A government advisor and the chief of the country’s $1.2 trillion public retirement fund are sparring over asset allocation between debt and equity. While stock market investors have a stake in the turf war, the bigger concern for bond buyers is the surge in pension liabilities.
If Chaori Solar fails to pay interest on March 7, as expected, what then? Investors will be deprived of cash, banks will have to mark down some of their holdings, and new issuers will have to pay more. Though a default is overdue, the aftershocks should not be underestimated.
State-backed COFCO is eyeing an agriculture joint venture with Singapore’s Noble, a week after taking control of Dutch grain trader Nidera. COFCO’s mission to ensure China’s food security is finally translating into large overseas acquisitions. Yet targets remain in short supply.
A survey that labelled the city-state the world’s costliest place to live suffers from a flawed methodology. Measuring the price of bread or petrol in U.S. dollars is not the right comparison. Consumers care about quality of life - in the currency in which they earn their living.
The country’s possible first bond default has prompted comparisons with the Wall Street firm’s failure. It’s tempting for investors to seek parallels with 2008. If the analogy fits at all, it’s only because it reminds the Chinese authorities which mistakes to avoid.
The buyout firm is purchasing Tyco’s security business in South Korea for three times revenue and 11 times EBITDA. That looks punchy. Koreans are reluctant users of alarm systems - even safer Japan has more. If incomes continue to rise and inequality increases, that will change.
LDK Solar is trying to avoid the fate of bankrupt rival Suntech. Yet even if it could restructure away its debts, LDK’s high costs make it look uncompetitive. Peers like GCL Poly seem overvalued, pricing in a solar renewal that may not last.