Wall Street Journal (February 27)
“Tens of billions of dollars in U.S. market value have disappeared in recent years as more than 170 U.S.-listed Chinese companies have faced scrutiny for embezzlement, theft, misrepresentation and other alleged abuses.” Regrettably, the Securities and Exchange Commission (SEC) has caved-in on tighter inspections, deciding “not to suspend the Chinese audit firms or penalize them beyond token fines of $500,000.” As a result, U.S. investors “still lack basic protections against Chinese fraudsters” while Chinese authorities “remain as free as ever to stymie future investigations.” Furthermore, the SEC’s lack of spine increases “China’s rising confidence that it can play by its own rules.”
Tags: Abuses, Audit firms, Embezzlement, Inspections, Investors, Market value, Misrepresentation, Rules, SEC, Theft, U.S.-listed Chinese companies
The Economist (February 7)
“Despite their flaws and excesses, activists are a force for good.” These investors “are often loathed by public-company bosses for their belligerence and opportunism. But the bosses are wrong. Activists are in fact the public company’s unlikely saviours.” Activist investors “fill a governance void that afflicts today’s public companies,” which are increasingly held by passive investors. They wake “lazy investors” up with their activist complaints, making “it harder for investors to stay on the sidelines.”
Tags: Activists, Excesses, Flaws, Governance, Investors, Opportunism, Passive investors
Institutional Investor (January 20)
“Once again, Chinese growth data takes center stage.” The International Monetary Fund cited China’s slowing growth as a major reason for its latest downward forecast revision. The IMF slashed expected global GDP growth from 3.8% to 3.5% during 2015. “With a global economy still attuned to demand from a rising China, the nation’s economy remains the central theme for macro and micro-focused investors alike.”
Financial Times (January 9)
“Investors looking for haven assets are increasingly having to pay up for the safety they provide as the volume of negative-yielding eurozone government debt has swollen to a record €1.2tn.” The change to assets you effectively pay to hold is unprecedented. At €0 in June 2014, this negative-yielding debt now accounts for roughly one quarter of outstanding eurozone sovereign debt, mostly “concentrated among the short-dated debt of core eurozone countries.”
Tags: Assets, eurozone, Government debt, Haven, Investors, Negative-yielding, Safety
Institutional Investor (December 31)
“The major market narrative remains oil.” 2014 brought the largest annual price decline since 2008. Investors are “focusing on what the impact of cheap oil will be on global fundamentals in the coming quarters.”
Wall Street Journal (December 11)
“China’s market may have a massive capitalization on paper but the small float of tradable shares means that it is easily manipulated. Retail investors are often sucked in and then burned.”
Tags: Capitalization, China, Float, Investors, Manipulated, Market, Tradable shares
Investment Week (November 10)
“Investors and fund buyers are increasingly backing Japanese equities as the country boosts its QE programme, and rotates its national pension fund towards domestic equities.”
Tags: Equities, Funds, Investors, Japan, Pension fund, Quantitative easing
Bloomberg (August 19)
The annual meeting of central bankers kicks off this week in Jackson Hole and it’s worth paying attention. “Central bankers, a group of largely independent technocrats, wield more power over the fates of politicians, investors and regular folk than ever before. In the absence of government action, they are bearing most of the burden of supporting economic recoveries in the U.S. and Europe. With their bond purchases and other unconventional policies, they have become a major force holding up financial markets around the world.”
Tags: Bond purchases, Central bankers, Economic recoveries, Europe, Financial markets, Government, Investors, Jackson Hole, Politicians, Power, U.S.
Institutional Investor (August 12)
“Disappointing sentiment data and continued conflict in eastern Ukraine” are leading to investor apprehension. “Slowing production levels and low inflation appear to leave the door open for European Central Bank intervention but political support for action from European Union leaders is still far from consensus. With a strong correlation between primary global equity indexes that has been noted by multiple strategists in recent sessions, deteriorating investor confidence in Europe is likely to cast a shadow over U.S. equity markets in the near term.”
Tags: Confidence, Conflict, Consensus, Disappointing, ECB, Equities, EU, Inflation, Intervention, Investors, Production, Sentiment, U.S., Ukraine
The Economist (July 26)
“ONE trillion dollars. That may be the cost to Russian investors of Vladimir Putin’s rule…. The calculation stems from the fact that investors regard Russian assets with suspicion. As a result, Russian stocks trade on a huge discount to much of the rest of the world, with an average price-earnings ratio (p/e) of just 5.2. At present, the Russian market has a total value of $735 billion. If it traded on the same p/e as the average emerging market (12.5), it would be worth around $1.77 trillion.”
Tags: Assets, Cost, Discount, Emerging market, Investors, Market, P/E, Putin, Russia, Suspicion, Trillion