strategy and has the capability and know-how to make everything in-house at present, resulting in one of the most efficient working capital cycle in the industry. As the global #4 X manufacturer making 15m units, or one out of ten X in the world, the company has built formidable competitive advantages in scale and product quality, and it has bold plans to expand capacity to 21m units. Profit margin is likely to climb further as it extends its dominant market leadership in the higher-margin niche segments of North American recreational vehicle (RV) market with 60% market share, European “Y” market with over 90% market share and break into new applications and market segments and new applications in air purifiers in China in partnership with Sharp. The company’s short-term downside is protected by an attractive 6.37% dividend yield. The company has a visible long runway as it broke the long-time dominance of the Japanese in the multi-billion energy-efficient Brushless DC (BLDC) motor market with initial output of 1.5m units (ASP $10-11/unit) in Jan 2015 and a new plant with initial output of 3-5m units in 2H15 with potential to scale up capacity to a total of 24m units. Valuation is also decent and reasonably cheap for a world-class company with PE 12.6x, EV/EBIT 10.6x and EV/EBITDA 7.1x. Net profit and EBITDA could potentially double to $70m and $150m respectively in the next 5 years in FY2020, pointing towards a 280% growth in market value to $1.8bn based on a modest EV/EBITDA 12x. Despite being not profitable for as long as the first ten years since it was established in 1989 due to the lack of production scale, the company persisted in pursuing the aspiration of achieving technical independence in the heart of the air-conditioner technology – the X – under the leadership of its chairman Mr. C. Led by Chairman C and CEO L, the company showed grit and determination in breaking past the milestone of an accumulative 100m units in 2014 and has plans to produce and sell another 100m units by 2020/21. We think the perseverance and focus is rare in Asian firms and the company deserves a valuation premium. Q: “Chairman C, we admire your persistence and determination that resulted in [company’s name]’s success as the global #4 air-conditioner X company. What kept you going all these years? And how do you pass on your values to the corporate culture and your employees at [company’s name]?” Mr. C: “In life, we must have dreams and aspirations. With dreams, our life becomes beautiful. An enterprise must pursue its dreams too. Our initial dream was to have technical independence and to produce world-class products. We are now #4 in the world and aiming at overtaking #3 in the next five years. Above all, [company’s name] aims to pursue the dream of creating infinite possibilities in smart, innovative energy-saving and environmentally-friendly future with ‘[Company’s name] Inside’, like ‘Intel Inside’, for multiple products and applications because of our superior quality and innovation. The corporate culture is that all of us at [company’s name] must adjust rapidly to the changing world. Attitudes, morals and thinking are the starting point of thoughts. Only by allowing our attitude to change our habits, habit to change character and character to change life and maintain a positive outlook on life can the ‘responsibility, integrity, innovation’ values fill employees and grow with the company. Anyone with responsibility, motivation and ambition can help [Company’s name] to create a new chapter in history and keep rewriting it.” Who is Mr. C and this wide-moat Bamboo Innovator? PS: In remembrance of the late Mr. Lee Kuan Yew, modern Singapore’s founding father, we like to share an article series that we wrote five years ago about Berkshire Hathaway and Singapore, both wide-moat compounders created and built by visionary leaders. Part 1: The power of vision The success of Berkshire Hathaway and Singapore can be traced to their visionary leaders who work with winning teams Part 2: Lion Infrastructure and value investing Both of them are an ongoing team process that demands sacrifice, hard work and soberness to scale new heights http://www.businesstimes.com.sg/?dlink=/sub/views/story/0,4574,389848,00.html Part 3: Lion Infrastructure is the way to go To reach a US$2 trillion GDP in 2065, Singapore must create and build commercial assets with a special quality The Trilogy in One Document: Warm regards, KB The Moat Report Asia http://accountancy.smu.edu.sg/faculty/profile/108141/KEE-Koon-Boon A new monthly issue of The Moat Report Asia is now available! Access the in-depth idea presentation: http://www.moatreport.com/members/ Paid subscribers get:
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Bamboo Innovator Daily Insight: 31 Mar (Tues) – Relearning the Art of Asking Question; Looking for Problems Makes Us Tired; Buffet dumps entire stake in POSCO
April 1, 2015 Leave a comment
Life
- Relearning the Art of Asking Questions: HBR
- Looking for Problems Makes Us Tired: HBR
- Protect Rogue Thinkers: The experience of an undercover cop teaches us that we should protect and support those willing to take risks, not leave them out in the cold when it goes wrong: Insead
- The myths we all believe about breakthrough thinking: Aha moments don’t just happen, they are usually preceded by dead ends and bad ideas. Here’s how to troubleshoot yourself to success. FastCo
- The Danger of Being Alexander: Leaders may find it tempting to wage ambitious crusades for personal reward, but eventually their troops can turn on them. Collaboration, often missed, can be a viable and sustainable alternative. Insead
- Art Degree Not Needed: New Sotheby’s CEO Offers Technology Savvy: Bloomberg
- In shadow of power and glory; Men constantly seek power and glory. Once you taste that nectar, there is no turning back. It is like an addiction. KH
- FT: Business pioneers in industry, technology, fashion & retail, transport, finance
- Boost Your Innovation Confidence; Know your customers, understand new technologies, embrace failure, then take a leap of faith. Strategy&
- S.E.C. Charged Financier Lynn Tilton of Defrauding Investors for allegedly hiding the poor performance of loan funds her firm managed, and collecting almost $200m in fees that it did not deserve: FT, NYT
- CIA interrogation techniques exported to the workplace: FT
- Who bears the risk of education innovation: Forbes
- A new lesson in teaching: The day we have teachers we can trust across education systems, that is when true education innovation will begin to bear fruit. Forbes
- The 100 Most Trustworthy Companies In America: Forbes
- Two Ways to Clarify Your Professional Passions: HBR
- Lee Kuan Yew, truly the father of Changi airport: BT
Bamboo Innovator Daily Insight: 30 Mar (Mon) – “Light that has guided us has been extinguished”, says PM Lee in eulogy of Lee Kuan Yew; “Mr. Lee taught people how to fish and brought fish to Singapore waters”; “What people think of it, I have to leave to them. It is of no great consequence. What is of consequence is, I did my best.”
March 30, 2015 Leave a comment
Remembering Lee Kuan Yew
- Lee Kuan Yew: I did my best: AsiaOne
- “Light that has guided us has been extinguished”, “He wrote us long and thoughtful letters sharing advice on how to make our marriages successful,” says PM Lee in eulogy: AsiaOne
- “Mr. Lee taught people how to fish and brought fish to Singapore waters.” Singapore Turns Out for Lee Kuan Yew’s Funeral; Thousands line streets in tropical rain to say farewell to Singapore’s founding prime minister: WSJ
- Malaysians yearn for a Malay version of Mr Lee: AsiaOne
- The great American disconnect: In Silicon Valley, ‘fail harder’ is a motto. In Washington a single miscue can ruin your career: FT
Life
- Mental Models: The Mind’s Search Algorithm: Farnam
- The Books That Influenced Thomas Schelling: Farnam
- David Graeber: ‘So many people spend their working lives doing jobs they think are unnecessary’; The anarchist author, coiner of the phrase ‘We are the 99%’, talks to Stuart Jeffries about ‘bullshit jobs’, our rule-bound lives and the importance of play: Guardian
- Tycoon Li Ka-shing Looks to Israel for Innovation: WSJ
- To topple a dynasty: Kung Fu rebels and the cycle of history: Fightland
- A Special Forces Officer Teaches You 5 Secrets To Overcoming Adversity: EB
- Are you a leader, or just the boss?: FP
Bamboo Innovator Daily Insight: 29 Mar (Sun) – How Mr Lee Kuan Yew’s State Funeral is being marked around the world; Mr Lee Kuan Yew’s state funeral will be a moment for all to share together
March 29, 2015 Leave a comment
Remembering Lee Kuan Yew
- How Mr Lee Kuan Yew’s State Funeral is being marked around the world; Mr Lee Kuan Yew’s state funeral will be a moment for all to share together: PM Lee: CNA, TODAY
Life
- 13 fascinating things you never knew about Steve Jobs from a new book about his life: BI
- A Seizure of Happiness: Mary Oliver on Finding Magic in Life’s Unremarkable Moments: BP
- Sense of Nonsense: Alan Watts on How We Find Meaning by Surrendering to Meaninglessness: BP
- Remarkable Commencement Addresses by Nora Ephron, David Foster Wallace, Ira Glass, and More: BP
- Complex Systems and the ‘Rashomon Effect’: WSJ
- Learning to See Data: NYT
- Ethical indiscretions and missteps: The slippery slope is all downhill: Forbes
- Elon Musk explains why living off a dollar a day as a teenager convinced him he could do anything he wanted with his life: BI
- The Brain’s Empathy Gap: Can mapping neural pathways help us make friends with our enemies?: NYT
Bamboo Innovator Daily Insight: 28 Mar (Sat) – ‘Mr Lee Kuan Yew thought about others, even when he was sick’; Lee Kuan Yew, the Man Who Remade Asia; He preached ‘Asian values’ and turned a tiny, poor city-state into an astonishing economic success.
March 28, 2015 Leave a comment
Remembering Lee Kuan Yew
- ‘Mr Lee thought about others, even when he was sick’: AsiaOne
- Lee Kuan Yew, the Man Who Remade Asia; He preached ‘Asian values’ and turned a tiny, poor city-state into an astonishing economic success. Is Lee’s ‘Singapore model’ the future of Asia?: WSJ
- The wise man of the East: Authoritarians draw the wrong lessons from Lee Kuan Yew’s success in Singapore: Economist
- Mr Lee Kuan Yew ‘embodied frugality in personal life, government’: TODAY
- Singapore: Life after Lee; The death of its founding father has triggered questions over the future of the tightly controlled city-state: FT
- An exacting boss who drove his people to do their very best: ST
- Lee Kuan Yew’s Son Faces a Changing Singapore; Prime Minister Lee Hsien Loong grapples with eroding support for the party founded by his father: WSJ
- Lee’s ‘rule by virtue’ : JP
- A Tale Of Two Economies: Singapore And Cuba: VW
Life
- Spanx founder Sara Blakely reveals her secret for coming up with million dollar ideas: BI
- Top entrepreneurs go back to school with Alibaba mega success Jack Ma: AsiaOne
- The Surface of the Earth Is Rising Beneath Your Feet: Bloomberg
- Top 10 Australian family businesses: CampdenFb
- 10 Things to Remember When You’re Struggling and Feel Stuck: TinyBuddha
- The Key to Loving Yourself, Other People, and Life: TinyBuddha
- The world is going to university: More and more money is being spent on higher education. Too little is known about whether it is worth it: Economist
- This is the biggest factor keeping planes from fully flying themselves: BI
- The Hermès chief executive talks about harvesting handbags, his Protestant work ethic and the culture of craftsmanship: FT
- How solution economy can solve bigger economic problems: Forbes
- Eight ways to find the true passion in life that has eluded you: Telegraph
- The Most Productive Way to Develop as a Leader: HBR
- Building a Collaborative Enterprise: HBR
Bamboo Innovator Daily Insight: 27 Mar (Fri) – Commander of his stage: Lee Kuan Yew
March 27, 2015 Leave a comment
Notice: The website AsianExtractor: Unearthing Accounting Fraud in Asia (www.AsianExtractor.com) is back online after seven days of technical problems.
Remembering Lee Kuan Yew
- Singapore to Carry Forward Lee Kuan Yew’s Business-Friendly Legacy; Businesses say Lee Kuan Yew’s policies and philosophy will outlast the elder statesman: WSJ
- Kuan Yew and I: Dr Mahathir Mohamad: AsiaOne
- Lee Kuan Yew as the ultimate entrepreneur in 10 quotes: e27
- Commander of his stage: Lee Kuan Yew: Economist
- Lee Kuan Yew’s Bad Prescription for India: Bloomberg
- A leader unfazed by politically sensitive questions: BT
Life
- Stanford’s most popular class isn’t computer science-it’s something much more important; It’s called “designing your life” – by reintroducing methods of “forming you into the person that will go out into the world, effect change, and be a leader.” FastCo
- Apple’s Tim Cook will give away all his money; “You want to be the pebble in the pond that creates the ripples for change”: Reuters
- Apple’s Tim Cook leads different: Fortune
- Here’s why successful people build careers like Leonardo da Vinci: BI
- Hey, Leaders: Stop Thinking So Much and Just Do It: Strategy&
- Who are the world’s best leaders? Why Obama isn’t on Fortune’s World’s Greatest Leaders list: Fortune, Fortune2
- How this ‘night owl’ CEO created a morning routine that makes her a better leader during the day: BI
- Munger: “What do you think a derivatives trading desk is? It’s a casino in drag. They make the witch doctors look good.”: Bloomberg
- What Jeff Bezos did when this new Amazon employee made a huge mistake: BI
- 5 surprising insights about Steve Jobs’s management style; “He didn’t care what the public thought of him. At times, he was surprised to have hurt someone’s feelings.”: Fastco
- How sleep became a social justice issue: Fastco
- ‘It’s OK If They Copy Us’: Google’s HR Chief On The Upside Of Giving Away Staffing Secrets: Forbes
- The story of Polaroid: Behind the instant-photography pioneer there stood a great man: Economist
- Towers of Babel: Is there such a thing as a skyscraper curse?: Economist
- Milk and economic development: No use crying; The ability to digest milk may explain how Europe got rich: Economist
- Meet the Father of Zero-Based Budgeting: Pete Pyhrr’s strategy reached the White House in 1970s, then almost disappeared; now Heinz, Kraft are adopting it: WSJ
- 22 successful entrepreneurs share their best productivity hacks: BI
- Rival Rothschild branches face court battle over family name: FT
- Why Group Brainstorming Is a Waste of Time: HBR
- The Five Key Reasons Why You Procrastinate: Forbes
Bamboo Innovator Daily Insight: 26 Mar (Thurs) – Lee Kuan Yew: Devoted husband and caring father
March 26, 2015 Leave a comment
Notice: The website AsianExtractor: Unearthing Accounting Fraud in Asia (www.AsianExtractor.com) is back online after seven days of technical problems.
Remembering Lee Kuan Yew
- Lee Kuan Yew: Devoted husband and caring father: AsiaOne
- In Lee’s death, Singapore efficiency shines through: AsiaOne
- Remembering Lee Kuan Yew, the candid leader: AsiaOne
- Jon Huntsman: What I learnt from Lee Kuan Yew: BT
- Former Senior Minister of State: ‘If you won his trust, he wouldn’t question you’: AsiaOne
- Journey with a master teacher: AsiaOne
- What Comes After Lee Kuan Yew?: PS
- Singapore, the Nation That Lee Kuan Yew Built, Questions Its Direction: NYT
Life
- Mark Cuban shares the most important lesson he learned in his 20s; “Most people won’t put in the time to get a knowledge advantage”: BI
- Sam Walton’s Rules For Building A Business: VW
- Why Shake Shack founder Danny Meyer makes all of his new executives bus tables: BI
- The amazing rags-to-riches story of Li Ka-Shing, Asia’s richest man: BI
- Inside Google’s insanely popular emotional intelligence course: Fastco
- 5 Lessons On Innovation From Modern-Day Explorers And Adventurers: Fastco
- The higher people rise at work, the more they are flattered and the less they hear honest criticism: FT
- Wanted: flexible corporate strategies for fast times; Frameworks used by managers are worn and compelling new theory is rare: FT
- Delighting in the possible: In an unpredictable world, executives should stretch beyond managing the probable.: McKinsey
Bamboo Innovator Daily Insight: 25 Mar (Wed) – Lee Kuan Yew’s Power of Forgiveness
March 25, 2015 Leave a comment
Notice: The website AsianExtractor: Unearthing Accounting Fraud in Asia (www.AsianExtractor.com) is down on technical issues and we are trying to resolve the problem asap.
Remembering Lee Kuan Yew
- Lee Kuan Yew’s Power of Forgiveness; When it came to the sins of the past, the prime minister put the future of Singapore first: WSJ
- Mr Lee Kuan Yew and his red box: TODAY
- LKY: A leader who’s ruthless in demanding honesty: AsiaOne
- All roads lead to Singapore: Asians study Lee Kuan Yew’s mantra: Reuters
Life
- Six Books Bill Gates Recommended For TED 2015: VW
- A Conversation With the Authors of ‘Becoming Steve Jobs’: NYT
- 6 Rules for Building and Scaling Company Culture: HBR
- Why Family Firms in East Asia Struggle with Succession: HBR
- Collaboration, from the Wright Brothers to Robots: HBR
- 9 habits of exceptional leaders, according to the classic book ‘How to Win Friends and Influence People’: BI
- All dictators live ‘in fear,’ former Libyan PM says; “When you oppress people, when you do wrong to others, you cannot live happily”: JA
Bamboo Innovator Daily Insight: 24 Mar (Tues) – The World Loses A Wise Voice During Troubled Time; Lee Kuan Yew made Singapore an economic powerhouse, demonstrating that the key is creating an environment in which human ingenuity can thrive
March 25, 2015 Leave a comment
Notice: The website AsianExtractor: Unearthing Accounting Fraud in Asia (www.AsianExtractor.com) is down on technical issues and we are trying to resolve the problem asap.
Remembering Lee Kuan Yew
- The World Loses A Wise Voice During Troubled Time; Lee Kuan Yew made Singapore an economic powerhouse, demonstrating that the key is creating an environment in which human ingenuity can thrive: Forbes
- Henry A. Kissinger: The world will miss Lee Kuan Yew: WaPo
- Can-Do Lee Kuan Yew: NYT
- What Would Lee Kuan Yew Do?: NYT
- Singapore’s Evolution: Lee Kuan Yew astutely evaluated any political or economic dogma that ran counter to his goals. WSJ
- Lee Kuan Yew and Tongil rice; ‘When the farmers are full, that’s the end of Communist revolution.’ – Lee Kuan Yew: JA
- The city state of Singapore braces itself for challenges to come; Political rumblings in Singapore can be heard, writes Kishore Mahbubani: FT
- In China and West, contrasting views on legacy of Singapore’s patriarch: WaPo
- Lee Kuan Yew’s Mixed Legacy in Singapore: NYT
- China’s Love of Lee’s ‘Singapore Model’ Ran Deep for Decades : Bloomberg
Life
- 17 of our favorite Steve Jobs quotes from the new book about his life: BI
- The CEO of Popeyes says becoming a ‘servant leader’ helped her turn around the struggling restaurant chain: BI
- People are turning to education for entertainment, whether from online lectures, learning vacations or television, for the love of learning new things and to stay economically viable.: NYT
- 6 Leadership Failures That Put Your Company at Competitive Risk: Forbes
- How Atari’s Nolan Bushnell turned down Steve Jobs’ offer of a third of Apple at $50,000: TheAge
- A Manifesto for Makers: The maker ethos is not unlike that of the athlete and can be found in faraway Russia or the local Maker Faire, says veteran engineer Lee Felsenstein.: EE
- The top 10 words of TED2015: TED
- University reforms will lead to new beatnik generation as students shun the hard degrees: Mark Carnegie: BRW
- Warren Buffett: Berkshire’s success has almost everything to do with being based in the US: BI
- The best lessons from ‘Art of War,’ a book Evan Spiegel bought Snapchat employees when he felt threatened by Facebook: BI
- Billionaire designer Tory Burch shares the best advice she ever got: BI
- 10 Principles of Organization Design: These fundamental guidelines, drawn from experience, can help you reshape your organization to fit your business strategy.: Strategy&
The Physics of Music and the Asian Innovators
March 24, 2015 Leave a comment
| “Bamboo Innovators bend, not break, even in the most terrifying storm that would snap the mighty resisting oak tree. It survives, therefore it conquers.” |
| BAMBOO LETTER UPDATE | March 23, 2015 |
Bamboo Innovator Insight (Issue 74)
|
| Dear Friends,The Physics of Music and the Asian Innovators
At the admission interview of the high school applicants into the Accountancy program at the Singapore Management University last week, one of the candidates “C” cried during the interview – and I gave her the highest score 19/20 amongst all the candidates and wrote down “strongly recommend”. We like to share some of the conversations in this story which inspired the discussion about why for instance Singapore’s Creative Technology (CREAF SP, MV $74m) did not scale up to become the Apple of Singapore/Asia, collapsing from over a billion dollar in market value at its peak to $74 million today, as well as the deeper thought-provoking insights to understand and identify the hidden Asian innovators that include Loen Entertainment (016170 KS, MV $1.09bn) which had more than tripled since we last highlighted them in Aug 2013 in “Berkshire Hathaway Embracing Media? An Asian Perspective”. “C” did not have the straight-As profile (H2: AABD, H1: AC) and even had a “poor” General Paper score, which was strange given her vivid and heart-stirring writing in the application form describing herself and the various activities she does that contributed to helping others during her time at Hwa Chong Junior College. The first impression she would definitely give to others would be that of a stereotypical shy, self-conscious and introverted person. A checklist approach and mindset will definitely strike “C” out. I sense that there is brilliance beneath her shyness as some of my probing questions and observations revealed that she is an introspective, self-reflective and intellectually curious thinker and tinkerer capable of something rare that eludes the straight-As and well-rounded-CV students – to produce original thoughts and ideas. “C” is the only candidate that I have come across in these years to have applied for both the Accountancy and Information Systems degree programs. With her interests in the Science Students’ Research Council where she was in the International Science Youth Forum Nobel Forum Committee, it seems that she has a yearning to do and make something with her hands and brains, that she is a tinkerer, and a tinkerer who is keen to explore further her interest and confidence in “numbers” – and to peer into the “framework” behind the “numbers”. “C, I see that you are capable of deep thoughts. I think your General Paper score was because you are too self-conscious in your thoughts about how you come across to others, that you are afraid of being misunderstood in the eyes of others and that affected your writing in that time constraint and pressure in the exam setting. Are you able to share what is the proudest piece of work that you have done up, beyond all these society-imposed resume criteria to fill the CCAs/Community Service silos?” This is akin to asking what does a person do if he or she is not measured by the KPIs or observed by others – to understand their true character and authenticity as a leader and innovator. And “C” shared about her “The Physics and Science of Music” piece of project work and prototype that I find very interesting and aligned to her deep-thinker personality and untapped hidden potential as an innovator, a Maker who has the capacity and capability to engage in creative work and systems design, work which requires deep thoughts, tenacity and sacrifices to bear through the uncertainty, anguish and passions. The usual self-entitled Taker with straight-As will hardly bother with such meaningless pursuits that do not have deterministic and measurable outcomes. Under all those society-imposed boxes, “C” could not mention or write about this at all in the form. Instead, “C” said wistfully, “But this is probably not worth mentioning. There is no value to this. It probably cannot be commercialized.” Inspired by her sharing, I said, “Why not? Imagine if Creative Technology had focused on your idea and organizing vision in the science of music, the science of audio and sound, they probably would not have languished.” I explained very briefly to “C” that Creative Technology had brought to the world in 1989 the Sound Blaster, a stereo soundboard inserted into the computers to give the computer a voice to play music. And this technology was made widely available to the general consumer, bringing what was previously accessible only to the privileged and wealthy to the masses to enjoy. Creative became the first Singapore firm to be listed on the NASDAQ stock exchange and Sim Wong Hoo, the harmonica-playing founder of Creative, became the youngest self-made billionaire in Singapore at the age of 45. ******** When Creative’s founder Sim Wong Hoo was said to seek some government financial assistance at the NCB (National Computer Board, now known as IDA) to market the product at Comdex trade show in US, they ridiculed him, saying that no one would ever want to hear a sound from the PC. They rubbed salt in by mentioning that he was just a poly diploma holder and that he needs to develop something for the local market for which NCB would give him assistance. Later, funded by a venture capitalist, Sim showcased Sound Blaster in the exhibition in America and, according to some photos, even Michael Jackson visited his booth. Sim later said about his vision, “I looked at the PC and said it was dumb. I said computers should talk. Computers should play music. I believe in sound. I believe in music.” Creative dominated the PC audio market as the de facto standard for a decade and had sold 100 million units by 2000. The all-time high was in March 2000 at $64 per share; now Creative is $. By the 2000s, OEM PCs began to be built with sound boards integrated directly onto the motherboard and the Sound Blaster found itself reduced to a niche product. Creative went on to launch other less successful businesses and products that include the CD-ROM business in which they were forced to write off $100 million in inventory when the market collapsed due to a flood of cheaper alternative, Nomad Jukebox and ZEN series of portable media players (before Apple launched iPods), Prodikeys (a keyboard with piano keys), reportedly burning a billion dollar in R&D in developing both the Zii stem-cell-like processor with supercomputing power launched in 2009 and the HanZpad computer tablet launched in late 2011. After sharing the Creative story to “C”, I was thinking that Creative could well have been the innovator in Guitar Hero, the billion-dollar gaming franchise that rekindle music education in children and has found use in health and treatment of recovering patients. Creative could also possibly ride the rising popularity and profitability of podcast network and audio storytelling phenomenon (podcast subscriptions have passed over one billion in 2013 and monthly podcast listeners have more than tripled to over 75 million per month from 25 million before the onset of the 2007 crisis). Creative could possibly beat Pandora Media (P US, MV $3.4bn)/Spotify/Deezer/Beats Music (acquired by Apple); the Pandora music-streaming app are embedded by GM into the dashboards of most Chevrolets, Buicks and Cadillacs. Taiwan’s KKBox, started in late 2005 as a PC application, now has over 2 million paying subscribers paying a monthly fee of around $5 for unlimited access to its catalogue of more than 10 million Asian songs and value-added content and services and is valued at over a billion dollar, attracting a $105m investment from Singapore’s GIC in 2014. KKBox has a dominant position in Taiwan in knowing where the music listeners are and what songs and artists they like and now offers a mixture of music, entertainment news, and even organizes its own concerts that are broadcast across the countries they are operating in. Loen Entertainment (016170 KS, market cap $1.09bn) operates Korea’s largest online music retail platform MelOn with a 60% market share. Loen was founded in 1961 by former English-language-daily journalist Min Young-bin as YBM Sisa English, a language-learning tape creator. In the 1960s when Korea was an impoverished nation just out of war, the medium of studying English was limited to printed publications including magazines, books and dictionaries. YB Min launched the country’s first magazine for English learners in 1961 and “A Handbook of Business English” in 1967 in response to policies designed to drive exports. The next decade marked the use of audio and sound in language education. In 1970, supported by the U.S. government, YBM brought out English 900, a set of six books with 60 cassette tapes on 900 English sentence structures. YBM later expanded into a major K-Pop music record label which debuted hallyu celebrity Rain. SK Telecom bought a 60% stake in the music record firm in 2005, renaming it Loen to be put in charge of operating SK’s online music distribution service MelOn in 2009. With the cataloguing know-how developed over the years, MelOn grew to become the most used online music sales in Korea. SK later sold its 52.6% stake in Loen to a foreign PE firm for $239m in Jul 2013. Organized by the science of music, an idea larger than oneself, the possibilities from business model innovation are more scalable and sustainable, instead of jumping around in chasing trends and themes like Creative did in repeating familiar hardware-based business models that had worked successfully for a while in the past but failed subsequently to remain sustainable. ******** Because I sense that her community service work is based on a genuine heart, which is rare, I asked “C” gently whether that was shaped by some personal or family experience and she said something moving and aspirational, which was not discernible at all in her opening introduction and write-up. People like “C” will always be misunderstood, and misunderstood badly, because the harsh and pretentious world look solely at the superficial skin, the poise, the posturing and never the inner worth and potential. “C” is the potential innovator and authentic caring leader who can contribute to improving the world and the people around her and she has far bigger potential that she realizes and that hidden potential needs to be unlocked with an opportunity. In our years of interacting and observing entrepreneurs and managers in Asia, we find that there seemed to be two kinds: some who would look for flaws in ideas and people, and then pounce to kill them; and others who started from a place of seeking and promoting good, new and original ideas and people. When the “idea and people promoter” saw flaws, they pointed them out gently, in the spirit of improving them – not eviscerating them. The “idea and people killer” were not aware that they were serving some other agenda, which was often to show others how high their standards are. The innovators understand the difficult, ephemeral process of developing the new. The innovators understand that looking beyond the pretty and rigorous checklist for something original, authentic, something surprising and unproven, are necessary for genuine value creation – and must be a conscious effort. We also want to observe that the corporate culture are NOT infested with the kind of people that populated Disney in the late 1970s as remarked by Pixar’s founder Ed Catmull in his inspiring and thought-provoking book Creativity, Inc.: Overcoming the Unseen Forces That Stand in the Way of True Inspiration: “Unbeknownst to me, soon after our meeting at Lucasfilm, John Lasseter would lose his job at Disney. Apparently, his supervisors felt that The Brave Little Toaster was – like him – a little too avant-garde. They listened to his pitch and, immediately afterward, fired him. What John hadn’t realized when he joined Disney Animation, however, was that the studio was going through a rough, fallow period. The animation there had plateaued much earlier – no significant technical advances had been made since 1961’s 101 Dalmatians, and many of its young, talented animators had left the studio, reacting in part to an increasingly hierarchical culture that didn’t value their ideas. When John arrived in 1979, Frank Thomas, Ollie Johnston, and the rest of the Nine Old Men were getting up in years – the youngest was 65 – and had stepped away from day-to-day business of moviemaking, leaving the studio in the hands of a group of lesser artists who had been waiting in the wings for decades. These men felt in was their turn to be in charge but were so insecure about their standing within the company that they clung to their newfound status by stifling – not encouraging – younger talents. Not only were they not interested in the ideas of their fledgling animators, they exercised a sort of punitive power. They were seemingly determined that those beneath them not rise in the ranks any faster than they already had.” We think this lesson from Disney is poignant for Asia which is at a critical transition phase in succession risk (and opportunity) with the patriarchs and matriarchs handing over the reins of their business empires to the right capital allocators, whether to their heirs or professional managers. Many of the Asian successors are like Disney’s highly experienced and well-qualified men-in-charge in the late 1970s. Above all, we think a corporate culture focused on KPIs is downright unhealthy as it results in gaming of the performance measurement system and distances people from creating an idea larger than oneself that can involve co-creators in the value creation process. What is this “idea larger than oneself” which we emphasized in many of our writings? Take the case of Hemant Amin, founder, chairman and CEO of Asiamin Capital, a low-profile, successful multi-million single family office, and our guest speaker for the Singapore Management University students in the course ACCT004 Accounting Fraud in Asia with the presentation topic “A Family Office Investment Journey and Understanding the DNA of Fraudulent Promoters”. We mentioned in a thank you note to Hemant that this idea larger than oneself is also about practicing and living out the values of Buffett-Munger: Hi Hemant, Thanks much – a recurring theme in the Compounders is that they are obsessed with creating an idea larger than themselves, whether it is Buffett-Munger with their philosophy manifested in their creation of Berkshire Hathaway or yourself in practicing and living out the values of a true value investor to educate and inspire the next generation of leaders! 🙂 Take the case of Lee Bakunin, a very early Berkshire Hathaway value investor whom we respect and admire greatly. A lawyer by training, Lee is the author of the upcoming book “How to Negotiate Like Warren Buffett”. The book’s vision is an idea larger than oneself. With the book, Lee has transcended beyond material wealth. He can remove himself from the equation and the ideas in the book will profoundly influence and impact positively the readers. Those who practice the philosophy in the book will become the idea itself. We hope to be able to have the opportunity in the future to invite Lee to address the SMU students taking the course Accounting Fraud in Asia and to inspire them with his wisdom and values. Hence, value investors should simply ask, can the Asian entrepreneur-emperor remove himself or herself from the business equation and the business can still compound in value? Only if he or she has created an idea larger than oneself. This is the true and only KPI that should matter in identifying the wide-moat compounder and Bamboo Innovator in Asia. And “C”s question to me at the end of the interview was also simple and brilliant, again reflecting her deep-introspective character. Having done admission interviews before, this was the first time I was asked such a question. “C, you are very good, don’t let anyone tell you anything otherwise,” I told her at the end. I think she cried softly two times during the interview because she felt she was understood, that her inner self was understood, that what she was trying to achieve at an emotional level was understood. “C” would still need to go through the admissions office’s elimination process based on the number of available places and we hope that she can get into SMU and the program(s) of her choice. We wish her all the best in creating the music of accounting for the business community and society in the years ahead. Warm regards, KB The Moat Report Asia http://accountancy.smu.edu.sg/faculty/profile/108141/KEE-Koon-Boon A new monthly issue of The Moat Report Asia is now available! Access the in-depth idea presentation: |
Bamboo Innovator Daily Insight: 23 Mar (Mon) – Mr Lee Kuan Yew was committed to a cause greater than himself: President Tony Tan; 穿越旷野的风 您慢些走 新加坡的夜 那么静那么静 连风都听不到听不到
March 23, 2015 Leave a comment
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Remembering Lee Kuan Yew
- Mr Lee Kuan Yew was committed to a cause greater than himself: President Tony Tan: TODAY
- LKY: The economic pragmatist; He was a man unafraid to challenge the popular ideologies of the day; he had no truck with dogma. Right up to the end of his life, LKY believed in constantly adapting to the hard realities of a changing world: TODAY
- Singapore After Lee Kuan Yew: Future Is Uncertain For The Utilitarian Paradise He Created: Forbes
- Lee Kuan Yew: China watcher who offered Beijing a model: FT
- The great persuader: He did not crave to be popular; rather, Mr Lee Kuan Yew sought to persuade people to see his point of view. TODAY
- After Lee, Singapore Needs a Rethink: Bloomberg
- An Expat Ponders Lee Kuan Yew’s Legacy & Asks: Is the Singapore Model Scalable?: WSJ
Life
- Dyson invests £12m to create new engineering school; The Dyson School of Design Engineering, based in South Kensington, has been set up to address the ‘dearth’ of UK engineers: Telegraph
- Stop waiting for the muse to arrive and make something new; Creativity tips from tech entrepreneur Kevin Ashton: FT
- Goethe’s Aphorisms: Farnam
- Speeches – Ten Rules to Utilize: Farnam
Bamboo Innovator Daily Insight: 22 Mar (Sun) – Why Steve Jobs’s legendary Stanford commencement ceremony almost never happened
March 22, 2015 Leave a comment
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Life
- Why Steve Jobs’s legendary Stanford commencement ceremony almost never happened: FastCo
- Walter Benjamin on Information vs. Wisdom and How the Novel and the News Killed Storytelling: BP
- World’s Best CEOs: Barron’s 11th annual list adds eight bosses, but includes only two from our first list, after a turbulent decade that’s been tough on CEOs. Barron’s1, Barron’s2
- Goodbye, math and history: Finland wants to abandon teaching subjects at school: Quartz
- Few Companies Actually Succeed at Going Global: HBR
- In Defense of Boredom: 200 Years of Ideas on the Virtues of Not-Doing from Some of Humanity’s Greatest Minds: BP
- ‘Disruptive innovation key to become world beaters’: Forbes
- In Italy, They’re Now Taxing Shadows: Zerohedge
Bamboo Innovator Daily Insight: 21 Mar (Sat) – Dear Teacher, A Video Game Developer Is A Real Job And Should Be Celebrated; Simply knowing that there is a framework of code behind Minecraft or Crossy Road is nearly as important as knowing how to code it. This knowledge removes the mysticism of computers
March 21, 2015 Leave a comment
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Life
- Dear Teacher, A Video Game Developer Is A Real Job And Should Be Celebrated; Simply knowing that there is a framework of code behind Minecraft or Crossy Road is nearly as important as knowing how to code it. This knowledge removes the mysticism of computers: Techcrunch
- Why engineers loved working for Steve Jobs; Steve challenged them in ways they had never imagined. No one else in the computer business had such radical goals and expectations; no one else seemed to care so much about their work. BI
- Jony Ive describes the moment he stopped fearing Steve Jobs; “But to hear his introduction of me to the whole of Pixar, I realized that he really understood what I was try to achieve at an emotional level. At some level, he know what I was trying to articulate”: BI
- Students learn on own initiatives: KT
- Finding Success, Well Past the Age of Wunderkind; Through the arts, education and other pursuits, more people are experiencing late-life rebirths that are rewarding creatively, emotionally and spiritually. NYT
- Jokowi Jets to Yogya to Reflect on Meaning of Life: JG
- 10 Steps to Access Your Goodness and Change Your Life: TinyBuddha
- Why You Shouldn’t Wait For Others to Validate Your Decisions; “Do not let another day go by where your dedication to other people’s opinions is greater than your dedication to your own emotions!”: TinyBuddha
- Why We Get Attached to Our Struggles and Who We Could Be Without Them: TinyBuddha
- Freeing Yourself from Fear: 4 Lessons from Anxiety; “The only journey is the one within.” ~Rainer Maria Rilke: TinyBuddha
- Gilding the Sheepskin: It is possible to have a good life-even a great one-without attending the college of your choice. Who knew?: WSJ
- Music Education Needs to Be a Click Away: WSJ
- Cannibalisation the only way to beat cheaper competitors, says professor: SCMP
- Why Islam Needs a Reformation: To defeat the extremists for good, Muslims must reject those aspects of their tradition that prompt some believers to resort to oppression and holy war: WSJ
- How We Learn to Be Afraid of the Right Things: Alison Gopnik on research that shows how humans (and rats) set up protected spaces for children to deal with the dangerous adult world: WSJ
- The Slippery Slope to Extinction: Neanderthals had bigger brains, sharper vision and were better adapted to the environment than homo sapiens. How did we replace them as Eurasia’s apex predator? WSJ
- Young Financier’s Insurance Empire Collapses: Investments of insurance companies owned by Southport Lane Management were swapped for unusual and sometimes worthless assets: WSJ
- Rise of the machines: is there anything to fear? What happens when ultra-intelligent computers begin to improve themselves? We should not assume they’ll have our best interests at heart: FT
- Rifat’s prison sentence indicates front running’s time is up: FT
- A degree of creativity; ‘Vocational degrees provide skills that can become outdated or be replaced by robots”: FT
- The 3 most important things to know if you’re managing half a million employees: BI
- How one man went from collecting unemployment to owning a burger chain with hundreds of locations: BI
- What’s Wrong with Finance: MH
- Overnight viral sensations: good lessons and great opportunities for marketers: NM
Investing Process
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- Audits alone can’t solve all: TheStar
- Cash flow, and not cash, is king; 1MDB has cash and bank balances of RM3.85bil and another RM12.89bil of investments that are deemed as “available-for-sale” but had to rely on a RM950mil standby credit facility from the Government: TheStar
Greater China
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- Goldin Financial’s meteoric gains raise questions over what is fueling the rally: WSJ
- China Regulator Urges Caution as Stocks Jump to Seven-Year Highs: Bloomberg
- China’s Trial-and-Error Economy: PS
Japan & Korea
- Inside Korea’s DIY home decor craze; “Shoppers these days are disappointed when I only show them classic designs that they can find elsewhere. They’re all looking for something that’s one-of-a-kind.” : KH
- Home furnishing market flourishes: Challenged by Ikea, Korean furniture makers transform into ‘lifestyle brands’: KH
- Prosecution to seek warrant for POSCO E&C’s ex-Vietnam head: KH
- Hyundai marks anniversary of founders’ death: JA
ASEAN
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- Malaysia has seen only small-scale forensic accounting cases, mostly in the form of investigation audits done on Practice Note 17 companies, which has surged since 2000. TheStar
- Auditing the Auditor-General: Is the Public Accounts Committee equipped to assess the work of Ambrin who has been tasked with verifying the books of 1MDB from 2009?: TheStar
- More moves to curb housing loans seen in Malaysia: TheStar
- AEC effects unlikely to be seen for years, meet told: NM
Macro
- Investors Embrace ETFs That Hedge Against a Strong Dollar; As the dollar has risen, investors have pumped billions into foreign-stock funds that shelter their returns from currency swings: WSJ
- The Global VAT Craze: A new study shows how the value-added tax is rising world-wide. WSJ
- While Regulators Fiddle, Avoid Getting Burned: WSJ
- How to Pick a Stock Picker: It’s tough to predict which active manager will beat the market. Here’s one way to improve the odds: Look for low fees. WSJ
- Newcomers jump into activist investing, eying returns and capital: Reuters
- Why Washington drives innovators and entrepreneurs nuts: WaPo
- How Scary Is the Bond Market?: PS
- We’re Frighteningly in the Dark About Student Debt: NYT
TMT
- Technical Hurdles Delay Drone Deliveries; Battery life and weather at least as daunting as pending regulation, say developers: WSJ
- YouTube Wasn’t Created As A Music Service, We Turned It Into One: Forbes
- Meet the man whose utopian vision for the Internet conquered, and then warped, Silicon Valley: WaPo
- Here’s some interesting gossip about how Microsoft could make more money from Windows: BI
- The tech formula: Nasdaq = small caps + Apple: FT
Healthcare
- Japan’s outsized demand for fertility treatment helps explain why shares of OvaScience, a fertility company based near Harvard University in the U.S., have more than tripled this year : Barron’s1, 2
Consumer & Others
- From Warren Buffett to Bill Gates: How auto dealerships are attracting a whole new class of investor: FP
- Starbucks aims to brew the right thing; A model for those seeking to create brand ‘narrative’ in this brave new media world: FT
- The fairytale success of Swarovski; The brand’s association with films and fashion has put sparkle into sales: FT
Bamboo Innovator Daily Insight: 20 Mar (Fri) – Speak Honestly, Lead Honorably; Tim Cook on Apple’s future: everything can change except values
March 20, 2015 Leave a comment
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Life
- Speak Honestly, Lead Honorably: Strategy&
- The Intangible Corporation: Bloomberg
- The difference between commitment and technique; Great teachers teach commitment. SethGodin
- Five Ways Your Financial Adviser Can Screw Up Your Retirement, Legally: Bloomberg
- Why positivity is the worst response to a problem: FastCo
- College for a New Age: NYT
- Today’s Anxious Freshmen Declare Majors Far Faster Than Their Elders; Weak job market and high debt loads prompt broad shift away from intellectual exploration; “People don’t go to college anymore to be fulfilled or to gain life perspective”: WSJ
- The business of business: An old debate about what companies are for has been revived: Economist
- The revolution that could change the way your child is taught: Guardian
- Leighton to change name to CIMIC in wake of corruption allegations, shedding an Australian brand that has existed for more than 60 years: TheAge
- The grim reality of start-ups: 95 per cent fail: TheAge
- There is widespread “mischief” and even “abuse” in how financial services firms treat a key system for detecting misconduct, ASIC says. TheAge
- Productivity guru David Allen shares his 3 best tricks for saving time: BI
- A poster boy for dogged resilience: Gyr King rebuilt his art prints business after a fire but advances in technology require constant vigilance: FT
- 12 Habits of Exceptional Leaders: Forbes
- The World’s Most Ethical Companies 2015: Forbes
Greater China
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- China Tells Internet Firm Ex-Boss, under investigation for alleged securities rules violations, to come back to the country as it seeks to avert a second corporate default in the onshore bond market. Bloomberg
- CVC Capital has secured a court order freezing the assets of a flamboyant Chinese restaurant owner who sold a majority stake in her company to the European private equity group last year for $300m. FT
- Chinese Firms Shift Investment From Mines to Trophy Assets; head of China’s mining association estimated that 80% of all overseas mining deals had failed: WSJ
- The Great Chinese Car Casino: Bloomberg
- Aberdeen Sees Bubble Valuation in China Stock-Market Leaders: Bloomberg
- Xiaomi Widens Smart-Home Push to India With Air Purifier: Bloomberg
- Will that be all, sir? Butler business booms in China: AsiaOne
- SFC outlines conditions for dual-share listings: SCMP
- China’s Anti-Corruption Agents Knock Again on PetroChina’s Door: Bloomberg
- China Needs More Creativity As it shifts from being the world’s factory to a source of innovation: Bloomberg
- HK SFC chairman Carlson Tong Ka-shing said a “sunset clause” could be considered should there be any change to the “one share, one vote” principle the first time the watchdog has expressed any willingness to alter the mechanism: Standard
- In Wake Of Kuaidi-Didi Merger, Uber Faces An Even Tougher Battle In China: Forbes
- Salvatore Ferragamo, the Italian fashion house, said it had blocked, seized or destroyed more than 100,000 fake products in a “fierce global battle against counterfeiting” focused on China and the internet. FT
- No Gain Without Pain for China’s Flabby SOEs; The urge to reform state-owned enterprises is at risk of waning as Beijing focuses on bolstering growth.: Barron’s
- Bacardi Launches Tea-Distilled Liquor in China; Spirits maker to sell ‘Tang,’ a light-green alcohol made from green tea leaves, in upscale restaurants: WSJ
- What’s Wrong With China’s Army?: Bloomberg
- For Hong Kong, a chill sets in as rich China tourists shop elsewhere: Reuters
India
- Indian Companies Look to Wives to Fill Female Board-Member Requirement: WSJ
- Modi Sees Shiny Cities in India’s Future: NYT
- India’s troubled opposition: The son also disappears; Congress, the party that long defined Indian politics, is in free fall: Economist
- Paper planes, parents help Indian pupils outsmart state exams: AsiaOne
- 5 Indian Bottom of Pyramid-focussed tech startups you should meet: e27
- The stalled Alibaba-Snapdeal deal is proof India’s e-commerce valuations are insane: Quartz
- Corruption might hinder ‘Make in India’: Deloitte’s James Cottrell: Forbes
- India Tackles Messy Web of Sales Taxes; Single levy would replace wildly varying regimes that snarl shipments in red tape: WSJ
- Modi Sees Shiny Cities in India’s Future: NYT
Japan & Korea
- LG CEO vows to step up innovation; Tech giant aims to be No. 1 in global home appliance market: KH
- Expensive Korean stocks come under pressure to split: KH
ASEAN
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- Bursa Securities raps, fines remisier RM312,000 for manipulation in numerous counters/securities. theStar
- Asia ’98 Recalled as Currency Losses Engulf Top-Ranked Singapore: Bloomberg
- Myanmar military to maintain political role, president says: Reuters
- Chang Beer maker debuts 30 cent tea: Nikkei
Macro
- SEC Joins Battle on Broker Bias That Could Remake Industry: Bloomberg
- Sri Lanka PM seeks probe into stock market’s insider trading: AsiaOne
- SEC Whistleblower Retaliation Push Could Face Challenge: WSJ
- How an Ex-Moore Trader Got Caught in the Most Complicated Insider Trading Investigation in British History: bloomberg
- Bitcoin Scammers Run Off With $12 Million: “Going to The Caribbean. Hope You Guys Understand”: Zerohedge
- America’s Hispanics: From minor to major; One American in six is now Hispanic, up from a small minority two generations ago. By mid-century it will be more than one in four. Have faith in the melting-pot: Hispanic-America’s rise is a tremendous opportunity: Economist1, Economist2
- Attack of the bean-counters: Lawyers beware: the accountants are coming after your business: Economist
- The Algosaibi affair: A Saudi saga; Six years on, the claims arising from a huge corporate scandal in the Gulf are still being fought over: Economist
- The war against Islamic State: The caliphate cracks; Though Islamic State is still spreading terror, its weaknesses are becoming apparent: Economist
- Mismatch point: The rise of the dollar will punish borrowers in emerging markets: Economist
- Notaries: The princes of paperwork; A highly regulated profession fights to preserve its privileges: Economist
- A leap in the dark: How will investors react to America’s first rate increase in nine years?: Economist
- The role of government bonds as an asset class is changing: Economist
- Debt-ridden emerging markets are heading for a nasty dollar hangover: Economist
- Quicksilver markets can catch out the unwary; Charts imply that equities are in bubble territory comparable to patterns in 1929, 2000 and 2007: FT
- How Foreigners Became America’s Financial Regulators: WSJ
Energy & Commodities
- In a World Awash With Crude Oil, Storage Companies Are Kings: Bloomberg
- Why Shale Producers Still ‘Pump and Pray’: Bloomberg
- No Relief Seen for Malaysia’s Energy Stock Drop on Earnings: Bloomberg
- Non-U.S. Shales Prove Difficult to Crack; Exxon, Shell and others are pulling back from once-promising shale finds in Europe, Asia: WSJ
Healthcare
- New Hope for Stroke Boosts Demand for Device to Nab Clots: Bloomberg
- Scientists Seek Ban on Method of Editing the Human Genome: NYT
- Big Pharma Needs to Get Busy in the Lab; Blanket generalizations about biotech firms being more efficient are unfounded. WSJ
- U.S. Recovers $3.3 Billion in Federal Health-Care Fraud; Obama administration steps up efforts to prevent Medicare fraud, not just uncover it: WSJ
TMT
- Tim Cook on Apple’s future: everything can change except values: FastCo
- The rise of the ecommerce enablers; With the ecommerce market booming, ancillary firms that provide logistical support from payments to delivery are becoming an investor destination: Forbes
- How The Netflix Model Can Screw Filmmakers: Forbes
- Tag Heuer, Intel challenge Apple with Android smartwatch: Reuters
- Fifty-seven million Latinos are a mighty market for the media: Economist
- “VIACOM is me. I’m Viacom. That marriage is eternal, for ever,” Sumner Redstone, a media mogul, once said about his firm. “For ever” is a relative concept. In May Mr Redstone will turn 92: Economist
- The log-on degree: College in America is ruinously expensive. Some digital cures are emerging: Economist
- Mobile payments: Unfriending cash; Facebook enters the booming market for mobile payments: Economist
- Founder Wang takes over as CEO as Taiwan’s HTC seeks turnaround: Reuters
- Tim Cook explains how Apple decides which new products to work on next: BI
- How Tim Cook implants Apple’s culture into new employees: BI
- Internet TV: the cord cutters bringing some sanity to US viewing: FT
- This company dominates the virtual reality business, and it’s not named Oculus: Fortune
Consumer & Others
Bamboo Innovator Daily Insight: 19 Mar (Thurs) – An Ancient Civics Lesson: How Athens and Rome empowered the poor; China’s debt situation is genuinely scary-and getting worse
March 19, 2015 Leave a comment
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Life
- How to Build a Strategy for ‘the Long Game’: K@W
- An Ancient Civics Lesson: How Athens and Rome empowered the poor. NYT
- A Dozen Things I’ve Learned from David Tepper about Investing: 25iq
- Interview with Marc Cohodes: Famous short-seller shares his favorite ideas/managers and life lessons: FirstAdopter
- When you’re building a new company, getting the word out is critical. WSJ
- PowerPoint Karaoke Brings Stress Relief to Silicon Valley’s Embattled Office Workers: WSJ
Greater China
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- China’s debt situation is genuinely scary-and getting worse: Quartz
- Tribunal begins hearing case of short-seller who alleged developer Evergrande was insolvent; Evergrande gets $16 billion credit line bailout on March 17 to shore up one of the country’s largest and most heavily indebted home builders: SCMP
- Li Ning reports loss of 781 million yuan as founder takes reins: SCMP
- Hong Kong-linked company appears on Thai SEC alert list for conducting securities and derivative business without a licence from the commission. SCMP
- Yahoo Pulls the Plug on China Operations; Internet giant lays off 200-300 employees and closes Beijing research center: WSJ
- CKH Holdings shares rise as reorganisation begins: SCMP
- Starbucks partners drinks maker Tingyi to expand in China: Reuters
India
- Metropolis’ Chain of Diagnostics Labs Pushes for Growth Across India and Africa: Forbes
- Inside India: India’s Fight Against Big Pharma Patents Is a Just War: WSJ
Japan & Korea
- Former Posco Group Chairman Chung Joon-yang allegedly invested some trillions of won in questionable mergers and acquisitions during his term; Posco probe shifts to its subcontractors: JA1, JA2
- Lotte Group’s shopping subsidiary is being investigated for allegedly creating a slush fund, prosecutors said: KT
- Japan’s Accounting Problem: PS
- These Japanese Engineers Invented $7,900 Bike Wheels: Bloomberg
- Father Fights to Oust CEO Daughter From Japan Furniture Chain: WSJ
ASEAN
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- Share manipulation scheme unveiled? Ex-staffer behind selling of Civmec shares? BT
- When 28% shareholding is a majority at an AGM… When only 55 per cent of issued shares are voting, which is the average at general meetings by Singapore-listed companies in 2014: BT
- How Singapore’s Lifebrandz lost its shine: AsiaOne
- Singapore tries to imagine a future without its founder, Lee Kuan Yew: WaPo
- Thai former PM Yingluck to face trial over rice scheme: court: AsiaOne
- Thailand’s outdated tech sector casts cloud over economy: Reuters
Macro
- Review Of SEC Enforcement Developments In 2014, And A Look Forward: WilmerHale
- In Praise of Short Sellers: Newyorker
- The Nonprofit Behind Billions in Mortgage Aid Is a Mess: Bloomberg
- Paris Ghetto With Views But No Jobs Shows Decades of Failures: Bloomberg
- Life After Loopholes Forces Luxembourg to Rethink Its Future: Bloomberg
- Hedge fund guru Crispin Odey says following China could lead to recession: SMH
- Federal Reserve decision: Fed signals that higher interest rates are coming: WaPo
- Asia can grow by learning from itself: ChinaPost
- Germany’s Mittelstand bond market is being overhauled in an effort to improve transparency for investors following a reputation-damaging wave of defaults and insolvencies. FT
- Negative gearing: a legal tax rort for rich investors that reduces housing affordability: Guardian
- Stanford Endowment Pauses Plan for Asia Office: WSJ
- Investors Raise Alarm Over Liquidity Shortage; Regulators also worried falling trading volumes could disrupt markets: WSJ
- Are emerging markets about to suffer another ‘taper tantrum’?: SCMP
- Here Is Why The Fed Can’t Hike Rates By Even 0.25%: Zerohedge
Energy & Commodities
- Mining companies shedding jobs by the thousands: TheAge
- The New Equation for Oil Prices: WSJ
- Banks Struggle to Unload Oil Loans; Citigroup, Goldman, UBS and others face losses as investors balk at riskiness of energy sector: WSJ
TMT
- Could Apple become the next Comcast? WaPo
- The rise of the ecommerce enablers; With the ecommerce market booming, ancillary firms that provide logistical support from payments to delivery are becoming an investor destination: Forbes
- Robots rub shoulders with human buddies: FT
- Internet of Things means never having to search again: Fortune
- What StoryCorps should do next; Text would be the logical next move for the audio storytelling phenomenon. Google and Microsoft could help. Fortune
- Tim Cook: It’s critical that Apple do everything it can to stay informal. Fortune
- LVMH’s Tag Heuer surfs wave of smartwatch partnerships: Reuters
Healthcare
- Bill Gates on a global epidemic: ‘Time is not on our side’: Fortune
Consumer & Others
- Cotton On tells staff to keep it real or face the sack; Since being created in 1991, Cotton On has grown rapidly with more than 1300 stores and offices around the world. TheAge
- From Paris, the Anti-Tesla That Costs 20 Cents a Minute: Bloomberg
- Starbucks will test delivery services in New York, Seattle this year: Fortune
- What Is Coke CEO’s Solution for Lost Fizz? More Soda; Despite changing consumer tastes, Muhtar Kent pushes strategy to sell more cola: WSJ
Bamboo Innovator Daily Insight: 18 Mar (Wed) – Bill Gates recommends you read this specific part of Warren Buffett’s letter and says this is the most important annual letter Buffett has ever written
March 19, 2015 Leave a comment
Life
- Bill Gates recommends you read this specific part of Warren Buffett’s letter and says this is the most important annual letter Buffett has ever written. BI
- 5 important business lessons one man learned from successfully climbing Mount Everest: BI
- Bill Gates: Steve Jobs would have made a ‘terrible’ Microsoft CEO: BI
- Blackmores Chairman tells his board he sold 150,000 shares of his stock to buy himself yacht: BI
- Here’s the remarkably simple secret to forming lifelong habits: BI
- Here’s how Steve Jobs told Tim Cook he was going to be the CEO of Apple: BI
- Here’s the first chapter of the business book Bill Gates says is the best he’s ever read: BI
- Here’s a guide to body-language etiquette around the world: BI
- Here’s how one psychologist learned to use her anxiety to make better decisions: BI
- Buffett’s childhood home on Airbnb: KT
- Shangri-La developer makes journey from Afghan refugee to construction king: TheAge
- Overthinking vs. Underthinking: Finding the Sweet Spot: Forbes
- School admissions no measure of one’s worth: NYT
- Managers Need to Make Time for Face Time: WSJ
- What have we learnt in 100 years of relativity?: PS
Greater China
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- China came THIS close to another massive property developer default; Chinese Developer Evergrande Gets $16 Billion Lifeline Amid Slump: BI, NYT
- Kaisa Said Unlikely to Pay Coupons Wednesday, Thursday: Bloomberg
- China Graft Probe Snares Another Developer After Kaisa: Bloomberg
- China’s house price crisis is creating a perverse bailout bubble for property companies: BI
- China: With friends like these; Beijing has lent billions to spread its influence, but as defaults loom its approach is shifting: FT
- China Stocks Break 15-Year Link With Hong Kong as Rates Diverge: Bloomberg
- Netflix’s Bold China Plan: Technode
- China’s Tech Giants Taking On the Domestic Entertainment Industry: Technode
- Xu Caihou and the demise of China’s ‘New Gang of Four’: WCT
- China Invites Bids to Audit Offshore Assets; China’s oversight body for state assets is holding a tender to audit state companies’ overseas assets: WSJ
- China in danger of reverting to cult-based politics: BT
- China Promises Transparent Audit Of State Enterprises’ $690B In Overseas Investments: IBT
- The Chinese government thinks it has found the answer to the country’s property market crisis; purchase unsold residential properties and convert these units into low-cost public housing to reduce inventory levels: BI
- China must pardon corrupt officials, says author dubbed China’s John Grisham; He Jiahong, a legal expert says Beijing must focus on the causes of corruption rather than its symptoms or face ‘disaster’: Telegraph
- China Investigates Former Senior Official of Shanghai Free-Trade Zone: WSJ
- Is the Chinese dragon losing its puff?: CT
- Lacklustre performance at NPC suggests Chinese provincial party boss Hu Chunhua’s star is fading: SCMP
- Xi Jinping’s inner circle: The mishu cluster: Brookings
- ‘Tigers and flies’ to ‘tigers and wives’: the other-halves of senior officials caught up in Xi Jinping’s anti-graft drive: SCMP
- Party Investigates CNPC Executive Once Seen as Company’s Next Leader: Caixin
- World not excited about China’s Belt and Road plan: TODAY
India
- Modi’s Biggest Problem May Be the Banks: Bloomberg
- Solar Parks on Fertile Land Are New Adversary of India’s Farmers: Bloomberg
- 10 sharply focussed ecommerce players in India: Forbes
- How ColdEx Logistics is climbing up the food chain: Forbes
- India’s growing appetite for food service startups: Forbes
- India plans IPO rule changes to lure homegrown start-ups: sources: Reuters
- India’s Mahindra Enters Racing, but With Eye on Tesla: WSJ
Japan & Korea
- Meet the Japanese gaming giant that’s going to save Nintendo: BI
- Yamaha drives ahead with third attempt at four wheels: FT
- Japan Inc gives biggest boost to base pay for more than a decade: FT
- Japan Pensions Sell Record $46 Billion Bonds to Buy Stocks: Bloomberg
- Prosecutors raided the head offices of the Korea National Oil Corp. (KNOC) and Keangnam Enterprises, Wednesday, as part of their widening investigation into allegations of corruption surrounding the failed “energy diplomacy” conducted under the Lee Myung-bak administration: KT
- Coupang says unafraid of Amazon: KT
- Shares in POSCO companies drop on slush fund investigations; Corruption bust should not be swayed by politics; the prosecution investigating suspected slush funds at the construction unit of POSCO is closing in on the conglomerate’s former CEO Chung Joon-yang and his associates: Maeil, KH
- Korea’s top financial regulator will try to shift the center of the nation’s financial industry from the banking sector to the relatively weaker capital markets as part of a long-term restructuring plan.: JA
- Korea’s Best Olympic Venue? Japan. Bloomberg
- Toyota’s Measly $33 Won’t Save Japan: Bloomberg
- Nintendo Finally Gets to the Next Level: WSJ
ASEAN
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- Fitch Sees More Than 50% Odds of Malaysia Downgrade on 1MDB: Bloomberg
- Fund Flap Roils Malaysia; Clash between a former Malaysian leader and the current one over alleged mismanagement of the country’s troubled multi-billion-dollar national investment fund destabilizes the government: WSJ
- Noble braced for next critique by mysterious research firm: FT
- Old Man Thailand Feels Pain of Economic Arthritis: Bloomberg
- Singaporeans pack JB nursing homes: AsiaOne
- The Catalist conundrum which shows no sign of getting resolved: BT
Macro
- ECB’s money printing may stymie cash generators: Reuters
- Hedge Funder Dalio Thinks the Fed Can Repeat 1937 All Over Again: Bloomberg
- CBA’s kickback scandal raises new questions about banking culture: TheAge
- Fannie, Freddie could need another bailout as risks rise: watchdog: Reuters
- Seeking a Cure for Raging Corporate Activism: Back from the 1980s, tenure voting is an intriguing but controversial idea to change how companies are run: WSJ
- Investors Demand More Info on Board Skills: WSJ
- Asia Steps Up Efforts to Reach the ‘Unbanked’; Governments from China to India are experimenting with novel ways to widen access to financial services: WSJ
- Hedge Fund Manager Fears “Sudden, Pervasive Loss Of Faith” In Markets; Says “It’s A Truly Scary Time”: Zerohedge
- S.E.C. Chief Voices Support for Higher Advice Standard for Brokers; Such a move would hold stockbrokers to a fiduciary duty standard, under which they must put their clients’ interests ahead of their own. NYT
Energy & Commodities
- Fortescue pulls $2.5bn bond as iron ore distress deepens: FT
- Oil Rig Squeeze Puts DNB on Alert to Help Billionaire Fredriksen: Bloomberg
- Oil Bonds Lose Investors $7 Billion in 10 Days: Bloomberg
TMT
- Subscriptions are enjoying a new prominence as a revenue engine for digital content and apps: BI
- TripAdvisor reviews are now so powerful they impact the tourist industry of entire countries: BI
- There are so many $10 billion startups that there’s a new name for them: ‘decacorns’: BI
- The clever way Apple was able to trademark the ‘iPad’ name while keeping the product a secret: BI
- Tesla CEO Elon Musk says in the future, cars with drivers will be considered too dangerous: BI
- MUNSTER: Apple’s new TV service could finally make the Apple television a reality: BI
- Apple TV has grown from a ‘hobby’ into a nice little business; Apple TV entices networks with promise of mobile viewers; Apple Upsets the TV Cart; Apple TV Plans Unscrambled; Apple Is Out to Blow Up the Cable TV Model: Bloomberg, WSJ, BI, Reuters
- 10 facts about the Apple Watch that show Apple’s obsessive attention to detail: BI
- Meet the man who could own Aviva France; One French investor has an unbelievable ‘magic ticket’ that is turning him into a billionaire without any risk: FT, BI1, BI2
- The pricing strategy for the Apple Watch is insanely smart: BI
- TIM COOK: This is the ‘disease’ that ruins technology companies: BI
- Tim Cook details one strategy that makes Apple different than Microsoft: BI
- The whoosh of start-up value going from Europe to Palo Alto; A local alternative to Silicon Valley’s disruption mantra is needed: FT
- What will be the impact of vast quantities of usable data on business? That is the overarching question that the authors of Big Data Revolution seek to answer. FT
- Biggest Advertisers Are Sending Their Dollars to Digital: NYT
- Digital Media Darlings Unfazed by the Fall of the News Site Gigaom: NYT
- The Most Obnoxious And Overused Startup Jargon: Forbes
- How to Build a Cross-Border Tech Startup When You’re Fighting; The only thing separating Israel and a pool of affordable talent is a border patrolled by soldiers: JG
- ‘Taxi Kingpin’ Gene Freidman, who owns more than 900 city cab medallions, in massive debt thanks to Uber; “People used to have a religious faith that yellow-cab-medallion prices would go up forever,” But Freidman is still living large: NYPost
- Jumei’s Makeover Is More Than Cosmetic; A pop in the shares of the beauty products e-tailer suggests investors are warming to its new strategy. Barron’s
- Sorcery! Bloomberg apparently just learned how venture capital works: Pando
- The Fuzzy, Insane Math That’s Creating So Many Billion-Dollar Tech Companies: Bloomberg
- Coming to Windows: Use Your Finger or Your Face as a Password; Microsoft says its next version of Windows will support biometric authentication: WSJ
- Leading IT Through Change, Not Buzzwords: WSJ
- GE Capital, Intel CIOs Create New Ways to Measure IT Business Value: WSJ
- Unbundling Pay-TV Brings New Questions; ‘Cord-Cutting’ choices grow, but questions for consumers, companies swirl: WSJ
Healthcare
- Holy Grail: Pain Pills Without the High; Drug firms try to find strong pain relievers that don’t invite abuse: WSJ
Consumer & Others
Bamboo Innovator Daily Insight: 17 Mar (Tues) – The Steve Jobs you didn’t know: Kind, Patient, and Human
March 19, 2015 Leave a comment
Life
- The Steve Jobs you didn’t know: kind, patient, and human: FastCo
- Skills in Flux : We are already using a set of subtle, flexible new skills to fit the new economy. It’s time we understood them. NYT
- The Hidden Talent of Steve Jobs: Genius alone didn’t bring Apple back. It took management chops. NYT
- Decoding the Rules of Conversation; The French love to land zingers. The British live in the land of irony. And Americans? It’s all about reassurance.: NYT
- Agility Is Within Reach; With strategic responsiveness and organizational flexibility, you can move quickly when your industry changes. Strategy&
- Would-Be Financial Whiz Is Charged With Stealing From Investors; Mark Malik’s fund won praise from ranking firms: WSJ
- Does Stress Make Us Forgetful? (Is That Why We Can’t Find the Car Keys?): WSJ
- Disruptive innovation is catching on: BT
- ‘Cinderella’ and the power of kindness: WaPo
- Motivational speakers modern charlatans: TheAge
Greater China
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- In pursuit of runaway funds, Beijing struck a deal with a fraudster Li Dongzhe tired of life on the run; Li is one of the 18,000 Chinese economic escapees hiding around the world: WSJ
- Sunac Said to Find Kaisa Unprofitable in Due Diligence Work; Analysts are still forecasting a profit for the full year, with the average of six estimates compiled by Bloomberg at 3.1 billion yuan ($495 million). Bloomberg
- China’s slowdown has suddenly become a “fiscal shock”; Land auctions make up a huge chunk of local government revenues-an estimated 40% in 2013-and account for a big chunk of China’s GDP: Quartz
- In China, trust firms shift, rather than reduce, shadow banking risk: Reuters
- Don’t Count on China’s Debt Problems Going Away: WSJ
- PetroChina Vice Chairman Under Investigation for Graft Allegations: WSJ
- Mainland corruption crackdown poses risks for foreign investors: SCMP
- Q. and A.: David Shambaugh on the Risks to Chinese Communist Rule: NYT
- Alibaba’s Jack Ma shows off new ‘pay with a selfie’ technology; New facial recognition software is intended to buttress the fast-growing mobile-payments business. Fortune
- A vote of no confidence from China’s young consumers; A vote of no confidence from China’s young consumers: FT
- China’s Answer to Pixar Unveils New 3-D Feature About Guardian Spirits: WSJ
- All You Need to Know About Alibaba’s Lock-Up Expiration: WSJ
- Hong Kong’s Decade-Long Property Boom Could Be Ending: Chart : Bloomberg
India
- India needs own model of manufacturing: BT
- Jewelers in India Jump Online for $22 Billion E-Commerce Pie: Bloomberg
Japan & Korea
- Japan’s Devaluation Warning for Europe; Monetary easing without reform has reduced real wages.: WSJ
- Nintendo Opens Door to Smartphone Games: WSJ
ASEAN
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- SGX needs to serve up equities revival: FT
- Deficiencies found in fair value measure in Singapore: audit survey: BT
Macro
- Can Asia Survive a Strong Dollar? Bloomberg
- IMF fears emerging markets instability: FT
- Why Wimp label sticks to emerging nations; They suffer from lacking international monetary power: FT
- Regulators step up warnings against pension scams: FT
- A Mystery in Hedge Fund Investing: Hedge fund performance has been terrible. Hedge fund expenses are insane. People continue to invest in hedge funds anyway. NYT
- A ‘Merger of Equals’ Is More Fragile: WSJ
- In Shift, Firms Give Investors New Clout Over Board Seats; Move rattles some as proxy access could give pension funds, unions greater influence over firms’ strategic choices: WSJ
- How a Rising Dollar Is Creating Trouble for Emerging Economies: NYT
- Insider trading masterminds Lukas Kamay, Christopher Hill jailed after Block bid: TheAge
- Funds Run by Robots Now Account for $400 Billion: Bloomberg
- Court Strikes on Insider Trading, and Congress Lobs Back: NYT
Energy & Commodities
- Are the good times over for growth in U.S. shale gas?: Reuters
- Fortescue turns to the junk bond market for $US2.5b after US loan investors demanded better terms, forcing the miner to pay up to extend and refinance its debt: TheAge
TMT
- Big problem for fund managers: liking Apple too much: Reuters
- Apple Watch shows the strategic ripple effects of a big splash: Engage? Ignore? Retreat? How to react when a powerful new product arrives in your sector:FT
- Can GrubHub Go the Last Mile?: Bloomberg
- Driverless cars: A tremendous innovation with a glaring Achilles’ heel: WaPo
- John Maeda says design is winning in Silicon Valley: WaPo
Healthcare
- Intensive Care Gets Friendlier with Apps, Devices: Family participation helps patients; respect and dignity are priorities: WSJ
- Scientists’ New Goal: Growing Old Without Disease; Researchers plan to test a pill to prevent or delay Alzheimer’s, heart disease and other ailments that come with age: WSJ
- Sirtex Medical loses $1b in market value after cancer trial disappoints: TheAge
- Horse dung has scientists on scent of antibiotic success: Reuters
- Looking at the Promise and Perils of the Emerging Big Data Sector: NYT
Consumer & Others
- Craft versus Kraft: Big US food groups are struggling to adapt to the diverse tastes of younger generations and immigrant populations: FT
Mocking Asia, the Pixar Solution and the R.E.S.-ilence Handle
March 16, 2015 Leave a comment
| “Bamboo Innovators bend, not break, even in the most terrifying storm that would snap the mighty resisting oak tree. It survives, therefore it conquers.” |
| BAMBOO LETTER UPDATE | March 16, 2015 |
Bamboo Innovator Insight (Issue 73)
|
| Part 1: A Family Office Investment Journey and Understanding the DNA of Fraudulent PromotersDear Moat Report Asia subscribers in Singapore,I have invited a guest speaker. He is Hemant Amin, founder, chairman and CEO of Asiamin Capital, a low-profile, successful multi-million single family office. He will be talking about his family office investment journey and understanding the DNA of fraudulent promoters in the Indian and Asian context with actual Indian cases accumulated from his wealth of experience in investing in Asia and India, where he is an early investor in Narayana Murthy’s Infosys which compounded over 60-folds for him: http://www.beyondproxy.com/grey-world/. His capital allocation track record over the past decade from 2004 to 2014 is outstanding, compounding at 29.3% and trouncing the S&P index by a factor of 3.6 times over the same period; a $1,000 would yield $16,857 during the period.
After witnessing over the decade plus how the Asian capital jungle has turned increasingly into a fertile ground for insiders-promoters-syndicates who have the incentive and power to manipulate prices and volumes, to deceive investors with fraudulent financial numbers, and to inject market “action” via positive corporate announcements of various sorts to excite the senses but rarely materializing subsequently in economic substance, luring investors and their funds in and then offloading the shares a pump-and-dump stock manipulation scheme, I desperately and madly wanted the SMU students to learn from a rare positive role model in the Asian capital jungle – and Hemant’s name is at the top of my list to invite as a guest speaker to inspire the students. Hemant showed that it is still possible to win as a value investor because of one having not only the right investing approach but more importantly, having the right values in life. That it is possible to create value without compromising on values in this harsh, pretentious and messy world. That one can avoid investing in the fraudulent promoters by understanding their DNA. It is immediately obvious that only someone who has a deep thinking process and value system can craft out such thought-provoking insights. Hemant’s carefully-prepared presentation material reflects and exudes his deep introspection, knowledge, resilient investment process and values. Having weathered through adversities and the mental drain in fighting the fraudulent promoters to reclaim the money invested, Hemant’s investment journey took a life-changing turn when he attended Berkshire Hathaway’s AGM in 1997 for the first time – and Hemant has made the pilgrimage to Omaha every year since. Hemant started to focus on the quality of the management and the business model and understood the difference between statistically-cheap cigar butts generated from net-net screens and checklists made famous by Benjamin Graham vs compounders which was the focus of Charlie Munger, the Vice-Chairman of Berkshire Hathaway and the influential partner to Buffett’s success. Because Hemant’s presentation is so good, I have invited the team of economic crime prosecutors at AGC (Attorney’s General Chambers) Financial & Securities Crime Division who might be coming over for the presentation. The AGC has recently invited me for a talk session on accounting and securities fraud in Asia with their DPPs; it is a great honor and I wish to share with them Hemant’s great insights. It will be great if you wish to join us on 17 March (Tuesday) at 4.30pm till 7pm. Warm regards, KB The Moat Report Asia http://accountancy.smu.edu.sg/faculty/profile/108141/KEE-Koon-Boon PS: We are honored that Hemant is a fellow Moat Report Asia subscriber. We will be making Hemant’s presentation material available for our Moat Report Asia subscribers. Part 2: Mocking Asia, the Pixar Solution and the R.E.S.-ilence Handle “If we were to mock Singapore, we would say it is a nation of bankers and real-estate developers. What we would like to become is a nation of entrepreneurs. The country is missing a big trick about how it thinks about entrepreneurial thinking. We make a list of all the things we want to do and we say okay, check, we’ve done that. It’s a list-building mentality. It’s not an opportunity-framing mentality – which is what entrepreneurial thinking is about… You cannot beat Apple by becoming more like Apple… We have to embrace being Asian… We have to build something uniquely Asian.” – Singapore Management University (SMU) business dean Gerard George in “Thinking Beyond the Checklist”, 13 March 2015 “But my internal sense of purpose – the thing that had led me to sleep on the floor of the computer lab in graduate school just to get more hours on the mainframe, that kept me awake at night, as a kid, solving puzzles in my head, that fueled my every workday – had gone missing. I’d spent two decades building a train and laying its track. Now, the thought of merely driving it struck me as a far less interesting task. Was making one film after another enough to engage me? I wondered. What would be my organizing principle now? My desire to protect Pixar from the forces that ruin so many businesses gave me renewed focus. I began to see my role as a leader more clearly. I would devote myself to learning how to build not just a successful company but a sustainable creative culture. As I turned my attention from solving technical problems to engaging with the philosophy of sound management, I was excited once again – and sure that our second act could be as exhilarating as our first.” – Pixar’s founder Ed Catmull in Creativity, Inc: Overcoming the Unseen Forces That Stand in the Way of True Inspiration For the last 50 years in Singapore and Asia, which is built on the foundation of the farsighted pioneers who established the place as a magnet of FDI flow and MNCs, all firms and entrepreneurs had to do was answer the phone from clients and lease more office space. And excess profits are used to reinvest in trading and accumulating property assets and financial engineering activities. “Positional leadership” are prized on those who can maneuver the giant organizational machinery with their “well-rounded” skill-set and climb to the apex. That run is possibly over. Relationship-based deal-making capabilities coupled with access to cheap financing have experienced diminishing marginal returns, even losses, and internal in-fighting and succession woes have fueled a hidden vicious race to the bottom in accounting tunneling of group resources that is hidden at the surface. Like an inverted U-curve that was also highlighted earlier in May 2013 in Pilgrimage to Omaha + Entrepreneurship, Asian-Style: “As value investors in Asia should know, path dependency has influenced the Southeast Asian (ASEAN) economy, which is the product of a relationship between political patronage and economic elitist power that developed in its initial starting point in the colonial era, and this politics-business nexus was sustained with a different cast of characters. Bet on the wrong jockey (entrepreneur) and the race is over. The Asian horse (business) doesn’t matter much; the ownership of the horse can change, a far more important information to monitor and analyze. Alas to the ones who are not in the insider’s track. These big Asian horses are often grants to quasi-monopoly or regulated/ protected concessions, normally in domestic goods and services industries without a requirement to generate the technological capabilities to compete on the global arena. These asset-based, deal-making trading businesses that form the foundation of many Asian tycoons are akin to elite forms of barber-like “services” in which the fiercely global competition cannot attack with impunity, such as commodities, construction/ infrastructure/ property, financial services. As Joe Studwell pointed out in his insightful book “Asian Godfathers: Money and Power in Hong Kong and Southeast Asia”, Southeast Asia has all the trappings of a modern dazzling economy with its high-tech factories and high-rise buildings but few indigenous, large-scale companies producing world-class products and services. The scraps that trickle down the big, long tables of the Asian tycoons are left to be competed fiercely in a lose-lose situation at the SME level. Even with the export-driven boom, the SME’s role as middlemen in taking and executing orders efficiently from their MNC customers has limited the scalability of their business model.” Growth and entrepreneurship in Asia is not driven by innovation and science given that every creative field — innovation, science, music, movies, books, art — follows a Power Law. They bring into the world richly valued things which did not exist before. And these creations like Pixar take time and effort of a different nature as compared to the asset-based, deal-making trading businesses and positional leadership skill-set for big corporates in Asia. From Pixar’s founder Ed Catmull story encapsulated in his inspiring book Creativity, Inc, we can sense and observe that the true innovator and compounder have:
Our mental model for navigating the Big Transition in Asia is to identify the Pixars and Bamboo Innovators, investing in the emerging tycoons, the innovators and the wide moats they are building – before they become obvious. We have discussed earlier about the philosophy of “Good is not the absence of evil”: how the value investor can only eliminate the “evil” ones with potential misgovernance and accounting tunneling fraud to limit downside risks – and still neglect and overlook the “good” compounders. And each time round there is a credit crisis punctuating the markets, there is an increasing premium on valuation for wide-moat business models in Asia as the Innovators stood apart from the Imitators and the swarming Incompetents. Value investors in Asia need to take the leap to become more Munger-like in selecting companies with wide moats that can generate compounding returns rather than dwell with a false sense of security in the realm of statistically cheap stocks that turn out to be either fraudulent or value traps. Starting next week, we will start expanding on these thoughts of finding the emerging tycoons in Asia and the wide moats they are building – before they become obvious. As we have highlighted in “Any Benjamin Franklin in Asia? (Part 2): Reflections from the Story of Linkabit-Qualcomm and the Inverted U-Curve of Singapore/Asia”: “True compounders have no time to waste and their brains and time are purposed towards ideas larger than themselves. In our interaction with Asian management over the past decade plus, the Bamboo Innovator like to sense this almost child-like fervour and time spent for ideas, which in the Asian context is deemed immature and foolish since the successful wealthy towkays feel that the mind should be occupied by the loud thought of “can make money or not” or “can be more famous and prominent or not”. That makes the difference between a wealthy local tycoon who creates wealth largely for himself or herself with the usually visible display of lifestyle to portray success and posturing activities to gain fame and social respect as compared to the quiet low-profile inventor-entrepreneurs who lived in the basement constantly thinking and worrying and keeping the ideas burning towards the flames of creation and scaling up.” As we have discussed, a checklist approach in examining “successful” companies might overlook the resilient Bamboo Innovators. After all, there are much larger impressive trees in the forest. By comparison a bamboo looks smaller, thinner, and fragile. The list of Bamboo Innovators is a surprising one; many of them are not the typical ones that one would come across. While the details are always different, certain features of the Bamboo Innovators are remarkably similar to those that resulted in the astonishing vitality in bamboo: the R.E.S.-ilience factors in value creation.
Sheaths are not the most obvious structures on a bamboo plant, but they are, perhaps, the most complicated. As the bamboo shoot breaks through the earth’s surface and reaches for the sun, it is covered and protected by a set of distinctive sheaths. Every soft and vulnerable emerging node of rhizome (root), culm, or branch bears a sheath that protects it during growth until it hardens. The outer surface of the culm sheath is usually tough while the inner surface is always smooth and glossy which allows the internode to rise rapidly through its casing. Similarly, upon crafting the culture and creating the context for resilient growth, sheath leaders play the role of protecting emerging nodes of innovation at the periphery from harm. An illuminating example would be how Singapore’s founding Prime Minister Lee Kuan Yew cleared the political obstacles and laid the ground to allow for the innovations devised by his key economic architect Dr. Goh Keng Swee to be implemented, as commented by Lee himself in his eulogy for Goh on 23 May 2010: “He [Goh Keng Swee] was my trouble-shooter. I settled the political conditions so that his tough policies we together formulated could be executed.” Like its tough outer surface, sheath leaders are brutally honest in recognizing a problem rather than to pretend there is none. Without gratitude, honesty cannot be brought out meaningfully, since gratitude is the ability to see value even in humble, unremarkable and problematic situations as areas to improve through providing his or her service. Gratitude is antiheroic. It does not depend on courage or strength or talent. It is based on our incompleteness and born only where solidarity and the awareness of problems are present. If we are honest and do not hide it from ourselves, we can proactively work to receive the goodness and opportunities that life offers us and we can be grateful. With its smooth inner surface, sheath leaders are able to weave diverse networks and groups who might otherwise be excluded into a coherent whole, quite unlike the typical command-and-control “position/title-based” leadership Sheath leaders are able to give voice to the unpopular, unconventional, unorthodox views to foster innovation. With this understanding of Sheath leadership in the Bamboo Innovator framework, we like to briefly discuss about Taiwan Paiho (TWSE: 9938 TT) which is up 80% since we highlighted the company in our Monthly Moat report in March 2014. Paiho is the world’s largest touch fastener tape maker (1.3m km/yr, >10% market share) with applications in apparel, shoes, diapers, car seats etc. All top 20 global athletic shoe brands, including Nike, Adidas, Reebok, Sketchers, UnderArmor are customers whom Paiho has forged long-term “spec-in” partnerships with. Taiwan Paiho (TWSE: 9938 TT) – Stock Price Performance Vs Taiwan Formosa Stock Index
What struck us was how Paiho founder and CEO Vergil Cheng tried to cultivate a sustainable culture of innovation by giving voice to diverse views so that everyone are co-creators in the value creation process rather than just a few dealmakers/rainmakers or the emperor himself, the same mindset as Pixar’s Ed Catmull: “The importance of R&D cannot be emphasized enough; it’s akin to helping the engineers and developers to “carry books”. At Paiho, all business unit managers and supervisors and above are automatically listed as a R&D personnel and can present their idea proposal. When a R&D project requires funding and the supervisor dare not make the decision whether or not to proceed, the business owner can provide his or her opinion. The investment opinion must not be based on the general macroeconomic outlook, but whether the specific product can have a breakthrough market potential.*“ Cheng explains how innovations enabled Paiho to pursue unique opportunities to widen its economic moat: “Winning in a price war is a transient race; continuous innovation in product quality is like a marathon and the sustainable way to win. A pair of branded sports shoe is around TWD 2,000-3,000 ($66-100). So if the tape fastener in the branded shoe is of an inferior quality, the customer will scold the brand owner and not the fastener supplier. So the brand owner will be very strict in selecting the best supplier and not go for the lowest price supplier. Paiho is one of the rare few Taiwan and even Asian shoe materials company with proven R&D capabilities and is involved in the design stage with the client before the new product is launched. Our “spec-in” long-term partnerships with all the top 20 athletic sports shoe companies develop new materials/designs and provide better and patented solutions to avoid price competition and maintain stable margin. We send 8,000 pieces of sample products to our clients for them to do their trial tests. Only by doing co-R&D work with the world’s best brands and growing together with them can we provide the best customer service and solution, to master and even lead the industry trend. Our comprehensive product range is also protected by over 110 patents. Some of these patented innovations include our water-resistant tape fastener which can maintain its ‘stickiness’ in the water and is designed for water sports activities.*” We particularly like a profound quote by Pixar’s Ed Catmull: “Imagine an old, heavy suitcase whose well-worn handles are hanging by a few threads. The handle is “Trust the Process” or “Story is King” – a pithy statement that seems, on the face of it, to stand for so much more. The suitcase represents all that has gone into the formation of the phrases: the experience, the deep wisdom, the truths that emerge from struggle. Too often, we grab the handle and – without realizing it – walk off without the suitcase. What’s more, we don’t even think about what we’ve left behind. After all, the handle is so much easier to carry around than the suitcase.” We think that there are many thoughts and statements about how Asia needs to be more entrepreneurial and innovative, akin to Ed Catmull’s “handle” trying to lift up the old, heavy suitcase of Asia. Unless one has a R.E.S.-ilience handle and framework to carry this suitcase, it will be difficult to invest in the emerging tycoons, the innovators and the wide moats they are building, like Taiwan Paiho and Vergil Cheng – before they become obvious – and uncover the hidden wealth inside during this critical transition period and in the coming decades ahead. *Chinese to English translation by KB Kee. Any translation errors are KB’s. Warm regards, KB The Moat Report Asia http://accountancy.smu.edu.sg/faculty/profile/108141/KEE-Koon-Boon A new monthly issue of The Moat Report Asia is now available! Access the in-depth idea presentation: |
Bamboo Innovator Daily Insight: 16 Mar (Mon) – Charlie Munger: Academic Economics — Strengths and Weaknesses, after Considering Interdisciplinary Needs
March 16, 2015 Leave a comment
Life
- Charlie Munger: Academic Economics — Strengths and Weaknesses, after Considering Interdisciplinary Needs: Farnam
- Developing a Mental Framework for Effective Thinking: Farnam
- How Stephen King Teaches Writing: Atlantic
- How successful people overcome toxic bosses: Quartz
- Overthinking vs. Underthinking: Finding the Sweet Spot: Forbes
Investing Process
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
Greater China
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- Xu Caihou, the most senior military officer snared in China’s anti-corruption campaign, has died of natural causes after military prosecutors dropped their case against him due to ill health. FT
- How Citic Bank traded rapid growth for bad loans: SCMP
- It’s Time to Look Under the Hood of China Auto Rental; Falling depreciation behind robust profit margin is puzzling because depreciation should have risen as CAR expanded its fleet by 20% last year; IPO lockup expires on March 18: WSJ
- Record China Debt Means Growth-Rally Mismatch: Chart of the Day: Bloomberg
- China FAW Group Chairman Faces Communist Party Graft Probe: Bloomberg
- Wall Street’s Macau delusion has really gone far enough: BI
- ‘Maker culture’ to be encouraged in China: WCT
- To trim its mounting inventory and stem losses from sluggish business, Nestle China has been incinerating instant coffee by the ton, burning up worth tens of millions of yuan since January: WCT
- Macau casino giant turns to non-gaming businesses: WCT
- Why China Won’t Manage The Great Debt Escape: Forbes
- Stiffer Bank-Technology Rules Loom in China: WSJ
- Why Chinese Steel Exports Are Stirring Protests: WSJ
India
- Tapping Into The Growth Of India’s Emerging Mobile Markets: Techcrunch
Japan & Korea
- Lotte seen forging ahead with succession plan: KH
- Economic mathematics to be introduced in 2018 in Korea as an elective subject of high school: Maeil
ASEAN
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
Macro
- In 2008, Phillip Monks was out of a job and decided to start his own bank. Today, it is worth over £650m: Telegraph
TMT
- Why Bankers Are Leaving Finance for No-Salary Tech Jobs: Bloomberg
- Top Silicon Valley investor explains why he is skeptical about driverless cars: BI
- A Police Gadget Tracks Phones? Shhh! It’s Secret: NYT
- Why focus is the name of the ecommerce game: Forbes
- ‘Dead unicorns’: Silicon Valley bubble burst draws near, warns investor at SXSW: NYT
- In Battery Revolution, a Clean Leap Forward; Vacuum maker Dyson is investing in Sakti3’s energy technology: WSJ
Energy & Commodities
- US shale industry shows remarkable resilience: FT
Consumer & Others
- Miller Lite tastes success again: Fortune
Bamboo Innovator Daily Insight: 15 Mar (Sun) – André Gide on Sincerity, Being vs. Appearing, and What It Really Means to Be Yourself
March 15, 2015 Leave a comment
Life
- André Gide on Sincerity, Being vs. Appearing, and What It Really Means to Be Yourself: BP
- Rilke on How Great Sadnesses Bring Us Closer to Ourselves: BP
- Here’s why patents are innovation’s worst enemy: WaPo
Investing Process
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- Great Expectations for Small-Cap Active Management: RoyceFunds
Greater China
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- The one Chinese innovation that could change the way we think about money; The upcoming launch of the new China International Payments System is part of a broader internationalization strategy for China’s currency to make it accepted worldwide: WaPo
Japan & Korea
- Onetime bestselling maker Sanyo to effectively vanish : JP
ASEAN
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
Macro
- S.E.C. Wants the Sinners to Own Up; In a shift to its policy, the regulator is asking for more than settlements. It wants companies and individuals to admit to their misdeeds. NYT
- How Many Mutual Funds Routinely Rout the Market? Zero: NYT
- Norway’s Sovereign-Wealth Fund Reduces Exposure to Europe: WSJ
- Bonds Or Stocks: Which Bubble Is Bigger? SocGen Answers: Zerohedge
- Michael Lewis is Right “Spoofing” Proves Market Rigged on Daily Basis: EconMatters
Energy & Commodities
- U.S. Producers Ready New Oil Wave; Even as crude plummets, energy firms are waiting to unleash more supply, capping any price gains: WSJ
TMT
- This could be Apple’s secret Apple Watch strategy: Fortune
- Leica Survives the Digital Shift; Camera maker struggled with the death of film, but now it has a lucrative niche: digital, retro cameras: WSJ
Consumer & Others
- How Starbucks’ dominance could one day be threatened: WaPo
Bamboo Innovator Daily Insight: 14 Mar (Sat) – Rags To Richest 2015: Billionaires Despite the Odds
March 14, 2015 Leave a comment
Life
- 52 Ways to Tell Someone You Love and Appreciate Them: TinyBuddha
- Rags To Richest 2015: Billionaires Despite the Odds: Forbes
- Marvell CEO: The Tinkerer at The Top; How many CEOs in the semiconductor industry today are so possessed with their inner technology questions that they actually spend weekends looking for answers?: EE
- The Indispensable Founding Father; Madison was patient and flexible, able to work closely with both political allies and those he strongly opposed. WSJ
- Beware the Ides of March; On Mar. 15, 44 B.C., assassins stabbed Julius Caesar to death at the Senate. How did the conspirators manage to get 60 people involved and keep it secret? What had Caesar done to alienate so many? WSJ
- Fourteen secrets of really persuasive people: Quartz
- The virtue – and peril – of empathy; There is debate over whether a capacity to experience what another is feeling helps or hurts decision-making. ST
- To innovate, hire the ‘wrong’ people: BT
- Richard Branson shares his 10 favorite quotes about embracing change: BI
- Martin Sorrell of WPP is one of the world’s most connected executives. But, as he turns 70, what is next for him and the advertising empire he created?: FT
- Businesses on the mindfulness bandwagon; Companies have adopted the Buddhist discipline but can an ethical philosophy coexist with corporate culture? And does it really work?: FT
- Math enthusiasts to mark once-in-a-century Pi Day: JT
- Stop Distinguishing Between Execution and Strategy: HBR
- Culture: Why It’s The Hottest Topic In Business Today: Forbes
- 12 best-kept secrets of successful business people: Fortune
Investing Process
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- The logistics of committing fraud on an industrial scale; “Think big and implement to the finest detail” was the motto of Chun Chi-wai, chairman of China Metal Recycling (CMR), once the darling of fund managers and stock commentators. SCMP
- Why words are the new numbers: ChicagoBooth
Greater China
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- In China, a Building Frenzy’s Fault Lines: NYT
- Anti-Graft Legislation Could Take Five Years to Work Out, Expert Says: Caixin
- Novelist and former vice-governor uses real-life graft as inspiration for new book: SCMP
- U.S. students losing interest in China as dream jobs prove elusive: Reuters
- In China, Only Leaders Are Allowed To Battle Corruption: HuffPo
- Traditional Chinese medicine is getting a voice at the World Health Organization: Quartz
- PBOC Pledges to Press on With Rate Liberalization Amid Slowdown: Bloomberg
- China is about to stop making savers subsidize wasteful state companies; Zhou Xiaochuan, just announced that the “probability is very high” that the government will lift the cap on deposit rates this year: Quartz
- China tycoon warns on corruption purge: FT
- China puts brakes on banks’ rate freedom: FT
- Chinese internet: Commerce and control; Beijing wants to harness the economic potential of online services while still censoring content: FT
- Mobile Radio Maker Hytera’s Chen Qingzhou Is China’s Latest Electronics Billionaire: Forbes
- Apple pies and iPads sweeten China’s dreaded TV expose: Reuters
- Beijing has a bitcoin problem on its hands: SCMP
- Ping An unit put on disclosure ‘blacklist’; Rating agency says Lufax.com failed to disclose debtor information: SCMP
India
- How Long Will It Take for India to Surpass China? WSJ
- Move over Kingfisher. Indians are now thirsting after craft beer: Quartz
- SBI rejects report of scrapping $1 bn loan pact with Adani: moneycontrol
- MODIfying India: Star
Japan & Korea
- End mass shareholders meetings; When meetings are held on the same day, it is difficult for minority shareholders to exercise their rights as stockholders. JA
- Amid split, two Koreas face widening linguistic gap: JT
ASEAN
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- Blog of former Malaysian PM Mahathir ‘suspended’; last posting was on 1MDB; 1MDB probe Malaysian Auditor-General’s biggest challenge: AsiaOne1, 2
- AEC needs financial lifeblood: Star
- Big Data And Internet Of Things Are The Keys To Singapore’s ‘Smart Nation’ Dream: Forbes
- Can Jakarta Get MRT Moving in Time for Asian Games in 2018?: JG
Macro
- GM’s Stock Buyback Is Bad for America and the Company: HBR
- Ernst & Young Settles Lehman Suits With New Jersey, California Municipalities: WSJ
- Avolon CFO: Untangling New Lease Accounting Rules; To get around this complexity and burden, companies might try to stop doing leases and start structuring them as service contracts: WSJ
- Michael Lewis Surprised By Reaction To Flash Boys, Says Real Story Missed; The Flash Boys story is about a small, independent minority on Wall Street who challenged a corrupted establishment on moral grounds: VW
- Flash Boys’ Michael Lewis Warns “The Problem’s Not Just HFT, The Problem Is The Entire System”: Zerohedge
- Norway’s oil fund joins push for proxy access in US: FT
- The dollar almighty will create risks: FT
- Chart of the day: Asia falls deeper in debt: SCMP
Energy & Commodities
- Oil’s Newest Short Seller: the Department of Energy: WSJ
- U.S. Producers Ready New Oil Wave; Even as crude plummets, energy firms are waiting to unleash more supply, capping any price gains: WSJ
- Smaller Mining Companies Hibernate to Survive Industry Downturn; Mine operators shut down projects, cut staff to dodge bankruptcy and ride out slump in metal prices: WSJ
TMT
- Algorithm That Tells the Boss Who Might Quit; Wal-Mart, Credit Suisse Crunch Data to See Which Workers Are Likely to Leave or Stay: WSJ
- Going Robo: What Schwab’s Move Means for You; With giant discount brokerage Charles Schwab launching its Intelligent Portfolios service this past week, the fledgling industry of automated investment advice is going mainstream. WSJ
- Why a Just-Smart-Enough Watch Is Better Than an Apple Watch: WSJ
- Speculation In This Sector Will End “Very Badly,” Canada’s Warren Buffett Says: Zerohedge
- Apple Watch low yield rate may lead to long delivery delays: WCT
- Why the Apple Watch will put the web out to pasture once and for all: Quartz
- This former Facebook engineer secretly built a startup that everybody’s going nuts oCloud applications – stuff like databases and servers hosted in large data centers elsewhere – are getting big and complicated, with lots of moving parts: BI
Consumer & Others
- How Pizza Became a Growth Stock: The secret? The Domino’s CEO cites a mea culpa ad campaign, digital delivery and unlikely new markets. WSJ
- The Keurig K-Cup is the greatest thing to happen to coffee in America: BI
- What the rise in luxury toilet paper says about the U.S. economy: FP
- The crazy, bitter battle over Japanese-restaurant chain Benihana: Fortune
- VW’s key to overtaking Toyota for global auto domination; Toyota sells as many vehicles, is about 50% more profitable than VW, and shows no signs of losing its way or backing down. : Fortune
Bamboo Innovator Daily Insight: 13 Mar (Fri) – Avoiding Decision Paralysis in the Face of Uncertainty
March 13, 2015 Leave a comment
Life
- Avoiding Decision Paralysis in the Face of Uncertainty: HBR
- Thinking beyond the checklist; “If we were to mock Singapore, we would say it is a nation of bankers and real-estate developers. What we would like to become is a nation of entrepreneurs.”: BT
- Britain: a nation of makers, techies and job creators: Telegraph
- At 85, Vanguard’s John Bogle still fighting hard for index investing; Elder statesman doesn’t mince words when discussing active management and worries about ETFs: IN
- Does Berkshire’s Culture Ensure Its Future?: Strategy&
- Why the business card is thriving in the electronic age: Economist
- Horizontal gene transfer: Genetically modified people; Human beings’ ancestors have routinely stolen genes from other species: Economist
- Workers of the gig economy, unite! Champion of freelancers says a collective identity is key: FT
- Debunking myths in sheep land: Meet the innovators of New Zealand: e27
- Apple’s Tim Cook ‘offered his liver to dying Steve Jobs’; Apple founder Steve Jobs angrily rejected Tim Cook’s offer of a transplant despite fears he would die: Telegraph
- 15 Body Language Blunders Successful People Never Make: Forbes
- Could tiny fish be the answer to China’s food safety woes? This Hong Kong start-up thinks so; Vitargent uses fish embryos to test for contaminants and toxins in consumer products: SCMP
- An Unlikely Driver of Evolution: Arsenic: NYT
- From the Gates Foundation, Direct Investment, Not Just Grants: NYT
- ‘Catch Me If You Can’ Con Man Says Technology Aids Fraud: Bloomberg
Books
- The Art of Stillness: Adventures in Going Nowhere: Amazon
Investing Process
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- Noble Group Nobbled: A big Asian commodity-trader is attacked by an anonymous online critic: Economist
- Noble’s concession gives clout to maverick researchers: Reuters
Greater China
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- Local-government debt in China: Swapping spree; The finance ministry moves to ease local governments’ money troubles: Economist
- Financials Flash Warning Seen Before 2008 Mainland Slump: Bloomberg
- Macau Boom-Bust Comes Full Circle Under Xi as $111 Billion Lost: Bloomberg
- U.S. Founding Father Invoked as China Debates $4 Trillion Debt Pile; Although the government wants to avoid moral hazard of a bailout: Bloomberg
- China’s Silicon Valley Sparking 49 Technology Startups a Day: Bloomberg
- As China Sneezes, is Asia Catching a Cold? Bloomberg
- Made in China? Asia’s dominance in manufacturing will endure. That will make development harder for others: Economist
- China’s Alibaba drives into ‘Internet car’ industry: ChinaPost
- Rongsheng Boss: Problems Linked to Blind Expansion, Gov’t Policies; Founder Zhang Zhirong blames debt problems on fact his company had too much on its plate when industry changed and a U-turn by officials: Caixin
- Steelmaker Powerless as Iron Mines Sink Abroad: Caixin
- China SOE’s restructuring leaves state ownership intact: FT
- The contradiction at the heart of China’s new growth target; Rising debt levels threaten both financial and economic stability: FT
- Princeling loses appeal over HK$43m ‘payment’ from Henderson Land Development for services related to a central government investigation of the Hong Kong-listed firm for violating Beijing’s foreign-exchange regulations. SCMP
- Loan or bond, China’s banks still locked into local governments: SCMP
- Warnings, Delays. Can Macau News Get Any Worse?: Barrons
- Changes Afoot in Chinese Stock Market; Researchers say market, often seen as highly risky for outsiders, is functioning better: WSJ
- At China Meeting, Karaoke Goes Quiet as Austerity Takes Over: WSJ
- Are Chinese Tech Startups Overvalued? Companies, such as Dianping and Didi Dache, are raising cash at record pace from investors afraid of missing out: WSJ
India
- Mumbai’s Beef Ban Sat for 20 Years Before Vegetarian Modi Acted: Bloomberg
Japan & Korea
- Prosecutors raid POSCO E&C over alleged slush funds accumulated by exaggerating the amount the South Korean company needed to pay local subcontractors in Vietnam: KT
- Foreigners Grab Japan Stocks as Topix Beats U.S. in Dollars: Bloomberg
- In rare sign of dissent, investor calls for change at South Korea’s Hyundai Motor: Reuters
- Japanese Banks to Ease Tourists’ ATM Frustrations; Three Biggest Banks Will Accept Foreign Cards at More ATMs: WSJ
- South Korea’s tallest skyscraper rises in cloud of fear: Reuters
- Japan’s Cautionary Tale for South Korea: Bloomberg
ASEAN
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- The Threat From Within Indonesia’s New Presidency; Voters were encouraged by Joko Widodo’s campaign of reform, but it looks like even he can’t escape Indonesia’s usual elite politics. WSJ
- Trouble at home: Political instability returns to South-East Asia: Economist
- Minister: 1MDB debt level not sustainable: Star
- Personal loans’ long tenure will keep M’sian indebtedness high: BT
- 1MDB saga extends to Swiss bank in S’pore: BT
- Homeowners hit as Sibor rises to highest in seven years: TODAY
Macro
- Are Currency Wars Looming in Asia?: WSJ
- Calpers Projects 8% Decline in Fees to Wall Street Next Year as it liquidates its hedge-fund program: Bloomberg
- The shipping industry: Low rates on the high seas; A slump in shipping rates reflects the chronic optimism of shipowners: Economist
- How to fire up America: The rise of Latinos is a huge opportunity. The United States must not squander it: Economist
- An ultra-low interest rate show that could run and run; Instead of Japanification, we should probably now switch to a new term: Europification: FT
- Why the business of risk is booming; The US is unlikely to possess the capacity to shape 21st-century geopolitical order: FT
- Investors in an unregulated oil scheme have alleged negligence in a lawsuit that they hope will establish the principle that “introducers” who informally endorse investments can be held responsible.: FT
- Fraudulent mortgage applications on the rise; the tightening of lending criteria was a factor driving the fabrication of home loan details. FT
- Asia Rushes to Lower Rates, but Maybe Not Fast Enough: NYT
- WisdomTree Soars With Dollar as Hedged ETFs Lead Inflows: Bloomberg
- Fed ‘Stress Tests’ Still Pose Puzzle to Banks; Goldman, J.P. Morgan and Morgan Stanley scaled back plans by at least $11 billion: WSJ
- It’s Back: Your Guide to the $18 Trillion Debt Ceiling; Bigger than U.S. GDP, the debt limit returns with plenty at stake: Bloomberg
- A Split Over Protecting Investors; The Labor Department is moving ahead of the SEC on broker rules; The financial industry is resisting attempts to require brokers to put clients’ interests ahead of their own.: Bloomberg
TMT
- Wearable technology: The wear, why and how; For smartwatches and other wearable devices to become mainstream products will take more than just time: Economist
- Data and technology are starting to up-end the insurance business: Economist
- Data-driven underwriting contains great promise and grave perils: Economist
- Apple Pegged To Bring Force Touch Pressure-Sensitive Input To Next iPhones: Techcrunch
- Understanding Alibaba’s Snapchat Obsession: Techcrunch
- Asia’s box office for movies is now bigger than America’s: Quartz
- Op-ed: The death of Gigaom and the changing face of journalism: e27
- The history of the iPod shows exactly why the Apple Watch will be huge despite what critics think: BI
- From the cricket pitch to politics, the big data bandwagon rolls on: FT
- Dotcom history is not yet repeating itself, but it is starting to rhyme: FT
- How Cloud Companies Are Killing Checks; Cloud companies are finally pushing U.S. businesses beyond paper billing and payments; The $10 billion market for digital corporate payment processing is getting more competitive as the money rolls: Bloomberg
- Why Asia’s Tech Giants Are Investing in U.S. Startups; Investments by Alibaba, Rakuten show willingness to spend big in U.S. for access to hottest technologies: WSJ
- In smartwatch war, Swatch goes for cheap, quick and China: Reuters
- ‘Frozen 2’ Is In The Works; ‘Frozen’ Is Disney’s Triumphant Reaffirmation Of Its Cultural Legacy: Forbes
Healthcare
- Actavis and the art of billion-dollar drug dealing; Brent Saunders generated $25 billion in value for investors by flipping drug companies rather than discovering new drugs. Is this the future of the pharmaceutical business?: Forbes
Energy & Commodities
- Time for tough action to tackle logjam at LME: SCMP
- Handful of supertankers holding oil as contango play fades: Reuters
Consumer & Others
- Electrolux Has New Stab at Smart Home After Dot-Com Bust: Bloomberg
- Aldi and Lidl: Tomorrow, not quite the world; The German discounters’ successful business model only stretches so far: Economist
- Supermarkets must expect permanently lower profits – and their customers are to blame: Telegraph
- Indian Motorcycles Adding Screens To Bikes. Really.: Forbes
- Once Unique, LeapFrog Has Rivals in the Educational Toy Market: NYT
- KFC faces pressure after McDonald’s says no antibiotics in chicken: Reuters
- Why Electrolux wants to connect your appliances: TheAge
Bamboo Innovator Daily Insight: 12 Mar (Thurs) – Warren Buffett shows HSBC and Delta Air Lines how to say sorry; When business leaders make mistakes, they have nothing to lose from a proper apology
March 12, 2015 Leave a comment
Life
- Warren Buffett shows HSBC and Delta Air Lines how to say sorry; When business leaders make mistakes, they have nothing to lose from a proper apology: FT
- Berkshire Hathaway: 50 Years of Enduring Advice: Burgundy
- Lessons from the great Beanie Babies crash; The amazing rise and terrible fall of the “Steve Jobs of plush”: Fortune
- What to say when your kids notice their friends have more – or less – money than they do: BI
- Here’s the personality trait that predicts success for employees – and entrepreneurs: BI
- Is There a Next Jack Bogle? Not If You Ask Jack Bogle: Bloomberg
- Leadership Lessons From Virgin Hotels, Courtesy Of Richard Branson And CEO Raul Leal: Forbes
- The Passport King: Christian Kalin’s business is showing poor countries they have at least one resource worth selling: citizenship. Bloomberg
- Perspectives on the long term: What will it take to shift markets and companies away from a short-term way of thinking?: McKinsey
Greater China
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- China’s local government debt: Defusing a bomb: Economist
- The unfrothing of Alibaba: FT
- China’s Hottest Phone? Here’s the Upstart Chasing Xiaomi: Bloomberg
- China Said to Plan Overhaul of $3 Trillion Industrial Machine: Bloomberg, Reuters
- Viral Role Model Emerges In Innovation-Starved Tech Hub Taiwan: Forbes
- Only China Can Contain China: HP
- For Chinese Economy, Strengths Are Now Weaknesses: NYT
- China’s Antigraft Drive Exposes Military Risks; Takedown of generals shines light on rampant buying of ranks: WSJ
India
- India could become the engine room for the IoT-enabled world: Forbes
Japan & Korea
- Nurturing Korea’s Disneys: KH
- LG heir sued for fraud: KH
- Samsung scions plan on paying 6 trillion won in taxes: JA
- How KakaoTalk’s Billionaire Creator Ignited A Global Messaging War: Forbes
- Far from dying, Abenomics may yet be coming up roses; Japan could be the only wealthy nation that is increasing the size of its middle class: FT
- Korean students suffer from all work and no play: AsiaOne
- Plunge Protection Exposed: Bank Of Japan Stepped In A Stunning 143 Times To Buy Stocks, Prevent Drop: Zerohedge
ASEAN
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- Jho Low and the Wolf of Wall Street: how Malaysian businessman ‘hooked up DiCaprio’; ‘I’ve nothing to hide’: Malaysia’s Jho Low breaks silence to deny money laundering allegations: SCMP1, 2
- Thai Temple’s Gospel of Wealth Draws Protests; Dhammakaya Temple’s spectacular growth is raising awkward questions about how Buddhism should adapt to decades of pell-mell growth in Asia: WSJ
- Car Hub Project to Spur Philippine Manufacturing: Southeast Asia: Bloomberg
Macro
- Investors Forced to Get Creative for ‘Carry’ Trade; Borrow in euros, buy in the Philippines and Sri Lanka: WSJ
- What the Strongest U.S. Dollar in a Decade Means for Your Wallet: Bloomberg
- Incentives favour short-term investment focus; Pension funds and insurers forced to shy away from infrastructure: FT
- Mafia thrives on Italy’s legalized gambling addiction: Reuters
- “We Have Front-Row Seats To An Imminent Market Shock”, Hedge Fund Billionaire Warns: Zerohedge
Energy & Commodities
- History Suggests OPEC’s Days Could Be Numbered: Bloomberg
Healthcare
- Ultrasound Shows Promise in Mice for Treating Alzheimer’s: WSJ
TMT
- Apple Watch Skewed to Geeky Guys Risks Alienating Female Buyers: Bloomberg
- Apple Pay faces a battle with banks to enter China’s huge mobile payments market: SCMP
- Launching the Apple Watch: The time machine; Apple wants to make smartwatches a mainstream technology. That will take time: Economist
- How Rebellion Photonics built a business on gas fumes; By creating a better tool for spotting gas leaks from oilfields and pipelines, tiny Rebellion Photonics got the jump on a global market no one else could see: Forbes
- Getting Advantage from Proprietary Data: WSJ
Bamboo Innovator Daily Insight: 11 Mar (Wed) – The crazy, true-life adventures of Norway’s most radical billionaire
March 11, 2015 Leave a comment
Life
- The crazy, true-life adventures of Norway’s most radical billionaire: Fortune
- The first time Bill Gates asked Melinda Gates out on a date, she turned him down: BI
- When babies outsmart the business experts; Leaders who say their predecessors are wrong are often advocates of useless reorganisation: FT
- A gadget that lies between sorcery and science; Polygraphs are capable of exonerating the guilty and framing the innocent: FT
- The Unavoidable Truth Of Moving Fast And Breaking Things: Techcrunch
- No friends, no money, no sleep: the dark side of entrepreneurship: Telegraph
- Electrifying secrets behind killer eels: Reuters
Greater China
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- Seven resignations, two sackings and two suspensions on board of troubled Birmingham International; In January, Birmingham announced that HK$38 million was suspected to have been misappropriated by an unnamed former employee and Hong Kong police were investigating the matter. SCMP
- Local government financing vehicles struggling to repay loans: SCMP
- China’s Biggest Shipyard Is Now a Ghost Ship; Padded order books and delivery delays preceded the demise of Rongsheng Heavy Industries, once the country’s busiest shipbuilder: Caixin
- China’s Solution to $3 Trillion Debt Is to Deal with It Later: Bloomberg
- Retired generals point to ‘horrible’ graft in PLA; Money, connections and personal bonds decide promotions, and the culture of confidentiality makes exposing wrong-doers difficult, former top brass says: SCMP
- 80% of bitcoin is exchanged for Chinese yuan: Quartz
- China Prepares Mergers for Big State-Owned Enterprises: WSJ
- Is China’s 1929 moment coming?: WaPo
- Xi Relishes Carefully Crafted Humble Past; Mao-Style Focus on Chinese Leader’s Personal Life Comes With Risks: WSJ
- Toothpaste maker Crest fined 6 million yuan for faking white teeth in advert: SCMP
- China shipbuilders urged to merge ito stay afloat: FT
- Knock-off Apple Watches go on sale in China: FT
- Top local developer Cheung Kong Holdings (0001) ended its 42-year listing yesterday, with market capitalization having grown more than 2,800 times from its debut. Standard
- Dairy producers in China explore online opportunities: WCT
- Sensitive Words: Prince (Zeng) Qing(hong): CDT
- Reading Xi’s Modern Twist on Plato’s “The Republic”: Inside
- Some Chinese companies are finding that borrowing just across the Hong Kong border, once a quick and easy way to make money, is no longer so fruitful.: WSJ
- The one Chinese innovation that could change the way we think about money: WaPo
Japan & Korea
- 50 top brands in Korea change with times: JA
ASEAN
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- Changes in transfer pricing in Singapore: BT
- Myanmar Tests Foreign Telecom Entrants; Qatar’s Ooredoo and Norway’s Telenor struggle with bureaucracy, ambiguous land ownership structures, hiring and even religious tensions: WSJ
- Year of plenty? Vietnamese brokerages raise funds to build war chest: AsiaOne
- Malaysia Reels as Asia’s Worst Dollar Debt Shunned: Asean Credit: Bloomberg
- Swiss businessman Yves Bouvier is facing charges of fraud and money laundering, Bouvier is known in Singapore for co-founding the Singapore Freeport and is one of the partners behind Art Heritage Singapore: Artnet
- Sentosa Cove unit sold at $1.2m loss after selling it around the rate of a mass-market home: AsiaOne
Macro
- Survey: Companies Finding More Whistleblower Retaliation: WSJ
- A New Tool to Investigate Inside Tippers: NYT
- Survey: Companies Finding More Whistleblower Retaliation: WSJ
- Outsourcing: Trading places; A proprietary trading firm has clawed its way into the big leagues using recruits from India, Kenya and China: FT
- Former SEC Director Admits The Truth: The Market Is Rigged: Bloomberg
- Why Vanguard Is Secretive on Stock ETFs; Uncommon delays in reporting of components protect shareholders: WSJ
- How The World Is Being Fooled About Chinese Gold Demand: Zerohedge
- Developing Nations Lose Their Luster: NYT
Healthcare
- The Future of Health Is More, Better, Cheaper: Strategy&
TMT
- Tech Blog GigaOm Abruptly Shuts Down: NYT
- The Apple Watch has a unique signalling ability that will ensure it is a massive success: BI
- This startup may have found the answer for getting people to pay for journalism online: BI
- Happy aniversary, Nasdaq looks different 15 years after its peak: Star
- Apple Watch makes the wearables race real: JA
- What Is the Next ‘Next Silicon Valley’?: NYT
- Learning the Duolingo – how one app speaks volumes for language learning: Guardian
- The New Tech-Stock Temptation; The Nasdaq rally is stirring memories of the dot-com boom. Forget 2000. It’s a different investing ballgame.: WSJ
- Swatch Co-Inventor: Apple Will Succeed and an Ice Age Is Coming for Swiss Watches: Bloomberg
- Apple Watch Targets China Aspirations in $16 Billion Market: Bloomberg
Consumer & Others
- The Sephora effect: How the cosmetics retailer transformed the beauty industry: WaPo
- A hit YouTube video launched Dollar Shave Club into the minds (and medicine cabinets) of men everywhere. But the company is just getting started. Fortune, YouTube
- How Ikea took over the world: Fortune
- Ikea researched people’s morning routines around the world — and made this mirror to solve a universal problem: BI
- The cappuccino kings changing the way Cambodians drink coffee: FT
Bamboo Innovator Daily Insight: 10 Mar (Tues) – Here’s why Warren Buffett, Oprah Winfrey, and Bill Gates love to read
March 10, 2015 Leave a comment
Life
- Here’s why Warren Buffett, Oprah Winfrey, and Bill Gates love to read: BI, LinkedIn
- The creative power of saying no: why focus is the key to innovation: BRW
- Trouble at the family mill? Call in the Chief Emotional Officer: Insead
- How Much Control Should You Have Over Your Firm? Insead
- Most Teach For America Instructors Plan to Flee Teaching; About 87 percent of the people the program trains as educators say they plan to leave teaching; “Teaching is tough work”: Bloomberg
Investing Process
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- Noble’s Spat With Iceberg Highlights Barriers to Disclosure: WSJ
Greater China
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
- Hanergy Working With ‘Unproven’ Solar Technology, Bloomberg New Energy Finance Says, after Financial Times in January raised questions about the company’s accounting practices. Bloomberg
- Hanergy Shares Soar Too Close to the Sun; Solar panel hot stock levitates 480% in six months, leaving gravity and reason back on Earth. Barron’s\
- Hanergy’s Lightning Rally Blinds Investors to Reality: WSJ
- Foreign banks tighten lending rules for China state-backed firms; Singapore DBS Group suffered a loss on a bad loan to an SOE-related firm it had assessed as risk-free: Reuters
- China Short Sellers Target World’s Biggest Broker Rally: Bloomberg
- Hong Kong-made ‘firefighting’ robots catch the attention of tech giant IBM: SCMP
- Mainland regulators learn from mistakes made in Japan: SCMP
- SFC’s ‘sneak attack’ on ownership responsibility will cost us money: SCMP
- China legal threat dents ICE’s Singapore plans: FT
India
- $1.20 for Office Lunches as Errand Apps Bloom in India: Bloomberg
Japan & Korea
- A veteran Japan investor has closed his small hedge fund and will join one of Asia’s longest-running hedge-fund operators, a move that underscores the increasing difficulty managers face striking out on their own: WSJ
ASEAN/Singapore
- Open Letter to SGX/MAS: Reply to CFO of SGX-Listed China Environment (CENV SP) on report “Potential Accounting Tunneling Fraud at China Environment?” – Address the accounting and governance concerns in an SGX/MAS announcement: AsianExtractor
Macro
- Hedge-Fund Manager’s Next Frontier: Lawsuits: WSJ
- Don’t get addicted to boom times: Why investors should beware market highs and other fads: FP
Energy & Commodities
- The big drop: Riyadh’s oil gamble; For years Saudi Arabia acted as a safety net in the market, but as prices fell the game changed: FT
TMT
- Apple Watch Success Will Hinge on Apps: NYT
- Apple watch could call time on Swiss ascendancy in the high-end market: Telegraph
- Apple Says New Smartwatch Will Go 18 Hours on Battery Power: Bloomberg
- Telecom’s Next Goal: Defining 5G; Industry pools knowledge in race to go beyond fast download speeds: WSJ
- Challenge for Apple Watch: Style but No ‘Killer App’: WSJ
Healthcare
- Feeling Nervous About a Biotech Bubble? Bloomberg
- What Autopsies Can Teach; A decline in postmortem exams has slowed scientific advances. New procedures aim to overcome qualms. WSJ
Consumer & Others
- Why McDonald’s Turnaround Plan Isn’t Working: Bloomberg
The Accounting of Words & The Hiss of the Asian Snake
March 9, 2015 Leave a comment
| “Bamboo Innovators bend, not break, even in the most terrifying storm that would snap the mighty resisting oak tree. It survives, therefore it conquers.” |
| BAMBOO LETTER UPDATE | March 9, 2015 |
Bamboo Innovator Insight (Issue 72)
|
| Dear FriendsThe Accounting of Words & The Hiss of the Asian Snake“No, you can’t hide behind GAAP. GAAP accounting rules are the ones that we all live by and they are very strict. We had both KPMG and Ernst & Young restate that they are ok with our numbers.”
This was the hissing sound made by Computer Associates’ Chairman and CEO Sanjay Kumar before he was later sentenced to 12 years in prison for his role in the $2.2 billion accounting fraud. The accounting disclosure of words — the level of disclosure (how much you say), its tone (what do you mean), and its transparency (how you say it) — can be an additional helpful tool for investors and regulators to ferret out the Asian Snake engaging opportunistically in accounting fraud. As Buffett puts it wisely: “Under any rules, if the CEO, wants to obfuscate, they can do that; and if they want to make it clear, they can do that. If they want to provide you with fluff, they can do that. If they want to provide you with substance, they can do that. The CEO will look at any rules through his own particular glasses, and either look at them as a way to give his shareholders more information, or to do some kind of tap dance number.” Despite the approximately 50/50 mix in preparing financial disclosures, the overwhelming focus is on accounting numbers. Significantly less time is spent looking at the context or the communication of these numbers. Opportunities are thus presented for investors and regulators to analyze not only the text of the Annual Report, Management Discussion & Analysis (MD&A) sections and IPO prospectuses, but also press releases, conference calls, and management interviews, etc. Investors may scrutinize the content for truthful revelation or opportunistic structuring of language in these situations by managers intent on hiding adverse information from investors. We will be examining and applying textual and unstructured data analysis tools – such as the FOG Index, the Narcissism Index, Tone Management, the 4Cs (Candor, Context, Complexity/ Confusion, Contradictions/ (in)Consistencies) etc – in different real-world western and Asian cases, including understanding their limitations. Week 1 – Survival in the Asian Capital Jungle: Who Knows What When? (108 slides) Week 2 – Western Tools to Catch An Asian Snake? (111 slides) Week 3 – The Incentivized Asian “Wedge” Snake to Tunnel Corporate Wealth (revised to 105 slides from 86 slides) Week 4-5 – Shedding of the Asian Snake’s Skin, The Opportunistic Tunneling of Corporate Wealth (157 slides) Week 6 – Descend into the Asian Snake’s Lair, Occult Offshore Centers, Tax-Tunneling, and Consolidation Craftiness (89 slides) Week 7-9 – The Asian Snake Charmer and Stock Manipulation Scheme (112 slides) Week 10 – The Accounting of Words & The Hiss of the Asian Snake (57 slides) Warm regards, KB The Moat Report Asia http://accountancy.smu.edu.sg/faculty/profile/108141/KEE-Koon-Boon A new monthly issue of The Moat Report Asia is now available! Access the in-depth idea presentation: |
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咬定青山不放松
咬定青山不放松，立根原在破岩中。 千磨万击还坚劲，任尔东西南北风。
Bamboo Innovator 