Bear rumblings in Asia

Written by Kapronasia || March 27 2008

The collapse of Bear Sterns has not only changed the financial industry in the US, but it's also had a number of knock-on effects in Asia.

China 2008: What lies ahead - Part 3 of 3

Written by Kapronasia || January 22 2008

The Olympics

Amongst all of the events happening in China in 2008, without a doubt, the most important item on the Chinese agenda this year is the Beijing Olympics. Seen by both domestic and international observers as a key indication of China’s development, the Chinese government has spared no expense in preparing for the games.

China 2008: What lies ahead - Part 2 of 3

Written by Kapronasia || January 18 2008

A continued look at China in 2008.

China 2008: What lies ahead - Part 1 of 3

Written by Kapronasia || January 17 2008

Year 4706, the year of the rat, begins on February 7th in China this year. With the celebration just under a month away, it’s tempting to use the time to procrastinate on making predictions on what will happen in China is 2008 as it’s technically not the new year here yet, but unfortunately, China doesn’t wait.

Betting on the Dragon: Chinese investor behaviour

Written by Kapronasia || November 22 2007

The Shanghai stock market continues to defy expectations -- up nearly 100% in 2007. Most of the commentary on the Shanghai market depicts the average Chinese investor as unknowledgeable and following the herd. However, a recent study that we’ve (kapronasia) just completed with Amber (www.amberinsights.com) shows that individual Shanghai A-share investors are actually much more market savvy than commonly thought.

GE loses on Shenzhen Dev Bank - Karma doesn't work in China

Written by Kapronasia || October 24 2007

Two years ago in 2005, GE agreed to buy a 7% stake in Shenzhen Development Bank, which at the time was worth US$100M. However, the deal had been held up due due to disagreements amongst the shareholders, one of which was the private equity group TPG. Most of the disagreements centred around government requirements on share restructuring as the initial agreement would have significantly diluted TPG's stake in the bank. TPG eventually did agree to modified terms, but yesterday Shenzhen Bank terminated the agreement.

Bear in a China Shop

Written by Kapronasia || October 23 2007

Not to miss the ‘invest in China’ boat, yesterday, Bear Stearns and Citic Securities announced a co-investment partnership agreement. If everything is approved by the regulators, which it likely will be, Bear, the darling of the CDO market, will invest US$1B in the Chinese brokerage, which will convert to a 2% stake over 6 years with the option to increase that to 7%. Conversely, Citic will invest the same in Bear, which will convert to 6% stake in Bear over 40 years, and will have the option to increase this stake to 9.9%. Most of the non-Chinese operations will likely be a co-branded operation and it’s yet unclear what the Chinese operation will look like.

China: Stock Dormancy

Written by Kapronasia || October 18 2007

For the past few weeks, most of the major news in China has centred on the Communist Party Congress. This is an pretty important event in China that happens once every 5 years and usually results in a number of far-reaching policy and people changes throughout the country and government.

 

Dubai: If you build it...

Written by Kapronasia || October 03 2007

So whilst everyone was making final preparations for SIBOS this past weekend, I was in Dubai keeping good on a long standing promise to visit a friend.

China: Barbie and Goldman

Written by Kapronasia || September 26 2007

Lead Toys

With recall troubles dating back to 2005 when a toddler in the US ate a loose magnet and later died, the toy manufacture Mattel has been in the centre of a toy recall that has thousands of class-action lawyers around the world drooling. The company has gone through numerous recalls in the past few months, the largest being for 18 million playsets plagued by another loose magnet.

Singapore: Bubble? What bubble?

Written by Kapronasia || September 17 2007
On a recent trip to Singapore, I was shocked to see that the 3 bedroom flat that I used to rent with a few people in 2004 for SGP$2,100 was now renting for SGP$4,300. Just over double in 3 years. Now what becomes even more eye-opening is if you take the USD exchange rate fluctuations into account, for those of us still clinging to greenback savings, the rise is closer to 230%. Indeed, according to government statistics, the prices are continuing to rise: in Q2, rents rose 10% and private-home prices rose 8.3 percent, the fastest in 8 years. Now, that’s not so bad when you consider Singapore’s GDP grew a healthy 7.9 percent last year, but it is worrying nevertheless.

China: You can invest abroad...but not quite yet.

Written by Kapronasia || September 04 2007

China, well known for its capital controls made some steps towards loosening those controls for individual investors last month with the announcement that individual mainland Chinese investors would be able to invest in the HK stock market. However, now it appears the implementation will be another few days or weeks off according to an announcement by the Bank of China (BOC).

China - subprimed or not?

Written by Kapronasia || August 28 2007

Reading Bank of China’s ticker last week was a crash course in China’s stock markets. Towards the end of last week, the bank reported on its sub-prime exposure. On the next trading day, if you were given the two ticker symbols for Bank of China (BOC) and their positions, you’d be hard pressed to guess what BOC’s actual position was. In HK, BOC fell by as much as 5.4% over the course of the trading day*, while in Shanghai, the stock actually rose 1% on a day when the entire market rose 5% overall. What happened?

 

Earlier this week we looked at how the Shanghai market has remained relatively unscathed by the sub-prime meltdown, but what about individual banks' exposure?

 

Losses through the week in major indices around the world and indeed in emerging market countries in Asia, have chipped away yearly gains that most indices have chalked up this year. China's Shanghai index however is up nearly 78% on the year. How is it possible?

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