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Saturday, 20 September 2014

BREAKINGVIEWS

Alibaba's headquarters in Hangzhou

Magic word greed opens $228 bln Alibaba valuation

19 September 2014

The Chinese e-commerce giant led by Jack Ma saw its shares pop 36 pct at the open. Staggering growth and margins proved irresistible to global investors. The company’s cloudy governance, frenetic dealmaking and corporate structure could yet prove a trap.

A Chinese national flag is seen in front of a GlaxoSmithKline office building in Shanghai, July 12, 2013.

GSK graft case raises risk for executives in China

19 September 2014

The drugmaker is paying a 297 mln stg fine for bribing non-government officials in China. That sets a floor for penalties in future probes. But the suspended sentences for five executives also send a warning that pain in such cases falls on individuals just as much as companies.

A SAP logo is seen at its offices in the CityWest complex, Dublin September 5, 2013. Picture taken September 5, 2013.

SAP's biggest takeover is hard to Concur with

19 September 2014

The German software giant is buying the U.S. travel specialist for $7.36 bln. That’s SAP’s fifth sizeable “cloud” deal in three years. Concur brings blue-chip clients. But at 9.5 times historic sales, SAP is overpaying. And it now has a big backlog of acquisitions to integrate.

Co-founder and Chief Executive of Oracle Corporation, Larry Ellison introduces the company's latest SPARC servers at Oracle Conference Center in Redwood Shores, California March 26, 2013.

Larry Ellison cedes driver seat with hand on wheel

19 September 2014

The Oracle founder is stepping down as CEO, but his 25 pct stake in the software giant – and dual role as chairman and chief technology officer – ensure he’s far from relinquishing control. Splitting his old job between two executives could, however, lead to a bumpy transition.

The European Central Bank (ECB) President Mario Draghi speaks during the monthly news conference in Frankfurt, February 9, 2012.

ECB can live with a pea-shooting bazooka

18 September 2014

Banks took up 83 bln euros in the first round of the ECB’s four-year liquidity injection. That’s less than hoped. Markets are sanguine, hoping sovereign debt purchases are now more likely. The limp start will at least pressure the ECB to deliver on its pledge to buy private assets.

Britain's Prime Minister David Cameron speaks to members of the media in front of 10 Downing Street in London September 19, 2014.

Federal UK is easier to promise than to deliver

19 September 2014

After the Scottish rejection of independence, the UK prime minister pledged a speedy devolution of more powers. Giving regions greater control of taxes and spending sounds sensible. But the politics and practicalities of knotty issues like devolving borrowing powers will be daunting.

Scotland

Scots' no to independence still leaves UK in limbo

19 September 2014

The roughly 55:45 vote against secession in a landmark referendum reduces many risks: financial instability, a UK exit from Europe and a sharp fall in trade. But the bribe to No-voters of more devolved powers creates other dangers – including a weakening of the union.

SEC Chair Mary Jo White testifies at a Senate Banking, Housing and Urban Affairs Committee hearing on Capitol Hill July 30, 2013.

SEC mistakes minor fraudsters for squeegee men

18 September 2014

The U.S. watchdog is nailing petty offenders just as cops used to nab pesky windshield-cleaners. The idea is to nip wrongdoing in the bud. But complex securities enforcement isn’t like neighborhood crime prevention. The tactic may boost SEC statistics more than it deters fraud.

Models present creations during New York Fashion Week in New York, September 10, 2013.

Zalando would find air rarefied in upper range

18 September 2014

Europe’s No. 1 online fashion retailer is aiming for an ambitious valuation for its Frankfurt listing. Anything in the upper half of its 18 to 22.50 euro range looks rich. Zalando has yet to prove it can deliver profit as well as growth. Then there are the governance risks.

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Features

Richard Beales

Review: VC bigwigs reveal Valley's contradictions

19 September 2014

Peter Thiel’s new book sets out possible features of the next world-changing startup that will earn its founders a monopoly – another Google, say. Ben Horowitz’s focuses on running a tech company amid fierce competition. One is about vision, the other – for most people – reality.

Una Galani

Australia at sharp end of China outbound ambition

19 September 2014

Growing ties to China are a source of anxiety but the lop-sided relationship is here to stay. As Chinese buyers widen their horizons from resources to property and education, Australians have a chance to show they’re pragmatic. Beijing could help too, with a touch of soft power.

Jeffrey Goldfarb

NFL only understands hits where they really hurt

18 September 2014

The U.S. football league has thrown its weight around to grow into a $10 bln entertainment colossus. Victims of the sport’s violence get trampled until the likes of Anheuser and Nike play offense. Corporate America may be all that keeps the NFL from going the way of boxing.

Columns

Edward Hadas

Edward Hadas: The economic lessons from Scotland

17 September 2014

However the independence referendum turns out, the arguments from both sides reveal some hard truths. Governments are at the centre of modern economies. But their freedom is limited, since no nation is an island. And the toughest challenge is managing the financial system.