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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Spekulatius who wrote (18848)	3/10/2004 12:57:47 AM
From: Spekulatius	Respond to of 78516

Reuters UPDATE - China orders clampdown on heated lending Wednesday February 11, 3:45 am ET By Scott Hillis (Updates with money supply and lending targets) BEIJING, Feb 11 (Reuters) - Chinese Premier Wen Jiabao has ordered a clampdown on excessive lending in the strongest step yet to tackle a problem that could undermine the economy and complicate reforms for banks and state firms. ADVERTISEMENT Wen's comments at an annual finance policy meeting in Beijing were backed by the country's central banker, who set a goal of cutting new loans by 13 percent this year and easing money supply growth. New lending grew about 50 percent in 2003. Last year's faster-than-expected monetary growth of nearly 20 percent helped fuel a sharp rise in lending into industries such as property, automobiles and steel. This week, China's banking watchdog ordered an investigation into lending in these sectors. The clampdown comes as banks prepare for multi-billion dollar initial public offerings to foreign investors by disposing of hefty bad loans made during decades of state-directed lending. They now face official orders to restrict lending, potentially complicating the drive to make the financial system more market-oriented. Analysts said Beijing's focus on restricting lending allowed it to duck more painful steps such as adjusting the yuan currency's controversial peg to the U.S. dollar or raising interest rates, which would make it more expensive for the government to finance its swelling budget deficit. "They hate to change interest rates, and they hate to change the exchange rate. They want to conduct monetary policy on the cheap," said Arthur Kroeber, editor of the China Economic Quarterly. "They want to put a brake on some of these sectors where there's too much investment going in, but they don't want to put the brakes on the economy as a whole," Kroeber said. Using strong language to back up his call for a clamp-down on credit, Wen was quoted in the official China Daily newspaper as calling many industrial projects "excessive", "unhealthy" and "unreasonable". The fear is that the lending is fueling industrial over-expansion, which could eventually lead to loan defaults and mass layoffs. Calling investment growth "excessively fast-paced," Wen said it threatened the health of the financial system, which Beijing is trying to reform with measures such as a $45 billion bail-out of two major state banks last month. Analysts described the comments as unusually direct. "Having Wen Jiabao come out and say this is interesting, because he hasn't made a lot of public statements about public sector behaviour in the past," said Kroeber. CENTRAL BANK MOVES Backing Wen's calls for slower loan growth, the central bank said it would try to keep growth of the broad money supply around 17 percent compared with 19.8 percent growth last year. The bank also hoped to cap new loans at 2.6 trillion yuan ($314 billion), down 13 percent from last year. China would "continue to carry out a stable and healthy monetary policy and maintain appropriate growth in overall lending", People's Bank of China Governor Zhou Xiaochuan said in a statement. China's economy grew 9.1 percent last year and is seen rising about 8.5 percent in 2004. Fresh official economic data released on Wednesday showed exports rose nearly 20 percent in January from a year ago while foreign direct investment rose 13.6 percent. The renewed anti-lending drive indicates that measures taken last year, such as a curb on lending to luxury property developers and buyers, and an increase in bank reserve ratios, did not work. Foreign developers, including Singapore-based CapitalLand Ltd (SES:CATL.SI - News), Hong Kong's Hutchison Whampoa (HKSE:0013.HK - News) and Shui On Group, have luxury projects planned or already in the works. The financial meeting, which ends on Thursday, would set reform goals for this year that would likely focus on further overhauling state banks and improving the capital markets, the China Daily said in an editorial. "The authorities must come up with a clear-cut timetable supported by a package of all necessary measures to transform state banks into real commercial banks," the newspaper said.

To: Spekulatius who wrote (18848)	3/10/2004 8:55:27 PM
From: Spekulatius	Read Replies (2) \| Respond to of 78516

Portfolio update - sold UTSI bought VIAb Stopp loss order @ 30$in UTSI ridded me of my small position in UTSI, adding to my abysmal trading record as of lately :-(. Bought VIAb @ 37.56$. In between J. Jackson's undecent and DISH networks lack of exposure, VIAB has been trading down lately. I hope that both players come to their sense and VIAb will be trading higher. Viacom is the best company in the media business, IMO. Current FCF yield of 4.5% and earnings and revenues should increase due to ad rebound. Stock is not cheap but not expensive either, IMO. Looking to add more VIAb, ABC, BDK if they fall further.

To: Spekulatius who wrote (18848)	3/15/2004 10:19:25 PM
From: Spekulatius	Read Replies (2) \| Respond to of 78516

Added to BDK @51.3$ my single best idea at this point - with a FCF yield around 8% per S&P. Keeping powder dry and still about 50% in cash in my trading portfolio. I see more buying opportunities ahead. Canon had a good report today, so if price is right i'll buy back some shares again. I think Honda is looking interesting as well, at around 20$ i would be shareholders again and at 23 Euro i will add to my shares in BMW preferred, as the Y2003 earnings look pretty strong.