Tuesday, October 26, 2010

Newsletter Editor Favors Hong Kong

Mark Skousen,PhD,editor of the subscription newsletter Forecasts&Strategy,is in a bullish investing mood.Dr.Skousen is fully invested now.He likes the low interest rate and low inflation environment,as well as the Federal Reserve's easy money policy.It's an opportunity to take advantage of a unique situation,in his view.
Dr.Skousen favors the iShares Hong Kong exchange-traded fund,among others.Hong Kong is the center of growth in Asia,he points out.The fund is trading at only fifteen times earnings,so he thinks it's a good buy.It also pays a 3% dividend,the economist notes.
Mark Skousen was a CIA economic analyst from 1972-75,and has taught at Columbia University.A frequent guest on business television,he started his newsletter in 1980 and has written more than 24 books.
iShares Hong Kong fund(EWH)

Saturday, October 23, 2010

Tuesday, October 19, 2010

Inside Russian Banking

VTB is Russia's second largest bank.It is selling a 10% stake in itself for three billion dollars.The government is ready to accept owning less than a majority stake now in Russia's largest companies,making such sales possible.
The Russian banking sector has recovered substantially.VTB went from a two billion loss in 2009 to a two billion profit for 2010.
Still,because of a lack of confidence in global growth,the Russian loan book is only growing at 5.5%.Basically,there is a lack of demand,a lack of confidence in the industrial sector in Russia.
As for new global capital requirements for banks,Russian regulations on capital were always more conservative than in the West,so that won't be a problem for Russian banks.They were already holding plenty of capital in reserve.
Andrei Kostin is CEO of the Russian bank VTB.

Tuesday, October 12, 2010

China Dominates Rare Earth Metals

Please note that this week,in addition to this post,two other posts of global interest have been published in the Extra Content blog.One deals with NATO ally Greece's debt crisis resolution program.The other explores the nature of Chinese naval power in the Asia-Pacific region.You may visit Extra Content by clicking on the link in the right column.
Speaking in Brussels last week,Chinese Premier Wen Jiabao was in a defensive mode.He said Europe shouldn't join the call for China to release its currency,the Yuan,from tight control.The problem wasn't with the Yuan,but with the U.S. dollar,Mr.Wen remarked.He also claimed China wasn't using rare earth metals as a bargaining chip with Japan.
There is considerable concern about China's control over the world's rare earth metal supply.China produces more than 90% of the world's rare earth metals.It has cut exports of the metals by 75% this year.The U.S. is considering filing a complaint with the World Trade Organization over possible Chinese hoarding of the metals.
Rare earth metals are used in everything from tanks to iPhones and hybrid cars.The U.S. has only one rare earth metal mine.It could take 15 years for the U.S. to restart its rare earth metal supply chain.There is a bill before Congress to do just that.

Tuesday, October 5, 2010

HPQ Selects German Executive

The Hewlett-Packard board has chosen Leo Apotheker to succeed former CEO Mark Hurd as of November 1.Mr. Apotheker resigned as SAP chief executive earlier this year when SAP didn't renew his contract,having underperformed in license growth.
A speaker of five languages,he is known for traveling most of the year to visit customers.HPQ is said to need the high growth,high margin software business to augment its slowing hardware enterprise.Seen as a software guy who doesn't understand hardware,Mr.Apotheker is expected to lean on other executives until he gets up to speed.
The new CEO,a native of Germany who has been living in Paris,said software is the glue that will tie HPQ's parts together.HPQ is in a good position to advance in every software area.He will be spending time listening to the company's various stakeholders.
Investors didn't respond well to the selection,knocking the stock down after the announcement.They had been looking for an internal appointment.