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Monday, 06 July 2015

BREAKINGVIEWS

Chinese shares still look overvalued

06 July 2015

Mainland authorities are taking ever-bolder steps to prop up stocks which have dropped almost 30 pct in three weeks. Yet earnings growth is slowing and valuations are still high when compared with other markets. If fundamentals matter, Chinese equities have further to fall.

A woman exits a voting booth at a polling station in Thessaloniki, Greece July 5, 2015

Greek "No" vote means ECB can no longer sit on fence

05 July 2015

A convincing anti-euro zone vote means the European Central Bank must decide whether to cut the Greek banks off from crisis loans, risking financial meltdown. In theory the ECB may be able to keep the sector going while the dust settles. But that may be politically impossible.

Greek Prime Minister Alexis Tsipras

Tsipras departure could unlock Greek debt relief

03 July 2015

European creditors are wary of writing off Athens’ debts because it could set a precedent. Yet if Prime Minister Alexis Tsipras resigns after the referendum, a deal should be doable. Few politicians would follow his path of capital controls, economic strife and career implosion. 

A mill production supervisor samples some potash in the process of being refined.

Potash Corp may have to go too far to get K+S

03 July 2015

The Canadian fertiliser giant is willing to bid $10.5 bln for its German peer. It will need to improve its offer and give credible job guarantees to win over the target. But these concessions could become contradictory. A higher price implies Potash will need bigger cost cuts.

Guangzhou Evergrande's Zhang Linpeng (L) fights for the ball with Bayern Munich's Javier Martinez during their FIFA Club World Cup soccer match at Agadir Stadium in Agadir December 17, 2013.

Alibaba kicks China’s new tech board to big league

03 July 2015

The e-commerce group’s soccer club will list on the “New Third Board”, an upstart exchange with $200 bln of companies that could be China’s answer to Nasdaq. It’s a welcome source of capital for start-ups, but a lack of oversight means investments are only for the brave.

Shipping container cranes are seen at the Patrick port facility in Melbourne June 9, 2009.

Brookfield can sail off with Asciano

02 July 2015

The Canadian investor wants to buy the Australian ports and rail operator for $6.8 bln. A solid 36 percent premium was enough to get Asciano’s board talking. So shareholders seeking a big sweetener may be disappointed. Part-payment in shares could be the main obstacle.

BP may now get closure on Gulf spill

02 July 2015

The UK oil major has settled claims with the U.S. government and five states for $18.7 bln. It brings the total bill to $53.8 bln. But it could have been worse and it’s payable over as much as 18 years. It may also mean BP can finally put the Deepwater disaster behind it.

A pharmacist counts pills in a pharmacy in Toronto

Aetna's bitter Humana pill is good long-term care

03 July 2015

The two U.S. healthcare insurers struck a $37 bln deal ahead of rivals in a race to consolidate an industry rapidly reshaping under Obamacare. Cost savings will fall short of the premium Aetna is offering. It may be a price worth paying to be first in line with trustbusters.

A leaflet which reads "Uber go home" is seen on a taxi as striking French taxi drivers block the traffic on the Paris ring road during a national protest against car-sharing service Uber, in Paris, France, June 25, 2015.

Uber's French lesson: disruption has limits

03 July 2015

The upstart taxi app has suspended its service in France after a fortnight in which it was the target of violence. Two executives were also detained. Uber’s truculent approach has driven growth. But agents of renewal sometimes have to work with the status quo to change it.

Lei Jun, founder and CEO of China's mobile company Xiaomi, shows the new features at a launch ceremony of Xiaomi Phone 4, in Beijing, July 22, 2014.

China pours cold water on Xiaomi's growth

03 July 2015

Falling sales over the past six months come as a nasty shock from a handset maker that commanded a $45 bln valuation just months ago. Xiaomi is grappling with a slowing home market and competitors catching up. China’s tech prodigy will have to look elsewhere for opportunities.

A protester waves a European Union flag in front of the parliament building during a rally calling on the government to clinch a deal with its international creditors and secure Greece's future in the Eurozone, in Athens, Greece, June 22, 2015.

Life after default: Malaysia's tips for Greece

03 July 2015

The Asian country shunned an IMF lifejacket in 1998. Greece could soon be in a similar boat. Breakingviews imagines former leader Mahathir Mohamad’s advice to Greek PM Alexis Tsipras: devalue, fix the banks, and boost spending – but don’t bother jailing your finance minister.

Cuba's President Raul Castro and U.S. President Barack Obama hold meeting in Panama City, Panama April 11, 2015.

Cuba's coming boom: A cautionary Caribbean tale

02 July 2015

As the communist nation’s emergence takes another step with U.S. diplomatic ties restored, its neighbor Puerto Rico is descending into a debt crisis. Breakingviews imagines a future conversation between former Presidents Castro and Obama if Cuba fails to heed the warning.

A man, with a sign strapped to his back, uses a megaphone to attract the attention of potential employers as he hands out resumes on Bay Street in the financial district in Toronto, March 5, 2009.

U.S. jobs gains yet to vanquish crisis hangover

02 July 2015

The economy added more positions in June and the jobless rate fell to 5.3 pct. It’s a steadily improving situation – yet there are clear signs of slackness, like a new low for workforce participation and stagnant wages. The damage from the 2008 crunch is proving persistent.

Videos

Columns

Hugo Dixon

Hugo Dixon: Greece will struggle to stay in euro

05 July 2015

After the people gave an emphatic “No” to the creditors’ proposals, there are still several ways Athens could avoid the drachma. But none seems terribly likely. All routes will lead to further hardship.

Rob Cox

Rob Cox: Uber gets a pass on its Wall Street habit

30 June 2015

Big banks break rules and pay fines. Traditionally it’s just a cost of doing business. Uber, meanwhile, pays fines when drivers violate regulations that stand in the way of its business model. Nowadays banks attract outrage, but Uber is often forgiven in the name of disruption.

Features

Andy Mukherjee

Fear all working robots, not just big bionic arms

01 July 2015

SoftBank’s Masayoshi Son says automatons may outnumber humans in 30 years. It sounds far-fetched. But robots are 80 percent cheaper now than in 1990, and getting lighter and safer for people to use. That makes them a big risk to many of the world’s 6 billion future workers.

John Foley

Rising China: a required reading list

26 June 2015

China has towering international influence and a huge population. It will soon be the world’s largest economy too. But it’s hard to know what makes the People’s Republic tick. Enter the Breakingviews required reading list, eight works agreeably free of “dragon” in the title.