SingTel broadens its footprint...again.
SingTel and Warid Telecom of Pakistan are coming together in yet another deal for SingTel that broadens its scope beyond Singapore.
The 30% stake in Warid is worth an estimated US$758 mln. and now gives SingTel access to another market beyond the shores of Singapore, bringing the total number of markets that SingTel has a major presence in regionally to 8.
This sort of growth for SingTel I think signals 2 things: 1) SingTel is more a regional telco than anything, and 2) SingTel has to broaden its horizons outside of Singapore to stay profitable and revenue generating. Simply put - as most companies will probably agree with - Singapore is tapped out and SingTel has scaled the market and capitalized off the market here at home as much as it possibly can.
But the investment in Pakistan is a good one for SingTel I think, given how much that market is on the rise. It just makes you wonder where SingTel's next move is going to be and what market they will tackle next.
As always please see your licensed financial advisor before making any investment decisions.
Curtis Bergh
The 30% stake in Warid is worth an estimated US$758 mln. and now gives SingTel access to another market beyond the shores of Singapore, bringing the total number of markets that SingTel has a major presence in regionally to 8.
This sort of growth for SingTel I think signals 2 things: 1) SingTel is more a regional telco than anything, and 2) SingTel has to broaden its horizons outside of Singapore to stay profitable and revenue generating. Simply put - as most companies will probably agree with - Singapore is tapped out and SingTel has scaled the market and capitalized off the market here at home as much as it possibly can.
But the investment in Pakistan is a good one for SingTel I think, given how much that market is on the rise. It just makes you wonder where SingTel's next move is going to be and what market they will tackle next.
As always please see your licensed financial advisor before making any investment decisions.
Curtis Bergh
Labels: Pakistan, Singapore, SingTel, Warid
Better more than less
Office rents in Singapore are expected to outstrip Hong Kong's by end 2008 and Singapore hotel room rates are projected to triple by 2015!
It's also an indicator of Singapore's vibrant and ever growing economy. According to the Business Times, the demand for space is driven by IPO's, Merger &Aquisition activities and private wealth management-and they are all expected to continue growing.
Singapore is also awaiting an entourage of foreign visitors awaiting the Formula One Circuit, casino-resorts, Universal Studio's theme park and the world's largest ferris wheel.
It's a case of demand outstripping supply. The supply for land or space is not enough to meet demand.
Its a much better fix to be in as compared to having excess land and space that we're sitting around swatting flies and wondering what we are to do with it.
Here's what i mean:
Chairman of City Developments Kwek Leng Beng says the city will be short of hotel rooms as Singapore attracts more tourist to its shores.
The government expects the number of visitors to double to 17 mln by 2015, with tourism spending tripling to S$30 bln.
With regards to office space, the government is currently considering moving some public organisations out of prime office space in the CBD to make way for the private sector.
Yes it may not be fair but at the end of the day money talks.
And so in turn, we'll have hotel rates and office rents rocketing sky high
Our island is small, we may have the capital to build magnificent structures that may draw in the crowds, but we can't run away from the fact that we are on a small island and land is limited.
And exorbitant rates may affect Singapore's competitiveness in drawing foreign investors
However, let's just say we'll cross the bridge when we get to it.
To leave your comments, please log on to investorcentral.blogspot.com
Yeo Sue En
It's also an indicator of Singapore's vibrant and ever growing economy. According to the Business Times, the demand for space is driven by IPO's, Merger &Aquisition activities and private wealth management-and they are all expected to continue growing.
Singapore is also awaiting an entourage of foreign visitors awaiting the Formula One Circuit, casino-resorts, Universal Studio's theme park and the world's largest ferris wheel.
It's a case of demand outstripping supply. The supply for land or space is not enough to meet demand.
Its a much better fix to be in as compared to having excess land and space that we're sitting around swatting flies and wondering what we are to do with it.
Here's what i mean:
Chairman of City Developments Kwek Leng Beng says the city will be short of hotel rooms as Singapore attracts more tourist to its shores.
The government expects the number of visitors to double to 17 mln by 2015, with tourism spending tripling to S$30 bln.
With regards to office space, the government is currently considering moving some public organisations out of prime office space in the CBD to make way for the private sector.
Yes it may not be fair but at the end of the day money talks.
And so in turn, we'll have hotel rates and office rents rocketing sky high
Our island is small, we may have the capital to build magnificent structures that may draw in the crowds, but we can't run away from the fact that we are on a small island and land is limited.
And exorbitant rates may affect Singapore's competitiveness in drawing foreign investors
However, let's just say we'll cross the bridge when we get to it.
To leave your comments, please log on to investorcentral.blogspot.com
Yeo Sue En
Labels: excess, F1, Grand Prix, hotel rates, office rents, tourism
SGX should set standard for corporate disclosure
The Singapore Exchange, apart from being a listed counter itself, is also one of the regulatory bodies when it comes to listings and trade.
It often emphasizes the importance for listed companies to be transparent to shareholders and to disclose any news that may affect their shares.
So it is no wonder that investors will take more notice if it gets queried by the Monetary Authority of Singapore over the sudden surge in its share price or if its shares get traded in unusually large volumes.
In other words, the SGX should practise what it preaches and set the standard for such corporate disclosures.
On 11 June, its share price spike prompted a query from the MAS, to which it replied that it “is not aware of any information not previously announced concerning the business of SGX...which, if known, might explain the price increase” and that it was not in any “negotiations or agreements which are disclosable under the Listing Rules”.
It provided a couple of reasons for the surge in its share price, citing a UBS Equities Research report which named SGX as their key sector pick and “Bloomberg and Dow Jones reports on the rise of SGX share prices amid speculation of takeovers and acquisitions.”
Attached to those are disclaimers about how it has not received notice from any party about acquiring 5% or more of its shares, or confirmed any collaborations or acquisitions of SGX shares, pretty much the same broad-based (non-committal) remarks you'd read from any other “response to MAS query”.
Four days later, it announced being informed by the Tokyo Stock Exchange that the latter has acquired about 4.99% of SGX's issued share capital.
Like, hello?
Doesn't the Listing Manual say that a company must, at any time, disclose any information that could possibly “materially affect the price or value of its securities”?
It already seems somewhat unreal that the SGX could not have anticipated this enough to have warned shareholders about any possible changes in share ownership.
After all, it has been collaborating with the TSE since last December and the TSE has, according to the Business Times, “agreed in principle to licence TOPIX-related indices to the SGX to create derivatives and electronic transfer fund products for trading on the local bourse”. They have also gone on to exploring other collaborative efforts.
So why didn't the SGX even give a hint of the possibility of such an acquisition?
It really should set the standard, being the regulator for all listed companies in Singapore.
Otherwise, it would be like the pot calling the kettle black.
Serene Lim
It often emphasizes the importance for listed companies to be transparent to shareholders and to disclose any news that may affect their shares.
So it is no wonder that investors will take more notice if it gets queried by the Monetary Authority of Singapore over the sudden surge in its share price or if its shares get traded in unusually large volumes.
In other words, the SGX should practise what it preaches and set the standard for such corporate disclosures.
On 11 June, its share price spike prompted a query from the MAS, to which it replied that it “is not aware of any information not previously announced concerning the business of SGX...which, if known, might explain the price increase” and that it was not in any “negotiations or agreements which are disclosable under the Listing Rules”.
It provided a couple of reasons for the surge in its share price, citing a UBS Equities Research report which named SGX as their key sector pick and “Bloomberg and Dow Jones reports on the rise of SGX share prices amid speculation of takeovers and acquisitions.”
Attached to those are disclaimers about how it has not received notice from any party about acquiring 5% or more of its shares, or confirmed any collaborations or acquisitions of SGX shares, pretty much the same broad-based (non-committal) remarks you'd read from any other “response to MAS query”.
Four days later, it announced being informed by the Tokyo Stock Exchange that the latter has acquired about 4.99% of SGX's issued share capital.
Like, hello?
Doesn't the Listing Manual say that a company must, at any time, disclose any information that could possibly “materially affect the price or value of its securities”?
It already seems somewhat unreal that the SGX could not have anticipated this enough to have warned shareholders about any possible changes in share ownership.
After all, it has been collaborating with the TSE since last December and the TSE has, according to the Business Times, “agreed in principle to licence TOPIX-related indices to the SGX to create derivatives and electronic transfer fund products for trading on the local bourse”. They have also gone on to exploring other collaborative efforts.
So why didn't the SGX even give a hint of the possibility of such an acquisition?
It really should set the standard, being the regulator for all listed companies in Singapore.
Otherwise, it would be like the pot calling the kettle black.
Serene Lim
Labels: corporate disclosure, SGX
Leaving all his troubles where they are...literally
Thaksin Shinawatra has been ordered back to Thailand to face corruption charges, and all does not seem well on the horizon for him and his family. This of course all goes back to the military coup that ousted him from power as a result, stemming from upheaval of the tax free sale of Shin Corporation to Temasek Holdings here in Singapore.
But since that coup Thaksin has been gallivanting around the world on what seems to be a buying spree as of lately instead of laying low, and getting him to return to Thailand where he has been charged may be harder than you might think.
Hey Thaksin, go back and face the music, and if they find you not guilty, then you'll know.
Regardless of whose side you sit on in the debate of where there was any wrongdoing, if any, goes beyond this blog (however leave comments if you do have a take!).
But I want to point out Thaksin's recent projects and how I definitely think that they are rather extravagant and rubbing it in the face of officials demanding that he return to Thailand. First, the Manchester City bid; second, the US$27 million house in Hong Kong.
Either way...I really think Thaksin should return to Thailand and face the charges, and, defeat them if he can. But then again, I'm sure he has his reasons for NOT wanting to return there, essentially seeing the world as his oyster and leaving all his troubles in Thailand (literally).
Curtis Bergh
But since that coup Thaksin has been gallivanting around the world on what seems to be a buying spree as of lately instead of laying low, and getting him to return to Thailand where he has been charged may be harder than you might think.
Hey Thaksin, go back and face the music, and if they find you not guilty, then you'll know.
Regardless of whose side you sit on in the debate of where there was any wrongdoing, if any, goes beyond this blog (however leave comments if you do have a take!).
But I want to point out Thaksin's recent projects and how I definitely think that they are rather extravagant and rubbing it in the face of officials demanding that he return to Thailand. First, the Manchester City bid; second, the US$27 million house in Hong Kong.
Either way...I really think Thaksin should return to Thailand and face the charges, and, defeat them if he can. But then again, I'm sure he has his reasons for NOT wanting to return there, essentially seeing the world as his oyster and leaving all his troubles in Thailand (literally).
Curtis Bergh
Labels: Hong Kong, Manchester City, Thailand, Thaksin Shinawatra
Singapore more dear than New York: All a matter of perspectives.
The standard of living in Singapore is certainly rising and according to Mercer Human Resource Consulting, Singapore climbed 3 places to rank as the 14th most expensive city in the world, overtaking New York's ranking of 15! Four Asian countries are in the world's top ten costliest cities. And we have Seoul at 3rd place, Tokyo at 4th and Hong Kong at 5th- all have been pushed down one place this year.
Raging property prices and climbing transportation pries are the factors that propelled Singapore up the ranks. Be prepared to fork out even more for rents, taxi rides and about everything and anything you can think of.
According to the Edge on the 11th of June, luxury homes in town soared 80% to 90% and rents in well-known residential areas rose 25% to 30%.
It also said that owning several multi-million Good Class Bungalows holds more prestige than ordinary bungalows.
Also known as GCB's, they have a minimum freehold land area of 1,400 square meters with a bungalow not exceeding two storeys and covering only 35% of its total land area- to maintain exclusivity.
The most sought after areas are the Botanic Gardens and Holland road Area. For example Nassim and Leedon Roads.
The average selling price for Q1 2007 was S$577 psf, 15% more than last years.
The number of GCB transactions have dipped slightly but interestingly buyer sentiments and selling prices are on the rise.
What's interesting is asset markets are starting to balloon but consumer prices were maintained.
Data from the Department of Statistics revealed the consumer price Index here rose 1.7%,0.5% and 1% in 2004, 2005 and 2006. It certainly pales in comparison to energy and commodity prices.
It is interesting to think about the prospects of potential or progressive hikes in consumer prices. One way or another, we'll all get used to it sooner or later. For example, most of us are used to the starting cab fare of S$2.50.
Yeo Sue En
Raging property prices and climbing transportation pries are the factors that propelled Singapore up the ranks. Be prepared to fork out even more for rents, taxi rides and about everything and anything you can think of.
According to the Edge on the 11th of June, luxury homes in town soared 80% to 90% and rents in well-known residential areas rose 25% to 30%.
It also said that owning several multi-million Good Class Bungalows holds more prestige than ordinary bungalows.
Also known as GCB's, they have a minimum freehold land area of 1,400 square meters with a bungalow not exceeding two storeys and covering only 35% of its total land area- to maintain exclusivity.
The most sought after areas are the Botanic Gardens and Holland road Area. For example Nassim and Leedon Roads.
The average selling price for Q1 2007 was S$577 psf, 15% more than last years.
The number of GCB transactions have dipped slightly but interestingly buyer sentiments and selling prices are on the rise.
What's interesting is asset markets are starting to balloon but consumer prices were maintained.
Data from the Department of Statistics revealed the consumer price Index here rose 1.7%,0.5% and 1% in 2004, 2005 and 2006. It certainly pales in comparison to energy and commodity prices.
It is interesting to think about the prospects of potential or progressive hikes in consumer prices. One way or another, we'll all get used to it sooner or later. For example, most of us are used to the starting cab fare of S$2.50.
Yeo Sue En
Labels: Ahead of New York, Singapore ranked 14th
China slave scandal leaves bad taste
The China slave scandal has been reigning the papers over the last week.
It all started with parents reporting the abduction of their kids and complaining about how some provincial law enforcement officials aren't doing anything to help.
It turns out that many of those taken from their parents were sold to work as slaves.
According to AFP, more than 450 people have been rescued “from brick yards and coal mines across two provinces in central and northern China that were run with exceptional ruthlessness.”
At least one man was beaten to death, with the rest badly hurt from the drastic conditions they work and live in.
This is just one of the few “embarassing” labour revelations last week, “including reports that children were being used to make merchandise for the 2008 Beijing Olympics.”
President Hu Jintao has ordered an investigation into the increasing cases and police in Henan and Shanxi provinces (where most of the slave labourers were rescued from) have acted “with a rare speed and thoroughness indicating high-level government concern,” according to Reuters.
If this issue isn't curbed as soon as possible, all the build-up in anticipation of the Beijing Olympics next year will be in vain.
So how will this affect our local stock market, you say?
For starters, we have many Singapore-listed mainland Chinese companies, which factories are located in the rural parts of the country.
If they are found to have been involved in these human trafficking activities, they will be in such trouble they may even lose their listing.
Second, the reports on how children were being used to make merchandise for the Beijing Olympics may very well lead to human rights protests in other parts of the world, and lead to the boycotting of the event.
All the build-up of infrastructure just waiting to be utilized by tourists in 2008 would then be in vain.
Of course, the country would still be better off with the new goods.
As for other SGX-listed companies, their businesses in China related to the Olympics would also be thrown into jeopardy.
And if this scandal could butterfly effect its way onto our shores like that, what more of the Chinese stock market?
So China had better be getting its act together quick.
Otherwise, it's probably going to pull the region down with it.
Serene Lim
It all started with parents reporting the abduction of their kids and complaining about how some provincial law enforcement officials aren't doing anything to help.
It turns out that many of those taken from their parents were sold to work as slaves.
According to AFP, more than 450 people have been rescued “from brick yards and coal mines across two provinces in central and northern China that were run with exceptional ruthlessness.”
At least one man was beaten to death, with the rest badly hurt from the drastic conditions they work and live in.
This is just one of the few “embarassing” labour revelations last week, “including reports that children were being used to make merchandise for the 2008 Beijing Olympics.”
President Hu Jintao has ordered an investigation into the increasing cases and police in Henan and Shanxi provinces (where most of the slave labourers were rescued from) have acted “with a rare speed and thoroughness indicating high-level government concern,” according to Reuters.
If this issue isn't curbed as soon as possible, all the build-up in anticipation of the Beijing Olympics next year will be in vain.
So how will this affect our local stock market, you say?
For starters, we have many Singapore-listed mainland Chinese companies, which factories are located in the rural parts of the country.
If they are found to have been involved in these human trafficking activities, they will be in such trouble they may even lose their listing.
Second, the reports on how children were being used to make merchandise for the Beijing Olympics may very well lead to human rights protests in other parts of the world, and lead to the boycotting of the event.
All the build-up of infrastructure just waiting to be utilized by tourists in 2008 would then be in vain.
Of course, the country would still be better off with the new goods.
As for other SGX-listed companies, their businesses in China related to the Olympics would also be thrown into jeopardy.
And if this scandal could butterfly effect its way onto our shores like that, what more of the Chinese stock market?
So China had better be getting its act together quick.
Otherwise, it's probably going to pull the region down with it.
Serene Lim
Labels: beijing olympics, china slave scandal, singapore stocks
Where does that put us?
In today's article on The Straits Times, the government has released 15 new sites to be sold for development. This includes plots of land for office spaces, hotels as well as apartments. This clearly illustrates that the number of people jumping into the property pool is increasingly aggressive.
This is probably one of their efforts to try and achieve the goal of having an eight million population by 2015.
On the flip side, far-far away (if you've watched Shrek) from now, this may not turn out too rosy after all.
My reasons: (and they're all results of a snowball effect)
First, the government is trying to create a 'pull' factor to get people to come to Singapore and reach that eight million population by 2015. Hence the development of luxury for locals or foreign talents, housing, in this case, the demand and growth of the property industry.
With new sites for sale means, lesser greenery to complement the Singapore landscape. When these land area is developed, Singapore may not have much green landscape.
Second, when these green landscapes are out of the picture, it may not necessarily look cosy to live in. There will be buildings everywhere, on top of the fact that we're in a mere 660 km sq (used to be at 642 km sq, now thanks to reclaimed land!)area country where every single space counts. It may not create a comfortable living for both foreign and local talents and may also backfire the government's plans of getting more people here.
Third, we have two issues. With eight million people here, it'll be a competition to get a job, even for the locals; where does that put us? Second issue, with lack of greenery, people may not find it attractive to work here. That may leave us with empty housing and redundant buildings with little or no greenery to complement our 'uniqueness' and lifestyle; where does that put us?
While the property market does not seem to break its bullishness any time soon, other considerables like greeneries have to be put to play. Singapore is known for its uniqueness with greenery. After all the extra land gone, the parks may be gone too.
On top of that, the government's effort for 'Clean and Green' campaign, shading our roads, and improving our parks' structures for a more cozy feel for example, may go to waste.
With more of it gone, where does that put us?
Nurwidya Abdul
This is probably one of their efforts to try and achieve the goal of having an eight million population by 2015.
On the flip side, far-far away (if you've watched Shrek) from now, this may not turn out too rosy after all.
My reasons: (and they're all results of a snowball effect)
First, the government is trying to create a 'pull' factor to get people to come to Singapore and reach that eight million population by 2015. Hence the development of luxury for locals or foreign talents, housing, in this case, the demand and growth of the property industry.
With new sites for sale means, lesser greenery to complement the Singapore landscape. When these land area is developed, Singapore may not have much green landscape.
Second, when these green landscapes are out of the picture, it may not necessarily look cosy to live in. There will be buildings everywhere, on top of the fact that we're in a mere 660 km sq (used to be at 642 km sq, now thanks to reclaimed land!)area country where every single space counts. It may not create a comfortable living for both foreign and local talents and may also backfire the government's plans of getting more people here.
Third, we have two issues. With eight million people here, it'll be a competition to get a job, even for the locals; where does that put us? Second issue, with lack of greenery, people may not find it attractive to work here. That may leave us with empty housing and redundant buildings with little or no greenery to complement our 'uniqueness' and lifestyle; where does that put us?
While the property market does not seem to break its bullishness any time soon, other considerables like greeneries have to be put to play. Singapore is known for its uniqueness with greenery. After all the extra land gone, the parks may be gone too.
On top of that, the government's effort for 'Clean and Green' campaign, shading our roads, and improving our parks' structures for a more cozy feel for example, may go to waste.
With more of it gone, where does that put us?
Nurwidya Abdul
Labels: 15, 2015, 642 km sq, 660 km sq, bullishness, Clean and Green, eight million population, government, land parcels, lush greenery, property, reclamation, Shrek, The Straits Times
DBS: Hey? Whataya' doin'?
Yes, I know I spelled that out in a very New Jersey, Tony Soprano-esque accent to pay homage to the show that ended Sunday night in the states. The irony is, I watched maybe 4 episodes total in my life but I feel like I know the entire plot because it was all my colleagues talked about back in the United States around the water cooler on Monday mornings.
So, today's blog has to focus on the story in The Straits Times about DBS raising the fee from $1 to $2 for ATM and online transactions for IPO's. Now, I took particular interest in this story because DBS's move is stupid I think, but, I can also see the strategy behind it as some IPO's you are only able to apply to via DBS and not the other banks.
So to drive people and generate more business, they are capitalizing off of that by making a quick buck or two. I don't believe in making a quick buck on something like this as I think it residually hurts your image and brand if your seen as crossing the line of being too monopolistic that you are taking advantage of people instead of capitalizing of something you should be, just like everyone else. DBS was already collecting a fee, but now people may take them more as money hungry hawks for stuff like this given the other banks have not raised their fees.
While it is good business to collect a fee and make money in some cases because they are the exclusive route for some IPOs that people will apply to, it's when they unilaterally do something - something that they have done in this case - that drives people away. Case in point, some guy actually called up and complained to The Straits Times about this 100% increase. If you have upset people that much where it actually drives them to do something like that, you've got issues.
People will switch to the other banks because of this $1 hike, which I think is such a negligible cost difference. Crazy isn't it? Consumers are that price sensitive here they will switch banks. Brand loyalty...fourgedaboudit, doesn't exist as strongly here as it does in other markets around the world (unless, you are selling ladies cosmetics which have an almost cult like following in Asia Pacific where in this case brand loyalty is unusually high).
Either way around, this move is just beyond me as it only gives the competition stronger ground and reason to stand on to undercut DBS on both price and service.
Either way...interesting story.
Curtis Bergh
Labels: DBS, Fees, IPO, Tony Soprano
Why biofuel won't cut it here so soon.
The word “ethanol” was probably most uttered by scientists and lab technicians until the whole hype about biofuel came about.
The chemical is blended with gasoline and used as fuel, which produces less carbon monoxide.
Ethanol “biorefining” is big business in the United States, with 120 refineries operating across the US and 77 new ones currently under construction.
What's worrying, however, is how much supply there is. And no demand.
This is exacerbated by the low number of service stations which offer E85 – the blended fuel.
Now if such infrastructure issues can happen in the US – where President George W Bush has legislated that oil refiners use four billion gallons of renewable fuel in 2006 and 7.5 billion gallons by 2012 – what hope is there for us in the region we live in?
There are many reasons why it will take the region way longer than expected to integrate biofuel into our daily lives.
First, news agency AFP quoted an energy analyst as saying that “ethanol-blended gasoline cannot be shipped by pipeline” so transportation is a constraint.
In the US, ethanol production is concentrated in rural midwest farm states, but gasoline demand is based along the heavily populated east and west coasts.
Space-wise, it does not seem like Singapore can handle even one large-scale ethanol biorefinery, so the nearest place to situate something like that would be in Johor.
Transport will still be a factor though, given that the blend cannot be pumped through pipelines.
Second, gas service stations are slow on the uptake of providing such blends.
There are only 1,100 service station pumps in the US for E85.
Unless it is mandated by the government, service stations in Singapore and the region will not be proactive in installing pumps which allow the handling of E85.
Third, International Energy Agency head Claude Mandil told the Financial Times that the Organisation of Petroleum Exporting Countries has nothing to fear because “the contribution from biofuels would be very small.”
Of course, OPEC would have a vested interest in selling more petroleum. But with such an attitude being taken towards environmentally-friendly measures, how much would it take to actually make things happen?
The only winners now, so far, are the farmers in the midwest who've invested in those biorefineries.
According to United Wisconsin Grain Producers CEO Jeff Robertson, even hourly workers at the plants earn about US$35,000 a year “and get profit sharing, incentive pay and full benefits.”
So for this part of the world to be more receptive to using biofuel, governments would have to set aside some sort of mandate to expedite service stations providing such new blends of fuel, and thereby, driving the demand for the more environmentally-friendly fuel.
The chemical is blended with gasoline and used as fuel, which produces less carbon monoxide.
Ethanol “biorefining” is big business in the United States, with 120 refineries operating across the US and 77 new ones currently under construction.
What's worrying, however, is how much supply there is. And no demand.
This is exacerbated by the low number of service stations which offer E85 – the blended fuel.
Now if such infrastructure issues can happen in the US – where President George W Bush has legislated that oil refiners use four billion gallons of renewable fuel in 2006 and 7.5 billion gallons by 2012 – what hope is there for us in the region we live in?
There are many reasons why it will take the region way longer than expected to integrate biofuel into our daily lives.
First, news agency AFP quoted an energy analyst as saying that “ethanol-blended gasoline cannot be shipped by pipeline” so transportation is a constraint.
In the US, ethanol production is concentrated in rural midwest farm states, but gasoline demand is based along the heavily populated east and west coasts.
Space-wise, it does not seem like Singapore can handle even one large-scale ethanol biorefinery, so the nearest place to situate something like that would be in Johor.
Transport will still be a factor though, given that the blend cannot be pumped through pipelines.
Second, gas service stations are slow on the uptake of providing such blends.
There are only 1,100 service station pumps in the US for E85.
Unless it is mandated by the government, service stations in Singapore and the region will not be proactive in installing pumps which allow the handling of E85.
Third, International Energy Agency head Claude Mandil told the Financial Times that the Organisation of Petroleum Exporting Countries has nothing to fear because “the contribution from biofuels would be very small.”
Of course, OPEC would have a vested interest in selling more petroleum. But with such an attitude being taken towards environmentally-friendly measures, how much would it take to actually make things happen?
The only winners now, so far, are the farmers in the midwest who've invested in those biorefineries.
According to United Wisconsin Grain Producers CEO Jeff Robertson, even hourly workers at the plants earn about US$35,000 a year “and get profit sharing, incentive pay and full benefits.”
So for this part of the world to be more receptive to using biofuel, governments would have to set aside some sort of mandate to expedite service stations providing such new blends of fuel, and thereby, driving the demand for the more environmentally-friendly fuel.
Labels: biofuel, ethanol, OPEC
The names Bond...Treasury Bond
That little note just keeps spoiling the party that we've been having on Wall Street. Now, this is of course a highly opinionated blog coming from me, just one of many financial journalists out there in the world today. But hey, I did say we shouldn't worry when the markets tanked in February right? Now look where we are! Or, where we were last week is what I really should be saying.
Now I am going to go out on another limb with what I think: The party on Wall Street's over; the rally is history, finished, done.
If you hit the clubs on weekends here in Singapore or wherever you are reading this from in the world, here's summing it up in nightlife lingo for you: we're well beyond where the bartender called 'last call' and are at the point now where they are kicking people out of the club.
This week has been a rough one to report on in the morning. Monday wasn't so bad, but that's only because Friday was somewhat decent and since we are 12 hours ahead in Singapore, things started out good. But Mondays U.S. session wasn't anything spectacular, just modest gains (this is probably where the bartender was yelling 'last call' but nobody heard it), so Tuesday was a decent report I filled.
But Wednesday morning here changed everything, and what I have effectively dubbed 'the beginning of the end.' Markets in the U.S. were down, and while the numbers were down somewhat, it was nothing nearly as bad as what we saw in the most recent U.S. session; a nearly 200 point drop on the Dow, and the last three days, we have lost more than 400 points on the Dow. Not good.
But in the underlying market, finding some positive stories that would explain if the drop was a fluke or not was hard to come by, and looking at the Bond market made you even more sick to your stomach if your an equities market loving groupie like us.
As an American I should know that we like some risk and trying our luck. We like going to Vegas for gambling, and if we can't get to Vegas for whatever reason, we'll at least get on a bus to go an hour or two to a casino built in the middle of nowhere built by a Native American Indian tribe with great food and catchy TV ads (if you're from Boston or the New England area you will know what I mean and where I am talking about).
But we are still smart enough to know when things are going too fast, too unsafe, and may become uncontrollable, so we like to have some security. We love having our fun but our minds are not in the clouds.
This brings me back to the Bond market; whenever we see the Treasury yields pick up as Americans, especially to highs we have not seen in a year or so, we start moving money. Traditionally, that comes out of equities and into more sure, secure investments like good old fashion U.S. Treasury Bonds.
And the Bonds just totally killed our party buzz for this equities rally.
Now I am going to go out on another limb with what I think: The party on Wall Street's over; the rally is history, finished, done.
If you hit the clubs on weekends here in Singapore or wherever you are reading this from in the world, here's summing it up in nightlife lingo for you: we're well beyond where the bartender called 'last call' and are at the point now where they are kicking people out of the club.
This week has been a rough one to report on in the morning. Monday wasn't so bad, but that's only because Friday was somewhat decent and since we are 12 hours ahead in Singapore, things started out good. But Mondays U.S. session wasn't anything spectacular, just modest gains (this is probably where the bartender was yelling 'last call' but nobody heard it), so Tuesday was a decent report I filled.
But Wednesday morning here changed everything, and what I have effectively dubbed 'the beginning of the end.' Markets in the U.S. were down, and while the numbers were down somewhat, it was nothing nearly as bad as what we saw in the most recent U.S. session; a nearly 200 point drop on the Dow, and the last three days, we have lost more than 400 points on the Dow. Not good.
But in the underlying market, finding some positive stories that would explain if the drop was a fluke or not was hard to come by, and looking at the Bond market made you even more sick to your stomach if your an equities market loving groupie like us.
As an American I should know that we like some risk and trying our luck. We like going to Vegas for gambling, and if we can't get to Vegas for whatever reason, we'll at least get on a bus to go an hour or two to a casino built in the middle of nowhere built by a Native American Indian tribe with great food and catchy TV ads (if you're from Boston or the New England area you will know what I mean and where I am talking about).
But we are still smart enough to know when things are going too fast, too unsafe, and may become uncontrollable, so we like to have some security. We love having our fun but our minds are not in the clouds.
This brings me back to the Bond market; whenever we see the Treasury yields pick up as Americans, especially to highs we have not seen in a year or so, we start moving money. Traditionally, that comes out of equities and into more sure, secure investments like good old fashion U.S. Treasury Bonds.
And the Bonds just totally killed our party buzz for this equities rally.
Labels: Bonds, Boston, Dow Jones, Equities, New England, Treasury Bonds, U.S.
Revamping the STI...it's about freaking time
News out last night that the SGX, SPH, and the FTSE Group would make some changes to the STI made me jump for joy.
For far too long I've thought the STI was lethargic in its movements and many stocks that were included in it, shouldn't be there. Seems they finally started to see the light on this.
For more in-depth details on the story you can get the full read from our website, written by my colleague Nurwidya.
But to save you from hitting the back button and browsing around, here are the quick-hits on the changes to come:
1.The number of constituent stocks will be reduced from 50 to 30. This will make the STI a high liquid index.
2.The STI will be calculated by the FTSE, in accordance with the method for liquidity criteria and free-float adjustments.
This move is done to aid investors in tracking the movements in the different sectors allowing them to make more informed decisions.
Today, there was also news out on the stocks that may (emphasis on may as there is no definitive decision yet) be dropped from the STI all together: the unlucky bunch includes some big name companies such Creative Technology, Mobile One, and the Jardine Group's stocks. These stocks have a high market cap, but low daily trade volume.
It's the right move I think, and one long overdue, that they are making with the STI. Seeing the result of plugging in new stocks and taking lethargic ones out could have a very interesting impact on not only what the index does on a day-to-day basis, but how it is viewed, and, how it drives trade.
Globally, more attention could be paid to the Singapore market, and, it could give the index more credibility. So, on the whole, I think this is the right move and, hey, better late than never right?
As always, please see your licensed financial advisor before making any investment decisions.
Curtis Bergh
For far too long I've thought the STI was lethargic in its movements and many stocks that were included in it, shouldn't be there. Seems they finally started to see the light on this.
For more in-depth details on the story you can get the full read from our website, written by my colleague Nurwidya.
But to save you from hitting the back button and browsing around, here are the quick-hits on the changes to come:
1.The number of constituent stocks will be reduced from 50 to 30. This will make the STI a high liquid index.
2.The STI will be calculated by the FTSE, in accordance with the method for liquidity criteria and free-float adjustments.
This move is done to aid investors in tracking the movements in the different sectors allowing them to make more informed decisions.
Today, there was also news out on the stocks that may (emphasis on may as there is no definitive decision yet) be dropped from the STI all together: the unlucky bunch includes some big name companies such Creative Technology, Mobile One, and the Jardine Group's stocks. These stocks have a high market cap, but low daily trade volume.
It's the right move I think, and one long overdue, that they are making with the STI. Seeing the result of plugging in new stocks and taking lethargic ones out could have a very interesting impact on not only what the index does on a day-to-day basis, but how it is viewed, and, how it drives trade.
Globally, more attention could be paid to the Singapore market, and, it could give the index more credibility. So, on the whole, I think this is the right move and, hey, better late than never right?
As always, please see your licensed financial advisor before making any investment decisions.
Curtis Bergh
Exclusivity may deter iPhone sales
Apple Inc says that it will start selling its latest most talked about and anticipated product, the iPhone, this 29 June in the US. It also said that the iPhone will only be sold exclusively at Apple stores and the service provider, AT&T Inc.
I say that this exclusivity will only deter iPhone sales.
My reasons:
First, by only having two main channels for distribution gives them no competition, especially over pricing. This may end up with consumers having not much places to go in search of a 'good deal' when it comes to buying the iPhone.
Second, it may prove to be quite costly to own one. For those who want to purchase the iPhone at a 'cheaper' rate may have to change their service provider to AT&T, to get it with a contract or line.
Consumers may need to terminate their line, pay an additional fee (usually US$200) for an early line termination, and sign up with AT&T. This may be quite costly and they may not be willing to fork out that much for a phone.
Third, consumers may sign up with AT&T anyway for a plan and the iPhone. This means that they may end up seeing bills from two different telcos at the end of the month.
Yes, the iPhone is one darling to have. Embedded with all the good things Apple has to offer from the infamous iPod to the touchscreen functions, it's no wonder that people are talking about it.
To only have it available to AT&T, the service provider, will definitely boost its service plans and awareness, but it may also steer potential buyers the other way.
Nurwidya Abdul
P.S: You may want to checkout this website on youtube.com. It's quite hilarious and nothing serious, really!
http://www.youtube.com/watch?v=xcjLEwZqcQI
I say that this exclusivity will only deter iPhone sales.
My reasons:
First, by only having two main channels for distribution gives them no competition, especially over pricing. This may end up with consumers having not much places to go in search of a 'good deal' when it comes to buying the iPhone.
Second, it may prove to be quite costly to own one. For those who want to purchase the iPhone at a 'cheaper' rate may have to change their service provider to AT&T, to get it with a contract or line.
Consumers may need to terminate their line, pay an additional fee (usually US$200) for an early line termination, and sign up with AT&T. This may be quite costly and they may not be willing to fork out that much for a phone.
Third, consumers may sign up with AT&T anyway for a plan and the iPhone. This means that they may end up seeing bills from two different telcos at the end of the month.
Yes, the iPhone is one darling to have. Embedded with all the good things Apple has to offer from the infamous iPod to the touchscreen functions, it's no wonder that people are talking about it.
To only have it available to AT&T, the service provider, will definitely boost its service plans and awareness, but it may also steer potential buyers the other way.
Nurwidya Abdul
P.S: You may want to checkout this website on youtube.com. It's quite hilarious and nothing serious, really!
http://www.youtube.com/watch?v=xcjLEwZqcQI
Labels: Apple, cheap, exclusivity, iPhone, Steve Jobs, termination, youtube
Bursting The China Bubble ...At Last
Only a fool would think China's efforts to cool its stockmarkets were a bad idea. The markets in Shanghai and Shenzhen have had a very strong run. Look at the five year chart! Doesn't this remind you of the dotcom days? It would be nothing short of preposterous to suggest they should continue on this path unchecked. After all, judging by reports those people who are jumping on the bandwagon now they aren't investing at all. They're just gambling. And as a value investor I see it as my duty to call this rally what it is: complete stupidity.
The Chinese authorities have now raised the tax on share transactions to 0.3%. This is already a tiny amount, but will hopefully curb some of the speculators. A Reuters report quoted in the Business Times this morning suggests that if this doesn't work, transaction taxes could be raised again, interest rates could be raised, approval for new mutual funds could be suspended, or a capital gains tax introduced.
I say: good on them!
The problem in China is investors have obviously not gone through the same rollercoaster ride investors in other markets have experienced over the last several years. Otherwise they would know the old phrase, that when taxi drivers and housewives start talking about the stockmarket it's time to get out. Or Alan Greenspan's comments about irrational exuberance during the dotcom days.
Who is listening to those words of wisdom now?
And what's the bet they will be quoted once again when the inevitable decline happens?!
The media have played their part in hyping the markets. They have dubbed a 44-year-old medical college graduate Lin Yuan as "China's Warren Buffett". He's quoted in The Standard as saying "my principles are simple: I nearly always invest every penny in the market. To win in the stock market, you must invest everything there for most of the time."
What complete nonsense!
Wealth managers will agree that leaving your money invested over time is important. Missing the 40 best trading days over the last ten years would have wiped out almost all gains. But that's not Buffett's investing philosophy at all. Buffett is a value investor. He invests where there is value. Frankly, given the lack of bargains in this market it's hard to see how anyone professing to practise Warren Buffett's investment methodology could be making comments like this.
Clearly, no investor who has bet their entire life savings on the rally in Shanghai's stockmarket wants to see the value of their money go down. But talk to stockbrokers in Singapore and they'll tell you how most people are bracing for a big fat bursting of this bubble. And that's not going to serve them well, either!
To my way of thinking, there would be nothing better than for the market to drop 10%-20% over the next month or so. A souffle-like deflation, rather than a balloon-like pop. It would let all those novice investors who thought the stockmarket was a sure-win casino down gently, and teach them the lessons they must learn. It would bring sensibility into a market that has gone completely crazy. And finally, it will open up opportunities to find value again in a market that has not only lost its bargains, but seemingly has also lost its mind.
January 2006 February 2006 March 2006 April 2006 May 2006 June 2006 July 2006 August 2006 September 2006 October 2006 November 2006 December 2006 January 2007 February 2007 March 2007 April 2007 May 2007 June 2007 July 2007 August 2007 September 2007 October 2007 November 2007 December 2007 January 2008 February 2008 March 2008 April 2008 May 2008 August 2008 September 2008 October 2008 November 2008 January 2009
