Indian Hubris Creates a Mountain of Debt

It may have been a coincidence that the Shanghai stock market tumbled 5 percent on the day that India's Tata group won a $12-billion battle for the Anglo-Dutch steel company Corus. But maybe not. Easy money and reckless purchases are a global phenomenon fuelled by a surfeit of cheap money. Chances are the neophyte investors…

Will China’s Tax Policy Throw Property into the Deep Freeze?

China's leaders appear once again to want to bludgeon their property market into submission. Their 20 January announcement that they would enforce a capital gains tax on property development that would cut developers' margins to 20 percent shows that their grasp on market mechanisms remains remarkably slippery.   But blunt instruments don't always work. Besides…

Singapore’s Shifting Sands

Is Singapore an empire built on sand, particularly Indonesian sand? A decade-long squabble between the island republic and Indonesia over what seemingly ought to be an inexhaustible commodity has escalated, with Jakarta suddenly slapping a permanent ban on sand exports and risking another setback in the oft-strained relations with its nearest neighbor. The move is…

China’s Raging Bull

The current bull market in China shares looks like a lot like any other bull market: frenzied trading volumes, fresh record highs on a regular basis, cheerleading banks upgrading their "price targets".  But there is also a very special rationale involved in the run on China assets. This is not just a bull market   this…

Borrowing in Yuan and Investing in Bucks

It is no wonder that so many of the so-called economists employed by investment banks and hedge funds keep up constant pressure on central banks, especially Asian ones, to keep rates low.  Without that there would be no fuel for the carry trade, which has enriched so many ill-deserving bulge-bracket gamblers and could potentially result…

Smoker’s Paradise

From the terraced emerald slopes of Bali to the jam-packed kampungs of Sumatra, the 13,500 islands of Indonesia reek with the sweet scent of clove cigarettes, known as kretek for the crackling sound they make when they burn.. Indonesia remains a smoker’s paradise. An estimated 141 million of the country’s 245 million people smoke cigarettes,…

Like Father Like Son, Macau Style

If you ever see Macau casino heir Lawrence Ho give a speech, right away you notice he embodies the spirit of the “next generation” in much the same way that Richard Li contrasts with the patriarch Li Ka-shing. Compared to father Stanley Ho, Lawrence’s profile is young and international.  When he gives speaks before investors…

Thailand Moves Against Foreign Firms

Thailand's military-appointed government raised the specter of protectionism and sparked a steep drop in stock prices Tuesday when it acted to halt the longstanding practice of using nominee firms to bypass the 49% foreign ownership restriction. The market responded with a 17 point drop on the Stock Exchange of Thailand, or nearly2.7 percent, after the…

The High Risk of Travel in Indonesia

The discovery on the sea bottom Monday off West Sulawesi of what is believed to be the wreckage of a Boeing 737-400 that crashed on New Year’s day dramatically points up Indonesia’s astonishingly bad air and sea transport safety record, especially since the turn of the century. Owned by three-year old budget carrier Adam Air,…

Treachery in Shanghai!

The Shanghai government is reaping a whirlwind of rising xenophobia and reviving memories of the Opium Wars over a plan to force local retailers out of the famed Nanjing Lu shopping area and turn the district over to upscale foreign brands. If web postings are any yardstick, the plan has generated nearly unprecedented protest. Hundreds…