Wednesday, December 28, 2011

CNBC Asia:2012 Outlook

CNBC Asia's Karen Tso offered a number of points for investors to consider in 2012:I don't think we're gonna be worried about China anymore.People are being defensive.
Thailand and Indonesia are consumption stories.Thailand's main policy is to increase the minimum wage.
The Shanghai Composite is down more than 20% this year.From a valuation perspective,it's one of the cheapest markets in Asia.There could be a big upside in early 2012.
In Asia,central banks loosening monetary policy could be potentially positive for stocks,Ms.Tso observed.
Karen Tso,based in Singapore,is co-host of CNBC Asia's "Squawk Box" programme.She has a Bachelor of Commerce degree from Griffiths University in Queensland,Australia.A business journalist for more than 10 years,Ms.Tso came to CNBC from Australia's News Nine.
Extra:Recent data suggests the growing influence of China's middle and upper classes.China's grain companies have bought 18 million tonnes of new grain,according to the Xinhua news agency.Chinese pork prices rose up to 0.3% in mid-December trading,and China just overtook India in jewelry sales.

Wednesday, December 21, 2011

Wealth Manager:What To Expect,For How Long

The economy's been picking up modestly,says Jason Pride,CFA,Director of Investment Strategy at Glenmeade Investment and Wealth Management.The political side of the equation in Europe is in complete contrast to that.It's gonna take a long time.Expect a bumpy period for an extended amount of time.
The reality is,we live in a very global environment.Our expectation is a moderate downside in Europe,not dragging the U.S. into the abyss.Our big theme is,don't hide in cash or Treasuries which are paying you nothing.
Glenmeade likes high quality high yield bonds and defensive,high quality stocks such as Colgate Palmolive and Yum Brands.These are companies linked to the emerging markets,Mr.Pride pointed out.
Glenmeade is a privately held firm that cites its strength and stability as an organization,delivering consistent and thoughtful advice in all markets,year after year.Glenmeade offers sophisticated strategies based on intellectual rigor for individuals,families,family offices and institutions.It has six offices in locations such as Philadelphia and Morristown,New Jersey.
Colgate Palmolive(CL),Yum Brands(YUM)

Wednesday, December 14, 2011

Asset Manager:Why PepsiCo Is Favored

The forward rate of return of PepsiCo is larger than that of Coca-Cola,according to Donald Yacktman,President and Co-Chief Investment Officer of Yacktman Asset Management.PepsiCo comprises 11.2% of YAM's portfolio.Any great business will have experience in both the U.S. and internationally,as PepsiCo does.
PepsiCo offers a slightly better rate of return,and we feel more comfortable with it.We also like and own Coca-Cola shares.
PepsiCo could change its name to Frito-Lay,the name of its snack food division.It makes more money than the soft drinks.Just walking down the grocery store aisle,you can see Frito-Lay's dominance,Mr.Yacktman noted.
Yacktman Asset Management manages two mutual funds,The Yacktman Focused Fund(YAFFX)and The Yacktman Fund(YACKX).Founded in 1992,the firm claims it is focused on delivering risk-controlled results by being objective,diligent and patient.

Wednesday, December 7, 2011

OppenheimerFunds:Liquidity and Structure in Europe

Thought leaders at OppenheimerFunds have been going over the recent proposals and rumors in Europe.The market is so volatile because of fear of lock up of the financial system.There is a multifaceted game of chicken that the Europeans are playing with one another,resulting in someone driving off a cliff.There does need to be some structural reform.Can it be put in place before the European Central Bank does what it should do?asks Jerry Webman,PhD,CFA,Chief Economist and Senior Investment Officer at OppenheimerFunds.
At least the Europeans have been willing to shake things up a little.Here in America we have an uneasy equilibrium.Among portfolio managers,there's a feeling we're as good as our last idea.Nobody wants to make a bad bet.You get punished for it,Dr.Webman observed.
It's a step in the right direction,adds his colleague Alessio di Longis,CFA,Vice President at OppenheimerFunds,but we are treating the symptoms,not the disease.It does absolutely not mean that we should start emphasizing stocks.Today signals the ECB tendency to ease,but we are not treating the underlying problems.
We have treated the Euro problem from an individual country approach.We need a structural approach,Mr.di Longis agreed.
Oppenheimer Holdings(OPY)

Wednesday, November 30, 2011

Author and Consultant:Riding the Sawtooth Market

We're in a slow growth,maybe no growth economy,and this could go on for years,observes Al Angrisani,former Assistant Secretary of Labor and Chief of Staff for President Ronald Reagan from 1980-84,whom he helped to create 16 million new jobs.Investors are picking winners and losers.If the price is down,I'll make a bet on those.
You're looking at IBM,Apple,Siemens.Those are good long-term plays.We're in a sawtooth pattern,but the trend is down.You're picking companies.You get numb from the ups and downs of this sawtooth pattern,and then perhaps you get whammed by China with its uncertainty.
Mr.Angrisani has worked as a turnaround expert,restoring value to shareholders as founder of Angrisani Turnarounds,LLC,a leading consultancy for failing publicly traded companies.He sets out his approach in his book "Win One for the Shareholders!"
Siemens(SI),International Business Machines(IBM),Apple(AAPL)

Wednesday, November 23, 2011

Emirates Chooses Boeing Jets

Emirates Air has ordered 50 more 777 airliners from Boeing for a record 18 billion dollars.The deal includes an option for 20 more 777s,which would bring the total cost up to 26 billion.At the same time,Oman has ordered six Boeing 787 Dreamliners.
Jeff Johnson,President of Boeing Middle East,says Emirates Air aims for global aviation domination.We're sold out for years to come.They want the technology.The Middle East sets the standard for wanting this technology.
The Middle East also hungers for military aircraft.There are big air bases in Qatar,Kuwait and Bahrain.These countries want interoperability with the U.S. military.A 60 billion dollar U.S. arms deal with Saudi Arabia is influenced by the fear of Iran,Mr.Johnson noted.

Wednesday, November 16, 2011

Russell Investments:What Makes Sense Today

Europe is a huge source of unknowable risk,in the view of Russell Investments' Chief Market Strategist,Stephen Wood.The U.S. economy is doing a hair better than O.K.It is growing.When the market focuses on U.S. fundamentals,it tends to do well.
A globally diversified portfolio of risk assets makes sense.They outpace inflation and give you some return.If you look at the pullbacks as opportunities to get in,you've been able to nickel and dime your way in.The emerging markets are gonna be good in 3-5 or 5-7 years.
Corporations are much less likely to default than governments.Equities could end the year positive on the backs of earnings.
We have a market-based culture,with government institutions responsive to the market.It's more confrontational in Europe.You kind of grind it out here.We've got a number of years to work through these debt issues,whereas in Italy and Greece they've got a couple of days,in Dr.Wood's opinion.

Wednesday, November 9, 2011

Managing Director:Don't Bank On Banks

This decade is the worst decade for bank revenue since the Great Depression,in the view of Mike Mayo,Managing Director at Credit Agricole Securities.After a financial crisis,things don't go quickly back to normal.Be prepared to muddle through.A muddle through scenario beats alternatives like failed institution MF Global.
U.S. banks are picking up some loans from Euro banks.You can increase funds for lending,but you can't create borrowers.U.S. debt to GDP is 8 to 1-worse than Greece.We don't have enough proper auditors.Citigroup's have been in place since 1969.
You don't have proper accounting,which creates a crisis of confidence.Let's have auditors sign their names to be accountable.Let's have less regulation,but hold the top people accountable.
We're not having capitalism the way it's supposed to operate.I feel a lot more concern about capitalism when talking to Dick Parsons,Chairman of Citigroup.Just change the characters.Bank CEOs do more damage with ill-conceived incentives,Mike Mayo noted.
Mr.Mayo,a longtime banking analyst,is the author of "Exile On Wall Street."Credit Agricole S.A. is the largest full service bank in France.It ranks second in Europe and eighth in the world.

Wednesday, November 2, 2011

Merrill Lynch:What You Need To Do

There is a re-balancing coming in Europe and the U.S.,according to Lisa Shalett of Bank of America-Merrill Lynch Global Wealth&Investment Management.This is a volatility that is unprecedented since World War II.These are in many cases policy-driven.Demand and policy are interconnected.There's just as much uncertainty among consumers.
What everybody thinks is safe may be risky,and vice-versa,such as Treasuries/emerging market bonds.Embrace a more global perspective.This is about real diversification.You need to be in every geography,and not just BRICs.Consider Indonesia,Mexico,Turkey.Emerging markets bonds are safer,Ms.Shalett believes.
Merrill Lynch GWIM provides comprehensive services to affluent clients and institutions,from investment solutions to retirement,benefit plan,banking and philanthropic services.GWIM offers robust and dynamic product and solution platforms from Merrill Lynch offices worldwide.
Bank of America(BAC)

Wednesday, October 26, 2011

Europe and America:A Standard Chartered View

The key question is,how quickly a Euro debt agreement will actually be implemented,said David Mann,Regional Head of Research Americas at Standard Chartered.It's a huge round of detail.As long as the European Financial Stability Fund can be levered up without downgrades or extra haircuts,only then can we feel more confident and that we've turned a major corner.
We won't see a pre-crisis level of employment till 2015.It's a more vulnerable economy.It's more likely you're going to see very weak growth.If you get a major shock,it will be closer to stall speed and negative growth.
We've already seen an incredible ability to cut costs,but we need to see the National Federation of Independent Business survey turn around before we can grow confidence and exceed expectations,in Mr.Mann's view.
Founded in 1853,Standard Chartered Bank's core geographies are in Asia,Africa and the Middle East.It has five locations in the U.S. offering wholesale and private banking to corporations,institutions and affluent individuals.

Wednesday, October 19, 2011

Managing Director:Where To Shelter Now

We're still very concerned about the situation in Europe,said Adrian Mowat,Managing Director and Chief Emerging Markets Strategist at JP Morgan Chase.What's gonna happen with France and Germany as they recapitalise their banks?We look forward to the G20 meeting November 3-4 in Cannes.
Our advice would be to reduce into that rally.We're concerned because the European Central Bank doesn't seem to get it.At the moment,they're still concerned about regulatory matters and they don't want to grow their capital base.
We need to look out for Chinese inflationary numbers.Inflation will eventually come off there.Our belief is that Europe will get worse before it gets better.Think about capital preservation at this point in time,keeping to U.S. dollar cash,Mr.Mowat advised.
JP Morgan Chase(JPM)

Wednesday, October 12, 2011

A Columbia University View:Occupy Wall Street and Beyond

The uncertainty is huge,notes Columbia University economist Jeffrey Sachs.Will the euro survive?Will Europe survive?We shouldn't underestimate how deep we've gotten ourselves into this bind we're in right now.
What's happening at the Occupy Wall Street protests is happening all over the world.Those kids are saying it's global.From the Arab Spring to Tel Aviv to Chile,they're saying we need help;we don't have the future.
We need to be attentive to the 99%.The inequality in this country is out of control.We've been on an economic path that's not working.That top 1% is gonna have to do more,in Dr.Sachs' opinion.
Citigroup CEO Vikram Pandit said he would be happy to speak with the protesters.Their concerns are very understandable.
The protesters are active in nearly 200 U.S. cities now.In a recent poll,40% of those in the upper income bracket expressed support for the protesters-the most support of any bracket.
Dr.Sachs is Director of the Earth Institute at Columbia,which aims for a sustainable earth,and is a special advisor to UN Secretary General Ban Ki-moon.

Wednesday, October 5, 2011

Venture Capital In China

Chinese stocks are over-amplified according to what U.S. markets are doing,in David Chao's view.Mr.Chao,who is co-founder and general partner at venture capital firm DCM,says the stocks are perceived as higher risk.In reality,Chinese listed companies in the U.S. are just as transparent as U.S. companies.They have to follow the same rules.
Chinese entrepreneurs and management are learning day by day.China is characterised by its 500 million Internet users and the burgeoning rise of their middle class.They are starting to spend money.That's a great opportunity.We have a local team in China,and also teams in Japan and the U.S.That's the best way to do it,Mr.Chao believes.
DCM invests in mostly early stage companies in core technology sectors such as Cleantech;Components;and Software and services.Some of its projects include,Pay Cycle and RenRen(RENN).

Wednesday, September 28, 2011

Advantage View:Market Thoughts From UBS

We have a dichotomy in the market:1.We need to see better macros,and 2.We need to see something better out of Euro policy makers.Our bias is to believe that the longer this continues,the weaker the numbers will be;our bias is to the downside.
We need more clarity out of policymakers,both U.S. and European-but especially European.I'll believe it when I see it.We haven't seen any evidence they are taking concrete measures.Given the 17 parliaments,it's by definition a slow process.
We favor U.S. equities such as consumer staples and defensive cyclicals such as tech.There's a lot of risk with industrial cyclicals and energy.Materials and industrials are lagging.
Over the next year or two,China will see 7-8% growth.It's not falling off a cliff,but slowing.Near term,event risks out of Europe and decelerating GDPs get us quite concerned about global equity markets.Medium term,we are constructive on equities.
Jeremy Zirin is Chief Equity Strategist at UBS Financial Services.UBS offers wealth management,investment banking,asset management and business banking services to clients worldwide,as well as retail banking in Switzerland.

Wednesday, September 21, 2011

Leading Economist Analyses Euro Debt Crisis

The swap lines that have been set up between central banks are positive,according to C.Fred Bergsten,Director of the Peterson Institute for International Economics.They show that the Federal Reserve and the Europeans are in communication.The European banks are in need of more capitalisation.This kind of thing buys time.
The European Central Bank has indicated it's not gonna let someone go belly-up,making a Lehman mistake.The Europeans have created this European Financial Stability Fund,which is an embryonic European Treasury.It's something like the U.S. Troubled Asset Relief Program.On the financial support side,I think they're moving in the right direction.
The strong Europeans deserve criticism.The strong Northern Europeans need to take expansionary measures.The Germans have an overwhelming interest in preserving the euro and the European Union.They are the ones who have the heft to make things happen.
The Europeans need to get on a clear path toward fiscal unification to go along with monetary union.In the mean time,the ECB needs to lend to governments and banks to keep the financial system afloat.A two-track strategy is needed,Dr.Bergsten believes.
C.Fred Bergsten has been Director of the Peterson Institute since its founding in 1981.Before that,he was Assistant Secretary of the Treasury for International Affairs from 1977-81 under President Jimmy Carter.

Wednesday, September 14, 2011

It’s the Jobs, Stupid! Part VI - TCW Asset Management - September 6, 2011

It’s the Jobs, Stupid! Part VI - TCW Asset Management - September 6, 2011

Assessing A Possible Greek Default

The consequences of a Greek default are being gauged by thought leaders in world financial capitals.Komal Sri-Kumar,Chief Global Strategist at TCW,says that,if Europe crashes,you're looking at the banking system being under very severe strain.As long as that is unknown,I think you're looking at a bit of trouble here.
Moody's,the ratings agency,downgraded the creditworthiness of two of France's three largest banks,Societe Generale and Credit Agricole,because of their exposure to Greek debt.The third bank,BNP Paribas,escaped the demotion.
You cannot just have Greece defaulting and everybody else doing fine.Greece defaulting will cause a series of defaults.If that happens,the impact on the U.S. economy and market will come from the financial system.It's gonna be even more difficult to get a mortgage in the U.S. because the Federal Housing Finance Agency is suing the big banks.
Dr.Kumar has said he believes we are already in a recession.He's staying with high grade fixed income for the next 2-3 months;after that,it's defensive stocks.
TCW,the Trust Company of the West,offers institutions and individuals a broad range of investment strategies.Since 1971,it has been committed to serving its clients through fundamental research and superior customer service.

Wednesday, September 7, 2011

Newsletter Publisher Sceptical of Euro Fund

Mark J. Grant,publisher of the "Out of the Box" newsletter,which is read daily by some 5,500 financial institutions,is sceptical of efforts to resolve the European debt crisis.It's a solvency issue for the banks,Mr.Grant said.They have 4.1 trillion dollars of debt to roll over.The response has been that we don't need to recapitalise the banks.
The European Financial Stability Fund,or EFSF,is a convoluted effort.It is virtually impossible to come up with any solution.There is not money enough to support this effort.There is not enough available to bail out Italy and Spain.
The markets are all interconnected at the international bank level.Any blow-up in Europe could have a substantial impact on the U.S. banking system.The European Union and China are manipulating the currency market,Mr.Grant believes.
Mark J. Grant is Managing Director of Corporate Syndicate and Structured Products at Southwest Securities.He has also written a highly regarded book,"Out of the Box and Onto Wall Street."

Wednesday, August 31, 2011

The Outlook for Chinese Equities

The global growth slowdown is much on the minds of financial analysts in Asia.HSBC says a fall in demand is already affecting countries in the region.China,India and South Korea are export-driven.China Daily said the European debt crisis will affect China's real economy.
Nonetheless,the major brackets are doing well,according to John Tang,a China strategist at UBS.I don't think we are gonna see earnings affected very much.If we still see 8-9% growth,bank earnings won't be much affected.The outlook for the index is actually quite good.
The Japanese yen or bond are not an option,and the euro is even worse.The U.S. dollar will still be a must have.
Real estate is the most upbeat sector.Earnings are very robust;valuation has been quite low.It is the number one consumer sector in China.Look past the short political headwinds.I don't think we should be trading at that low level,Mr.Tang observed.

Wednesday, August 24, 2011

Shortfall of Rare Earth Elements Persists

Molycorp is the sole producer of rare earth oxides in the Western Hemisphere.The Mountain Pass,California company has reached profitability,and CEO Mark Smith indicates that the condition out of China is driving his company.The supply side is not nearly strong enough to meet the demand both in and outside of China.
We're seeing not just price realisation,but a volume increase as well.We see the demand continuing to climb very rapidly.China cannot produce enough for their own in country needs.
A 30-35,000 ton supply of rare earth is needed per year.Molycorp puts out 5-6,000 tons for its customers.We are fully funded to close the Sumitomo deal,under which Sumitomo Corporation of Japan will provide Molycorp with financing in exchange for a seven year supply of rare earth products.We certainly would like to enter into contracts.
We have to stay focused on our 781 million dollar expansion project.It is the number one priority for every employee in the company.We have to bring that project in on time and within budget.That's what people invested in Molycorp for.
We don't foresee any let up in demand for rare earth elements,Mark Smith noted.The oxides,considered critical by industries such as aerospace and defence,are utilised in diverse applications such as lasers;computer memory;aerospace components;magnets;batteries;and PET Scan detectors,as well as X-ray components.

Wednesday, August 17, 2011

Analysing The Current Financial Problem

Komal Sri-Kumar,Chief Global Strategist at TCW,thinks the fundamental problem is you have an excess of debt in the world.The Federal Reserve left open the possibility of QE3,or more quantitative easing.It's something to be worried about this late in a recovery.
If we don't do any structural reforms,I can't see any improvement.We need to have free trade agreements;a more flexible labor market.I think we are in a recession now and into Q4.
We are looking into defensive areas.We like energy;information technology.Stay away from European equities and fixed income.The corporations have something like two trillion of cash.The money is kept mostly outside the U.S.,away from higher taxes.
I considered QE2 alchemy.You need incentives,getting workers to work and increase productivity.You cannot get anything else out of monetary policy.Many companies are firing domestic workers as they hire them abroad,because it is more efficient,Mr.Sri-Kumar noted.
TCW,the Trust Company of the West,offers institutional and individual investors a wide array of U.S. Equity,U.S. Fixed Income,Alternative and International strategies.It is committed to fundamental research and superior customer service.Based in Los Angeles,TCW was founded in 1971.

Wednesday, August 10, 2011

BlackRock's Downgrade Reaction

The timing of the downgrade of U.S. credit did take us by surprise,said Peter Fisher,head of fixed income trading at BlackRock,but we did a great deal of planning to protect our clients.It's a wake-up call about the level of risk in the world.A number of investors will take it as one more risk.They're selling risk assets,not Treasuries.
We're not mechanistic sellers or buyers.We are managing risk and looking for opportunities that this downgrade may create.The risk that the U.S. will not pay is pretty marginally increased.Clearly,coming in the fragile markets,it's one more straw breaking the camel's back of investors.
U.S. Treasuries were 60% of all AAA assets.It's a liquidity pool with great transparency.There's a little too much overreaction.Do not change behaviour abruptly.We've been up in quality and liquidity to try and brace ourselves,Mr.Fisher indicated.
BlackRock is the largest money manager in the world,with 3.66 trillion dollars of assets under management.It provides investment,advisory and risk management solutions from offices in 26 countries.

Wednesday, August 3, 2011

Thriving in China:Hang Lung Properties,Ltd.

Ronnie C. Chan,Chairman of Hang Lung Properties,Ltd.,a Hong Kong-based developer,owner and manager of upscale real estate,thinks the government is finally heading in the right direction after 10 years,releasing more land for sale.We are not forced to sell,with more than 10 billion dollars in cash.I don't think this is the time to sell.
We want to be in commercial.The problem is,the government is building a lot of subsidised housing,driving residential developers into the commercial field.Wages are a big issue,not construction costs.
We're building five mega malls,but China can still pass increases on us.There are no fixed contracts in China.We are opening one in Xinan.It is fully leased six months ahead of opening.
As for expanding outside of China,Mr.Chan says he doesn't think he is smart or foolish enough to look elsewhere.
Hang Lung Properties is a constituent stock of Hong Kong's Hang Seng Index.It is one of the largest real estate companies in the world.Its holdings in Hong Kong and mainland China include malls,office buildings and both serviced and non-serviced apartments.
iShares MSCI Hong Kong Index Fund(EWH)

Wednesday, July 27, 2011

From Downturn to Downgrade

Concerning the Euro-zone plan for debtor aid,it's surprising in terms of the scope and the coordination,in the view of Rick Reider,Chief Investment Officer of Fundamental Fixed Income at BlackRock,who helps manage more than 600 billion dollars in assets.I think it's a pretty significant move.A series of parliamentary approvals have to take place,and we're still in a slow growth European economy,so we're not out of the woods yet.
The one point with the plan is,you're dealing with liquidity,but not solvency.That's the big risk.Also,how do you recapitalise the banks?
The U.S. still has the best refuge for investors.Even if it lost one AAA rating,there's nowhere else for investors to go.If losing the rating is a warning sign,it's ultimately terrific.
The markets are anticipating a 50/50 chance of a downgrade.Companies are in great shape relative to the governments around the world.Ratings agencies need to see real reform or they will downgrade.If the deal is late or weak,downgrade can still occur,Mr.Reider explained.
Although the global markets have transitioned from the collapse of equities engendered by bad loans and obscure instruments,they now must surmount a new challenge in the form of the sovereign debt issue.This aftermath of governmental largess is a follow-on dilemma for the wealth creators and managers.

Wednesday, July 20, 2011

This Week's Notebook:Goldman and Greece

This week I have devoted the time slot for this blog to a story about Goldman Sachs that I came upon while researching a post for this blog.The Goldman story has been published in Wall Street Workbook,which you may access from the link list in the right hand column.Still,here are some notes on the European debt crisis.
France says the Euro-zone summit today,Thursday,will send a strong message.They are still discussing the share of the private sector in the Greek rescue.
After all the talk that has already gone on,scepticism about the summit may be widespread in the community of financial observers.Will this summit really resolve the issues?It may be just another photo op and delaying tactic-so the feeling goes.
Secretary of State Hillary Clinton was in Greece recently to express support for all the Papandreou government has done to impose austerity.The situation today is much different than two years ago thanks to the new measures approved by parliament,Greece pointed out.It was indeed a strong and positive first step.Hopefully Europe will get behind Greece with any practical help it really needs now.The serious risk of contagion makes it imperative that they do so.
Update:The Euro-zone countries have agreed a 109 billion euro aid package for Greece and potentially other troubled countries.This sent stocks decidedly higher worldwide.

Wednesday, July 13, 2011

Dubai Retail Recovers

The retail sector in Dubai is on the mend.There is growing optimism this is a solid trend as tourists and shoppers return in droves.At the iconic Mall of the Emirates,consumer traffic is up 15% on the year.
Gulf region consumers think Dubai is retail central.The consumption of luxury goods is up 3% and projected to double.The regional consumers are supplemented by a gaggle of shopping tourists from both Saudi Arabia and the Indian subcontinent.
The Mall of the Emirates has 520 stores,anchored by the hypermarket Carrefour,the incredible Ski Dubai indoor slopes,CineStar Cinemas and several others.There are eighty eateries,two hotels and 60 luxury designer stores.Child care is also available at the huge emporium.
According to noted researcher Jim Bianco,the high end is doing better than the Wal-Marts of the world.The wealthy are benefiting from the higher stock market.If stocks start to slump,all bets are off for the consumer discretionary business.
For now,though,the woes of the financial crisis are fading in the desert sun.

Wednesday, July 6, 2011

Investing in Emerging Markets

According to Nicholas Smithie,emerging markets strategist at UBS,the emerging markets have had a splendid decade.We know there is an overhang about sovereign debt.They are trading lower than 75% off other periods,pricing at distressed valuations.We think investors go for them for their high rate of domestic growth.
In the emerging markets,domestic consumption and infrastructure are really starting to take off in Thailand,Indonesia and the Philippines.Investor holding periods have become very short:they want all their returns all at once.Those in it for the long haul will benefit.
We think that Chinese equities have fallen to very low valuations,pricing in a hard landing.In the second half of the year,Chinese growth will come through.We'd be buying,Mr.Smithie advised.
China has just raised interest rates for the third time this year,a sign that growth is still so strong,even with the tightening measures already taken,the government is afraid of the economy overheating into more inflation.
UBS offers wealth management,asset management and investment banking globally,as well as retail banking in Switzerland.Founded in 1854,it is based in Zurich and Basel,Switzerland.UBS has offices in more than 50 countries.

Wednesday, June 29, 2011

A World Bank Perspective

With regards to the European debt crisis,my guess is,the International Monetary Fund and the European Union will muddle through,says World Bank President Robert Zoellick.The developed markets have obviously been stumbling along.China does seem to be slowing a little bit,but I think it's appropriate so as to avoid a bubble situation.
People are gonna be moving at different speeds with different issues.That's the nature of the new global market we are in.
Food prices are about 50% higher,but the risk is,the stocks for wheat and grain are very,very low,making them vulnerable to price shocks.The low income countries and big wheat importers in the Middle East are hurt the most.We've launched a pilot with JP Morgan Chase providing some additional credit support and access to commodities markets derivatives to insure some of these players.
The European Union is pretty slow,with its low population growth.As they muddle through,the question is whether they will make the necessary structural changes,Mr.Zoellick wonders.
The World Bank offers financial and technical assistance to developing countries worldwide.It provides resources,shares knowledge,builds capacity and forges partnerships in the public and private sectors.Founded in 1944,it has more than 10,000 workers in over 100 offices around the globe.
JP Morgan Chase(JPM)

Wednesday, June 22, 2011

Indonesia Earns High Marks

Indonesia has been called the next Brazil,the next BRIC nation.As trade minister Mari Pangestu points out,they've seen a robust export growth,increasingly with Asia-up 30% this year.There is much more trade with Vietnam,Thailand and Korea.
Indonesia could grow at 8%,once they address infrastructure bottlenecks.They are growing at 6.5% now.Medium term,many infrastructure projects are coming on stream.
Indonesia has become a lot more prudent since the financial crisis.It is on the right path to weed out corruption.People are getting it,as far as becoming more hospitable,Ms.Pangestu believes.
President Barack Obama spent four years of his childhood in Indonesia.He is regarded by the Indonesian people in a special way,as being one of them.Mr.Obama visited Indonesia in November 2010,after a two year delay.
Indonesia's students are actively recruited by U.S. colleges and universities.They are seen as intellectual assets who add diversity to the campus environment.
iShares MSCI Indonesia Investable Market Index Fund(EIDO)

Wednesday, June 15, 2011

OPEC:Bitterness in Vienna

By the end of June,Saudi Arabia will raise its oil production by up to 300,000 barrels a day,in order to restrain the price per barrel.When OPEC ministers met in Vienna recently,there was resistance to the Saudi example.OPEC,the Organisation of Petroleum Exporting Countries,failed to reach an output consensus.It was basically Saudi Arabia versus Venezuela and Iran.
OPEC will evaluate the situation after three months.The next meeting is scheduled for December 13-14 in Vienna.OPEC stocks are currently three days above the five-year average,according to OPEC Secretary General Abdalla Salem El-Badri.
Saudi Arabia is committed to supply the needs of the market,Saudi oil minister Ali El-Naimi said.This was one of the worst OPEC meetings he's ever had,Mr.El-Naimi remarked bitterly.A veteran of six decades of meetings,he saw that six countries were opposed to an increase in production,while six others supported it.It has been at least a decade since OPEC failed to reach a consensus.
OPEC is to maintain its current output for now.Nonetheless,in actuality,Saudi Arabia and three other Persian Gulf states are able to to boost production to the desired quota by themselves,should they so choose.
In spite of all the contention,Mr.El-Badri declared he was confident the cartel will reach a quota deal at the December meeting.To fail again would call the organisation's utility,and indeed its continued existence,seriously into question.

Thursday, June 9, 2011

Qualcomm Posts Global Profits

One of the biggest success stories in the telecom space,Qualcomm has added 38 billion dollars in market value,posting 5.6 billion dollars in profits in the last year.Its vision is to power mobile phones and tablets with Qualcomm chips.The company is spending much on innovation.
CEO Paul Jacobs says Qualcomm's customers want micrographics technology.They want a lot of bandwidth.Qualcomm is getting to innovate in a lot of different areas for them.
Qualcomm is the single chip supplier to Windows mobile phones.The sales of its Snapdragon chip set have really taken off.Microsoft will use the Snapdragon chips in devices running its new Windows 8 platform.
Windows 8 is to be compatible with tablet PCs.It is the biggest upgrade since Windows 95,Qualcomm's partner Microsoft announced.
Based in San Diego,California,Qualcomm has 159 offices worldwide,including a major commitment in Asia.From Manila to Mexico,the company strives to assist the underserved wherever it does business,improving lives through connectivity.
Founded in 1985,Qualcomm is one of Fortune magazine's 100 Best Companies To Work For.

Wednesday, June 1, 2011

Newsletter Editor Favors Uranium

Mark Skousen,PhD,editor of the Forecasts and Strategies newsletter,has deep concerns about the economy.He believes the U.S. is obviously doing something wrong.We need to unburden business.These are burdens keeping the Great Recession with us.Higher interest rates would get us out of this.
Dr.Skousen,a noted economist and author of the textbook Economic Logic,as well as The Making of Modern Economics,continues his longstanding investment advisory work.He likes the Canadian uranium miner Cameco.This is a great recovery story.Uranium prices fell sharply,but are now stabilising and starting to go back up.China and India plan to expand their nuclear energy assets,and Cameco stands to gain from this,in Dr.Skousen's opinion.
He also favors Spain's Telefonica.Over 70% of this company's business is outside of Spain and Europe,and it pays a 9% dividend.
As for another of his picks,Rare Earth Elements,Mark Skousen says we're gonna take our profits.It's too volatile for a long term holding beyond six months.He will personally keep holding the stock as a speculator,however.
Mark Skousen,who has a doctorate in economics from George Washington University, served in the Central Intelligence Agency from 1972-75 and is also a scholar in Benjamin Franklin studies.
Cameco(CCJ)or TSX:CCO,Rare Earth Elements(REE),Telefonica(TEF)

Wednesday, May 25, 2011

The Commodities Markets Today

Dr.Francisco Blanch is seeing that,in the short run,it's still a very tight crude oil market.
Dr.Blanch,global head of commodities research and a managing director at Bank of America-Merrill Lynch,notes that we're going into the summer driving season now.
China has stopped exporting diesel.Japan has strong needs for fuel.It's still very tight going into June and July.
You can only buy West Texas Intermediate crude around Texas and Oklahoma.Brent crude should be your global benchmark.It may be at 140.00 a barrel in three months.It is currently around 115.00.
In terms of the economic context for commodities,Dr.Blanch observes that real interest rates are about to turn upward.If the U.S. economy gets back on track,the Federal Reserve will not renew the Quantitative Easing policy.
These factors tend to support commodity prices.
Dr.Blanch says they also like corn and palladium.
Francisco Blanch has a doctorate from the Complutense University of Madrid.He is the publisher of widely read newsletters such as Global Energy Weekly,Commodity Strategist and Energy Strategist.
Bank of America(BAC)

Wednesday, May 18, 2011

Enbridge Sees Growth Stretching Out

This is the strongest growth that we've had,and we see it going five years out,says Enbridge,Incorporated's CEO Patrick Daniel.The Canada-based energy delivery company serves North America with its transport and distribution of oil and natural gas,as well as its interests in renewable and green energy technologies ranging from wind to solar.The Canadian oil sands,as well as the Bakken and Eagleford shales,will make us much less dependent on foreign oil than we are,there's no doubt,Mr.Daniel believes.
Canadian energy producers like the optionality of our largest pipeline system in the world.In addition to Enbridge's vast and complex oil pipeline system,we think we're in a very strong position to export Canadian natural gas.
Citing the Gateway Pipeline to the west coast,Mr.Daniel promotes Enbridge as a jobs-creator.They're very good jobs that stem from both the construction and operation of our pipelines,he indicates.
Enbridge employs 6,000 Canadian and American workers.The company has never cut its dividend in 55 years.It is listed on both the Toronto and New York stock exchanges under the same ticker symbol,ENB.

Wednesday, May 4, 2011

PepsiCo Confident Going Forward

PepsiCo is confident in meeting the challenges it faces in today's business climate.We really do think we've got a portfolio of brands and market positions that enable us to manage rising costs effectively,says chief financial officer Hugh Johnson.My expectation is,we'll be taking pricing across the whole of our business.Strong brands growth is offsetting higher commodity costs.
While you see some challenges in developed markets,developing markets are growing quite strongly.We feel committed to 7-8% growth this year,Mr.Johnson noted.
PepsiCo beat Q1 earnings estimates slightly on both the top and bottom lines,but has an outlook a little below Wall Street expectations.In December 2010,it announced it was acquiring a controlling stake in Wimm-Bill-Dann,a Russian beverage titan.Wimm-Bill-Dann is the market leader in dairy products and children's food in Russia,Ukraine and the Commonwealth of Independent States,and a major producer of juice drinks.For PepsiCo,it's another move away from carbonated beverages to a much broader porfolio of brands.
PepsiCo is led by CEO Indra Nooyi.

Wednesday, April 27, 2011

Fiscal Reform:Geithner's Global Optimism

In the view of U.S. Treasury Secretary Timothy Geithner,the journey to fiscal responsibility is well underway worldwide.In the U.S.,Mr.Geithner said,the important thing for the economy now is to lock in reforms to bring down the long term deficit.It's not surprising that average people are sceptical of Washington.I'm confident we will start the process.I think it's achievable.There's an emerging consensus on how much we have to do-four trillion in cuts-and the time frame.
The more details you have,the more credible it's gonna be.Faced with enormous challenge,Washington has always come together.You have to do it in a balanced,comprehensive way.There's no way to do this without changing our tax code.Life's about alternatives.We need a balanced,comprehensive package that will add modestly to the burden of the most fortunate Americans.
We have to earn the confidence of investors,but I didn't have to reassure foreign investors when Standard&Poor's downgraded their U.S. credit outlook to negative.We don't know how much is gonna be possible,but we have good prospects of laying down a foundation.
For its part,Europe is doing incredibly difficult reforms.The leaders of Europe have said they will do whatever is necessary to address the sovereign debt issue,and they're making some progress,in Timothy Geithner's estimation.
Before assuming his cabinet post,Mr.Geithner was president of the Federal Reserve Bank of New York,where he played an integral role in dealing with the financial crisis,assisting his predecessor at Treasury,Hank Paulson.Although initially disliked by some in Congress for mistakes he made on his income taxes some years ago,he has developed a decent working relationship with lawmakers over time.

Wednesday, April 20, 2011

Brazil Still A Force

U.S. equities will be higher.We think the markets are still gonna rally,says Michael Yoshikami of YCMNET Advisors,and the emerging markets are gonna continue to do well with their commodities.Singapore is the Switzerland of Asia.
We think Brazil is still an impact story.There is enough appetite for Latin America from U.S. companies.You can't put everything in Asia.Brazil is gonna continue to be a major trading partner with China,and that's gonna drive that economy.U.S. companies see a slow GDP story in the U.S.
Gold will reach 2,000 dollars an ounce.You buy gold for scepticism about the markets and as an inflation hedge.Food is going to be huge in demand.Commodities need to be part of an investor's portfolio,in Mr.Yoshikami's opinion.
YCMNET Advisors is a wealth management firm located in Walnut Creek,California.It was named one of Barron's Top 100 Independent Advisors for 2010.
iShares MSCI Brazil Index Fund(EWZ)

Wednesday, April 13, 2011

Finance and Foreign Affairs:The View From Qatar

A leading figure in Gulf states finance and foreign affairs has been reflecting on the recent turmoil in the region.We are thinking the Libyan people didn't deserve this,says Sheikh Hamad bin Jassim bin Jabr Al-Thani,Prime Minister and Foreign Minister of Qatar,who also helps oversee Qatar's sovereign wealth.Most of the problem in the Middle East is the economy.Gadaffi should go,leave the people of Libya decide what they want to do.
We see a lot of movement in Qatar.Some of the big companies are moving into Qatar from Egypt.
Between 5 and 7 years we will finish the Qatar infrastructure.Seventy billion is already allocated for that.The challenge is what to do after that to keep the growth 5-8%.We don't want the growth to collapse in 3-4 years when the work is finished.
Last year we invested more than 20 billion.This year we must invest 35 billion if we have the opportunity.We invested in Washington property,as it is a city that is not affected a lot by real estate problems because it is the capital.We think it's the right time to invest in U.S. commercial real estate.We are also looking at retail and energy in the U.S.
We have to be realistic about the supply and demand for energy.The supply is there,but there is anxiety about the Middle East events.In Asia,we sell our gas 3-4 times what we sell it for in the U.S.;Asia is our natural market,frankly speaking.
With regard to censorship of the Internet,to shut down any technology,I think this is stupid,the British-educated Sheikh Hamad believes.
Through its Delta Two fund,which is headed by Sheikh Hamad bin Jassim and managed by Paul Taylor,the Qatari government has increased its stake in British retailer Sainsbury to just over 25%.This is being seen as another step in a possible takeover of the department store chain.

Saturday, April 9, 2011

Wednesday, April 6, 2011

Japan:Gauging the Effects

Domestic demand and tourism will suffer in Japan,says Bruce Kasman,an economist at JP Morgan.We don't know the exact size of this disaster yet.This disaster is gonna be very large and short-lived.The rebound will begin in April as production comes back on line.
We think there's a lot of resiliency in the supply chain and production.
Growth captures.After you destroy,you rebuild.
The spillover will be felt in the rest of Asia.The U.S. economy won't feel it very much.Other Asian economies will feel it quite sharply.
In the U.S.,oil and food prices will surprise the Fed with their effect on inflation,but they will not act for the next 3-6 months,Mr.Kasman predicted.
In business for more than 200 years,JP Morgan is a part of JP Morgan Chase&Co.It provides a full range of financial services,from asset management to private banking and treasury management, to commercial,institutional and affluent clients in more than 100 countries.
JP Morgan Chase(JPM)

Wednesday, March 30, 2011

Inside the Deal:AT&T/T-Mobile

Dallas,Texas-based AT&T is purchasing T-Mobile from Bonn,Germany's Deutsche Telekom AG for 39 billion dollars.AT&T's competitors declined to comment on the news.Sprint had reportedly been talking with DT for some time about possibly acquiring T-Mobile itself,but agreement eluded them on valuation,among other issues.
Analyst Kevin Smithen of Macquarie Group Limited said that Sprint was left standing at the altar.We believe that Sprint is the odd man out.
The deal makes AT&T the largest U.S. wireless carrier.It needs more radio spectrum to improve smart phone data transmission,spectrum which will help it set up its high speed network,Mr.Smithen noted.AT&T is also acquiring spectrum from Qualcomm.These moves should help in the short term.They will be in the market for more,however.
With this deal,AT&T will get customers and infrastructure as well.Overall smart phone penetration rates are 21-22%.As more phones hit the market,there will be a huge demand for wireless data over the next 12 months,Mr.Smithen believes.
The need for wireless data will continue to grow.This creates a huge opportunity for players who do control spectrum going forward.The deal will help AT&T roll out the futuristic LT service to 95% of the nation,the Macquarie analyst predicted.
AT&T(T),Deutsche Telekom AG(DT)

Wednesday, March 23, 2011

Japan Prospects and Impacts

This is a great buying opportunity in Japan,says Robert Masetti of French financial titan BNP Paribas.The crisis will take down Japan's GDP by 1.2% this year.In 2012,we will see a 1.2% bump in GDP.We could see their inflation go to 1-2%.
We're not trying to pick a bottom.This will pass.It will play out.Look at the positives:an end to deflation;a recapitalisation.It would be surprising to us to see a big drop of the Japanese market from these levels.
Japan remains attractive.We're positive about the medium to long term outlook for Japan.This is yet another buying opportunity along the path of an improving Japan,according to Mr.Masetti.
Short term,the Japan crisis is having an industrial impact worldwide.GM is shutting a plant in Indiana because of a lack of parts from Japan.Almost all U.S. vehicles have Japanese components.One fifth of chips are Japanese.These chips are in household appliances from refrigerators to stoves,as well as a number of consumer electronic goods.
iShares Japan Index Fund(EWJ)

Wednesday, March 16, 2011

What Drives Molycorp Minerals

Molycorp Minerals describes itself as the Western Hemisphere's only producer of rare earth oxides.The price of rare earth metals has appreciated markedly recently,and CEO Mark A. Smith says this is largely driven by an increased volume of sales at a time of tight supply and demand.
We really are not seeing any slowdown in China and India.We are right on schedule with our new mine.It is to be fully producing by the end of 2012.
Every person we talk to continues to indicate that China will continue to lower its export quota of rare earth metals.The number of opportunities in this business are more than I've seen in my 24 years in this business,Mr.Smith noted.
China supplies 97% of the world supply of these essential materials,but has been cutting back on exports for some time now.Rare earth metals are used in high tech applications such as fiber optics,lasers and hard disc drives,as well as hybrid vehicles,green energy,national security and water treatment applications.
Molycorp Minerals is headquartered in Greenwood Village,Colorado.
Molycorp Minerals(MCP)

Saturday, March 12, 2011

Tuesday, March 8, 2011

Risk Management:Carlyle Group Mothballs Egypt Plans

Private equity firm The Carlyle Group has deferred plans to invest in Egypt.They have concerns over the recent change in leadership there.In Egypt,you need an official sign-off to make an investment.They feel that what's going on in Egypt isn't going to end anytime soon,and are concerned over getting local partners to exit a project.
Carlyle has an office in Egypt and will continue to work in Saudi Arabia and Turkey.As of 2009,they had 500 million dollars in their Middle East and North Africa fund.The group has a 40% stake in a Turkish hospital company,as well as a stake in a Saudi lighting fixture firm.
The Carlyle Group is a global alternative asset manager with more than 97.7 billion dollars under management.It combines global vision with local insight from its 19 offices that span the continents from North America to Asia.
Those who are interested in private equity may want to consider the PowerShares Global Listed Private Equity Portfolio(PSP).This exchange traded fund buys shares of 40-60 companies whose principal business is to invest in,and lend capital to,privately held companies.

Thursday, March 3, 2011

Genomics Pioneer Leads Internationally Recognized Institute

Dr.Claire M. Fraser-Liggett,PhD,one of the first scientists to describe sequencing techniques for microbial genomics,enabling the mapping of a complete genetic blueprint for bacteria species,was recruited by the University of Maryland School of Medicine in 2007 to head its new Institute for Genomic Sciences(IGS).She was seeking strategic collaborations in which results from sequencing the human genome could catalyse advances in health care,integrating genomics with biomedical research.
Dr.Fraser-Liggett brought a team of more than a dozen senior investigators with her from The Insitute for Genomic Research(TIGR)in Rockville,Maryland to IGS.Located at the University of Maryland BioPark in Baltimore,this new research center of international excellence,which was formally opened in April 2009,is using genomics to develop personalised medicine,a more detailed treatment methodology than current practice.For example,in personalised medicine,there could be different treatments for different types of pain patients may be experiencing,rather then a blanket approach to pain,based on expanded knowledge of disease processes achieved through genomics research.Such an approach is believed to hold promise for more effective treatments with fewer side effects.
Among other topics being studied at IGS are the human microbiome,the vast collection of microbes inhabiting the human body and the role of their genomics in disease processes;and deveoping better malaria drugs and vaccines.
These studies involve more than merely cataloging DNA sequence data.The data must also be analysed and annotated,adding biological data to genomic sequences.The ablity of IGS to do this is globally admired.
Dr.Fraser-Liggett has a BS in biology from Renssalaer Polytechnic Institute in Troy,New York,and a PhD in pharmacology from the State University of New York.
iShares Nasdaq Biotechnology Index Fund(IBB)

Tuesday, March 1, 2011

Making the Case For Change:Toronto Executive Confident in Stock Exchange Merger

Something business leaders have to face from time to time is convincing regulators-typically politicians-to permit their larger plans to go forward.Thomas Kloet,CEO of the TMX Group,parent of the Toronto Stock Exchange,thinks they will get the deal done.The Ontario provincial government,as well as other provinces and the federal government in Ottawa,are scrutinizing the proposed merger of the Toronto and London stock exchanges.
I understand there's a political element to this,Mr.Kloet said.There are gonna be multiple questions.We think we have a very compelling story to tell.It's good for Canadian investors and capital formation.
Ours is a merger of equals,with shared government and management nearly 50/50.You're seeing a consolidation within the space.We see it as a chance to offer low cost services to our clients.We think we'll compete very favorably,with the most listed issues.
I believe we're positioned for further growth with this consolidation.We have an excellent business strategy.This combination accelerates our strategy and increases its possibility for success,Mr.Kloet maintained.
NYSE/Euronext and Deutsche Boerse are also attempting to merge,and the NASDAQ/OMX Group is evaluating its own options.

Tuesday, February 22, 2011

Analyst:NASDAQ Exchange May Be Acquired By Asians

Ed Ditmire,Capital Markets Analyst at Macquarie Group Limited,thinks the NASDAQ/OMX Group,the Times Square-based stock exchange,is characterized by efficiency and lower growth,with an equity emphasis.It is pressured by the forthcoming merger of Deutsche Boerse-NYSE/Euronext,but seems to be more of a target than an acquirer.
A large Asian exchange such as Hong Kong may go after NASDAQ/OMX.After all,Hong Kong uses the NASDAQ trading system.
Mr.Ditmire is very positive on the stock exchange sector.There are better business trends now,with more mergers and acquisitions.It's hard to rule out any deal as having no merit.
NASDAQ/OMX is reportedly considering a range of options to respond to the NYSE deal,from launching a rival bid for NYSE with a partner,to buying another exchange,as well as possibly selling itself.The company fears being marginalised.
Macquarie Group Limited is a full service financial firm with 15,500 employees.It is based in Sydney,Australia and has 300 billion dollars under management.
Macquarie Group Limited(MQG),NASDAQ/OMX Group(NDAQ)

Tuesday, February 15, 2011

Golf on the Gulf:The Omega Dubai Desert Classic 2011

Spaniard Alvaro Quiros overcame two triple bogeys to clinch victory at the Omega Dubai Desert Classic in the United Arab Emirates this past weekend.Quiros eagled the eleventh with a hole in one,giving him the momentum he needed to take home the trophy,an enormous Arabian teapot.He has won a tournament every year since 2007,among them the Qatar Masters in 2009.
Denmark's Anders Hansen and South African James Kingston were tied for second on the leader board.
The stubble-bearded Quiros got 558,376 euros for the win-that's about 755,307 U.S. dollars.Tournament sponsors included Emirates Air,Dubai Aluminium,Omega,CNN,Jumeirah Hotels and Resorts,Gulf News and Mercedes Benz.
The tournament was first held in 1989.Since then,the desert backdrop has been transformed by an impressive massing of skyscrapers in the heat haze.The Emirates GC course,where the tournament is held,has an extensive palm plantation for even more visual appeal.

Saturday, February 12, 2011

Tuesday, February 8, 2011

Egypt Crisis Management:The Business Implications of Uprising

Businessmen with interests in the Middle East have been assessing what the Egypt revolt means to them.Mac McClelland of Center House Limited says we need to watch the Egyptian uprising very carefully,and be cognisant of the power plays.The strong Islamic tilt could affect how the new government takes effect in Egypt.There's a leadership vacuum.
The people were concerned about food,peace,prosperity,security and stability.Businesses are also concerned with that security and stability aspect.Our clients are concerned about protecting their brands and business continuity,Mr.McClelland noted.
Ken Moelis of Moelis&Company,which has an office in Dubai that advises the Dubai government on restructuring debt,observes that the rest of the region is acting as if this is an Egypt-specific event.For now,you're gonna see them stay pretty aggressive.The region is still doing business as usual.
A corporation can't see Egypt as a stock trade.You have to wait for more information,Mr.Moelis explained.

Tuesday, February 1, 2011

Private Equity:A Blackstone View

Europe has been slow,in the estimation of Stephen Schwarzman,CEO of The Blackstone Group,L.P.,but we're starting to see Europeans now liquidating things in a way that wasn't previously the case.What we're seeing is sort of spotty growth in Europe.Overall this year,growth should be about 1.5%.
Europe for us used to be very high-priced.We look at Europe in a position of healing now.The consensus of finance ministers is slow growth,strengthening of the rescue fund,and life will go on.
China prices have gotten very high.There's no shortage of money in China,and there's a lot of optimism.In India,there isn't so much money around.They are actively looking for money,so there are a lot of opportunities we like,such as coal-fired electric plants,Mr.Schwarzman indicated.
What we're seeing in every area of our business is,there's always an unusual opportunity where it isn't very difficult to make a decent return,the financier said last weekend at the World Economic Forum in Davos,Switzerland.Blackstone is gonna be a whole lot more active this year.
The Blackstone Group,L.P.(BX)

Tuesday, January 25, 2011

Global Commodity Crunch Concerning

A global commodity crunch is driving prices up with little relief in sight.Freezes in China,droughts in Russia and Australian floods,coupled with emerging market diets that are tending toward more protein and sugar,are generating costs that lead to civil unrest worldwide.
Citigroup says that corn and soybean prices will remain elevated for the next 6-12 months.U.S. corn and soybean production are down.Algerians are paying up to 30% more for staples.
Abdolreza Abbassian of the UN Food and Agriculture Organisation thinks we are entering a very precarious situation.We do not see any good news coming in from the crop side or the weather angle.In terms of prices,we are already as bad as 2008.Commodity exchange traded funds are also affecting prices as investor demand for shares continues to increase.
We would like rules and regulations and transparency by investors,Mr.Abbassian said.The weather will be the main driver in the months ahead.It is a very unpredictable and often unfavorable weather outlook,the FAO official noted.

Tuesday, January 18, 2011

AIG:Rescuing a Business

We've resolved the debt to the Federal Reserve.The real challenge is making sure we have good performance,said Robert Benmosche(pronounced "Benmoshay"),CEO of American International Group.Treasury's goal is to get as much as it can from the next initial public offering of AIG stock.My focus now is tomorrow.You can't make yesterday better.
How do you make the most money from selling the smallest amount of profits?Among AIG's businesses are SunAmerica Financial Group,U.S. Life,aircraft leasing and Mortgage Guaranty.We're gonna continue to look overseas.
AIG has the most entrepreneurial culture.That capability is not easy for people to underprice.Our turnover is below normal levels;our retention of clients is above normal levels.We have a core of people in leadership positions-they're excited.
We have a succession plan in place.I would love to see this all the way through,to see the last share be sold.The government will probably sell over a year and a half.
Europe is gonna be a tough haul.My sense is,they're gonna work through these problems.I don't see this as a disaster.It's just gonna slow things down a little bit,observed Robert Benmosche,the veteran business leader with a shock of gray hair to prove it.
AIG has repaid four billion dollars to the Federal Reserve Bank of New York,a milestone on its way back to independence from the government following the bailout that rescued it from the financial crisis.Plans for the sale of Treasury's stake in the company are well underway,which will mark AIG's return to normal corporate life.
AIG is a leading property-casualty insurer and financial services provider in more than 130 countries and jurisdictions.Its stock is listed on exchanges in the U.S.,Ireland and Japan.AIG employees are still aggressive achievers and pleased to be part of the recovery plan.
American International Group(AIG)

Saturday, January 15, 2011

Tuesday, January 11, 2011

Molycorp To Help Fill The China Gap

Molycorp Minerals is stepping up to the task of revitalising the U.S. rare earth elements industry as China cuts back on its exports of the strategic materials,which are vital to high tech industry and national security.China has an increasing internal demand for the minerals,which is currently at 60% of its production.
Mark Smith,Molycorp's cordial CEO,says there is an absolutely overwhelming demand for these materials.Rare earth processing,setting up the circuits,is a very time-consuming process.Molycorp will proceed carefully and with good chemical engineering.
At its Mountain Pass,California facility,Molycorp has one of the world's largest and richest rare earth deposits.It will take an additional 100-200 million dollars to double production by 2012.So far,20,000 tons per year have been funded.The additional money would come from certain interested parties.We expect to announce some good news in that regard in the next 3-6 months,Mr.Smith indicated.
The U.S. rare earth industry withered as China became the world's dominant producer of the minerals used in everything from cell phones to wind turbines and miltary hardware,a fact now regretted in the halls of Congress.A bill providing for revitalisation of the rare earth industry died in the last session of Congress, when it was passed by the House,but the Senate failed to take it up.The legislation,which authorised loan guarantees for rare earth projects,may be reintroduced in the new Congress.
Molycorp Minerals(MCP)

Tuesday, January 4, 2011

Guggenheim CIO:European Debt To Play Out In 2011

Scott Minerd,Chief Investment Officer at Guggenheim Partners,notes that every bank in Europe has some exposure to sovereign debt risk or some other European bank.There's a lot of stuff hidden under the carpet here.
There's gonna be some precipitating event,such as an Irish bank run.The Irish government doesn't have the resources to fully pay the deposits off.The European Central Bank has the printing press.
Already,5% of domestic deposits and 20% of foreign deposits have been withdrawn from Irish banks.The ECB will ultimately resort to printing money.I think this a 2011 event.
In the first half of the year,we will begin to see these events play themselves out.We'll be dealing with the ramifications through the second half of 2011.
We're positioning our clients to be long gold and credit protection in France,Germany and Italy.This is also a money-making opportunity,Mr.Minerd believes.
Guggenheim Partners is a global,diversified financial services firm active in money management,advising,investment banking and merchant banking.It operates from offices in the U.S.,Europe and Asia.