Chinese miss out on two of life’s greatest pleasures

One is enjoying diary products like fresh milk, butter and cheese because of lactose intolerance:

Approximately 65 percent of the human population has a reduced ability to digest lactose after infancy. Lactose intolerance in adulthood is most prevalent in people of East Asian descent, affecting more than 90 percent of adults in some of these communities.

Lactose intolerance – Genetics Home Reference – NIH

https://ghr.nlm.nih.gov/condition/lactose-intolerance

The other is not being able to enjoy booze by having a combination of genes that puts us off drinking alcohol. It causes an unpleasant reaction and makes them feel unwell.

Further to Fake news on alcohol and stroke, if you did not read the BBC article I referenced there, you’d have missed something the bit about alcohol intolerance:

East Asian countries are useful places to study the effects of alcohol.

Many people with Chinese ancestry have a combination of genes that puts them off drinking alcohol. It causes an unpleasant reaction and makes them feel unwell.

As a result, there is a wide variation of alcohol intake in China – one in three men doesn’t drink and very few women do.

But by comparing the health outcomes of drinkers and non-drinkers according to their genetic profile, scientists say they have been able to assess – with much more certainty than before – the direct effects of alcohol on stroke risk, distinct from any other factors.

Western populations don’t possess these genes, so it would be impossible to carry out a similar study here.

And most studies are observational, which makes it’s difficult to judge which factor is causing what effect.

Dr Iona Millwood, study author and senior epidemiologist at the University of Oxford, said: “Our genetic analyses have helped us understand the cause and effect relationships.”

https://www.bbc.com/news/health-47817650

No wonder, we Chinese compensate for these defects by eating sea slugs, chicken claws, sharks’ fin and other exotics.

 

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HSBC: another view

Further to HSBC: Looking vulnerable, the view from an institutional broker, here’s another view from the Investors Chronicle, a respected retail investor magazine.

It says “Buy: HSBC”

HSBC’s progress is encouraging. That bodes well for the maintenance of its dividend, which was last cut in 2009.

showing the retail emphasis on sustainable dividend. (Think: Hyflux is warning of investing in high dividend yield stocks.)

It says HSBC’s Asia pivot makes it a natural victim of US-China trade rows. Chairman Mark Tucker blamed market weakness during the fourth quarter for lower-than-expected revenue for 2018: must have financed large share purchases on margin.

Combined with a 6 per cent rise in adjusted operating expenses as the lender seeks to expand across the northern China and Pearl Delta areas, this resulted in negative adjusted “jaws” – the difference between the rates of change in revenue and costs — of 1.2 per cent.

In its global banking and markets business, economic uncertainty and reduced primary issuance led to lower adjusted rates and credit revenue. But this was partially offset by stronger demand for securities services and global cash management liquidity.

Retail banking and wealth management were much stronger, posting an 8 per cent rise in net operating income. That business benefited from a 9 per cent rise in lending and improved deposit margins due to rising interest rates.

But mortgage lending grew in the UK and Hong Kong, although margins shrank.

Higher lending and adverse foreign exchange movements across business lines also resulted in an increase in adjusted risk-weighted assets, which reduced the common equity tier one ratio to 14 per cent from 14.5 per cent in the prior year. However, the return on tangible equity improved by 1.8 percentage points to 8.6 per cent, with management reiterating its target to grow that figure to over 11 per cent by 2020.

Expected credit losses were slightly higher than loan impairment charges in 2017: blame Brexit and trade rows. Credit quality in the UK will get worse.

Analysts at Shore Capital expect adjusted net tangible assets of 732 cents (US) a share at the December 2019 year-end, up from 701 cents at the same time in the previous year.

HSBC: Looking vulnerable

Because investors are likely to be disappointed: slower revenue growth, no share-buy back and dividend yield could go up (share price falls).

JPMorgan Cazenove, a leading UK broker, downgraded HSBC to “underweight” from “neutral” with a 620p target on the back of the bank’s full-year results on Tuesday. Among the broker’s concerns was a rise in funding costs as Hibor — a measure of lending costs between banks in Hong Kong — underperforms Libor, the equivalent UK rate.

Although we rate HSBC’s management highly and view the group on the right strategic path long term, we believe that revenue growth pressures (partly as a result of the changed outlook for US rate hikes, a widening Libor-Hibor gap and macro uncertainty) alongside cost investment needs could weigh on the [return on tangible equity] outlook for longer than we previously thought.”

With HSBC unlikely to deliver an 11% on tangible equity by 2020, its premium valuation of 1.2 times book value looked exposed, JPMorgan said. It added that while HSBC no longer had a capital surplus, but investors continued to expect a share buyback this year.

The dividend of 51 cents (US) should remain stable over the medium term but the yield of 6% (in line with other UK banks) might move higher (i.e. because share price falls) because of the the uncertainties faced,

HO Ho Ho: What Temasek forgot when it bot into StanChart

There’s an FT report that Temasek is putting pressure on StanChart to shape up. It’s tired of being reminded that under the current CEO, the share price has fallen 40%. Worse, share price is roughly at half of Temasek’s entry point 13 years ago.

 

Temasek forgot when it bot into  StanChart that StanChart did not and still does not have have a major, thriving, prosperous market that it dominates.

Although it’s smaller than the supertanker of HSBC, it doesn’t have the engine of Hong Kong that HSBC does, so it’s taking every bit as long, if not longer, to reform. But we’re still very supportive.

(Hugh Young, head of Asia Pacific at Aberdeen Standard Investments, which holds a stake of about 5 per cent in the bank talking to the FT)

It also does not a client like the Lis.

The story of how two Chinese gentlemen made Hongkong Bank great is told in HSBC, Superman and another Cina superhero.

 

Hongkies can’t spell/ 2018 was not a gd yr for Cathay

2018 was a bad year for Cathay, and not only financially.

https://www.bbc.com/news/world-asia-45572275

Dr Goh’s HK counterpart had similar views on MRT and other major issues

Remember Khaw saying this?

It was a very different era. Finance was tight, so we really had to scrutinise every dollar of spending.

The government of the day thought very hard if we could really afford an MRT line. It took months to think through and debate through this major strategic decision.

It was not easy. Some of you who are younger might not remember.

But I remember, as a civil servant, the big debate which was televised on the options – an all-bus system or an MRT system.

There were proponents for the MRT, as a city without MRT is almost impossible. But there were others who were extremely worried whether we can really afford it.

So sometimes today we spend money as if money comes easily. We forget that it was not too long ago. So when there are people who criticise the North-South and East-West Lines on why we did not do this and that, we were simply short of cash.

http://www.todayonline.com/singapore/comparing-singapores-newest-and-oldest-mrt-lines

He left out the elephant in the room: Dr Goh Keng Swee. He wasn’t convinced that an MRT would be cost effective. Hence the scrutiny the project underwent, even after the cabinet (sans Goh) had agreed to build it.

A contemporary of his, Sir John Cowperthwaite, HK’s financial secretary (17 April 1961 – 30 June 1971) had earlier opposed the building of the MRT system in HK, citing the cost: despite the traffic jams in the streets. Construction only began after he retired.

Here’s more on Sir John Cowperthwaite, who came to HK as a British civil servant in 1945. He should be interesting to S’poreans because he had views, some like that of Dr Goh, some unlike, on how to have a prosperous, thriving economy in a small state.

Like Dr Goh, he was for

Low taxes, lax employment laws, absence of government debt, and free trade are all pillars of the Hong Kong experience of economic development.

And

No deficit government financing, which could merely push costs to a future generation and make the territory vulnerable to financial upheaval.

[…]

Public housing would be funded, but only for tiny flats; reservoirs would be built, but users would be charged.

[…]

Requests by industry for subsidies were routinely rejected.

Architect of Prosperity: Sir John Cowperthwaite and the Making of Hong Kong

https://www.economist.com/news/books-and-arts/21729983-sir-john-cowperthwaite-most-unlikely-things-bureaucrat-hero

Sounds like a PAPpy?

But throughout the 1960s, Cowperthwaite refused to implement free universal primary education, contributing to the relatively high illiteracy rate among today’s older generation in HK.

And he really believed in the importance of the private sector, unlike the PAP (not excluding Dr Goh) who talked the talk of the importance but the private sector,  but who made sure GLCs dominate the local economy.

“I myself tend to mistrust the judgment of anyone not involved in the actual process of risk-taking.” This faith was rewarded. As industries such as cotton spinning, enamelware and wigs declined and Cowperthwaite declined to offer assistance, businesses shifted their attention to promising areas such as toy and electronics production, and then finance. Migrants found work in the expanding industries, becoming a cog in a productive engine rather than merely a cost.

(Economist review)

But he allowed private sector cartels to continue to dominate the HK economy. In his time, it was the Hongs (Jardines, Swire and other ang moh Hongs) and the big banks (HSBC and StanChart).  A tradition continued today with local property cos controlling the property mkt (no massive affordable public housing), and Cheung Kong, Jardines and Swire having a big share of the retail mkt, and HSBC and Bank of China dominating the finance sector.

 

 

Creating shareholder value the HK way

Real dedication by CEO and founder: he died.

CEC International Holdings, the owner of a successful Hong Kong retail chain focused on snacks and drinks imported from across Asia, saw its share price more than double in value on Monday following the death of its founder and chief executive.

(FT on Tueday)

Why?

The jump also came after the chair of retailer Best Mart 360 told local newspaper Apple Daily he was interested in acquiring CEC for less than HK$1bn. Monday’s jump took CEC’s market capitalisation to HK$1.27bn.

(FT on Tueday)

At time of writing shares are 10% off Monday’s close.

HoHoHo: StanChart disappoints, again

On Tuesday (London time), StanChart reported half-year operating income of US$7.6bn, 6% more than in the same period last year. The stock dropped 3.5% trading because operating income was below expectations. Blame higher IT spending: costs in general have outgrown revenues by a whole percentage point. Not good.

FT’s Lex

StanChart investors must be counting on costs soon falling, relative to revenues. The hope should be for a leaner and cleaner bank ready to grow at the bottom of the next cycle.

adding

Shares in HSBC, another London-listed bank with an Asian focus, have climbed 63 per cent in the past two years, compared to 13 per cent at StanChart.

 

 

S’poreans and mainlanders are the real Chinese

Honkies and Taiwanese are not,

We and mainlanders don’t believe in renting short term (99 yr leases are not short term rental leases no matter what Goh Meng Seng and other cybernuts think)

Hongkies love PAP govt, diss their govt

TOC, The Indians and other cybernut pubkications don’t report: “Hongkongers admire Singapore more than own city”

In a University of Hong Kong Public Opinion Programme poll asking 502 Hongkongers how they feel about different governments, the Lion City came out on top in a list of 14 places.

In contrast, Hong Kong was ranked 11th and Canada slipped to 2nd, from 1st in August last year. The US was at the bottom of the list of places that included regions in Greater China and other countries

https://www.scmp.com/news/hong-kong/community/article/2156855/hong-kongs-love-affair-singapore-continues-residents-give

Note that the piece not written by any of the ex-ST constructive, nation-building journalists in the SCMP newsroom. They now rather bite the hand that once fed them well. Once a Judas, always a Judas.

Anyway grass ia always greener on the other side. Juz ask Goh Meng Seng who even thinks that the cost of housing is lower in HK. Can you believe that? But then he’s a cybernut who helped the PAP’s preferred candidate win in 2011 PE. With enemies like him, how can the PAP ever lose?

 

HoHoHo: More money for Budget

Soon, Temasek will be contributing a bit more to the Budget.

“StanChart restarts dividends as profit returns” is the FT’s headline on the turnaround in StanChart. It stopped paying dividends several years ago.

And there’s still plenty of room for it to improve

[D]espite stellar economic growth in Asia, which accounts for over two-thirds of underlying pre-tax profit, the group is still destroying economic value. Return on equity, at 1.7 percent or 3.5 percent excluding exceptional items, is still far below the group’s cost of equity, which is probably more like 10 percent. Costs are rising, even as the group clamps down on loan losses.

After years of retrenchment, Winters needs turbocharged revenue growth and restraint on costs to hit his modest medium-term target for an ROE of 8 percent. Suppose operating costs grow just 2 percent annually, with flat loan losses and restructuring charges and taxes at 30 percent. StanChart would need 7 percent annual revenue growth to fulfil its aim by 2020, according to a Breakingviews calculation. That is more than double last year’s rate and at the top of the bank’s projected 5 to 7 percent range.

https://www.breakingviews.com/considered-view/stanchart-shareholders-pay-winters-a-compliment/

If things work out at StanChart (and elsewhere), maybe GST increase can be delayed? Dream on, pigs will fly first.

Update at 7.30am Chris K responded:

News like this does not impact the NIR Temasek delivers the budget becos the contribution is based on expected real returns over the long run.

I responded:

So long as no transparency shows how flakely is NIR. It’s want the PAP administration says it is.

FT description of Hongkies

Hong Kong has long had a lively retail investor scheme. Hong Kongers do not care much for games of chance, like roulette or lotteries. They prefer wagers on games of skill like horseracing, mahjong – and leveraged equity trading. Warrants are a preferred vehicle. But the uncomfortable reality is that spikes in warrant trading volume are an excellent sell signal. An increase in retail trading activity often presages a market fall.

FT: Letter from Lex

Why our housing valuations look decent?

I was fooling around with this https://www.economist.com/blogs/graphicdetail/2018/02/daily-chart-5 and among other things compared S’pore property valuations with that of HK. Something didn’t seem right about the S’pore valuations when I remembered some Bloomberg stuff I saw in 2016.

This is something cybernuts don’t tell us, especially the one who jets in from HK on his private jet to lecture us on why life in HK is a lot better in HK and why we must all sing “The East is Red” and even the Malays and Indians must be Chinese patriots.

 

 

 

 

 

 

 

Because of public housing, housing here is a lot more affordable.

 

http://www.bloomberg.com/news/articles/2016-10-06/singapore-crushing-hong-kong-in-race-to-bring-down-home-prices

Now if the PAP administration were a lot less obssesed about “stealing from the reserves” and “market pricing” (Market pricing? Market market pricing when the state is the largest player in the market what with its control of supply?), housing here could be a lot more affordable.

Coming back to local property prices, if u had keyed in S’pore in the Economist’s interactive model, like I did, you would have seen that valuations (historical and present) here are pretty decent. I suspect public housing data is included. Even if this is not, the public sector housing affects the private sector valuations.

 

 

HO HO HO: How Shi**y is StanChart?

In 2016, when China as a country grew at close to 7 per cent, StanChart’s revenue across greater China and north Asia declined by 15 per cent. While Southeast Asia GDP grew by nearly 5 per cent, StanChart’s revenue there shrank by 5 per cent. And in Africa and the Middle-East, another fast-growing region, the bank’s revenue was down 4 per cent. StanChart’s full-year numbers for 2017 have yet to be published, but at the last count its ROE was running at about 5 per cent …

Today’s FT

Job mkt for NTU maths grads

But first contrasting HK and S’pore in one sentence:

Tycoons are as synonymous with the story of modern Hong Kong as founding prime minister Lee Kuan Yew is with Singapore.

FT

But thinking about it, both share a common preoblem resulting from this contrast.

The article then goes on to analyse why young Hongkies are unhappy with the legacy of these tycoons. They dominate the HK economy, stifying the aspirations and creativity of the young. Even a tycoon’s heir can feel so frustrated that he has to enter the family business, in order to get on.

Sounds like the legacy that Harry left us. Because of Hard Truths, TLCs and other GLCs dominate our economy, stifling the aspirations and creativity of the young.

And the job market ain’t that good even for elite local grads.

Recently I spoke to a friend whose daughter, an NTU maths scholar, is just about to join a big local bank’s data mining development team on a one year internship (very decent pay). So far so good.

But the catch is that out of the previous cohort of NTU maths grads who finished their internships, only 3 out of 10 manage to get permanent jobs, some continuing on a yr to yr contract. They are told it’s the economy.

Meanwhile LKY’s son rows with his siblings and fixed the presidency so that a presidency reserved only for Malays, has none of the three declared candidates having an i/c saying “Malay”. As I wrote here:

The PAP’s candidate and a candidate who speaks Malay badly both have i/cs saying “Indian” while the third person has one saying “Pakistani”. Even for me who knows about the thin culture line between Malays and some Indian Muslims* am shocked that there isn’t someone with an i/c saying “Malay” willing to stand. Don’t want to be regarded as selling out to the PAP isit? Or unlike “Indians” and “Pakistanis” feeling piseh to stand in a presidency reserved only for “Malays”.

Go to tech city: No masterplans or highly paid technocrats

It juz has smart entrepreneurs that want to make money.

A few days later than promised because the temptation to pour scorn on Hali’s BS was too great. I had promised to talk about a place that even Silicon Valley envied; a place that grew without master plans drawn up by highly paid “technocrats”.

The “predominant epicenter of high-tech design and manufacturing in the world” is Shenzhen http://www.bbc.com/capital/gallery/20170809-inside-chinas-skyscraper-capital Shenzhen shows how a high-tech hub can develop without master plans or MNCs . It was a low-cost manufacturing centre for HK businesses that juz kept on moving up market without master plans being drawn up by bureaucrats. Granted its economic zone status was granted by fiat but then HK and S’pore were similarly kick started.

Shenzhen has risen to become the predominant epicenter of high-tech design and manufacturing in the world. Variously called the “world’s factory,” “the new Silicon Valley,” and the “maker’s dream city,” Shenzhen has a complete ecosystem that contains everything needed for all stages of electronics production all in one place. This has turned the city into a staging ground for large high-tech companies, rising startups, and independent innovators from all over the world looking to get their stuff made as efficiently as possible. Tech giants like Huawei, ZTE , and Tencent all got their starts here, and many more companies seem to be on the way up.

https://www.forbes.com/sites/wadeshepard/2016/07/14/a-look-inside-shenzhens-high-tech-empire/

And Shenzhen’s growth has benefited HK which despite its political problems outperforms S’pore. Once Shenzhen provided HK manufacturers with low-cost facilities, now Shenzhen’s manufacturers use HK to provide services like finance, insurance etc.

 

Finally HSBC pleasantly surprises

Just before the CEO retires. As Guardian says:

HSBC’s tale also shows what can happen when a big international bank stops shooting itself in the foot and avoids scandal. The cleanup of HSBC – forced by past scandals, notably the £1.2bn fine in the US for money-laundering offences plus tax avoidance scams in Switzerland – is finally delivering for shareholders.

https://www.theguardian.com/business/nils-pratley-on-finance/2017/jul/31/hsbc-shows-what-happens-when-a-bank-stops-shooting-itself-in-the-foot

And from NYT Dealbook

HSBC plans to buy back up to $2 billion in shares after its performance proved better than expected in the second quarter.

The London-based bank has been overhauling its operations, shedding tens of thousands of jobs, selling underperforming businesses and shrinking its global investment banking business. And as its prospects have improved, it has announced $5.5 billion in share repurchases since the second half of last year.

Profit was up to $3.9 billion in the second quarter, from $2.5 billion the year before.

The bank is also headed toward a change of leadership. Mark Tucker, the chief executive of AIA, will replace Douglas Flint as chairman in October. Mr. Tucker will have to find a chief executive to replace Stuart Gulliver, the chief executive, who plans to retire.

Waz this BS about China’s influence growing?

Uncle Redbean, Goh Meng Seng (Remember this adviser of wannabe-president TKL?) and other China tua kee nuts keep dissing the PAP administration for not kow-towing to Xi. They say S’pore should lick China’s ass because China is the coming hegemon. After all PM’s dad licked US’s ass and more.

To put things in perspective: if Hongkies are not happy with China, what does this show about China’s influence in the wider world? It can’t even influence opinion in HK to like it.

Hong Kong finds Beijing flunking soft-power test

China is flunking the soft-power test with Hong Kong. President Xi Jinping will visit the city to commemorate the 20-year anniversary of its triumphant return to Chinese control. But Beijing’s grip over hearts and minds in Hong Kong is weakening. That is a problem, since this a primarily ethnically Chinese, ruthlessly pragmatic city – people who one would expect to be sympathetic.

…

In Hong Kong, China has revealed an unfortunate pattern duplicated in other countries: a preference for working with elites, popular or not; a willingness to use money – or force – to silence criticism; disregard for the rule of law when it doesn’t suit current needs; and a general disdain for the carrot when the stick will do.

The irony is that Beijing is spending as never before on “soft power,” a phrase best simplified as “convincing other people to like you, and to want what you want.” It is rolling state television stations out across Africa, buying newspapers in Australia and radio stations in the United States. The Confucius Institutes, an unapologetic propaganda effort, subsidize pro-China education around the world.

But this hasn’t drowned out headlines from Hong Kong. For all the spending, Pew Global Research polls show negative views of China have increased in recent years. Beijing can throw money around all it wants, but if even Hong Kong won’t buy the message China is selling, it is hard to see it travelling well elsewhere.

http://www.reuters.com/article/us-hongkong-politics-breakingviews-idUSKBN19J0C3

Charts that show Hongkies are getting, feeling “less Chinese”. http://fingfx.thomsonreuters.com/gfx/rngs/HONGKONG-POLL/010020KY1EB/index.html

No point listing in HK

KPM Holdings, a Singapore sign-maker, closed down 44% yesterday as microchips had a second day of falls.

List here and falls also the same leh.

LKY talked cock on UBS/ Ang mohs that really invest for long term

GIC’s sale of at a loss of part of its stake in UBS reminded me that one Harry Lee boasted that S’pore was even more long term than Buffett: it had a 30 yr horizon. Well he said that in 2007 or 2008 after GIC bot UBS and Citi and Temask bot Barclays (sold) amd Merrill Lynch (disappeared), so it turns out he was talking cock: like on being a good friend of China? He was a running dog of the US going by the quality of the US crowd versus that of the PRC crowd at his funeral.

Now this is serious long term

— Jardines (controlling shareholder of Hongkong Land where the land in Central now resides) first bought freehold land in Central in 1901, and

— HSBC has owned its nearby site since 1866.

And that’s nothing. The Duke of Westminster has properties in central London dating from the 17th century.

HK, S’pore compared

Despite what a S’porean Oppo politician living in HK says, life here is surely better (The quotes about HK and Hongkies come from http://www.bbc.com/news/world-asia-china-38623439)

Hong Kongers enjoy free speech and a free press, but don’t have the right to democratic elections – meaning they can readily discuss what makes them unhappy, but have limited political means to change things.

We happier because we don’t enjoy free speech and a free press and so not frus (sans cybernuts like Oxygen) that our free but unfair elections can never change things. So why does Mad Dog Chee keep on banging his head against the wall? He doesn’t read his own analysis of S’pore isit? And what weed is he giving to smart people like Dr Paul to follow him? Police must investigate.

Hong Kong often ranks as having the least affordable housing in the world – and this “affects young people’s family planning, and their choice of future careers,” Dr Wong says.

Our public housing is affordable We got PAP looking after us from cradle to grave via the HDB system. More on this one of these days. Even TOC (writer Chris Kuan contributing) says “The reply by Housing Development Board (HDB) on resale prices and Lease Buyback Scheme (LBS) sums don’t seem to add up to resale buyers overpaying.” https://www.theonlinecitizen.com/2017/04/28/hdb-reply-on-resale-prices-and-hdb-lbs-example-show-resale-buyer-are-not-overpaying/

The LBS is value fot money, is what Chris K wrote. Err wondering if Terry knew what he was publishing: a pro PAP piece?

Jennifer grew up in a public estate with her parents and brother – but says after her brother got married, the small two-bedroom flat became extremely cramped.

“For almost a year, I had to sleep on a sofa in the living room.”

Not having a room meant she struggled to sleep properly after a long day at work, especially after her brother and his wife had their first baby.

We got more room for sex.

According to one study, Hong Kong’s young people are the unhappiest they have been in a decade – and the least likely, of all age groups, to agree with the statement “life is really worth living”.

Other surveys find that 60% of those aged 18-29 want to emigrate, and 80% are unhappy with the political situation.

If Hong Kong’s youth appear particularly unhappy, it might be because of the territory’s unusual situation. It’s technically one of the richest territories in Asia, but also has one of the worst wealth gaps.

We not that bad.

As my FB avatar pointed out to Chris Kuan when I read his LBS piece,

Glad to see u realise that the faith of the 70% in PAP is not misplaced. LOL. Seriously, bet u a lot of the cybernuts following u on FB will stop following u …

Btw, anyone knows what happened to that Oppo politician living in HK who used to tell us that everything in HK is a lot better than in S’pore. He gone AWOL? Or MIA? Or in detention in China?

DBS HK info leak affects clients here too

A DBS customer here I know says that he had getting overseas calls asking him to take out loans from DBS. He was surprised to get the calls and when he asked how he got on the call list, the line went dead, only for another call to come later.

Telemarketers contacted DBS clients to try to get them to borrow from the bank, with the employees and the call center splitting commissions, Apple Daily reported, without citing a source for its information. Some employees were sales staff who were authorized to sell loan products in branches or on the street but not by cold calling, it said.

Some DBS staff allegedly bribed department managers to get client data, including names and contact details, Apple Daily reported.

More from https://www.bloomberg.com/news/articles/2016-12-09/hkma-expresses-concern-after-report-of-dbs-arrests-in-hong-kong

The Hong Kong Monetary Authority expressed concern after a newspaper said DBS Group Holdings Ltd. staff were arrested in a probe connected with an alleged leak of customer data.

The city’s Independent Commission Against Corruption began investigating after the data were supplied to a telemarketing center in mainland China, Apple Daily reported.

The Singapore-based DBS disputed the newspaper’s report that more than 20 current and former staff had been arrested, but wouldn’t specify a number.

 

 

 

Gd Cantonese description of our parliament?

‘Rubbish Council’

The word rubbish also sounds like legislative in Cantonese so obviously….

In HK, the Legislative Council (LegCo) is the body that passes and rejects laws, and approves the government’s budget. It’s HK’s parliament.

Some call it “Rubbish Council” (punning on how the words “legislative” and “rubbish” sound similar in Cantonese), arguing the legislators are all talk and no action. BBC Online

Like in S’pore, major constitutional changes, including changes to the voting system, need to be passed by a two-thirds majority in the council (parly here). Pro-Beijing parties always win more seats but the “democrat” lobby always have at least 24 seats so they can veto changes they disagree with. And they’ve used this power repeatedly

In the latest LegCo elections on Sunday, the “democrat” lobby retained its veto power. They now have 30 seats.

Here the PAP can suka suka change the constitution because it has more than two-thirds majority, courtesy of 60- 70% of the voters.

Even if LegCo is Rubbish Council, the “democrat” lobby has a veto on constitutional changes.

Funny Goh Meng Seng and Uncle Redbean don’t praise the Hongkies for being smart enough to ensure that the pro-Beijing parties and China can be thwarted.

FYI, going in for cataract surgery on the right eye later today. After the final post op check-up (left eye) on Monday was offered an op on Tuesday on the right.

Why HSBC owed UK one cont’d

As I reported earlier many shareholders were disappointed that HSBC decide to remain HQed in the UK, and not retuen to HK.

Then it emerged that in 2012 Mr Osborne, the then UK Chancellorm interceded in the US Justice Department’s investigation into HSBC over money laundered through its American branches by Mexican drug lords. The DoJ was considering bringing charges on top of the fines it imposed on the bank, Britain’s biggest, but Mr Osborne argued that this would destabilise a “systemically important financial institution” and lead to “contagion”.

Now NYT Dealbook tells us more about how this intervention affected the DoJ’s decision to go easy on the maeco-bank

A BANK TOO BIG TO JAIL If you’ve ever wondered why the 2008 financial crisis generated almost no criminal prosecutions of large banks and their top executives, you should read the congressional report, “Too Big to Jail,” Gretchen Morgenson writes in Fair Game.

The report examines the Justice Department’s settlement with HSBC in 2012 after accusations that it laundered nearly $900 million for drug traffickers and processed transactions on behalf of countries subject to United States sanctions. It shows how regulators and prosecutors turned a potential criminal prosecution of HSBC into a watered-down settlement that insulated its executives and failed to take into account the full scope of the bank’s violations.

The bank and its American Subsidiary, HSBC Bank USA, agreed to pay almost $2 billion under the settlement, striking a deferred prosecution arrangement that remains in place. Under such deals, the government agrees to delay or forgo prosecution of a company if it promises to change its behavior.

The report concluded that the Justice Department’s leadership overruled an internal recommendation to prosecute HSBC, citing concerns “that prosecuting the bank ‘could result in a global financial disaster.'”

Peter Carr, a spokesman for the Justice Department, said it was “committed to aggressively investigating allegations of wrongdoing at financial institutions, and, along with our law enforcement partners, holding individuals and corporations responsible for their conduct.”

The facts outlined by prosecutors were damning enough to raise questions about why the bank had not been subject to harsher treatment and fueled the view that large financial institutions are not only too big to fail, but also too significant to be prosecuted criminally.

“The fact that so many of these cases are settled rather than going to court means we don’t get an airing of facts and challenges of facts,” said Edward J. Kane, a professor of finance at Boston College and an authority on regulatory failures. The report should be viewed as “evidence of an abuse of the regulatory system,” he added. “And unless proven otherwise, this is just the tip of the iceberg.”

S’pore, Asean on risky list

Indonesia and PinoyLand head the list, HK is a pretty safe place.

CrossBorder Capital said its Emerging Markets Risk Index fell sharply in May and is now at its lowest level since 2012, having peaked in early 2015.

This measure is based on three components: financing risk, which measures the ability of EM entities to roll over their debt; forex risk, driven by the quality of liquidity in a country and how dependent it is on central bank money; and exposure risk, which flashes a warning sign if a high proportion of investment in a country is in risk assets such as equities and corporate debt, rather than lower-risk government bonds and cash.

FT

2047 financial problem in HK

From NYT Deal book

Expiration Date on China’s Promises Stokes Unease in Hong Kong Housing Most banks have yet to formulate mortgage policies beyond 2047, when an agreement guaranteeing the city a high degree of autonomy runs out.

• NYT »

I’m sure Uncle Redbean and Goh Meng Seng will scold the banks foer being afraid. They look forward to the day when Chinese “rule of law” prevails in HK.

 

How come HK got minimum wages but more competitive?

Don’t PAP ministers insist that minimum wages will destroy the S’pore economy?

These tots crossed my mind when I read the headline:

Singapore Loses to Hong Kong in Race for Most Competitive

http://www.bloomberg.com/news/articles/2016-06-09/singapore-loses-to-hong-kong-in-race-for-most-competitive

But after reading the report, more nuanced tots came to mind.

One tot: S’poreans want to restrict the flow of FTs but this it seems makes S’pore less competitive.

Singapore’s stricter rules on hiring foreign labor, which adds to business costs.

“The key difference between the two territories is Singapore’s restrictions on importing foreign labor, and their policy of boosting labor costs to discourage companies from being dependent on foreign labor,” said Brian Tan, an economist at Nomura in Singapore. “When you push labor costs, that’s going to have an effect on competitiveness.”

… Hong Kong’s labor market as more competitive than in Singapore, with the China-controlled territory improving from 2015 on scores such as working hours, skill levels, unemployment legislation and immigration levels.

Hong Kong also leads Singapore on business efficiency, including productivity and here PAP administration can’t blame the plebs management practices, according to IMD.

Next, there seems to be a disconnect between what the local PMETs (and even this retiree) feel and the “experts” say: FT policy to us is not restrictive what with FTs being allowed to become drivers and barbers.

Another tot:“It’s not just the economy, stupid,” says a poster by the Brexit campaign in the UK.  And one of its charismatic leaders surely is right when he says, “We need to value people’s quality of life and standards of living and not just national GDP figures.” (But Brexit would say these rhings. The conventional economic wisdom is that the UK is doomed economically if it leaves the EU.)

Coming back to HK’s liberal FT policies: HK is Goh Meng Seng’s paradise on earth. Funny he doesn’t laud HK’s liberal immigration policies. He’s got his family there but thinks he is entitled to lecture us on the failings of the PAP. Surely the PAP in doing the popular thing (restricting FTs) is doing the wrong thing, and HK , GMS’s paradise on earth, the right thing?

Juz remember for S’poreans now:“It’s not just the economy, stupid. and”“We need to value people’s quality of life and standards of living and not just national GDP figures.”

 

HK gives finger to Soros

NYT Dealbook

Stocks have been surging since February, helped by promising corporate earnings in the United States, the recovery of oil prices and indications of restraint on interest rate increases from the Federal Reserve.

There may be question marks over many parts of Hong Kong’s economy, but stocks there seemed to have shrugged all that off. The Hang Seng index rose 1.8 percent on Thursday, while the MSCI Hong Kong Index closed at its highest point since Nov. 24. Optimists say concerns over monetary tightening from the Federal Reserve and the weakening renminbi have eased, and the shares are too cheap to pass up, Bloomberg News reports.

But George Soros is warning markets that China’s financial system is at risk and the rise in credit will be the downfall for world’s second biggest economy.

Speaking at an Asia Society event in New York on Wednesday, Soros said the similarities between the credit markets in China “eerily resemble” to those of the United States in 2007 before the financial crisis.

Recent stimulus packages in China have seen sharp rises in asset prices – namely in the housing and construction sector, but Soros believes these have been fueled by excessive lending to underperforming industries.

“Most of the money that banks are supplying [in China] is needed to keep bad debts and loss-making enterprises alive,” Soros said.

Read more: George Soros Worried about China’s Financial System | Investopedia http://www.investopedia.com/articles/investing/042116/george-soros-worried-about-chinas-financial-system.asp#ixzz46i1T5WmU
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HSBC: End in sight

HSBC Chief Said to Leave in Two Years Stuart Gulliver, HSBC’s chief executive, will step down in two years, and the bank has already started compiling a list of possible internal successors, The Sunday Times reports, citing senior sources.

• THE SUNDAY TIMES

NYT Dealbook

Naving him as CEO since 3011 is like us kanna Mah Bow Tan and Raymond Lim and Taacob at the same time.

Here’s an interesting tot from FT reader on executive salaries

“Chief executives are agents for owners, the shareholders. They should be treated the same way as football club managers. Your team performs badlly and you are promptly sacked. Preferably they should have only one or two year’s contracts, to be ended on expiry without compensation.”
By Brian Reading on Four ways to bring galactic executive pay back down to earth

 

HK$, M$ do well against US$

HSBC: Cut ang moh, Indian layabouts

People and assets.

HSBC’s so-so results prompts th=hs analysis. Results fr 2015 were flat after an expected US$1,9bn  4Q pre-tax profit turned into a loss of US$858m.

As at August 2015, Asia accounted for 69% of HSBC’spre-tax profits. And HK, China is where the money is minted.

Well these show that ang mohs and Indians: people and assets are lazing in the sun.

 

Yes India is in Asia but look at the number of Indians employed, more than the Honkies. HK is the place that HSBC makes its money, not india but there are more Indians working for HSBC than Hongkong people.

Related post: StanChart’s very own Little India.

Update at 10.45 am: http://blogs.reuters.com/breakingviews/2016/02/22/hsbc-shares-weighed-down-by-fear-of-future/

Update at 4.30pm; From NYT Dealbook: HSBC’S FOURTH-QUARTER LOSSES HSBC, Britain’s largest bank by assets, posted a loss of $1.33 billion for the three months ending Dec. 31,Chad Bray reports in DealBook. It had posted a profit of $511 million in the fourth quarter of 2014. Before taxes, the bank posted a loss of $858 million.

The bank also revealed in its earnings statement that it was under investigation by the Securities and Exchange Commission over its hiring practices in Asia. Several banks are under scrutiny after the commission opened an inquiry into whether JPMorgan Chase hired the children of powerful officials to help win lucrative business contracts.

HSBC did not give any further details on the investigation.

Its results were weighed down by restructuring costs, provisions for legal and regulatory matters, loan impairment charges and provisions for credit risk.

The bank is in the process of reshaping its operations, shedding tens of thousands of jobs, selling underperforming businesses and shrinking its global investment banking business.

“China’s slower economic growth will undoubtedly contribute to abumpier financial environment, but it is still expected to be the largest contributor to global growth,” Douglas Flint, the HSBC chairman, said in a news release.

Where S’pore trumps HK

Goh Meng Seng keeps on harping on how good life is in HK compared to S’pore. His daughter’s schooling and healhcare costs are cheaper* there. HK is Heaven, S’pore is Hell he implies.

Funny he doesn’t tell us that this is the 6th yr in a row that HK tops this index. It’s not uncommon for entire families to live in spaces less than 50 sq m. Btw, there are no  “cage homes” — tiny bunks stacked atop each other and enclosed by metal grating — here.

Nothing heard on thr issue of housing affordability in HK by Memg Seng who prefers to talk cock about the golden dinar.

The PAP administration can do more to bring affordbility levels to those at the end of the 90s, early noughties: 15- 20 yrs of paying mortgages not the present 25 yrs. But hey let’s not pretend that S’pore isn’t too bad.

And remember GMS’s silence on HK people critical of China diappearing. They on his UFO? (He believes in the UFOs, having claimed to have seen one (or was it in one?)

—————————————————-

*Err Value for money or not he doesn’t say. He focuses on the cost. Btw, he can’t persuade his wife to stay here but wants us to vote him into parly?

Data centre security: HK v S’pore

Parachutist extraordinaire, (Three GEs, three different parties, three GRCs and a diminishing share of votes) Goh Meng Seng is at it again, dissing S’pore in favour of his adopted home. HK. Where everything is better.

Here’s one area where S’pore is tops according to a HK newspaper.

The city-state’s financial regulator has set up a test for centres looking to host sensitive data from banks, called a threat vulnerability and risk assessment (TVRA).

In order to pass, the centres must weather severe natural disasters and even attacks from rocket-propelled grenades.

Intruders to one of these heavily guarded units should beware of the “mantraps”. This type of security door will lock down upon detecting a breach, trapping within bewildered, defenceless data burglers.

The test also has an equally stringent cyber security assessment in place to ensure the centres can keep most hackers out.

…

It could just be a marketing element from the regulator. But if it is, it’s a good one,” Krupal Raval, senior vice president for finance at Digital Realty, told the South China Morning Post in an interview. “From a banking perspective, we see more activity in Singapore. That’s because [regulators] are more proactive in reaching out.”

By “reaching out”, Raval means that the Monetary Authority of Singapore is signalling to banks and other financial institutions they can safely outsource sensitive data operations. The TVRA is the monetary authority’s stamp of approval on the centres at a time when a data breach on banks can spell out massive fines and a loss of reputation.

Digital Realty is one of the world’s biggest data centre companies, with major hubs in both Hong Kong and Singapore.

The 177,000 square-foot facility in Singapore has passed the TVRA test, something that the company said has attracted the interest of financial institutions looking to outsource sensitive financial data from clients.

Not so for Hong Kong, however. Digital Realty operates an even larger centre in the Tseung Kwan O industrial estate. It has a tier-III rating from the Uptime Institute, which is mainly concerned with how much time the plant must be shut down in order to be maintained.

While Raval says that site is just as secure as the one in Singapore, banks are less likely to outsource in Hong Kong without a financial regulator’s thumbs-up on the centres. Financial institutions in Singapore can outsource data operations only to centres that have the TVRA. Hong Kong regulators do not have an equivalent assessment. Spokespeople at the Hong Kong Monetary Authority and Financial Services and the Treasury Bureau said they could not answer questions on the topic.

“It would be an opportunity for Hong Kong going forward,” Raval said of instituting a similar test. And a missed opportunity for the time being as companies holding sensitive client data search for safer but cheaper ways to do their businesses.

Banks have traditionally built expensive in-house data centres to reduce the risk of breaches. Offering regulator-approved choices for outsourcing the work presents an attractive option for financial firms moving to Asia.

The stringent regulations for data centres were just part of Singapore’s digital competitiveness. The 15 submarine fibre optics cables connected to the city have boosted connectivity and lowered costs, says Clement Goh, South Asia managing director at Equinix.

“As such, a multitude of companies are not just flocking to Singapore but choosing to headquarter their businesses here,” he says. Equinix is another one of the world’s biggest data centre companies with centres in both Hong Kong and Singapore. “This definitely gives us a competitive edge over our other counterparts in the region without such regulatory measures in place.”

http://www.scmp.com/business/companies/article/1880844/singapore-mantrapping-away-hong-kong-financial-competitiveness?utm_source=outbrain&utm_medium=outbrain&utm_campaign=Outbrain-SG-business&utm_term=48752606

Good move by Yaacob’s sis

She was the deputy editor of ST and earlier this yr joined the SCMP in HK. Great timing. Alibaba will pay HK$2.06bn (US$266m; £175m) for SCMP.

Alibaba Buying South China Morning Post, Aiming to Influence Media The Chinese Internet giant said the deal was fueled by a desire to improve China’s image and offer an alternative to the biased lens of Western news outlets.

• NYT » | WHEN THE SOUTH CHINA MORNING POST WADED INTO CONTROVERSY | READ IN CHINESE

(NYT Dealbook)

Given her role* in ST as a cheerleader, class-monitor and enforcer for the PAP administration in ST, she’ll fit in very well under the new regime in HK. Her husband, Cherian George, a vocal social activist here (calling for a free press here is his obsession) but now lecturing on media (because of his obsession) in a HK uni, must be a happy man.

His wife can put her well-honed skills to good use in the service of Alibaba  to improve China’s image and offer an alternative to the biased lens of Western news outlets.

The couple must be oprning the champers.

——-

*She was a major-general in the Imperial Stormtroop Paper division and a padawan Sith Lord.

HK has an edge over us in IOT

“For IoT [internet of things], we see Hong Kong as much more advantageous than other places like Singapore because of its proximity to Shenzhen and the ease with which you can rapidly develop prototypes,” the FT quotes VXC David Chen . He helped investee co Hanson Robotics, move from Texas to Hong Kong’s Science Park

China really tua kee

Related post: http://www.bbc.com/news/business-34344926

 

HSBC’s 1979 gift keeps paying for itself

Li ka-shing accounted for 70% of HSBC’s global M&A advisory work in 2015 according to the FT.

HSBC sold him its stake in Hutchison Whampoa at a very special “For you only” price in 1979. This gave him face and showed that HSBC was aligning itself with the Chinese tycoons not the ang moh houses like Jardines. The then Oz CEO of Hutch said he could have gotten a better price for the stake. He was told by HSBC to mind his own business because he was an employee. HSBC had hired him to turn round Hutch which he.

Long term greed.

Shareholders need to find a new Sandberg and Purvis combination, with John Bond assisting. We know the damage (think sub-prime and Safra) that Bond can do when not supervised by adults. But I’m to harsh. During his tenure, HSBC had a one-for-one bonus and the ex-bonus share price almost reached the cum price. And there was a deeply discounted share issue to pay for the losses in the US.

But at the very least we need a  home-grown John Cryan*. Off with Gulliver’s head.

Gulliver sucks, like Anshu Jain and has to go. Capital markets investment bankers are not usually rational, cold and deep thinkers

As Lex rightly pointed out a few weeks ago, Hongkong Bank is trying to cut fat and grow muscle. Us sporty fatties know that this is real hard work and often fails. Taz why we are still fatties. Gulliver failed to trim fat and is lousy at PR (When Blatter said he couldn’t be expected to know everything at FIFA, I tot of Gulliver’s remarks on managing HSBC.). And now he wants to cut fat and grow muscle?

Failed in cutting costs and now wants to do something even hardEer? Pigs are likely to fly first. Or i’ll lose some serious fat and put some muscle.

He’d likely cut muscle and grow fat. Maybe expansion into the industrial heartland that is the Pearl Delta estuary isn’t the greatest idea? “Poll shows 25% of foreign businesses plan China job cuts,” is the top FT headline on my PC screen.

—-

*And if there’s no-one homegrown do what the Germans did, go find someone and put the chap in charge of the board’s audit committee. Great hands-on experience and sreep learning curve.

I always believe that in most cases there is always someone inhouse in a company with a strong corporate culture who can do the CEO’s job: the problem is finding the guy and the board having the balls to appoint the “unknown”.

PRCs spend more here than in HK

Casinos

PM must be doing shumething right, right?

Keep on banging yr balls in frustration Goh Meng Seng and his felow cybernuts, some of whom are so frus with the PAP that they blame the parents of the dead children for the deaths, sneering at their stupidity, as these cybernuts see it, for allowing the children to go to Sabah. More on this tom.

Singapore is sitting atop the world as the best city for FDI, ranking first globally in 2014 for the amount of greenfield inward investment it attracted. The city-state received two-and-a-half times more investment than its main rival, Hong Kong.

Also the top-ranked destination city in 2013, Singapore has strengthened its lead over London and Shanghai since then. According to figures from fDi Markets, an FT data service, 390 companies announced or launched 409 greenfield projects in Singapore last year, totalling an estimated $11bn in capital expenditure. London attracted 334 projects at $7bn, and Shanghai, 245 projects at $8bn. Hong Kong, the sixth-ranked city based on number of projects, received 162 projects at $5bn.

… Beijing, Bangalore, Dubai, São Paulo, Kuala Lumpur and Mexico City join S’pore , HK and Shanghai on the list.

FT

HSBC: Desperately seeking home-grown John Cryan

As a long suffering Hongkong Bank shareholder (But to be fair, I was there when John Bond called a bonus issue and the share price post bonus issue almost reached the pre bonus share price and I was there when the bank called for a massive deeply discounted during the crisis rights issue), who is the inhouse John Cryan*?

John Cryan the incoming UBS boss is rational, cold, deep thinker and no show-off – (NYT Dealbook).

Hongkong Bank needs a rational, cold, deep thinker who is not accident-prone.

Gulliver sucks, like Anshu Jain and has to go. Capital markets investment bankers are not usually rational, cold and deep thinkers

As Lex rightly points out, Hongkong Bank is trying to cut fat and grow muscle. Us sporty fatties know that this is real hard work and often fails. Taz why we are still fatties. Gulliver failed to trim fat and is lousy at PR (When Blatter said he couldn’t be expected to know everything at FIFA, I tot of Gulliver’s remarks on managing HSBC.). And now he wants to cut fat and grow muscle?

Failed in cutting costs and now wants to do something EVEN hardER? Pigs are likely to fly first.

He’d likely cut muscle and grow fat. Maybe expansion into the industrial heartland that is the Pearl Delta estuary isn’t the greatest idea? “Poll shows 25% of foreign businesses plan China job cuts,” is the top FT headline on my PC screen.

—-

*And if there’s no-one homegrown do what the Germans did, go find someone and put the chap in charge of the board’s audit committee. Great hands-on experience and sreep learning curve.

I always believe that in most cases there is always someone inhouse in a company with a strong corporate culture who can do the CEO’s job: the problem is finding the guy and the board having the balls to appoint the “unknown”.

HSBC should return to its roots

No not as a narco-bank for the modern day equvalent of the Jardines, Mathesons and Sassons who were the drug barons of the early 19th century smuggling opium into China

https://atans1.wordpress.com/2012/07/29/hsbc-doing-gods-work/#comments

https://atans1.wordpress.com/2012/12/23/hsbc-great-customer-shareholder-service/

It should remember that the HS stands for Hongkong and Shanghai and that it was once known as Hongkong Bank (when it was kicked out of China) https://atans1.wordpress.com/2013/04/02/hsbc-london-greater-china-bank/#comments

HSBC should focus on its jewel in the East

Here’s a good idea that (almost certainly) will not be announced by HSBC at its big strategy day on Tuesday: split the bank in two, and let only the Asian business base itself in Hong Kong.

UBS analyst John-Paul Crutchley is the author of the inspired demerger idea, which starts by arguing that “taking the accumulated baggage of the last three decades home may not be the best course of action”.

Baggage may seem a harsh description of the non-Asian parts of HSBC, including its UK retail banking operation, but Crutchley reckons the Hong Kong Asia-Pacific bank accounts for 80% of HSBC’s market valuation while deploying less than half the equity. It is the jewel. Indeed, the analyst reckons HSBC’s share price could be twice the current 619p if the group had decided in the 1980s to stick with its Asian franchise and not pursue all the deals and acquisitions elsewhere.

That observation illustrates the fact that HSBC management’s head-scratching over where to base the bank is something of a sideshow. Dodging the full impact of the UK bank levy by redomiciling the whole shebang to Hong Kong might save $1bn a year. But, even if one assumes such a saving is worth $12bn in today’s money, that’s only the equivalent of 44p on the share price. The bigger question is: what’s the best way to manage this vast sprawling group?

A demerger is not a cure-all but it would deliver a few advantages. The Hong Kong end could concentrate on combating increased competition from Chinese banks. Rump HSBC could be more vigorous in allocating capital to the parts of the business generating better returns. And, since regulators are piling heavier capital and compliance costs on very big global banks, both bits might benefit from being part of smaller organisations.

It’s an idea HSBC is highly unlikely to adopt. But a dose of bold thinking is arguably exactly what it needs to awaken a slumbering share price. Flogging the Brazilian and Turkish operations – Tuesday’s likely highlights – probably won’t be enough to excite shareholders.

From Guardian

HK ahead of us, Switzerland, M’sia behind us

HK people are more pragmatic than Singkies

Every year, thousands of one and two-year-olds in Hong Kong attend interviews to try to get into pre-school. Teachers, experts and tutors have been telling Helier Cheung what parents should expect.

http://www.bbc.com/news/magazine-32308422

In S’pore, the parents unable to get their kids into good pre-schools and who have then to go to the PAP Foundation-run pre-schools, will, anonymously, be venting online their anger at the PAP administration. The cybernuts infesting TRE’s comments section will cheer these parents on.

When TRE republished https://atans1.wordpress.com/2015/04/29/cheapo-acs-mum-cant-sleep-over-50-donation/ the cybernuts agreed that this mum was right to be upset: ACS should not ask parents for money. Everything should be free.

Govt sees StanChart as risky?/ LKY’s 30-year investments revisited

The Hong Kong Monetary Authority says that it “takes a positive attitude should HSBC consider relocating its headquarters back to Hong Kong”, where it is the largest bank.

HSBC WEIGHS MOVE FROM LONDON HSBC was established in Hong Kong 150 years ago and moved its headquarters to London in 1993. Now it is considering a return trip. Citing changes in regulation, HSBC says it will study whether to relocate its headquarters out of London, reports Chad Bray in DealBook.

A big part of the issue is Britain’s bank levy, which was instituted in 2010 to help pay for the government’s financial crisis bailouts. While all banks operating in Britain pay the tax, Mr. Bray writes that “The levy hits British-based banks particularly hard, however, as they are taxed on their global balance sheets.” HSBC’s announcement could become a political issue as Britain nears a general election on May 7.

(NYT’s Dealbook)

Hongkong Bank is a HK quitter. It moved to UK in 1993, juz before PRC regained HK in 1997. But all is forgiven.

Both HK have S’pore have similar sized economies (about US$300bn in GDP).

HK is willing to be lender-of-last-resort to HSBC a bank with US$2,6 trillion in assets, despite HSBC being almost 9 times bigger than HK’s GDP.

Yet the S’pore authorities, it’s clear from hints in the FT, are unwilling to have StanChart HQed here (only 1.1 trillion in assets), despite Temasek being the largest single shareholder (which will benefit from reduced tax: HSBC shares were up 6% in HK yesterday), and despite many of StanChart’s operations being run from here.

The PAP administration is afraid of another of Temasek’s investments blowing up? After all StanChart is not as safe as our local banks: https://atans1.wordpress.com/2015/03/25/stanchart-not-as-solid-as-local-banks/

It also has weaker capital ratios than HSBC and the big US banks. So weak that the new CEO is expected to call for yet another massive rights issue.

Remember LKY and his bank investments that are forever? OK 30 yrs leh) Even longer than Buffett’s investments, he once said

In 2007/2008, our SWFs’ bot into UBS (GIC), Citi (GIC) and Merrill Lynch (Temasek) in a big way that ST characterised then as showing S’pore was a tua kee investor.

We lost serious money in two of the 30-yr investments by 2009.

— Estimate of Temasek’s realised losses on ML and Barclays:

https://atans1.wordpress.com/2010/08/04/swee-say-said-that-gd-temasek-lost-billions/

— Estimate of GIC’s loss on UBS as at 2011:

https://atans1.wordpress.com/2011/07/26/gic-not-reported-in-st-cna-or-today/

(BTW, Temasek’s 2012 purchase of Credit Suisse mandatory bonds:

https://atans1.wordpress.com/2012/07/22/third-time-lucky-temasek/)

 

 

 

Wanted: PRC princeling to be SGX’s CEO

The Singapore Exchange (SGX), Bank of China (BOC) and BOC International (BOCI) are extending their collaboration on renminbi (RMB) initiatives and joint marketing initiatives. (CNA today)

And yesterday SGX denied “market rumours” in news reports that it will establish a stock trading link along the lines of the Shanghai-Hong Kong Stock Connect.

What this tells us is that SGX (and S’pore: Remember who PRC sent to LKY’s funeral: an unranked politburo member; this despite LKY’s and the PAP administration’s self-serving claims that he had great personal ties with the last two presidents. None of them turned up did they?) doesn’t have any serious China connections.

So SGX should make it a priority that its next CEO has the best possible China connections. As US banks are now wary of employing princelings (could run foul of US anti-corruption laws) with the right connections, SGX should have an easier time finding one with the right connections.

SGG has a lame duck ang mog FT  CEO, an Indian FT as president and Indon FT as head techie. (By the way all these are people where the “T” stands for “Trash”.) Why didn’t it even try to get a PRC FT? Taz how screwed up SGX is.

Why such a trading link is so impt:

A stock trading link with China will make it easier for Chinese investors to buy Singapore-listed shares.

The Hong Kong-Shanghai Stock Connect got off to a slow start when it was launched late last year. In recent weeks though, a surge of investments from mainland China has propelled Hong Kong stocks, including those of many smaller-cap firms, to multi-year highs. (CNA)

 

HSBC, Superman and another Cina superhero

(Or “HSBC and the right Chinese tycoons”)

HSBC is traditionally Li’s go-to bank for financing deals with its dominant local presence and a dedicated team to cover Li’s companies earned US$136 million in fees.Goldman Sachs has emerged as Li’s favored bank, pulling in an estimated $220 million in fees from Li’s two main companies Hutchison Whampoa and Cheung Kong Holdings since 2000.

http://www.reuters.com/article/2015/01/25/us-likashing-fees-idUSKBN0KY0YR20150125

Do remember that HSBC’s fees are on top of the interest it gets on its loans to these cos.

HSBC sold him Wharf once upon a time (the ang moh MD of wharf was angry as he said he could have arranged a better price) and both never looked back.

Which reminds me of the man who laid the foundation that made HSBC a global bank. Lee Quo-wei, the former chairman of Hong Kong’s Hang Seng Bank Ltd died on 12th August 2013, age 95

After joining Hang Seng Bank in 1946, Mr Lee was among those who transformed Hang Seng into the second-largest Hong Kong-based lender from a money-changing shop founded 13 years earlier. He helped Hang Seng end a bank run in 1965 with a capital injection from Hongkong & Shanghai Banking Corp, now HSBC. Four years later he was part of the team that created the Hang Seng Index.

Mr Lee was appointed executive chairman of Hang Seng Bank in 1983, according to a statement from current chairman Raymond Ch’ien. He retired in 1998, becoming honorary chairman and later honorary senior adviser.

If Hongkong Bank did not buy Hang Seng (at a good price from Hongkong Bank’s perspective, Mr Lee used to say to HSBC’s ang moh executives), HSBC, would not have become so entrenched into the HK economy. Look at StanChart and taz the best HSBC would have become.

As a shareholder of HSBC, I thank him.

Btw, It may be hard to imagine but once upon a time Bangkok Bank, OCBC were the rising banks while StanChart and HSBC were seen as the relics (albeit still powerful and rich) of colonialism.

Change a’coming at StanChart

The Sunday Telegraph reported that Temasek and Aberdeen (between them they hold 30% of StanChart) had told chairman Sir John Peace that he must find a replacement for Mr Sands within months or stand down himself.

FT reports the bank is looking to replace Peter Sands this year and has hired a headhunter to look for a successor ASAP. It says that Temasek and Aberdeen hold him responsible for not responding fast enough to a reversal of StanChart’s fortunes.

Double confirm StanChart’s rogue bank & PAP apologist is a fool

Remember a “PAP is always right” man KPKBing when StanChart was charged that the reulator was a “rogue regulator”. StanChart then made the dean of LKY School look dumb, really dumb, by pleading guilty.

Double confirm that StanChart is a rogue bank and the PAP apologist is a fool because now: The management of Standard Chartered is facing renewed pressure after being placed under fresh scrutiny by US regulators.

Two years after being fined more than £400m for breaching US sanctions towards Iran, the bank revealed that a two-year deferred prosecution agreement (DPA) that was imposed at the time was being extended for three years.

The US authorities are now investigating whether Standard Chartered breached its sanctions rules beyond 2007, the period when the previous offences for which the bank was penalised took place.

http://www.theguardian.com/business/2014/dec/10/standard-chartered-management-us-regulators-investigation-sanctions

Looks like Santa didn’t bring Ho a nice Christmas present, giving her a turd instead. Juz look at share price chart from FT. [Chart added at 11.30 am]

Meng Seng would be KPKBing if this happened here

Seriously, I doubt S’poreans would be so tolerant of the u/m. GG would go red in the face and GMS would call this a trespass on our sovereignty. Well at least we know that GMS’s sojourn in HK hasn’t made him as friendly to the Pinoys as the Hongkies he so admires.

A COMMUNAL sit-in of sorts blocks the streets of Central, the main financial district of Hong Kong. The assembled crowd is peaceful. Some play cards or paw at their smartphones. Others lie under umbrellas, catching up on sleep. While the world in recent weeks has come to know the alliance of electoral-reform advocates who call themselves Occupy Central, this is something different. And it has been going on for years.

These participants are foreign domestic helpers, called “amahs” locally. There are about 320,000 of them in Hong Kong, almost exclusively female and mainly from the Philippines and Indonesia. Many spend their single day off each week sitting on flattened-out cardboard boxes, acquired from trolley carts pulled around by local entrepreneurs. Some build elaborate temporary houses with room partitions and outer walls. Anywhere else in the world this cardboard city would raise eyebrows, but not in Hong Kong.

http://www.economist.com/blogs/analects/2014/11/hong-kongs-domestic-helpers

S’pore property more expensive than Swiss city/ What Goh Meng Seng doesn’t tell us about HK

Prime International Residential Index – Square meters US$1m will buy

• Monaco 15
• Hong Kong 21
• London 25
• Singapore 33
• Geneva 35
• New York 40
• Sydney 41
• Paris 42
• Moscow 43
• Shanghai 46

Source: Knight Frank

Related posts:

https://atans1.wordpress.com/2014/06/04/swiss-cost-of-living-in-s-terms/

https://atans1.wordpress.com/2012/02/27/spore-despite-fts-an-expensive-place-to-make-pancakes/

GMS likes to tell us online the ways in which HK is a better place than S’pore. It’s gd to get the perspective of someone who jets between HK and S’ore and who is raising a family there while working there.

But he never tells us this

We are not among these cities ’cause of our “affordable” public housing that is causing debt problems for younger S’poreans. It’s so affordable that GMS sold his flat to help fund his bid for a S$15,000 monthly salary. He knew he could get a second bite at the cherry if he needed to?

Whatever it is, we do know that GMS has the money to raise a family in a city where housing is very “unafforable”. He FT in HK?

StanChart directors to push for chief’s succession plan

Above is FT’s headline for today.

Ho, Aberdeen, Blackrock and L&G baring their fangs? TRE ranters and other anti-PAP paper activists, pls note that Temasek has been pushing for a succession plan for some time.

But they can rejoice ’cause  sharesclosed at £9.39 on Friday – down from £18 less than two years ago.

They will be celebrating.

Related:

https://atans1.wordpress.com/2014/10/29/lousy-set-of-results-from-stanchart/

https://atans1.wordpress.com/2014/10/31/stanchart-gives-ho-more-problems/

 

StanChart gives Ho more problems

Is StanChart a rogue bank?

Standard Chartered Plc (STAN) fell for a fourth consecutive day in London after U.S. prosecutors reopened investigations to determine whether the bank, which entered into a deferred prosecution agreement in 2012, withheld evidence of Iran sanctions violations.

The U.S. Justice Department, Manhattan District Attorney Cyrus Vance Jr. and Benjamin Lawsky, superintendent of New York’s Department of Financial Services, are all reopening their original inquiries into the London-based lender to determine whether it intentionally withheld information from regulators before the 2012 settlements, according to two people briefed on the matter, who asked not to be identified because the probes are confidential.

http://www.bloomberg.com/news/2014-10-30/standard-chartered-bank-of-tokyo-said-getting-new-review.html

Temasek wants clear succession plan at StanChart

https://atans1.wordpress.com/2014/10/29/lousy-set-of-results-from-stanchart/

Lousy set of results from StanChart

Standard Chartered has announced a 16% fall in operating profit because of a restructuring of its South Korean business and an increase in bad loans.

The Asia-focused lender said pre-tax profits fell to $1.5bn (£930m) in the July-to-September quarter compared to the same period a year ago.

Standard Chartered also warned full-year earnings would fall because of weak trading activity.

http://www.bbc.com/news/business-29797961

FT reports that some of the major shareholders have been pressing for the CEO to be sacked if things don’t improve soon. It also reports that Temasek  is “pressing for a clear plan of succession”.

. 

 

 

Parking problems in HK, S’pore might benefit

No not a shortage of parking lots in Admiralty or Mong Kok caused by the heloos of Roy and FT  H3.

There is a shortage of moorings for superyachts. There is nowhere left to park them in HK, the Economist reported sometime back.

Still got space here, though the waters around S’pore are pirate-infested. Blame the Indon navy for that. Sadly our navy not like the Royal Navy in the 19th century. Keppel and other naval captains went around attacking pirate ships and their dens.

Roy’s & New Citizen H3 should go to HK

And observe, research and analyse how the students and other protesters are doing things in such a way that caused a Mainland Chinese official visiting Hong Kong to say, “It’s so amazing they can organise such an orderly, peaceful and self-disciplined protest.” (FT).

As at the time of writing, these protestors have behaved in such a way no-one can reasonably fault their behaviour even though what they are doing is technically, illegal: they don’t have permission to protest.

A walk among the tens of thousands clustered around the Admiralty district in Hong Kong feels more like attending a music festival than a protest. The demographic of those calling for representative elections in 2017 is mostly twentysomething or younger – some are in school uniforms. Volunteers hand out snacks, drinks, and goggles to defend against pepper spray, though there has been no sign of any since the first day’s ruckus. Volunteers shepherd new arrivals away from overcrowded areas; others hand out home-made flyers on how to remain calm if provoked.

Anyone can be violent, but keeping protest this calm requires strategy. According to many non-violence theorists, the only way to confront a muscular government like China’s is to train, plan, stay calm and kill the enemy with kindness.

http://blogs.reuters.com/breakingviews/2014/10/01/hong-kong-harmony-hits-beijings-worst-fears/

But somehow going by TOC’s video* showing at the very least showing Roy, H3 and friends shouting their slogans in front of special needs kids, I suspect that the lessons the HK protesters can teach S’poreans will be lost on them and their very vocal defender of their actions Goh Meng Seng (who is in HK). Too bad because

What’s most impressive is that the orderliness is basically self-generated. While some training had taken place beforehand, much of the co-ordination among the protesters has been ad hoc, with more experienced protesters conducting on-the-spot education, according to one organizer. Supplies are requested via social networks and Google Docs. Meanwhile, the crowds have the element of surprise on their side. Protests were still spreading to previously untouched areas today, including the high-end shopping district Tsim Sha Tsui, a magnet for mainland tourists.

Thankfully we have Cherian George there. He can perhaps observe, research and analyse, and then teach teach S’poreans how to ensure that social movements can be emotionally charged but peaceful, disruptive but harmonious.

If that happens, the govt and the administrators will rue the decisions that forced him to move on to HK. Cometh the our, cometh the man.

———-

*Recommended viewing by H3 and Roy to support their view that they didn’t “heckle” the special needs kids. My view is that they are trying to be pedants. The usage of the word “heckle” has evolved to encompass their actions.

This is a neutral report of the scene: When Yahoo Singapore visited Hong Lim Park just before 5pm on Saturday, Ngerng and Han were leading about 100 protesters in circles around a large tented area where people attending the YMCA event were seated, waving large and small Singapore flags and chanting “Return our CPF!” and “PAP, vote them out!” through microphones connected to speakers placed on the outskirts of the YMCA event area.

At at least one point, Ngerng and Han led the group of protesters near the front of the permanent stage at Hong Lim Park, where performances by various youth groups, including one by special needs children, were taking place.

The performance of the special needs group appeared to be disrupted by the sound of the protesters’ chants, and the song the children were dancing to was stopped and restarted after the protesting group moved to a mound at the back of the lawn.

-https://sg.news.yahoo.com/police-investigate-cpf-protest-march-at-hong-lim-park-004904810.html

Dispersing crowds the Hongkie way/ Govt thinks Hongkies are stupid?

… Hong Kong’s health authorities have warned of “pollution risks” and advise the general public to reduce time outdoors.

The South China Morning Post observes that air pollution threat “had been low due to less traffic since the demonstrations began”.

However, the Post notes that the Environmental Protection Department has changed its health risk forecast to “high” and “very high” in the city on Tuesday, due to “different sources of pollution”.

Protesters interviewed by the paper, however, insist that the poor weather will “not undermine the protesters’ determination to seek democracy”.

“I don’t think rain and bad air quality will dampen or deter protesters’ will and confidence,” one said. “We have raincoats ready to hand out. We also have big umbrellas for protesters to share.” (BBC Online)

Btw, wonder if Roy and New Citizen 3H are going to HK, joining Goh Meng Seng, in researching the protests. After all Roy and 3H went to do research in Norway. What Norway has in common with S’pore except big SWFs is beyond me.

Uniquely HK way of protesting (Updated at 4.05pm)

http://www.bbc.com/news/world-asia-china-29423147

 

Tourism potential of Indon, Vietnam & Burma

Number of foreign visitors received in 2013

• Thailand – 26.5 million
• Malaysia – 25.7 million
• Hong Kong – 25.6 million
• South Korea – 12.1 million
• Japan – 10.3 million
• Indonesia – 8.8 million
• Vietnam – 7.5 million
• Myanmar – 2 million

I’m surprised that Indonesia has only 8.8m visitors given the popularity of Bali.

Still Mynamar is the place to invest in the tourism biz. Opportunities there from recent BBC article.

S’poreans: 11th in lying on hols experience

Chinese are number 1. lie to friends and family about the marvellous time they had,The survey didn’t give a reason for why the Chinese exaggerate the most about their holidays, but the status of being able to afford to go abroad, ensuring you keep one step ahead of the Wangses, may be a factor. Another explanation could be that the Chinese tourist is a relatively recent phenomenon who could learn a thing or two about complaining from travel-hardened European and American holiday-makers  Economist

Both reasons are likely to apply to the sheep Singaporeans too.

In Asean, Thais are ahead of us. Interestingly, Hongkies, who many locals think are BS artists don’t exaggerate that much. But then they have a reputation for being gd at complaining.

 

Problems at Temasek’s StanChart & DBS/ OCBC ovepaid for HK bank?

Standard Chartered has said first-half operating profits will be 20% lower than a year earlier, blaming a slump in income from its financial markets business.

The warning comes only three months after the Asia-focused lender reported its first fall in annual profits for a decade.

The UK bank had been expected to show a modest bounce-back this year.

But it said tougher regulations and low market volatility had hurt revenues.

…

Standard Chartered said its interest rate and foreign exchange trading had been particularly hit.

Chirantan Barua, an analyst at Bernsteinm said: “Cyclical headwinds are yet to arrive in full force in the bank’s two key markets – Hong Kong and Singapore. Not that Korea or India is out of the woods either.

“Pack that in with a challenging and uncertain capital regime that won’t be resolved until the end of the year and you have a great deal of uncertainty around the stock.”

http://www.bbc.com/news/business-28031504

StanChart shows the peril of investing in a stock listed overseas overseas that operates internationally. When profits were gd, sterling was weak against all major currencies. When sterling is strong, profits no gd. Note the value of sterling is irrelevant to the underlying profits or losses of  most of bank’s international operations.

——

ON AN afternoon in early summer a prospective customer walked into the gleaming new branch established in Shanghai’s free-trade zone by DBS, a Singaporean bank that, like many of its international rivals, has long touted China’s great promise for its business. The lobby was empty, save for a guard playing a video game. A log showed that the branch was attracting just two or three visitors a day. DBS remains optimistic about China and says that most of its free-trade-zone transactions are routed through other locations. But the torpid atmosphere at the branch points to foreign banks’ struggle to crack open the Chinese market.

—–

To be fair to DBS its New Citizen CEO is not like the FT CEO of OCBC who may have blundered.

OCBC is offering to buy Wing Hang Bank’s shares for 125 Hong Kong dollars (US$16.12) each, in a big bet on China’s sustained economic growth. OCBC hopes the deal will springboard its growth into mainland China through the Hong Kong bank’s cross-border operations, and give it a foothold in Macau.

OCBC and Wing Hang Bank, one of Hong Kong’s last remaining family-owned lenders, began discussions on a possible deal late last year, and in January entered exclusive talks (after ANZ and UOB balked at the family’s asking price), which were extended twice as they argued over price.

The most recent comparable transaction (and bargaining benchmark for the family), the 2013 sale of Chong Hing Bank, went for 2.35 times book value including the value of a special dividend related to Chong Hing’s real estate. Accounting for the increase Wing Hang ascribes to the value of its property, the OCBC offer is closer to 2 times book value, a discount, compared to the Chong Hing deal, considering Wing Hang’s return on equity averaged 11.3% for the past three years, versus 7.8% for Chong Hing, according to Capital IQ.

Still OCBC shareholders were not that happy and its share price suffered.

What is unknown is the value of Wing Hang’s Hong Kong real estate, on some of the busiest shopping streets in the world. These could be worth even more than the bank says. A government index of Hong Kong retail properties has risen 400% over the past decade. Yet the company’s revaluation over the acquisition cost of the property is less than 100%.

If enough of Wing Hang’s minority shareholders refuse the price on offer, however, OCBC might prefer to raise it or offer* or bear the cost of maintaining the Wing Hang listing, and the cost of failing to fully integrate the bank.

Update at 6’00am: Here’s someone who thinks OCBC got sold a dog.

Wing Hang gives it greater opportunity to finance trade between China and other parts of Asia such as Malaysia and Indonesia, where it already has a foothold. Wing Hang’s strong funding base – loans were just 73 percent of deposits at the end of last year – is another advantage, as is its ability to capitalise on the yuan’s growing international popularity. About 17 percent of Wing Hang’s deposits are currently in the Chinese currency.

Nevertheless, the purchase brings risks to OCBC investors. China’s economic slowdown is creating credit wobbles, while Hong Kong’s property boom is bound to have led to some lending excesses. Meanwhile, rising interest rates in the United States could reverse the cheap deposits that have flowed into both Hong Kong and Singapore in recent years. Shareholders, who will probably be asked to help finance the purchase, may pay a high short-term price for OCBC’s long-term China ambition.

 http://blogs.reuters.com/breakingviews/2014/04/01/ocbcs-chinese-ambition-comes-with-hefty-price-tag/

 ————

*OCBC has said the bid, a 50% premium to the then stock price, is generous.

“E-Friction” index: HK’s 5th, S’pore’s 15th

Interesting that this never ever got reported by our constructive, nation-building media or mentioned by Yaacob, the propaganda ministry, MDA and IDA

The solution to improving our score is ensuring speedy and cheap online access should top the list. So come on Yaacob, MDA and IDA: stop trying to fix netizens and get us cheaper online access. Example the 4G charges were added on.

More on the index:

A new study by the Boston Consulting Group, to be presented at the World Economic Forum in Davos this week … “Greasing the Wheels of the Internet Economy”, its purpose is to make it easier to identify points of friction that hold back the digital economy.

At the heart of the report is an “e-friction” index. The authors took no fewer than 55 indicators (from “internet bandwidth per capita” and “average mobile connection speed” to “strength of intellectual property protection” and “press freedom”) and calculated a score for each of the 65 countries covered, which rises the higher the friction (see chart on this page. The full country ranking can be found here).

… The usual suspects from northern Europe (Sweden, Finland, Denmark) end up on top, with HK 5th, Oz 14th and S’pore 15th.

… Such rankings often depend on how the indicators are weighed. BCG argues that infrastructure factors, such as the quality and cost of internet access, are the most important sources of friction, and bases half of its index on these. Other types of indicators, such as those that measure barriers that deter companies and consumers from adopting the internet, count much less. But even with a more even weighting, the authors say, the results would not be much different.

A more interesting finding is a clear correlation between a country’s rank in BCG’s index and the size of its internet economy: the lower the friction, the larger the share of online-related activities as a percentage of GDP …

What can countries do to move up the curve? Each country is different, the authors of the study argue. But ensuring speedy and cheap online access should top the list.

http://www.economist.com/blogs/schumpeter/2014/01/digital-trade

People that the PAP fear?

“A prophet without honour in his own country or home,” was what I tot.

No not talking about one Devan Nair, for one thing he is being re-recognised by the PAP govt: “Prime Minister Lee Hsien Loong officially opened the Devan Nair Institute for Employment and Employability in Jurong East …”, it was reported on 1 May 2014.

No, I couldn’t help but think “A prophet without honour in his own country or home”*, when I read on Saturday, “Outspoken academic Cherian George takes up post at Hong Kong Baptist University” (http://www.scmp.com/news/hong-kong/article/1508715/outspoken-academic-cherian-george-takes-post-hong-kong-baptist).

He needs no introduction as the hubbie of ST’s editor, brudder-in-law to the Malay minister, and an academic and former journalist who has had disagreements with the PAP govt since the 1980s. Seeing no future in journalism, he became an academic. In 2009, he was made an NTU associate professor but denied tenure. In 2010, NTU denied the school’s attempt to renew his position as head of journalism. He was denied tenure again last year and had to “move on” and out of S’pore.

Is it not surprising that The Reporters Without Borders 2014 Press Freedom Index ranked Hong Kong at 61 and Singapore at 150 out of 180 nations?

Mr Spock can reasonably conclude that he was denied tenure because “Service and other contributions to the university, profession or community are also taken into consideration.”**

He is after all, “one of Singapore’s most accomplished and civic minded media commentators”, as someone whom  I respect described him. He could also have be a model for what Seah Chiang Nee in his final column for the Star wrote: “make sure you get the facts right. Use refined language, with no exaggeration. Accuracy, objectivity! When it does well, give it credit; if it does badly in the eyes of most people, say so.” This is something that doesn’t fit rabid PAP cybder warriors.

Rabid anti-PAP cyber warriors especially those who distort the truth can take heart that they are not the ones the PAP fear most or that they will get into trouble for attacking the PAP.

The PAP it seems fears those who are willing to speak the truth, and who thereby have the respect of the 35% of S’poreans who can be swayed by the facts and rational arguments, unlike the 35% (Any donkey so long it is branded “PAP” and 30% (Any donkey who says he is anti-PAP) who can’t.

I’m exaggerating who the PAP fear most? Remember this incident when someone was uninvited to the Istana.

And there are some (not me though, here’s why ) who think that Alex Au’s legal problems have something to do with his well researched and totful pieces.

Happily for the PAP, the really rabid anti-PAP cyber warriors don’t think that telling the truth is that important. What matters is being cheered on by 30% of the voters. If only they can recognise that 30% is not a majority in S’pore politics, and that they have to appeal to the middle 35%.

But maybe they (or at least some of them do) do but are afraid of kanna “marked” by the PAP, and suffering the consequences like having to “move on” or being a non-person.. Better to appeal to the 30% hard core. Better safe than sorry. That after all is the S’porean way.

———–

*1And he went out from thence, and came into his own country; and his disciples follow him. 2And when the sabbath day was come, he began to teach in the synagogue: and many hearing him were astonished, saying, From whence hath this man these things? and what wisdom is this which is given unto him, that even such mighty works are wrought by his hands? 3Is not this the carpenter, the son of Mary, the brother of James, and Joses, and of Juda, and Simon? and are not his sisters here with us? And they were offended at him. 4But Jesus said unto them, A prophet is not without honour, but in his own country, and among his own kin, and in his own house. 5And he could there do no mighty work, save that he laid his hands upon a few sick folk, and healed them. 6And he marvelled because of their unbelief. And he went round about the villages, teaching. (Mark 6)

**An NTU spokesman said,: “The tenure review process is purely a peer-driven academic exercise with two equally important criteria, distinction in scholarship and high quality teaching. Service and other contributions to the university, profession or community are also taken into consideration.”

He wrote on his blog, “As for why the university took the exceptional step of withholding tenure from a faculty member who it decided had earned promotion, I was assured this had nothing to do with my scholarship, teaching or service, and not because I had conducted myself inappropriately.” He was never contradicted by NTU.

So a hyper rationalist like Mr Spock can reasonably conclude that it was “Service and other contributions to the university, profession or community are also taken into consideration” that did him in, making him move on; to a place controlled by the Chinese Communist Party, no friend of a free media or internet.

 

Why global education league rankings are meaningless

South Korea is rated number one according to this ranking* by Pearson and the EIU. And other education league tables also rank it highly.

But we know that over 200 Southern Korean students obeyed orders, and drowned as a result.They behaved like sheep rather than intelligent human beings.They were not sceptical enough. Is this what education all about? Behaving like sheep?

BTW, we are third and I’m sure our students would have obeyed orders too, like the Japs (second), and drowned. (Can’t be sure about the Hongkies 4th.  (http://www.bbc.com/news/business-27314075). I suspect the Hongkie kids would have disobeyed orders, HK’s that kind of place, Hongkies not afraid to protest. Power to them)

If behaving like sheep is the result of the best education system in the world, I’d rather be an American kid ( USranked 14th)

— it’s an American teenager from Hicksville USA (actually Mississippi) who started a campaign that made Coke and Pepsi drop an ingredient in their sports drinks. http://www.bbc.com/news/magazine-27300185

— And remember this 5-yr-0ld American boy who is a Microsoft recognised security researcher for spotting an Xbox flaw? https://atans1.wordpress.com/2014/04/14/v-v-good-at-solving-paper-problems-so-what-more-peanuts/

When the PAP govt and its trumpeters and drummers in our constructive, nation-building media laud our education system citing these int’l league tables, remember the Korean kids who drowned. My test would be, “Which countries’ kids are least likely to have drowned?”

—-

*These rankings are based upon an amalgamation of international tests and education data – including the OECD’s Pisa tests, and two major US-based studies, Trends in International Mathematics and Science Study (Timss) and Progress in International Reading Literacy Study (Pirls).

They also include higher-education graduation rates, which helped the UK to a much higher position than in Pisa tests,

We really poor? Why we don’t have Swiss standard of living?

The u/m perhaps explains why the PAP despite the triumphalism  of itself  and its wallies of our Swiss standard of living, our massive (but  “secret” reserves), and massive budget surpluses (last yr’s estimated $2.4bn is likely to be $6.5bn according to economists. Gd TRE post on this http://www.tremeritus.com/2014/02/18/sg-surplus-for-this-fy-may-hit-6-5-billion/) refuses to spend our money on ourselves. I’ve always blogged that a Hard Truth born of meanness is, “Don’t spend money on making life more comfortable for S’poreans, better to cheong on markets”. But maybe we juz don’t have the $. It belongs to MNCs.

Incidentally, the article shows why local investment is preferable to foreign investment: the profits stick around. The PAP govt rightly takes credit for attracting MNCs here in the 60s and 70s to create jobs. So it should accept responsibility for not diversifying away from this reliance on MNCs, especially as attracting MNCs is not conventional wisdom. In the 60s and 70s, attracting MNC was seen as neo-colonialism.

In Singapore, personal consumption expenditure has steadily fallen over the years as a percentage of GDP and, at 35 per cent, is now barely half of what it is in Hong Kong. This is an oddity characteristic of a startup economy, not of a wealthy town like Singapore.

But it means that, on the basis of our money-in-your-hands measure, Hong Kong at US$24,000 per capita still outranks Singapore at US$21,000.

The second chart gives you a clue as to why the two economies are so different on this measure. Industrial investment in Singapore, always predominantly foreign, has become even more so in recent years, accounting for an average of about 80 per cent of total investment over the past 10 years. I do not have the equivalent figures for Hong Kong but, at a rough guess, the foreign-local ratio would be the reverse.

This foreign investment in Singapore has in turn produced a huge trade surplus in both goods and services. Over recent years, it has run at about 30 per cent of GDP. And most of this money goes right back out again to pay foreigners for all the confidence they have shown in Singapore by investing in it so heavily.

In short, Singapore’s high GDP numbers are mostly an anomaly created by very generous industrial concessions to foreigners. They do not really reflect domestic wealth.

In another way, however, these GDP measures of Hong Kong and Singapore do not mean much as a yardstick of the comparative efficiency of either system. The fact is both are parasite economies feeding off much larger neighbours, the mainland in Hong Kong’s case and Indonesia and Malaysia in Singapore’s. They are both wealthy because they perform services that their neighbours cannot or, for reasons of policy, will not perform.

http://www.scmp.com/business/economy/article/1420215/singaporeans-not-wealthy-gdp-figures-suggest

Where S’pore and other Asean countries most vulnerable to Fed tapering

This chart from Reuters shows the vulnerability of major Asian economies to Fed policy of tapering

http://graphics.thomsonreuters.com/RNGS/2013/AUG/ASIARANKINGS/ASIARANKINGS.html

S’pore is vulnerable

Slowing GDP: Most vulnerable

Growing Public Debt : Second most vulnerable

Uncompetitive Currency: Second most vulnerable

Growing Credit Intensity: Fourth most vulnerable. Another view: Banks with large property loan portfolios will face higher risks when interest rates start to rise — this as highly-leveraged households begin to have difficulty paying their mortgages.

Economists said this could lead to credit tightening by banks, and a hard landing for the property sector.

If that happens, DBS Bank said Singapore and Hong Kong will be hardest hit within Asia.

In other Asean round-up news

surpluses of Thailand, Hong Kong and Malaysia have narrowed even more since the second half of 2007. However, this is partly because Thailand and Malaysia have boosted domestic investment, which lifts imports.

…

Malaysian and Indonesian companies are grappling with a margin squeeze: The two commodity-producing economies have witnessed the biggest rise in their real cost of capital. The Philippines has the opposite problem: Falling inflation-adjusted returns for savers.

…

Rightly or wrongly, though, the sovereign debt issued by developed countries is perceived as safe. Malaysia is not in the same league, and it is pruning petrol and diesel subsidies to control its growing public debt problem.

Unlike in 1997, most Asian countries have relatively straightforward choices. Malaysia can introduce a goods and services tax to control the 14 percentage point increase in its sovereign-debt-to-GDP ratio since 2007. Indonesia can raise interest rates to tame 9 percent inflation. The main problem is India, with its cocktail of slumping growth, high inflation, a creaking banking system, reckless fiscal policies and political uncertainty. Other Asian nations can’t take rising U.S. interest rates lightly, but they are far from a crisis.

http://blogs.reuters.com/breakingviews/2013/09/05/not-all-asian-countries-need-to-fear-the-fed/

Indonesia’s central bank raised its benchmark interest rate 25 basis points Thursday afternoon in a move that defied market expectations and continued a swift phase of tightening efforts as the nation’s economic growth showed signs of stumbling.

The interest rate increased to 7.25 percent, the fourth hike in as many months, as Bank Indonesia moved to stabilize the increasingly volatile rupiah while controlling inflation and the widening trade deficit.

The danger of capital controls in Asean (Note this is new link and chart, not the one originally posted)

http://www.economist.com/news/finance-and-economics/21586569-error-apology-and-revision-spreadsheet-different

Asean trade with China (FT charts)

“HK finds room for 7.2 million people”

That was the headline of a SunT article in the same issue that downplayed the protest at Hong Lim Green, a downplaying that not only got me annoyed but upset a retired senior ink-wielding Imperial Storm Trooper http://berthahenson.wordpress.com/2013/02/17/reporting-hong-lim-park/.

One can only assume that as the same issue carried a front page story on why according to PM, S’pore is a great place to breed, that the story filed from HK was meant to reinforce the view that the 6.9m number that had gotten 5,000 S’poreans to protest was no big deal: their reactions were “emotional” , “unbalanced” or “not shedding light on important issues”*.

Unfortunately for ST, the article contained a table scan0001  comparing the land use in HK and S’pore. Two comparative figures stand out

— Land Use

HK        S.pore

1108       710 sq km

— Country parks and nature reserves

HK         S’pore

738*           57 sq km**

*66.6% of Land Use

**8%

Need I say more on why S’poreans are upset? Especially as the 8% grren space includes the Central Catchment area which will be ripped apart to accommodate the planned projected FT expansion

ST has rightly been given a lot of stick for its coverage of the 6.9m debate. But two cheers to it for the land usage comparison table which sabos the PM’s and his govt’s assertion that 6.9m people doesn’t mean living in a slum. Despite all the extra land and green spaces, even SunT’s HK eporter admits that life isn’t that comfy.

And “Yes’ fair-minded readers, and PAPpies can bitch that I used the comparison stats unfairly, but hey the PAP govt** and allies in the media and the think-tanks (ISEAS is an honourable exception), ain’t playing fair in trying to persuade us that living like battery-hens is high quality living.

—

*Er how can the PM, defence minister etc say that they are listening and have learnt from when one ESM Goh Chok Tong makes these remarks? PM should give him a tight slap to show that the and his govt are sincere in caring for S’poreans, unlike GCT. Remember during his premiership, FTs were allowed to sneak in under the radar. And our fears were dismissed.

***Donald Low, a senior fellow at the LKY School of Public Policy and a former senior civil servant, has criticised the white paper, “wasn’t even a References section to show what research the writers of the paper had done, what social science theories they relied on, what competing theories/frameworks they looked at … There was also a surprising lack of rigorous comparison with other countries that have gone through, or are going through, a similar demographic transition.”

S-Chips are not the only Chinese junk exports, ask the US and HK

The 180 Chinese companies that went public around the world since the beginning of 2010 are trading at an average of 21%  below their IPO prices, Bloomberg News reports.

In Singapore, the third-biggest market for such listings after Hong Kong and New York, eight Chinese companies that went public in 2010 have declined an average of 47 percent from their offer prices, the data show. That compares with a drop of 15 percent for the 23 non-Chinese firms that had IPOs in 2010.

And trading volumes are shrinking. In the last 12 months, trading volumes in S-Chips have halved. [Update on 24 April 2012 at 7.20pm]

But HK and the US are doing something. Regulators in Hong Kong are set to propose rules that would make banks liable for faulty IPO documents, Reuters reports. And earlier today, Hong Kong’s securities regulator fined a brokerage firm and revoked its corporate finance licence. Mega Capital (Asia) has been fined HK$42m (US$5.4mfor “inadequate and sub-standard” diligence work and “failure to act independently”. The firm was the sole adviser to Hontex International, which had raised HK$1bn via a share sale in 2009. BBC Online

In the US, the SEC and FBI have been investigating people allegedly involved in fraud in China-based companies listed on US exchanges. Latest [25 April 2012] SEC investigations and analysis of the complicated structure that overseas listed Chinese cos (including S-Chips) have to adopt to list overseas which makes malpractice easier..

Err waz happening here? We are told by an SGX non-executive director that SGX is “a private club” despite it regulatory role. He said this recently when representing SGX in court as SGX’s lawyer in a case involving a S–Chip. Article 14 analyses the case.

S’pore’s average wage relative to other countries

S’pore’s average wage is juz behind Germany’s and juz ahead of Australia. HK is a long way below us. So Gordon Lee and David See (TOC contributors) stop talking BS when comparing S’pore to HK. Lots of things wrong with S’pore but there is a difference between facts and rubbish. (Funny that TOC use their stuff when TOC has contributors of the quality of Ghui and Uncle Leong.)

 http://www.bbc.co.uk/news/magazine-17543356

Funny also the our mainstream constructive, nation-building doesn’t report how well S’pore ranks globally. Cock-up or subversion by friends of Gordon and David in the newsrooms of our constructive, nation-building media? ISD should investigate.

Hong Kong to resume subsidising housing

Hong Kong will resume a programme to subsidise home purchases to address public anger over ever rising property prices.

Donald Tsang, HK’s leader, said in his annual policy address that the government plans to provide more than 17,000 apartments between 2016 and 2020. On average about 5,000 apartments will be available each year. “Peanuts” by S’pore standards and remember there are lots more people in HK.

The programme is aimed at families who earn too much to qualify for public rental housing but who cannot afford to buy a home of their own.

The flats are to be priced at the equivalent of S$250,000 – S$330,000 and available to those earning a monthly salary of the equivalent of S$3,300 and S$5,000. These apartments will be between 400 to 500 square feet in size.

More background from BBC Online.