The Exchange: Goldfingers 2 Nov 2018 Oliver Bullough's book "Moneyland" delves into the parallel world of super-rich super-crooks, where rules are for the little people. He discusses wealth, corruption, tax havens and how to fix it all with Clara Ferreira Marques and Nicholas Shaxson, author of “The Finance Curse”.
China trade-secrets case brings sanctions closer 1 Nov 2018 State-backed chipmaker Fujian Jinhua was indicted for allegedly stealing designs from U.S. rival Micron. It was already barred from buying U.S. parts, so this raises the stakes. Former President Obama mulled sanctions for industrial espionage. That idea could be in play again.
Goldman gets no closure from banker’s 1MDB plea 1 Nov 2018 Former star banker Tim Leissner pleaded guilty in the Malaysian money-laundering scheme. The firm can cite his lies and deception. But fat fees from bond offerings should’ve raised red flags. U.S. authorities have punished Wall Street for past examples of poor oversight.
Japanese telecom titans get rude wakeup call 1 Nov 2018 The country’s big three carriers lost $30 bln in market value after NTT Docomo said it would cut prices. Scant details suggest the selloff may be overdone. With new rival Rakuten rolling out soon and a SoftBank IPO approaching, anxious investors are now bracing for the worst.
BHP atones for past M&A sins 1 Nov 2018 The mining titan is returning all $10.4 bln from its U.S. shale sale in a dividend and buyback. A nudge from pushy investor Elliott and deal discipline led to a better use of capital than in the last cycle. Boss Andrew Mackenzie has set a higher bar for BHP’s financial balance.
China’s Mr Fix It banks have a property problem 1 Nov 2018 Beijing wants lenders to do everything. That means supporting infrastructure spending, propping up stocks and rescuing state zombies – all while cutting bad debt. It’s a tough juggling act. Now, though, there are worrying signs in property: if that ball drops, others may follow.
India’s central bank spat has a global hue 1 Nov 2018 New Delhi has ratcheted up tensions with a mooted threat to invoke a never-used power to meddle with the RBI. With the rupee sinking, it’s a terrible time to undermine the bank's independence. Donald Trump’s readiness to fault the U.S. Fed has given others cover to be bolder.
Evergrande’s bond bravado baffles bystanders 1 Nov 2018 The indebted Chinese developer issued $1.8 bln of dollar bonds at eye-watering coupons, but sold $1 bln to its chairman. With housing looking toppy, the yuan sliding, and a listing in the works, Evergrande has a lot of balls in the air. This gesture confuses more than it amuses.
Budget tests mettle of Malaysia’s mavericks 1 Nov 2018 Mahathir Mohamad's government is set to present the $300 bln economy's most significant blueprint in decades. It needs to burnish reform credentials and soothe rating agencies. Outlining a credible tax plan will be a start; a plan to reduce the state's role is the bigger prize.
Nomura’s U.S. business offers lessons from Lehman 31 Oct 2018 A decade on from buying them, the Japanese bank’s Europe, Middle East and Asia advisory units are industry laggards but still outshine the Americas operation Nomura built itself. That business is having a good year, but the crisis deal shows how hard it is to start from scratch.
China’s advertising giants face white space 31 Oct 2018 With a slowing economy, marketing teams will pull back on ad spend. That will hit sales growth for search titan Baidu and microblog Weibo. The squeeze, alongside Google's mooted return to China, threatens to exacerbate the tech selloff and puts fresh importance on the race to diversify.
ANZ sets flat tone for contrite Aussie banks 31 Oct 2018 The $52 bln lender has reported a 5 pct drop in full-year earnings, hit by clean-up costs. Given regulatory heat, it could have been worse. Yet bank shares remain pricey. That suggests pain ahead as a boom, fed by a rosy economy, household debt and pricing power, winds down.
Trade and pig diseases infect China’s pork giant 31 Oct 2018 WH Group, $11 bln owner of U.S.-based Smithfield, is fighting a losing battle on two fronts. Deadly swine fever is sweeping China, while tariffs hammer its American market. Quarterly earnings fell by almost a third from a year earlier. It will get worse before it gets better.
China’s oil windfall covers up hints of gas pain 31 Oct 2018 PetroChina has reported a more than fourfold rise in quarterly earnings, a bumper profit fuelled by higher crude prices. But the $210 bln state producer also took a heavy hit on gas imports this year. Those losses may widen as China cranks up a shift away from coal at all costs.
Sony’s turnaround is missing an enduring plot 30 Oct 2018 The $70 bln Japanese group beat quarterly earnings expectations, thanks to videogames like Marvel's Spider-Man. But even after a two-year rally, the shares are cheap. The next challenge for new boss Kenichiro Yoshida is to prove the revival is more than one-hit wonders.
Ping An’s tech wizardry hits old-school hurdles 30 Oct 2018 The $165 bln Chinese insurer posted a 7 pct drop in earnings, weighed down by its property and casualty arm. Nifty tech like AI has helped it offer more targeted policies. Yet outdated rules have meant a higher tax bill. The group can afford to work its magic on regulators.
Wilbur Ross finally picks right fight with China 30 Oct 2018 Washington has put a provincial chipmaker under an embargo similar to that which crippled telecoms giant ZTE. Fujian Jinhua is accused of IP theft by Idaho-based Micron; this retaliation presumes guilt. Still, targeting smaller state-backed firms is smarter than blanket tariffs.
Korean conglomerate accentuates the discount 30 Oct 2018 Nearly six years after selling a controlling stake in Coway to a private equity shop, Woongjin is buying it back with a partner for $1.5 bln. News of a return to its original steward erased 25 pct of the appliance rental company’s value. It’s a reminder of just how sprawl can scare.
China tax cut would only be band-aid for carmakers 29 Oct 2018 Halving the levy on new vehicle sales might help prop up falling demand. But it could delay the country’s much-needed industry consolidation. Meanwhile foreign automakers have far more to fear from U.S. and European slowdowns – not to mention the prospect of more trade tariffs.
Uber-Ola strike flags dangerous transit dependency 30 Oct 2018 Drivers demanding higher fares protested for eight straight days in Mumbai, disrupting a city with poor transport options. Uber and Ola steered into trouble by cutting effective salaries paid to partners. The fallout drives home the need for tighter regulation.