Fisher Capital Management News: Fraud warning for craigslist users, scammers seek financial info

SACRAMENTO — A scam targeting users of craigslist continues to be reported to the Better Business Bureau of Northeast California.
The scam, first reported months ago, involves the intended target getting an email shortly after posting an ad with craigslist, the online classified advertisement website.
The person sending the email claims to be the CEO of craigslist and states the consumer has won a computer.
The scammer asks the target to go to a website, where personal financial information is required before the free computer can be claimed.
Officials said the emails are a blatant and somewhat clumsy attempt to commit identity theft.
Names usually associated with the emails, Amy Sanders and Angel Thompson, have no connection with craigslist.
People who feel they are being targeted by fraud should contact the BBB at 1-916-443-6668.

Fisher Capital Management News:Will China’s Economy Stumble?

China, along with other emerging countries, is the great hope for global economic growth.

The developed economies, bruised and aching, are pulling themselves slowly back to their feet after the Great Recession.

As Western consumers and governments struggle to get on top of their debts, they are not going to be the source of booming demand for goods and services they were in the last decade.
China by contrast slowed down a bit in the recession and then rapidly got back to something like full speed.
From 2007 to 2011 China accounted for as much of global economic growth as the G7 leading industrial countries combined.
Essential goodsChina is a very important market for suppliers of commodities; Australian coal and iron ore and Brazilian soy beans for example.

It must be said China is also a big exporter, with a hefty trade surplus. That means in terms of global demand for goods and services overall it takes more than it gives.

But imports are growing so China is providing an increasingly important market for some.
But will the powerful performance be sustained?
There are some of sceptics.
The Wall Street Journal recently declared “after years of housing prices gone wild, China’s property bubble is starting to deflate”.
The result is usually painful. Just look at the US, Ireland, Britain, Spain where bad property market loans have been a central feature in the financial crisis.
Rising pricesThe Chinese authorities are getting increasingly uneasy about inflation.
They have repeatedly raised bank reserve requirements, a measure intended to curb the growth of credit.
And then there is Dr Doom himself, Nouriel Roubini, the New York University Professor, prophet of the financial crisis, warning about China slightly further into the future. He says China could face a “hard landing”.
He thinks the economy is too dependent on investment. Very high rates of investment create excess capacity and they can’t be sustained.
They can leave debt problems in their wake as borrowers who built housing or commercial buildings don’t get the income from them that they anticipated.

The movement of millions of Chinese from the land into the cities will slow – will it also slow economic growth?

Urban shiftLooking even further into the future, there are some longer term issues that could slow China down.
One key element in element in China’s growth has been shifting millions of workers from relatively unproductive work in the countryside to industrial employment in the cities.
That won’t go on for ever.
Professor Barry Eichengreen of California University also warns that fast growing economies do invariably slow down at some stage and it comes sooner in countries with a large proportion of elderly people.
China’s one-child policy and rising life expectancy will put China in that category, he argues.
Jim O’Neill of Goldman Sachs, who coined the term BRICs, for the large emerging economies of Brazil Russia India and China agrees that China will slow down this year, to growth of about 8%.
But he sees what he calls a “happy landing”, which will help bring inflation under control.
And he doesn’t buy the talk of bubbles.
StumbleWhat is pretty clear is that China’s pattern of growth will change. At some stage, the astronomical rates of saving, investment and exports will surely give way to an increasing role for consumer spending.
Investing for exports is not the easy living it was when consumer spending in the developed economies was booming.
Chinese business will increasingly have to sell their goods either to other emerging economies or to Chinese consumers.
The country’s rising and increasingly affluent middle class probably will provide that growing market.
But watch out for a stumble in the near term.

Fisher Capital Management News: Fraud warning for craigslist users, scammers seek financial info

SACRAMENTO — A scam targeting users of craigslist continues to be reported to the Better Business Bureau of Northeast California.
The scam, first reported months ago, involves the intended target getting an email shortly after posting an ad with craigslist, the online classified advertisement website.
The person sending the email claims to be the CEO of craigslist and states the consumer has won a computer.
The scammer asks the target to go to a website, where personal financial information is required before the free computer can be claimed.
Officials said the emails are a blatant and somewhat clumsy attempt to commit identity theft.
Names usually associated with the emails, Amy Sanders and Angel Thompson, have no connection with craigslist.
People who feel they are being targeted by fraud should contact the BBB at 1-916-443-6668.

Fisher Capital Management - Japan Elects a New Premier Part 2

Fisher Capital Management Eight and a half months after riding the Democratic Party of Japan’s

(DPJ) historic lower house victory into office, Prime Minister Yukio

Hatoyama announced his resignation, having haphazardly frittered

away a chest brimming with political capital.

Major newspapers said that Hatoyama was resigning mainly for

two reasons: his failure to keep his promise to relocate the functions

of US Marine Corps Air Station Futenma, Okinawa, out of Okinawa

Prefecture, and a political funding scandal that included his mother’s

provision of some ¥1.26 billion to him over years.

Fisher Capital Management - Japan Elects a New Premier Part 2: Instead of deregulation and lower corporate taxes, he envisions

increased employment and consumption through focused

government spending in nursing, medicine and other social welfare

fields. But some economists expressed doubts; they say there is no

guarantee that the positive effect of government spending can

steadily outpace the negative effects of tax hikes.

Kan seems to be open to the idea of raising Japan’s consumption

tax from its current level of 5%, though the approach of the upperhouse

election on July and concerns over a political backlash suggest

caution will be the government’s modus operandi.

“Any rise in the consumption tax rate must be offset by lower levies

on daily goods as well as refunds for low-income households”, he

recently said. But he also hopes to reduce corporate taxes from the

current 40% rate to around 25%, in line with other major countries.

In the foreign exchange market, Kan has earned a reputation as a

weak-yen advocate. “The business community says that a yen in

the mid-90s against the dollar is appropriate, so it would be better

if it weakens a bit further”, he said in January, shortly after becoming

finance minister.

Fisher Capital Management - Japan Elects a New Premier Part 2: Market observers believe that Kan still supports a weaker yen and

that the Japanese currency could depreciate against the US dollar.

Regarding monetary policy, Kan is generally considered an advocate

of inflation-targeting and quantitative easing. As finance minister,

he has put some political pressure on the Bank of Japan (BOJ) to

fight deflation more aggressively, he nudged the BOJ to double a

special bank lending program introduced in December. The bond

market believes Kan is a wise choice to manage the sustainability

of Japan’s government debt.

The DPJ had promised to unveil a long-term plan to improve public

finances. However, “postponement is likely because of the current

political churn, and any real ‘meat’ in the plan will probably not

be disclosed until after the Upper House election” … says Flemming

Nielsen, senior analyst at Danske research.

Kan is a self-made man, ascending into politics after years toiling

in citizen movements and he has a reputation as a quick learner

and a pragmatic politician, with sharp elbows and an aversion to

any criticism.

The country he now leads is facing dire long-term problems that

beg for strong leadership, including a staggering level of public

debt, a stagnant economy, and an ageing population. He has a few

weeks to fix the impression left by nine months of incompetent DPJ

governance.

If he fails, the party will be routed in the elections for the Diet’s

upper house.

Fisher Capital Management News: Commodity Markets 2010

The performance of the commodity markets remains very impressive. Speculative activity is a major factor, and supply shortages, often the result of adverse weather conditions, are also providing considerable support; but there is clearly a view amongst both traders and investors that the general level of prices is too low, and that they will move higher. Over the longer-term that view is likely to prove to be justified. Commodity markets have been extremely volatile over the past month, rising strongly in the early part of the period, but falling back sharply towards month-end concerns about the effects of the austerity measures being introduced in Europe, and indications of a continuing slowdown in China, have combined to increase fears but for most of the past month traders and investors apparently decided that the gloom was overdone; and commodity prices also benefited from some “safe haven” buying by investment funds.

Base metal prices are still ending the month higher overall, but below recent levels, with the further sharp rise in the tin price as the outstanding feature; and food prices have also moved higher, with the continuing surge in wheat prices as the outstanding feature of these markets, to provide further support for the view that the era of cheap food is coming to an end. The gold price has also improved, as investors have sought “safe havens in the present storm”; but oil prices have fallen back.

Base metal prices are closing higher again over the past month. Zinc and tin prices still ended sharply higher, but overall improvements elsewhere were fairly modest.

Chinese demand remains a critical factor in these markets. It is this demand that has been the main driving force over recent months, and that has pushed iron ore prices to record levels and enabled other metal prices to recover from the lows of the recent recession.

Soft commodity markets have provided a mixed performance over the past month, but prices are generally higher. The exceptions have been the cocoa price, which has continued to fall as weather conditions in the Ivory Coast have improved, crop estimates have been pushed higher, and the effects of the technical squeeze created by the decision by Armajaro, the London-based hedge fund, to take delivery of around 7% of the world’s annual cocoa bean production last month, have eased; and soya-bean prices are also basically unchanged over the month. But elsewhere there has been a sharp rise in Arabica coffee prices, and a further improvement in the sugar price.

However the main interest over the month has been in the wheat market, after the massive price gains, and also in other grain markets. The most significant events during the month were the decision by the Russian authorities to ban the export of wheat and other grains until year-end because of the drought that has devastated crops and caused widespread fires across the country; and to ask other neighbouring countries to take similar action.

It is not yet clear how they will respond; but the action has already created widespread concern.

Russia was the world’s third largest wheat exporter last year, sending 18.3 million tons abroad, and so the decision to ban exports for the rest of the year has had a dramatic effect on prices. Attempts have been made to limit the price gains, with the US Department of Agriculture in particular indicating that US stockpiles of wheat are close to 30 million tons and at a 23 year high, and the UN Food and Agriculture Organisation insisting that global stocks are more than adequate to cope with the shortfall, even if other neighbouring countries join the Russian ban.

But these countries were expected to supply around one quarter of total global wheat exports this year, and so the panic conditions in the markets have not been significantly eased. Evidence of significant purchases of US grain by China for the first time in a decade have also added to the concerns about the availability of global supplies, and made it even more difficult to assess the full consequences of the Russian decision; but it seems unlikely that the surge in the prices of wheat and other grains in over.

After rising sharply in late-July and early-August, oil prices have subsequently fallen back towards the $70 per barrel level. There have been warnings from the International Energy Agency that “the short- term global economic outlook is highly uncertain, presenting significant downside risks to future oil demand growth”; there has been a cautious view of future oil demand from OPEC; and also a report from the US Department of Energy that US stockpiles of crude oil and refined products have risen to their highest levels since weekly records began in 1990. Much will depend on future demand in the US and in China; but the fundamentals do not seem to point to an early and sustained improvement in prices unless there is a serious deterioration in political conditions in the Middle East.

The swing in sentiment towards a more cautious view of global economic prospects, and the renewed concerns about sovereign debt defaults in Europe, have provided further encouragement for investors to seek “safe havens” in the present uncertain situation, and this has led to a significant rally in the gold price over the past month.

The dollar has recovered well from weakness earlier in the month, and so the fear of dollar weakness has not been a factor pushing the gold price higher this month. The evidence that the sovereign debt crisis is far from being resolved, and the indications of increased Chinese buying of gold, have all helped to push the price higher. The latest strength may well lead to a further period of profit-taking; but given the present international situation, it would be unwise to assume that the improving trend in precious metal prices is over.

Fisher Capital Management Korea is a leading global financial institution holding extensive relationships with financial institutions, institutional investors and corporations across the world. As a full service company Fisher Capital Management Korea provides a full range of investment banking services including advanced risk management, corporate strategy and structure, plus raising capital through debt and equity markets. With this as our backbone we continue to provide a client service second to none.

Fisher Capital Management News: Equity Markets

Equity Markets: All the major equity markets, and most of the emerging markets, Are stable over the past month. There had been expectations that the Fed might introduce further quantitative easing measures at its recent OMC meeting, and this provided some support for the markets in the early part of the month; but it made only very modest.

Government Bond Markets: The major government bond markets have made further significant gains over the past month, despite the funding pressures resulting form huge fiscal deficits, and the renewed concerns about debt defaults.

Short-term interest rates have remained low, and monetary policy has been supportive; but it has been the enhanced “safe haven” status of these markets that has provided most of the momentum, as investors have sought “shelter from the current storm”. However the moves have surprised most commentators, and this has led to warnings about “bond bubbles” that will not be sustained.

Financial Markets: Sentiment in the financial markets has deteriorated. Signs of slowdown in the Chinese economy, have produced a much more cautious view of prospects for the rest of this year and in 2011; and there have been renewed fears about banking problems in Europe, and the likelihood of sovereign debt defaults. There have also been further indications of the conflicting views of central banks about the most appropriate response to the current problems.

Currency Markets: Uncertainty has been the main feature of the currency markets over the past month. The dollar has recovered from earlier weakness after the Fed made only very modest changes in its monetary policy at the latest OMC meeting, and is ending the period basically unchanged; sterling has weakened slightly against the dollar but is higher against the euro; and the euro has also fallen back against most other currencies as the fears about sovereign debt defaults in Europe have increased.

But the feature of the currency markets over the month has been the sharp appreciation of the yen because of its enhanced “safe haven” status. The move is obviously an unwelcome development for the Japanese authorities, and there has been considerable speculation about intervention by the Bank of Japan to reverse it; but there has been no action so far.

Short-Term Rates: There have been no changes in short-term rates in the major financial centres this month. Commodity markets have followed the trend in the other markets, improving in the early part of the period, but falling back towards month-end. The main features have been the continued strength of wheat prices after the Russian decision to suspend wheat and grain exports, and the sharp fall in oil prices.

Fisher Capital Management Korea is a leading global financial institution holding extensive relationships with financial institutions, institutional investors and corporations across the world. As a full service company Fisher Capital Management Korea provides a full range of investment banking services including advanced risk management, corporate strategy and structure, plus raising capital through debt and equity markets. With this as our backbone we continue to provide a client service second to none.

Fisher Capital Management Report Part 2 - The UK Emergency Budget

Fisher Capital Management Report  Part 2- The UK has had an emergency budget and it could have been much

worse. The heavy lifting is being done by a rise in VAT bringing in

£13 billion. On the spending side the cuts are achieved by freezing

public sector pay, indexing state benefits to the CPI rather than the

faster-rising RPI and freezing child benefits. State pensions will be

indexed to the higher of wages or the CPI but the pension age will

be raised to 66 fairly soon.

Interest rates are projected to remain low, with inflation absent;

and it is possible that Quantitative Easing will need to be resumed

but on present prospects this seems unlikely to be necessary.

Another concern is with the regulative proposals. There is an antibank

mentality developing in this coalition government, which is

most unfortunate; much of it seems to emanate from Vince Cable

and the Lib Dems.

Yet a moment’s thought should be enough to convince one that we

need bank credit expansion and a return to competition on the

bank high street in order to foster recovery and enterprise. Ever

tougher bank regulation is what was needed before, at the peak of

expansion, not now in the slough of recession giving way to recovery.

Talk of breaking up banks fails to recognise the natural economics

of banks, which favours scale and risk-spreading. Talk of capping

mortgage lending at modest percentages of income is also unfortunate

when the UK want to see a revival of it’s housing market, now once

again back in the doldrums.

A last area of concern is the state of the labour market. The UK do

have near ‘full employment’ if one discounts the modest temporary

effect of recession. But this only applies to those normally looking

for work.

Fisher Capital Management Report Part 2 - The UK Emergency Budget: There is now a large group of people who are claiming benefits of

various sorts in order to stay out of the labour market. Disability

benefit is one route; another is the having of children in order to

get child benefits and related parenting allowances, with tragic

consequences for some children.

Tightening up of this has been signalled in the budget but this has

happened before, with no proper follow-through.

Another UK labour market problem is the resurgence of union

power as Labour loosened the union laws passed before 1997. One

key loosening was the 12-week rule, which allows workers to breach

their contracts with impunity when on strike until 12 weeks of

strike have occurred. When strikes are designed for short periods

for maximum disruption, this 12 week period can take a long time

to trigger. During it the employing firm is unable to defend itself

by recruiting a different labour force.

Under the pre-1997 legislation firms were able to dismiss workers

in breach of contract, provided they did so in a non-discriminatory

way. This led to a huge reduction in strikes and a large rise in UK

productivity, to the great general benefit.

As we have seen in recent years, certain unions are exploiting this

12-week rule to damage the economy — the classic case has been

the BA dispute where UNITE has persisted in attempting to defend

well-above market wages for cabin crew.

In sum the budget was a decent start in restoring fiscal sanity. But

only a start.

The UK now needs urgent attention to the creation of a proper tax

system with low marginal rates but generating a reliable revenue

source — the two are perfectly compatible. It needs sense and

restraint in regulation. Finally they need to reform their labour

market yet again.