Wednesday, May 30, 2012

Testing His Mettle:Deutsche Bank's New Asian Star

If ever there were a time for clarity of thought in European banking,it is today.We are nowhere near a run on the banks,according to Anshu Jain,incoming Co-CEO of Deutsche Bank.The real issue in Europe is about sovereign debt,starting with Greece.We've got capital-lots more;liquidity-lots more;it's gonna be harder under the new regulations.We're really happy with our U.S. franchise.I'm confident we'll hit all capital targets.It's way too early to do a post-mortem on the JP Morgan trading problem.It's very important that we restore the credibility that has been lost.I don't think there are any easy answers.We did let a lot of people down,and now we have to make up for that.At this point,it's organic capital accretion at Deutsche Bank.We are reasonably constructive on many asset classes,but our main concern is our clients,not acquiring assets.Getting it right in our home market and continuing to grow in the emerging markets and the U.S.,in that order,are our priorities at Deutsche Bank,the native of Jaipur,India made clear.Mr.Jain and Juergen Fritschen assume the reins of leadership at Deutsche Bank from Josef Ackermann on Thursday at the annual shareholders' meeting in Frankfurt.At 49,Mr.Jain is one of the most prominent business leaders of Indian origin,having received an economics degree at Dehli University,and an MBA at the University of Massachusetts Amherst.He was head of global corporate and investment banking at Deutsche Bank prior to his new appointment,with considerable success.He will certainly need every talent he has in the difficult climate that prevails in European finance at the present time.Deutsche Bank(DB)

Wednesday, May 23, 2012

Co-CEO:Logistics Business Strong

We've built a multi-billion dollar business in Japan,said Hamid Moghadam,Co-CEO and Chairman of Colorado-based industrial real estate firm Prologis.There is a need for modern large logistics buildings.As the market leader,we continue to be very optimistic about our prospects in Japan.We're promoting our high seismic standards of newer facilities that we build securely.There is increased demand from reconstruction.Even incomplete facilities are 70% leased.China is in the very early innings of building infrastrcture for logistics.I can see our business prospering in China for the next 20-30 years.The market is pretty remarkable.Recovery is probably most advanced in the U.S.There's 10% more people today than at the beginning of the financial crisis.We're growing rents in certain European markets.Latin America is simply on fire,and we cannot keep up with the demands of our customers,Mr.Moghadam observed.Prologis(PLD)

Wednesday, May 16, 2012

Power Woes Continue for Japan

Still ailing from the 2011 earthquake and tsunami,Japan may face rolling blackouts this summer,according to Penn Bowers,Asia-Pac Power Company Analyst at Credit Agricole.The severity of them is the big question.If they are unable to distinguish among big electricity users such as hospitals,there could be a big backlash. Power companies have been eating the costs of the disaster,cutting dividends in the process.Dominant utility TEPCO,the Tokyo Electric Power Company,has been taken over by the Japanese government,which is giving it a one trillion yen bailout to deal with its crippled nuclear plants. If Japan's 50 nuclear power plants don't restart,there will be a lot of pressure on the government to reduce the cost burden of alternative fuels such as gas and oil,Mr.Bowers predicted.TEPCO is actively seeking a permanent solution to its generation shortfall,engaging in talks for a 4.4 billion dollar stake in a Chevron Australia liquified natural gas project called Wheatstone.TEPCO has asked multinational conglomerate Mitsubishi Corporation and shipping company Nippon Yusen KK to participate in the deal,fearful that China will come in with a higher bid for the Wheatstone LNG field stake. Chevron(CVX),iShares MSCI Japan Index Fund(EWJ)

Wednesday, May 9, 2012

Recovery Today:A Trust Company Assessment

The unemployment rate went down slightly in April,but it doesn't include part-timers and the frustrated who have dropped out of the jobs search,points out Komal Sri-Kumar,Chief Global Strategist at TCW.The male participation rate was the lowest since 1948.The pain should be measured by the participation rate.Regardless of whether the job market is normally a lagging indicator,in this recovery it has become a leading indicator.The stock market cannot recover without jobs. The question is,do you want to right the market for a short period of time,or do you want to support it for 3-5 years with jobs?That is at the top of my list.In the short term,I look for U.S. Treasury yields to go down if there is more trouble in Europe or the U.S.In the first half of 2013,you will see more meaningful measures on jobs after the election,Mr.Sri-Kumar projected. TCW,the Trust Company of the West,was founded in Los Angeles in 1971.It serves institutional and high net worth individuals with a broad array of U.S. equity,U.S. fixed income,alternative and international strategies in accordance with its core values of fundamental research,remaining true to its investment styles and superior customer service.

Wednesday, May 2, 2012

Executive Chairman:The Unreflected Risks

Three to four weeks ago,it just seemed to me the macro environment seemed to be stabilising,but now it seems a series of old and big question marks have returned,said Roger Altman,co-founder and Executive Chairman of Evercore Partners.These are 1.Europe;2.a weak U.S. recovery;and 3.the fiscal cliff in the U.S.Perception in so many cases is reality.Today the perception is,the Euro crisis is again front and center,with the political tumult in France and the Netherlands,and the PMI out this morning.The crisis is boiling up again.At the same time,the U.S. GDP continues to be profoundly weak.There are two exogenous factors that could be destabilising:1.Iran;and outright implosion in Europe.Neither one is playing through the markets right now,but they are big risks,Mr.Altman believes. Mr.Altman was an Assistant Secretary of the Treasury from 1977-81 and Deputy Secretary from 1993-95.He has an MBA from the University of Chicago,and serves as a trustee of New York-Presbyterian Hospital and Vice-Chairman of the Board of the American Museum of Natural History. Evercore Partners is a global independent investment banking advisory and wealth management firm. Evercore Partners(EVR)