From Nikkei Asian Review – “The commitment of Asean leaders to the AEC represents a dramatic expansion in the group’s remit — from an organization focused merely on lowering formal barriers in goods trade to the creation of a single market that covers goods, services, investment and beyond in ways that previously had only scratched the surface.”
Fresh Pick of the Day, June 19, 2014: How will the new Southeast Asian community resolve its differences?
From The Economist – “There is a risk that climate change will happen faster or be more costly than we anticipate, possibly threatening humanity’s very existence. Whether or not it makes sense to pay to cut emissions in order to enjoy the benefits of slower warming, it is worth taking action now in order to reduce the odds of a civilisation-ending outcome. Though that argument makes quite a lot of sense, it does leave some economists unsatisfied. Surely the costs of warming are high enough that it’s worth cutting emissions to stop it, whether or not it threatens our very existence, right?”
From Knowledge@Wharton – “It’s not the case that all information is good and we should just rush to maximum disclosure,” Edmans notes. Previous research in this area has generally assumed that all types of information are easily disclosed, and that the cost of disclosure is limited to the minimal expense of preparing and mailing documents. But the researchers’ paper shows that the actual cost may be much greater than the direct expenses associated with communicating information: Disclosure can distort the manager’s investment incentives. The source of this incentive effect is that, in real life, some types of information are easier to reveal than others.
From Bank of America Merrill Lynch – The Chief Financial Officers of Asia’s largest companies are embracing growth for 2014. 76% of respondents expect revenues to grow this year. However, profit expectations are falling. The proportion of Asia’s CFOs that expects profits to grow has dropped to 60%, down from last year – suggesting that it is getting tougher to extract value from revenue growth. Asia is no longer the high growth, high earnings market that it used to be. CFOs in Asia are now thinking about strategies to improve operational efficiencies to drive profitability.
From Knowledge@Wharton – “weaker-than-expected economic growth may at least have the virtue of uncovering some diamonds in the rough. Uncertain growth is also causing investors to get choosier about their PE investments. Expect money to gravitate toward large firms with solid track records, and also towards niche firms that offer a unique approach. Firms in the middle could get squeezed.”
From Knowledge @Wharton – “ these days, in a challenging global economy — where technology is constantly changing the rules of the game, and the populations of developing countries are rapidly becoming more urbanized — collaboration and cooperation of the finance and marketing sides are essential, said Laxman Narasimhan, CFO of PepsiCo Americas Foods.”
From CNBC – “Alibaba’s initial public offering later this year will mark the end of an era, as well as the beginning of a new regime on the global tech landscape. The three Chinese Internet giants Baidu, Alibaba and Tencent—known as BAT—are the big tech companies born out of the PC era, said David Chao, co-founder and general partner of Doll Capital Management (DCM). The e-commerce powerhouse Alibaba, which is the most profitable of the three, will be the last of the group to go public.”
From WSJ.com- “Investors may not be as stupid as some researchers think, but they still need to fight their own fear and greed.”