Still at the centre of the world’s news coverage

A range of issues keeps China in its coveted position as the most watchable country.

CHINA’S global profile remains undiminished this week, despite many other issues competing for international headline space.

The buzz among foreign investors is whether it is too late to “enter the Chinese market.” There is a strong implicit element of time for what will soon be, if not already, the world’s biggest market.

China Daily on Monday ran a piece on how opportunities still exist, particularly for SMEs. A consensus seems to be that while doing business in nominally communist China is better than ever because of improvements in institutional frameworks and the regulatory environment, competition from Chinese rivals particularly “tech companies” is getting tough.

The Google-Baidu competition could be an object lesson here. With incentives like the recent 4 trillion yuan (RM1.88 trillion) stimulus package for state-owned enterprises, China’s capitalist ethic is doing well.
The number of private companies grew more than 4,600% to 6.6 million over the past 18 years. Among foreign corporations, 96% of Fortune 500 companies are already operating in China.

Then there is the negative side as well, including that which reinforces negative stereotypes. This often involves Beijing’s attempts to control cyberspace, and what China’s 384 million Netizens may or may not do.

A Bill of amendments requiring Internet companies and telcos to report on users passing state secrets is up this week for its final reading in the National People’s Congress Standing Committee before becoming law. Associated Press reports that the move has already attracted criticism at home and abroad.

Officially, tightening the law on communications use is to ensure greater national security. Among the problems is that interpretation of what is a “state secret” is open to interpretation and abuse, so the law would be arbitrary and draconian.

More legislation attracting controversy this week concerns modifications to the law on the detention of suspects. When police have been required to pay compensation to persons wrongly detained, now compensation applies only to wrongful and prolonged detention beyond 37 days (one week and one month).

There would be no huge claims; sums derive from the average daily wage of a state employee in the preceding year. However, there are provisions for further compensation in cases of police brutality. Such laws may not be the best indicators of social change. A better measure would be the impact of public debate and argument on the policymaking process.

China’s next international extravaganza, following on the 2008 Olympics, is Shanghai’s World Expo that opens tomorrow. Singapore’s Straits Times bills it as the “glitziest and greenest” Expo of them all.

The organisers would make it the most glamorous World Expo yet. But, mindful of critics who would condemn a commercial showcase with doubtful environmental value, Shanghai’s show would also be the most environment-conscious.

For symbolism, there would be the world’s largest solar panel; for novelty, a restaurant would recycle excess food to produce electricity; and for visitors’ convenience, 1,000 vehicles powered by renewable energy would ferry people around the site.

Four large parks would act as “green lungs” while 3,000 inefficient factories have been closed. The Expo, due to run for six months, took nine years to prepare. The environmental aspects alone cost US$33bil (RM106bil), which is twice that of the Beijing Olympics. This indicates something of the scale with which China operates, ever since the Great Wall. Inevitably, the growing clout of a rising superpower would be reflected in its role in major multilateral institutions. Perhaps the most appropriate here is the World Bank, where this week China nearly doubled its voting power to 4.42%.

This places China as third-powerful in the bank after the US and Japan, reflecting its number three position in world GDP terms. That could soon change again: China’s economy is already bigger than Japan’s in PPP (purchasing power parity) terms, and is set to be number two even in GDP terms this year.

Every other country in the 186-member institution had its share reduced to make way for China’s increased strength except the US, which retained its share at 15.85%. But since the world’s largest debtor nation owes so much of its wherewithal to China’s economy, relations among Bank members may have to change further to remain relevant.

MIDWEEK By BUNN NAGARA

In China we trust,again

Will China crash economically?

Capital Talk

CHINA bashing by now must surely be the most popular sport among Western investors, mass media and institutions. China crashing now, China crashing a few years later, China crashing anytime and crashing forever is the mantra.

A mantra is like a hymn. If you chant it endlessly and repeatedly, it gets stuck in one’s head. However, the fact that it may get stuck in one’s head does not mean that it will happen or that it represents the reality.
In fact, a mantra based on superfluous analysis or worse, an inherent bias, would block the real realities from surfacing. An objective analysis of the global economic conditions would show that this is what is actually happening.

With all the high profile, high publicity given to China bashing, all eyes are centred on China in general and its property sector in particular. Will China crash? When will China crash? i Capital’s managing director gets these questions all the time.

In contrast to all the dire predictions about China, i Capital expects China’s economy to nicely soft land this year. When the Lehman Panic broke out in September 2008, and almost collapsed the world economy, China was ahead of every other economy in implementing economic expansion measures.

China very quickly bottomed out and pulled the global economy out of its worst conditions (which, of course, no Western country has given China any credit). While the US led the world economy into possibly the worst recession in a long time, China and the rest of Asia quickly pulled the world economy out of a US-created catastrophe (see charts).

As China’s economy recovered quickly and strongly, the Chinese government has subsequently acted very quickly and effectively again. Measures to cool the hot property sector down have already been announced months ago.

China’s government is ahead of the property “bubblet” curve. However, it takes time for the impact to be felt, which is expected to take place in the coming months.

Selected segments of the property sector will cool down but the rest of the economy will still be performing well. China’s economy is huge and a cooling of the property sector will not crash the continental economy.
The decision by The People’s Bank of China not to raise interest rates so far is correct. Why kill the rest of the economy when there is no need to? There are many other effective ways to tackle the property “bubblet”, especially when the cause of the rise in property prices is not low interest rates.

Another unnoticed development that favours China soft-landing this year is that the current global economic recovery is not synchronised. The recovery in the United States is behind that of China and the rest of Asia but it is gathering momentum.

The growth in US exports and the recovery in the industrial sector have led the US recovery. Consumer spending is also recovering and will gather momentum as the US job market improves further. The US housing sector is also expected to contribute positively this year.

As 2010 progresses, the US economic recovery will play a greater role in global economic growth. This is ideal, as it will allow China to turn to other economic sectors for growth while it tackles its property bubblet.
In short, as the US economic recovery gathers momentum in 2010, China’s GDP growth would slow to a healthy, high single-digit rate.

Based on the economic outlook of the United States and China, i Capital sees a benign global economy. Unlike 2006 or 2007, 2010 will see a healthy unsynchronised global recovery. This upbeat view can, of course, be turned topsy-turvy by unexpected events. There seems to be plenty nowadays.

One, while the currency pressure on China seems to have reduced somewhat, the United States is now cleverly turning to other countries and US-dominated global institutions to crack China’s position. Apparently, even India and Brazil are now joining in the bandwagon as prominently headlined on the front page of the Financial Times.

So, although the currency pressure cooker is not boiling over for now, the threat of a trade war needs close watching.

Is China crashing the real worry? Or is the eurozone breaking up the real worry? Actually, an economy that has crashed but that has not been described in this way is the eurozone a.k.a a continent of discontent.

First, it was the PIGS (Portugal, Ireland, Greece and Spain). The budget deficit for Iceland is 14.3%, Greece 13.6%, Spain 11.2%, Portugal 9.4% and China 2.2%. The China bashers say that China’s budget deficit is actually higher because it does not include the local governments. We wonder why the clever Greeks did not think of this simple trickery.

Anyway, the Greek civil servants are on strikes and the budget deficit is running at unsustainable levels. No wonder the Greek economy is not in a sustainable mode. This continent of 35-hour working week but with wages paid equivalent to 350-400 hours of work in China or India is declining fast, faster than what is generally realised or acknowledged.

Greece, supposedly the birthplace of democracy, has transformed itself into a “debtmocracy”. Will China crash, as we all are led to believe, or will Greece be the Sword of Damocles for the eurozone and thus the global economy?

Then, as if Greece et al is not enough, as if an evil spell has been cast on Europe, we all discovered that cash-starved Iceland is actually rich with ashes. Imagine Iceland, more than 1,800km away from London and more than 2,100km away from Germany, taking revenge on the eurozone. Who would imagine that?

The hiatus caused by the volcanic eruption is not small. That a volcano from Iceland is causing so much havoc in the eurozone is symbolic of the very difficult period that this fledgling economic bloc is undergoing.

Almost every economy in the eurozone, including that of the United Kingdom, is in trouble. As i Capital wrote above, this is the reality, this is what is actually happening.

China and the rest of Asia are not crashing. The United States crashed and the eurozone has crashed. Should the East follow the West?

i Capital does not think so although there are many out there who would want to see this happening.
Once again, we have to say, In China We Trust. As i Capital advised previously, “This decoupling is here to stay”.

Aussie 'fraud mastermind' Daniel Tzvetkoff to stay in jail

Happier days ... Daniel Tzvetkoff and his former Gold Coast mansion.

A US judge has crushed former Australian internet high-flyer Daniel Tzvetkoff's hopes of winning release from prison ahead of his trial.Just a week ago Tzvetkoff, 28, accused of being the mastermind of a $US540 million ($590 million) internet gambling money laundering and bank fraud scheme, was granted bail by District Court Judge Peggy A. Leen in Las Vegas.

The decision infuriated US government prosecutors who believe Tzvetkoff may have a secret stash of $US100 million and would flee if released from prison.

At a fresh hearing on Wednesday in the New York District Court, where the trial will be held, Judge Lewis A. Kaplan sided with prosecutors and reversed the decision.

He declared Tzvetkoff "a serious risk" of fleeing if granted bail.

"No condition or combination of conditions will reasonably assure the presence of the defendant as required," Judge Kaplan noted.

Tzvetkoff has been locked up in the North Las Vegas Detention Center since his arrest at a casino in the city on April 16 despite Judge Leen's bail decision last week.

With Judge Kaplan's ruling, Tzvetkoff faces a tough road.

The complicated money laundering and bank fraud charges he faces could take two years to be finalised in court, resulting in Tzvetkoff spending that time in jail even if he is ultimately found not guilty.

If convicted of the charges Tzvetkoff faces up to 75 years in jail.

US Marshalls will transport Tzvetkoff from the jail in Las Vegas to a prison in New York.

The decision is a major blow to Tzvetkoff and his family, including fiancee Nicole Crisp who is eight months pregnant and hoped to live with Tzvetkoff in New York until the trial was completed.

Tzvetkoff's father, Kim, flew to Las Vegas last week to support his son in court and agreed to put up his $US1.17 million Brisbane home as bond and also drive his son from Las Vegas to New York for the proceedings.

If Judge Leen's bail decision had not been overruled, Tzvetkoff would have lived in New York and submitted to electronic monitoring, maintained a verified residence in New York and abide by a curfew.

Wednesday's court decision is the latest fall from grace for Tzvetkoff, who created highly-profitable Brisbane-based internet payment processing company Intabill, bought a $27 million home on the Gold Coast, drove Lamborghinis and Ferraris, sponsored a professional motor racing team and had was once estimated to be worth of $82 million.

Tzvetkoff has since filed for bankruptcy.

Source: http://newscri.be/link/1086509

Debt crisis: UK banks sitting on £100bn exposure to Greece, Spain and Portugal

Shares in UK lenders slide amid fears of renewed credit crunch but French, German and Swiss most at risk from Greek default

Barclays is estimated to have £40bn exposure to Greece, Portugal and Spain, while RBS may have £35bn in loans. Photograph: Kevin Coombs/Reuters

Fears of a fresh banking crisis stalked the markets today as the risk of Greece defaulting on its debt repayments raised concerns about the exposure of major banks to indebted countries in Europe.

As analysts estimated that Britain's banks have a combined exposure of £100bn to Greece, Portugal and Spain – the three countries causing most concern on the financial markets – the Financial Services Authority was closely watching the markets and assessing exposures to the vulnerable countries.

After the ratings agency Standard & Poor's had downgraded Greek debt to "junk" yesterday, bank shares were knocked today but spared further falls as the downgrade of Spain's crucial credit rating came just as the stock market was closing. With UK banks standing to lose more in Spain than in Greece and Portugal, analysts said there might have been a more severe reaction if London had remained open longer today.

Analysts at Credit Suisse calculated that UK banks had £25bn of exposure to Greece and Portugal but £75bn to Spain, where the collapse in the property market has already forced banks such as Barclays to admit to bad debt problems and left Royal Bank of Scotland facing questions about its exposure.

"Lloyds' exposure to the three regions is likely to be negligible, we estimate that Barclays has £40bn exposure (predominantly loans in Spain and Portugal, excluding daily positions in Barclays Capital), and RBS has around £30bn–£35bn (again predominantly Spain, although we estimate £3bn to £4bn in Portugal and Greece as well)," the Credit Suisse analysts said.

Money markets, in which major banks lend to each other, also reflected the tension caused by the Greek downgrade with eurozone interbank lending rates enduring their biggest rise in nearly a year.

Much of the anxiety was targeted at French, German and Swiss banks. Howard Wheeldon, of BGC Partners, said: "If Greece defaults that means the pressure will then be felt and exerted on national banks that hold the Greek debt. That includes very many German, French and Swiss banks and it just may be that with so many banks involved one of these might just go down."

At today's annual meeting, RBS's chairman, Sir Philip Hampton, played down any exposure to Greece, while Lloyds' finance director, Tim Tookey, said on Tuesday that the bank had no "material [significant] exposure". Barclays publishes a trading update on Friday and will face questions about its exposure to the countries being downgraded.

In early trading today banks were the biggest fallers, with RBS tumbling 7%, Lloyds down by 6.5% and Barclays off 4%, though they recovered much of their losses by the time market closed.

Among continental European banks, analysts at Evolution calculated that Fortis, Dexia, CASA and Société Générale were most affected because of the value of their Greek debt holdings relative to their size.

According to Barclays Capital, UK banks account for only 3% of the exposure to Greek bonds, while data from the Bank for International Settlements shows that, at the end of 2009, Greece owed about $240bn (£160bn) overseas. Of this, France and Germany have the biggest exposures of $75bn and $45bn respectively.

Analysts expressed concern about the problems spreading. Daragh Quinn, banks analyst at Nomura, said: "Given the scale of the debt problem facing Greece, the prospect of some kind of debt rescheduling or even default are being considered as possibilities by the market. Sovereign risk concerns are also spreading to Portugal and Spain."

Only last week the International Monetary Fund, which has been called in to help fund the Greece deficit, warned about the impact of a sovereign risk crisis. "Concerns about sovereign risks could undermine stability gains and take the credit crisis into a new phase, as nations begin to reach the limits of public-sector support for the financial system and the real economy," the IMF said.

Credit Suisse analysts pointed out that not all the problems facing the markets were negative for the banking sector. "The increase in volatility should assist revenues at the investment banks, particularly for primary dealers like Barclays," the Credit Suisse analysts said.

"But there are clearly a number of important potential negatives. These include the potential for increased capital and liquidity trapping in affected sovereigns, or increased micro prudential requirements for local subsidiaries. Our bigger concern, however, is increased nervousness towards the UK," they added.

But while the timing of the downgrade of the Greek sovereign rate surprised the markets, there had been expectations for some time that the ratings agencies would eventually lose patience with the situation and take the decision to downgrade. This might have helped to cushion the markets' reaction to the situation, analysts said, and was likely to ensure that the major banks and other investors had already assessed their exposure to the Greece market before the downgrade took place.

The impact of a downgrade

The cost of borrowing for the Greek government briefly hit 38% in a stark illustration of the impact that a downgrade can have on the health of a nation's finances. Greece has been graded BB+ by the credit rating agency Standard & Poor's, official "junk" territory. It is now on a par with Azerbaijan, Colombia, Panama and Romania.

 

Britain is one of 11 countries with a prized 'triple A' rating, along with Australia, Denmark, Germany, France, the United States and Luxembourg. But it is the only one of the elite to have been put on "negative watch", a warning that it might face a future downgrade.

The cost of Greece borrowing on a two-year bond was as little as 1.3% in November, but has risen sharply amid fears of bankruptcy. By the end of tradingtoday, the cost had fallen back to 19%. In contrast, Britain is able to borrow on two-year bonds at a rate of 1.2%. S&P's lowest rating, CCC+, is assigned to Ecuador, which defaulted on $3.2bn of bonds last year.
 

Jill Treanor,guardian.co.uk, Wednesday 28 April 2010

Shanghai sets stage for World Expo spectacular

(Reuters) - Shanghai unveils to the world on Friday its multi-billion dollar World Expo, which China hopes will be an opportunity to assert its growing global clout and show off the fruits of its economic transformation.

Shanghai, already China's richest and most glamorous city, has made an unprecedented effort to impress with its Expo, a world fair which has in recent years largely dropped off the world's radar, and to grab some glory from Beijing's Olympics.

The new roads and subway lines which criss-cross the city have been purposely built not only for Shanghai's future growth, but also to transport the 70 million mainly Chinese who will visit during the six-month extravaganza.

China says it has spent $4.2 billion on the Expo -- double what it spent at the 2008 Beijing Olympics. It is the most expensive and largest Expo to date, and local media have reported the true cost is closer to $58 billion, including infrastructure.

"This is a very important moment. We have made preparations for years," Hong Hao, Deputy General for the Expo, told Reuters.

Shanghai wants to put the World Expo back on the world stage as the first developing country to host one, encouraging countries large and small to take the Expo seriously and use it as a means to improve fractured foreign ties and increase trade.

China's relations with the outside world have been strained of late, with issues like the value of the yuan currency, a fight over censorship with Google and the trial of four Rio Tinto executives casting a pall over the country's efforts to present itself as a respected international player.

Leaders including French President Nicolas Sarkozy, Russian President Dmitry Medvedev, South Korean President Lee Myung-bak and EU Commission President Jose Manuel Barroso will be at Friday's opening ceremony.

Smaller countries, such as Israel, are also making efforts to engage China through the Expo, despite the shadow cast by the financial crisis.

Yaffa Ben-Ari, deputy commissioner general of Israel for the Shanghai World Expo, said the Jewish state aimed to boost cooperation through the event. It was the first time, he said, that Israel had built its own pavilion, with the government allocating a budget of $12 million for the project.

TEETHING PROBLEMS

The project has not been without its detractors. Rights groups have complained about evictions of residents to make way for the two spectacular main Expo sites on either side of the murky Huangpu River.

Some Chinese have also wondered why the country, with its growing rich-poor gap, severe environmental and other problems is spending so much on an event which lacks an Olympics' cachet.

"Our living costs are five times yours but our salaries are one fifth of yours. Yet we survived and we are still joyfully and happily welcoming friends from all around the world," wrote popular Shanghai blogger Han Han, with a strong sense of irony.

Despite unremitting propaganda in state media about how great the Expo will be, not all the country pavilions will be finished in time for Friday's opening.

Organizers are also trying to iron out teething problems for handling large crowds after initial trial days received widespread complaints from tired, hungry visitors.

Still, the financial hub is abuzz with Expo fever. The blue molar-shaped "Haibao" mascot adorns every street corner, bus stop and subway station.

"Most people are very excited," said Shanghai resident Si Yudan, 30, brushing off all the inconveniences of seemingly endless renovations and building projects to spruce up the city.

Security has been stepped up, with subway passengers forced to go through airport-style bag checks.

Analysts, however, say a terror attack is unlikely due to the relatively low global profile of the Expo.

"Of more concern would be bird flu or H1N1. If that breaks out on site, how will they manage to prevent it spreading and how will they attempt to quarantine such a large number of people?" said Greg Hallahan, regional director at business risk consultancy PSA Group in Shanghai.

(Additional reporting by Rujun Shen; Editing by Ben Blanchard and Ron Popeski)

(Reuters), http://newscri.be/link/1084332

Joos Orange Solar Charger

Reviewed by Bryan Gardiner 

$100  •  solarjoos.com/

Solar Charger Juices Your Gadgets, Rain or Shine

It's an unavoidable fact of life: Your gadgets need juice —like a preacher needs pain, like thunder needs rain. (Thank you, Bono.) And when it comes to portable power-ups, our new favorite flavor is Orange.

The Joos Orange solar charger is the physical manifestation of simplicity. It's rugged, easy to store and carry, and (most importantly) quick to bestow a watt or two whenever you need it. Simply choose the correct adapter (the Orange comes with seven of the most popular ones), plug in your depleted phone or DS into the charger and let the life-giving juice flow. Yep, that's it.

Weighing in at a pound-and-a-half, the Orange is roughly the same size and weight as an iPad —and arguably a lot more useful. It can be completely submersed in water, dropped, kicked, and, in general, take the worst abuse man or nature can dish out.

Nestled inside its durable polycarbonate shell is a super-efficient 5,400-milliamp-hour replaceable lithium-ion battery capable of holding its charge for years. In our tests, we managed to dole out four full charges to a completely depleted iPhone before the Orange needed a solar recharge. It even fully charged the notoriously fickle iPad.

While PC owners will be able to download a standalone GUI for precise power metrics, the unit also has two LED status lights on the sides: one solar light (red) and other for the battery (green). When the Orange is running, the red light will blink rapidly to let you know you're getting juiced. Similarly, the green light spits out one blink for every 20 percent of the battery that's full. Four blinks and you know you have a battery that's between 60 and 80 percent full. Even better: the Orange comes with a pair of attachable reflectors that help collect somewhere between 20-30 percent more power when affixed to both ends.

No sun? No problem. While our test model wasn't equipped to charge efficiently by USB, the folks at Solar Components assured us that production models can be refilled at the standard USB charging rate (500 milliamps at 5 volts or 2.5 watts).

So go ahead and leave those outlets. Sucking down solar power has never been easier.

WIRED Cheap. Crazy-durable. Comes with nearly all connector tips you'll need for your mobile gear (you can order specific ones from Solar Components if not). Two screw-in mirror panels beef up charging efficiency by 30 percent. Nuclear fallout blot out the sun? Charge up by USB.
TIRED No Mac compatibility for GUI software. Deciphering the LED takes some getting used to. Screws for attachable mirrors are not ideal and are easily lost.

http://newscri.be/link/1085159

Brain Games Won't Make You Smarter, Study Says

Brain training games do not make you smarter - FACT

"Brain games" are certainly fun, but contrary to what many players hope, they're not likely to make you any smarter. From a six-week study paid for by the BBC and reported by Discovery News:
Photo by wetwebwork.

More than 8,600 people aged 18 to 60 were asked to play online brain games designed by the researchers to improve their memory, reasoning and other skills for at least 10 minutes a day, three times a week.
They were compared to more than 2,700 people who didn't play any brain games, but spent a similar amount of time surfing the Internet and answering general knowledge questions.
Researchers said the people who did the brain training didn't do any better on the test after six weeks than people who had simply been on the Internet. On some sections of the test, the people who surfed the Net scored higher than those playing the games.

Some brain-game manufacturers argued with the studies results, claiming that the findings didn't apply to their games. Whether or not the results of that study are on the money, professor of psychology from the University of Illinois Art Kramer points out: "There is precious little evidence to suggest the skills used in these games transfer to the real world."

It's not all bad news, though. For starters, regular mental exercise may increase your life expectancy. If you're really looking for some brain-boosting benefits, physical exercise is an extremely effective way to exercise your mind—and you're killing two birds with one stone.

Are you a big believer in the brain games? Share your experience in the comments.

Brain Games Won't Boost I.Q. [Discovery News]

Brain training games do not make you smarter - FACT

By Gerald LynchBy 

 

Nicole Kidman may have been fooled by its cute brain teasing charms, but Tech Digest were never truly convinced. Now there's proof: new research shows that brain training games do not improve your IQ.

A scientific study of 11,430 volunteers conducted by the BBC proved that while using the brain trainers made the gamers better at the games themselves, the skills gathered were not transferable to the world at large.

One third of the volunteers were tasked with training their reasoning powers, planning and problem-solving skills, another third played games designed to train short-term memory, attention, mathematical abilities and visuospatial skills, while the final group were given web-browsing tasks that didn't target any specific cognitive skills.

Across all the tests, none of the brain game participants gained a boost in everyday thinking tasks any more than those using the web-browser.

Dr Adrian Owen, a neuroscientist at the Medical Research Council, said: "The results are clear. Statistically, there are no significant differences between the improvements seen in participants who played our brain training games, and those who just went on the internet for the same length of time."

Via: BBC