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Jeffrey
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Posting #1: Sat Jan 13th, 2007 05:44 |
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Malaysia's Minority Investors Need Protection, World Bank Says
Updated : 12-01-2007 Media : Bloomberg
Story By : Angus Whitley
Jan. 12 (Bloomberg) -- Minority shareholders in Malaysia's publicly listed
companies need more protection, according to the World Bank, which called
for legal reform to improve corporate governance.
Directors at listed companies must be made more accountable for their
actions, the World Bank said in a report issued today in Kuala Lumpur.
The government's holdings in some publicly listed companies are also a
``challenge'' to corporate governance, the World Bank said.
(Something I believe should be addressed for a better investing climate.)
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Moolah
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Posting #2: Sat Jan 13th, 2007 06:25 |
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Yes, I do agree that minority shareholders needs more protection...
but...
on the other hand... these minority shareholders, they really need to know better themselves. Protection is one thing but to fully assume that they will be protected 100% is just being too naive.
And the best protection in my opinion is themselves. If they want to ba a minority investor, then by all means be a smart minority investor.
Rgds
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Jeffrey
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Posting #3: Sun Jan 14th, 2007 02:18 |
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SeekingAlpha
Munger: 'Not Enough Executives Have Gone to Jail'
Monday January 8, 5:43 am ET
Neal Shanske submits: Charlie Munger, vice-chairman of Berkshire Hathaway (NYSE: BRK-A - News) and CEO of Wesco Financial (AMEX: WSC - News) recently spoke with the Los Angeles Times on the issue of executive compensation. As always, the 83 year old Munger provided colorful commentary.
Munger derided compensation consultants, declaring that “I have always said that prostitution would be a step up for these people.” Munger pointed out that the problem was not that CEOs were evil, but that “… envy-driven compensation mania … brings out the absolute worst in good people.”
Munger points out that legislation is unlikely to fix the problem, citing a 1993 law that aimed to curb compensation above $1 million. He concedes that some CEOs are worth huge packages, but that companies with less talented CEOs are forced to match high pay packages or admit “that the company down the street has a remarkable CEO, but we have a mediocre klutz.”
What should be done to solve this problem? Munger is not afraid to conclude that it my be unsolvable:
Just because something is a serious problem doesn’t mean that you can fix it. There’s an element of tragedy in this because some very good people are acting in some very bad ways. But things are seldom so bad that you couldn’t make them worse by a dumb intervention.
Munger goes on to say that the events of the last several years have gone some way in eliminating “the garden variety of corporate fraud,” but concludes “In my opinion, not enough executives have gone to jail.”
(There are landmines in every step of investing but if SC and the those invloved in policing pull up some for discipline, that will help. And, agreed self education is imperative but as investing goes, the even ground you stand on in investing is also not rock solid. An investor is a life long student in many disciplines - psychology even)
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Moolah
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Posting #4: Sun Jan 14th, 2007 02:41 |
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| I really believe that the minority investors should learn to protect themselves. To expect the SC to protect them 100% is just being too naive.
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Jeffrey
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Posting #5: Tue Jan 23rd, 2007 06:48 |
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The Malaysian Institute of Economic Research has been required to parrot the Government’s own downgrading of the economy for 2007. The earlier projected 6% growth for this year has been reduced to 5.2 %. Last year the hyped up 6.2% projection was ultimately cut down to 5.8 %.
Tun Dr Mahathir does not believe Government statistics anymore. The Ninth Malaysia Plan is predicated on a 6% growth rate. But for two years in a row, the growth rate has slipped to the 5 % level. The Ninth Plan is also projected on oil revenues based on USD64 per barrel. Oil is now trading at USD50 per barrel. Analysts predict oil to settle at USD45 to USD48 per barrel.
In stark contrast the KLSE has reached 1139 points and is still going north. Obviously the run up in the KLSE has nothing to do with our economic fundamentals anymore. Huge amounts of dollar based hot money are now flowing into the region, hoping to make gains from the weakening dollar and pushing up stock prices at the same time. When this hot money exits the scene, the KLSE bull will collapse. The question is how soon?
(the whole story can read here: http://malaysia-today.net/blog2006/hakeem.php?itemid=1986)
Not relevant but gives a thought of why the market is zooming past the growth in economy. The Thais were worried about foregin funds and pulled their trigger and caused a speed bump in their market recently.Last edited on Tue Jan 23rd, 2007 06:51 by Jeffrey
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Jeffrey
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Posting #6: Wed Jan 24th, 2007 00:47 |
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B U S I N E S S (The Star)
Tuesday January 23, 2007
Malaysia not worried about impact of rising capital inflows
KUALA LUMPUR: Malaysia is "very happy'' with the inflows of foreign funds amid a strengthening of the local currency, a minister said Tuesday.
The Malaysian stock market has seen an influx of foreign funds since late December, partly due to a strengthening of the local currency, which recently hit a nine-year high of 3.5010 ringgit to the dollar.
"No. We are not concerned at all, we are very happy with the capital inflows,'' Second Finance Minister Nor Mohamed Yakcop told reporters when asked about the issue.
"We will carry on with the policy to encourage portfolio inflows, that is the policy.''
Asian central bankers, meeting in Tokyo on Monday, have warned that large capital inflows into the region posed a policy challenge because of its impact on economic and foreign-exchange policy.
While the Malaysian government also has said it is not troubled over the rise of the ringgit, currency dealers say the central bank has been intervening in the foreign exchange market to curb the ringgit's surge amid concerns it may hurt exports, which are a key factor in the country's manufacturing-driven economy.
Nor Mohamed said the government is confident Malaysia's economic growth in 2006 would exceed the official 5.8 percent target, after expanding by 6 percent in the first three quarters of last year.
He did not elaborate.
The government targets growth of 6.0 percent this year. - AP
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Jeffrey
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Posting #7: Wed Jan 24th, 2007 03:04 |
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http://business-times.asiaone.com/sub/news/story/0,4574,222111,00.html?
Foreign investors turn net buyers on Bursa
Trading volume on the rise, with a third generated by buyers abroad: CEO
By PAULINE NG IN KUALA LUMPUR
Published January 23, 2007
HAVING shunned Malaysian equities for the greater part of the past nine
years, foreign investors have turned net buyers, Bursa Malaysia's top
official said yesterday.
_______________________________________
Trending up: The Bursa benchmark is close to a 10-year
high but still off its historical record reached in 1994
_______________________________________
In the past three months in particular, strong foreign participation has
fuelled growth and volume, with a third of daily trade generated by overseas
investors.
As result, trading velocity has been boosted to 45 per cent from 32 per cent
last year, said Bursa Malaysia chief executive Yusli Mohamed Yusoff.
Shares of the demutualised exchange have been one of the biggest
beneficiaries of the new bullishness, rising to RM10.70.
Trading now at 1,156 points, the bourse is close to a 10-year high but still
off its historical high of 1,344, reached in 1994.
Judging by the speedy rise, the exchange could soon hit 1,200 as forecast by
stockbrokers.
Although velocity has improved significantly, it is still lower than that in
surrounding markets, some of which do 60 per cent, Mr Yusli said.
The challenge is to sustain volume going forward, he said yesterday at the
launch of the FTSE-Bursa Malaysia Emas Syariah Index.
Retail punters should get into the market or they will miss out, Mr Yusli
said.
So far, gains have been broad-based going by the fact the FTSE-Bursa
Malaysia Mid 70 Index has performed better than the FTSE-Bursa Malaysia
Large 30 Index.
The retail segment, which accounts for a third of trades, is still lagging
as most punters stay sidelined for fear of being burnt again.
Because foreign investors could withdraw, stockbrokers would prefer a
stronger local retail presence to sustain the market, which in the 1990s
enjoyed double the retail participation it does today.
Despite the run-up in prices over the past four or five months, Bursa's rise
has not matched that of some other Asian bourses, which continue to scale
new heights.
Asked if Bursa Malaysia plans to acquire a minority stake in neighbouring
bourses, Mr Yusli said: 'If and when the opportunity arises we would be
interested, but nothing in the immediate future.'
Such equity tie-ups would not be simple, he said. 'We would like to
participate in growth markets but it is not easy to take stakes in another
exchange because in this part of the world, exchanges are regarded as part
of national infrastructure and we can only do so if we have strong
relationships with one another. We can only do that if governments help us
get a stake.'
Bursa's new Syariah Index tracks 247 constituent stocks compared to 518 in
the existing Kuala Lumpur Syariah Index. Both indices will run parallel for
the next nine months, until the KLSI is retired on Nov 1.
Bursa plans to focus on developing a tradable Syariah index and to introduce
more Islamic structured products in line with its aims of being a global hub
for Islamic finance.
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http://www.biznewsdb.com/english/newspage/newspage.asp?
ID=7012375&file1=7&bulan=01&kw=wwqq
http://business-times.asiaone.com/sub/news/story/0,4574,222057,00.html?
Asian central banks warn against capital inflow risks
Published January 23, 2007
(TOKYO) Asian central bank governors yesterday warned against risks from
growing capital flows into the region, a phenomenon they said could be the
biggest challenge they face because of the impact on currency fluctuations
and economic policies.
'It is, and will surely be, the most difficult task for any monetary
authorities to maintain the stability of foreign exchange rates, the free
flow of capital and the independence of monetary policy simultaneously,'
Bank of Japan governor Toshihiko Fukui told a symposium held to mark the
10th anniversary of the region's currency crisis.
The governors also noted their success in getting the economy on a sound
footing and strengthening the financial system since the end of the crisis,
during which a flight of foreign capital sent Asian currencies tumbling in
1997/98.
'Ten years later, everything is different,' Mr Fukui said. 'The foreign
exchange and financial markets are much more stable and the currencies
sometimes face upward rather than downward pressure.'
But Mr Fukui also said that with the globalisation of the world's financial
markets, large capital flows will continue to have a strong impact on open
economies.
Bank of Thailand governor Tarisa Watanagase also expressed caution about rapid moves in capital flows.
The Bank of Thailand implemented capital controls to restrain the baht's
rise in December but made an abrupt partial reversal of the decision later after the move alarmed foreign investors, triggering a near 15 per cent plunge in the stock market.
'Rapid movements of capital flows have caused exchange rates to be vastly out of line with the underlying economic fundamentals and have negative impacts on the export or the import sectors,' Ms Tarisa said.
'The recent surge in capital inflows has caused a one-way appreciation of
the baht relative to regional currencies' that is detrimental to the
nation's export competitiveness, she added. - Reuters
____Last edited on Wed Jan 24th, 2007 03:14 by Jeffrey
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Jeffrey
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Posting #8: Thu Jan 25th, 2007 00:47 |
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KUALA LUMPUR: The Minority Shareholders Watchdog Group (MSWG) is in talks with World Bank representatives on the possibility of setting up a shareholders protection network in the Asia-Pacific region, which would also involve some European nations and the US.
.......some more literature here .....
He added that the balance RM2mil should come from sales of reports, corporate print cards, and other products as well as seminars on corporate governance.
(for berevity's sake - the articles are hogging up memory)
the full article is here:http://biz.thestar.com.my/news/story.asp?file=/2007/1/24/business/20070124184142&sec=business
My cynical outlook on this: yada, yada yada,..... ho hum, what's for lunch. Where's the guy carrying the big stick? I dont see him.
Last edited on Thu Jan 25th, 2007 01:18 by Jeffrey
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Jeffrey
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Posting #9: Fri Jan 26th, 2007 09:44 |
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Asian Wall Street Journal
January 25, 2007
Ringgit's Steady Climb Is Expected to Continue
Remarks Indicate Government Expects Stronger Currency
By CAROLYN LIM
KUALA LUMPUR, Malaysia -- The central bank of Malaysia may be buying
dollars more frequently than usual, but official remarks that the
nation welcomes fund inflows suggest the ringgit is ready to head much
higher.
Currency participants interpret the combination of words and action to
mean Malaysian authorities aren't keen for an overly quick rise in the
ringgit but accept that a stronger currency is inevitable.
Capital continues to flow into Asia on expectations the massive China
growth engine will provide enough momentum for the region's economies,
countering an expected slowdown elsewhere. Diversification out of the
dollar, Chinese yuan strength, and policy tightening among Malaysia's
main trading partners are also fueling expectations of a higher
ringgit.
Eleven economists polled by Dow Jones Newswires now expect the dollar
to fall to 3.4323 ringgit by year end, steeper than the average 3.4573
ringgit forecast a month ago.
Yesterday morning in New York, the dollar was slightly weaker at 3.5
ringgit.
"The signs are pretty strong in favor of the ringgit," said CIMB.
"Foreign direct investments in the textile industry are believed to be
shifting back to Malaysia from China, with some multinationals
planning to relocate parts of their operations ahead of the signing of
the Malaysia-U.S. Free Trade Agreement."
Infineon Technologies AG, for instance, opened a $1 billion
wafer-fabrication plant in Malaysia in September after downsizing its
chip-card business in France.
The upbeat mood is also evident in the country's stock market, as
foreign investors have turned net buyers. Nearly one-quarter of the
shares of power utility Tenaga Nasional Bhd., the country's biggest
company in market-value terms, are now in foreigners' hands, compared
with 9.7% a year earlier.
Institutional investors spooked by Thailand's December capital
controls are believed to have shifted some of their portfolio holdings
into Malaysia. Merrill Lynch this week said fund managers slashed
their exposure in Thailand by $783 million, becoming Asia's least
preferred market, while their survey of fund managers showed the
weighting for Malaysia shooting up to 12% from negative 13% three
months earlier.
Asian central bankers meeting in Tokyo earlier in the week warned
about the challenges that large capital inflows into the region pose
for economic and foreign-exchange policy. However, Malaysia Second
Finance Minister Nor Mohamed Yakcop said Tuesday the government is
"very happy with the capital inflows" and "will carry on with the
policy to encourage portfolio inflows."
Although Bank Negara Malaysia, the central bank, is believed to have
been unusually active in the currency market, buying dollars
repeatedly since early December, J.P. Morgan yesterday said Mr. Nor
Mohamed's remarks "underscore the lack of policy fears to
fundamentally driven [ringgit] gains and should alleviate market
concerns over capital-control measures."
"What Bank Negara is doing is slowing [the ringgit's rise] down a bit
but it doesn't mean they are completely resisting a higher ringgit," a
currency strategist at a big investment bank in Singapore said.
A 3.3% appreciation in the ringgit since the central bank began
intervening early December is further evidence the central bank
doesn't oppose a stronger Malaysian unit, he said. He forecasts the
dollar to fall to 3.45 ringgit by year end.
According to traders, the central bank's dollar purchases from 3.50
ringgit to 3.501 ringgit this week kept the U.S. unit above 3.50
ringgit despite persistent dollar sales from offshore players.
Citigroup economist Sim Moh Siong expects "the central bank to provide
staggered support on the downside to prevent a complete free fall of
the [dollar], with first target on a break of 3.50 ringgit coming in
at 3.47 ringgit."
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Jeffrey
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Posting #10: Wed Jan 31st, 2007 20:14 |
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Warning on China stock market ‘bubble’
By Sundeep Tucker in Dubai and Geoff Dyer in Shanghai
Published: January 30 2007 22:00 | Last updated: January 31 2007 04:28
The Chinese stock market is developing into a “bubble” and investors are in danger of behaving irrationally, a leading Chinese legislator said on Tuesday in the strongest public expression of concern to come from a senior state figure.
Cheng Siwei, vice-chairman of the National People’s Congress and an influential figure in Beijing financial circles, warned the mainland stock market could be overheating, after a rise of 130 per cent last year.
“There is a bubble going on. Investors should be concerned about the risks,” Mr Cheng said in an interview with the Financial Times.
“But in a bull market, people will invest relatively irrationally. Every investor thinks they can win. But many will end up losing. But that is their risk and their choice.”
He added: “You can’t take administrative measures to change people’s behaviour. The market is based on people’s behaviour. Investors will have to learn their own lessons.”
After a five-year slump from 2001, the sharp rise in the market during the past year has prompted a stock market frenzy in mainland China by retail investors. Shanghai’s exchange has seen record daily trading volumes this month.
........ (there's more).........
Some China-based analysts believe the fears of a stock market bubble are exaggerated.
The article was lifted from here:-
http://www.ft.com/cms/s/5415cad8-b0a1-11db-8a62-0000779e2340.html
Last edited on Wed Jan 31st, 2007 20:19 by Jeffrey
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