Fresh Pick of the Day, August 12, 2014: “Fund managers – Assets or liabilities? ” from The Economist Magazine

- From the Economist magazine – “Regulators worry that the asset-management industry may spawn the next financial crisis. Regulators are stuck between a rock and a hard place. It is their job to anticipate future crises, which may not resemble those of the past. But that logic requires them to regulate parts of the industry which have not, in the past, been the source of problems. Another concern is that risk may be a game of whack-a-mole: hammer it down in one place and it pops up somewhere else. Some of the problems regulators fret about, such as the illiquidity of the corporate-bond market, are the result of regulations imposed since the crisis. If they now bear down on funds or fund managers, they may simply create another problem somewhere else.”

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Fresh Pick of the Day, August 7, 2014: “Building the Whole Foods of China”

From Bloomberg Businessweek – “Given the explosive growth of China’s urban elite in recent years, there’s money to be made catering to finicky demands. Since 2009, Zhang’s customer base has grown 20 percent to 50 percent a year. Zhang has reeled in $40 million from Western and Chinese investors and millions more in government subsidies. His company generates revenue of $18 million to $24 million a year, and he says he now runs one of China’s largest organic farming and retailing operations, spanning thousands of acres across eight provinces.”

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Fresh Pick of the Day, August 6, 2014: “Financial analysts: Are they useful after all?”

From Knowledge@HEC – “The results of the study confirm that analysts generate important information that is used by market players, which impacts the cost of capital for firms and, consequently, the investments they agree to and their financing. In fact, after the loss of an analyst, companies reduce their investments by on average 2.4% of the total value of their assets. The three investment components that the researchers focused on (capital, research and development, and acquisitions) fall significantly in both the year prior to and following the loss of an analyst in comparison to similar firms that do no lose an analyst. Firms also considerably reduce their financing (on average by 2.6 % of their assets) when they lose an analyst. Amongst the three variables that the researchers were interested in (changes in long and short-term debts and equity issuance), only short-term debt does not decrease significantly, because it is less sensitive to uncertainty and, consequently, to analyst coverage. The greater the coverage, the more information there is available for investors, thus the lower the uncertainty regarding.”

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Fresh Pick of the Day, August 5, 2014: “Marketing – Why Location is King for E-commerce, Too”

From Knowledge@Wharton – “There are two really important takeaways here for anyone who is in the online world selling things through the Internet. The first is that it’s very critical to understand what the offline environment looks like. Why is it that you have some customers in one location and no customers in another? What is it about the physical world that is affecting what is going on in the virtual world? That’s the first thing. The second thing that this research emphasizes is that existing customers are often the most powerful source of new customers for a firm — the extent to which they advocate to [others], the [degree to which] the product they’re using is socially visible, and the extent to which they talk about it with friends, family and others who they come into contact with locally.”

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Fresh Pick of the Day, August 4, 2014: “Manage Your Team Conflicts Before They Spread”

From Stanford Re: Think – “A scholar of organizational behavior explains how managers can contain the spread of disagreement in their team. We know dysfunctional conflict when we see it, from boardroom brawls to teams whose members spend so much time in their silos sniping at each other that they get nothing done. But how do conflicts start, and, more mysteriously, how do they infect an entire group on such a grand scale?”

 

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Recommended Book for the Week, August 1, 2014: “The Heart of Business: Solomon’s Wisdom for Success in Any Economy”

Become an excellent employer while running an effective business. The Heart of Business focuses on the business wisdom found in Proverbs that is vital to personal and professional success. This study is divided into four easy-to-follow sections:

• God’s promises
• Our responsibilities
• Avoid these things
• Become these things

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Fresh Pick of the Day, July 31, 2014: ” The morning routines of the most successful people”

From Fast Company – “Which morning routine might be best? While there’s probably not an ideal morning routine that fits everyone, we can learn a lot from the morning routines of successful people as well as from the research and inspiration behind starting a morning on the right foot.”

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Fresh Pick of the Day, July 30, 2014: “Is it profitable to invest in wine?”

From Knowledge@HEC Paris – “A collection of fine red wines may be an asset for gourmets, but it is also an interesting financial asset, which appreciates over time. Unique research based on the study of prices of Bordeaux premiers crus over the course of the 20th century shows that wine appreciates beyond its drinking value to deliver high returns, even outperforming some other traditional investments.”

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