Philippines is most improved ASEAN nation according to U.S Firms Survey

MANILA, Philippines- American firms and the ASEAN Business Outlook Survey of 2014 reported that the Philippines is the "most improved" country in the Association of Southeast Asian Nation (ASEAN).

The latest survey results shows the  U.S. firms confidence and satisfaction on the Philippines politics and business practices. U.S. firms drop their supposed corruption rate from 91 percent in 2003 to 59 percent as of today. Meanwhile, their adverse thoughts on the countries infrastructure also deteriorate to 55 percent from 69 percent within the same period of time.

The survey also showed that 87 percent of the total survey respondents seemed to be contented on the Philippine trained personnel’s availability.

“Highlight in the region is the marked improvement of the Philippines. The country has experienced high levels of growth recently and our survey shows why, as business leaders there indicate higher levels of satisfaction across almost all surveyed factors as compared to five years ago,” said Simon Kahn, chair of AmCham Singapore.

However, corruption, insufficient infrastructure and the tax structure continues to challenge the Philippines, based on the survey which is why Singapore remains on the top of the list.

“Singapore remains one of the most attractive countries in Asean to do business, with low levels of corruption, excellent infrastructure, and predictable laws and regulations,” said Kahn.

Obama wants Wall Street overhaul

WASHINGTON (AP) — Passage of a sweeping overhaul of Wall Street regulations in 2010 was a hallmark of President Barack Obama’s first term. Three years later, amid delays and compromises that critics say have diluted its ambitious goals, the president is trying to rekindle the law’s promise.

Obama prodded the nation’s top financial regulators on Monday to act swiftly and finish writing rules designed to prevent a recurrence of the 2008 financial crisis that helped precipitate a damaging recession from which the country is still recovering.

Obama met privately with Federal Reserve Chairman Ben Bernanke and seven other independent agency heads to emphasize his desire for comprehensive new rules as the five-year anniversary of the nation’s financial near-meltdown approaches.

The law was considered a milestone in Obama’s presidency, a robust response to the crisis, which led to a massive government bailout to stabilize the financial markets. But its implementation is behind schedule with scores of regulations yet to be written, let alone enforced.

Obama hoped to convey ‘‘the sense of urgency that he feels,’’ spokesman Josh Earnest said before the president convened the meeting.

Lehman Brothers collapsed into bankruptcy on Sept. 15, 2008, and the administration has wanted to use that dubious milestone to look back on the lessons of the crisis and to chart the progress so far to prevent a recurrence. In a statement at the conclusion of the meeting, the White House said Obama commended the regulators for their work ‘‘but stressed the need to expeditiously finish implementing the critical remaining portions of Wall Street reform to ensure we are able to prevent the type of financial harm that led to the Great Recession from ever happening again.’’

Not everyone feels that way about the law, known as Dodd-Frank after its Democratic sponsors, Massachusetts Rep. Barney Frank and Connecticut Sen. Christopher Dodd.

Republican House Financial Services Committee Chairman Jeb Hensarling, an early opponent of Dodd-Frank, dismissed Obama’s meeting with the regulators, saying, ‘‘Much like Obamacare, Dodd-Frank is an incomprehensively complex piece of legislation that is harmful to our floundering economy and in dire need of repeal.’’

The law set up a council of regulators to be on the lookout for risks across the finance system. It also created an independent consumer financial protection bureau within the Federal Reserve to write and enforce new regulations covering lending and credit. And it placed shadow financial markets that previously escaped the oversight of regulators under new scrutiny, giving the government new powers to break up companies that regulators believe threaten the economy.

But because of the complexity of the industry, the law gave regulators extended time to write the new rules that would enforce its provisions.

So far, regulators have missed 60 percent of the rule-making deadlines, according to an analysis by the law firm of Davis Polk, which has been tracking progress on the bill. Even so, the rules are so complicated that the ones already written have filled about 13,800 pages, compared with the 848 pages in the law itself.

‘‘I would have to give it a mediocre grade at this point,’’ said Sheila Bair, the former chair of the Federal Deposit Insurance Corp. ‘‘Most of the rules have not been finalized. A lot of them haven’t even been proposed yet. When some of the rules have been proposed, they’re highly complicated, they’re riddled with exceptions, they’re watered down.’’

Dennis Kelleher, president of Better Markets Inc., a bank watchdog group, said Obama needs to hold monthly meetings with regulators and fight for more money for the financial regulators to do their job.

‘‘Only that level of consistent presidential leadership and involvement will turn the tide against Wall Street’s relentless attacks, which is what has killed, weakened and delayed so much of financial reform,’’ Kelleher said.

A key goal of the legislation was to prevent a rebuilding of a financial system that would permit banks to become so huge and intertwined that they would be ‘‘too big to fail.’’ But the nation’s top banks today are bigger than they were in 2008. A key proposal in the law would restrict banks from trading for their own profit, a practice known as proprietary trading. That rule, named after former Federal Reserve Chairman Paul Volcker, has yet to take effect and the current proposal has been weakened from what the law initially envisioned.

Annette Nazareth, a former Securities and Exchange commissioner who is now a partner at Davis Polk, said that when it comes to the Volcker rule, the law requires that various regulators write a single rule that applies to all the regulated financial entities. ‘‘So to some extent it’s not surprising that it has taken longer when they have had to reach consensus on some very tough issues,’’ she said.

Overall, she added, ‘‘we are in a better position than we were before the financial crisis.’’ She said banks have stronger capital positions, regulators are more aggressive and failing banks can be dismantled in ways they couldn’t before. ‘‘We have the building blocks for a better, more stable financial system.’’

Action has varied from agency to agency. The Commodity Futures Trading Commission, for example, has been criticized for moving so swiftly on rules that it has had to issue an unusual number of so-called ‘‘no action’’ letters relieving firms that it oversees from the regulations.

Other central elements of the law have fallen into place.

The Senate last month confirmed Richard Cordray as the director of the Consumer Financial Protection Bureau created by the law. Republicans had been blocking his confirmation and demanding broad changes in how the bureau was configured and how it obtained its finances. But a number of Senate Republicans withdrew their opposition, putting Cordray in place and removing one element of uncertainty that had clouded the bureau’s work.

The Federal Reserve last month raised the amount of capital that big banks must hold to reduce the threat they might pose to the broader financial system. The requirements, which meet international standards agreed to after the downturn, have met some resistance from financial institutions as being too high, but have also been criticized for not being high enough.

‘‘There is a trade-off between holding capital and the ability to lend,’’ said Scott Talbott, a senior lobbyist for the Financial Services Roundtable. ‘‘Our concern is that as you take a look at all the regulations in totality, you will decrease the banks’ ability to help the economy.’’

http://www.boston.com/business/markets/2013/08/20/obama-urges-renewed-push-for-wall-street-overhaul/Y38skvpTCSoP1i3USmISsJ/story-1.html

Unease over Fed leaves shares at one-month low, bonds settle

(Reuters) - World shares are down to their lowest level in more than a month on Tuesday as unease about an expected cut in U.S. stimulus and a related rise in bond yields left markets on edge.

Europe's main stock markets opened down 1 percent following a fourth straight day of falls on both Wall Street and in Asia to leave MSCI's global index .MIWD00000PUS, which tracks shares in 45 countries, at its lowest level since July 12.

Wednesday's minutes from the most recent Fed meeting could offer fresh hints on when the U.S. central bank will start winding down its $85 billion-a-month support program, a tricky process markets have been nervous about for months.

The uncertainty has broadly driven up bond market borrowing costs in recent weeks. The upward pressure on U.S. government bonds eased overnight, leaving the benchmark 10-year Treasury just off a 2-year high at 2.83 percent.

As has been the recent pattern, German government bonds, Europe's equivalent benchmark, moved in lockstep with yields edging down to 1.879 percent having topped 1.9 percent on Monday.

On European share markets, a 10.8 percent jump to 19.38 points in the Euro STOXX 50 Volatility Index .V2TX indicated uncertainty over the near-term outlook, though the measure remained below its 2013 peak of 26.80 points.

Ramin Nakisa, a global macro strategist for UBS in London, said market turbulence was bound to pick up as the Fed starts to switch the direction of its policy.

"We expect volatility... People will start to wonder whether there is anything in the fixed-income world that really is safe," he said adding that there was also likely to be another short selloff in share markets.

EMERGING WOES

The jitters about the U.S. moves continued to batter emerging markets where there are fears an end to cheap money and improvement outlooks in advanced economies could see a stampede of investment leaving already-strained markets.

Indonesia and India had another torrid session with their stock markets down 4 and 1 percent respectively as their currencies also continued to tumble.

Japan's Nikkei .N225 slumped too, falling 2.7 percent, reflecting the exposure of many Japanese companies to India and Indonesia.

"India's problems are nowhere near resolution because New Delhi has not done anything - there is no focus on improving productivity, infrastructure or getting FDI (foreign direct investment) back," said Nomura credit analyst Pradeep Mohinani in Hong Kong.

"It's all about stemming the flow of currency and that is not the cause of the problem."

Despite the focus on the Fed, the dollar was steady against a basket of major currencies .DXY. There was also little movement in the euro and sterling.

Emerging market volatility did spur the yen however. "The yen tends to attract buying when tensions in the market increase," said Satoshi Okagawa, senior global markets analyst for Sumitomo Mitsui Banking Corporation in Singapore.

In commodities, copper prices dropped to $7,264.75 per tonne, while gold eased to $1,361.66 per ounce after snapping a three-day winning streak on Monday and moving away from a two-month high hit that session.

Brent crude prices fell 0.5 percent to $109.36 a barrel, pressured by the Fed speculation but supported by the loss of Libya's oil exports as well as concerns that continuing unrest in Egypt could spread and interfere with supply.

http://www.reuters.com/article/2013/08/20/us-markets-global-idUSBRE96S00E20130820

Ackman Resigns From JC Penney's Board

J.C. Penney Co. reported that hedge-fund manager William Ackman had resigned from the company's board, in the wake of an unusually public dispute over the embattled retailer's future.

The announcement follows statements Ackman made last week saying he'd lost confidence in Penney's board and that its Chairman Thomas Engibous should be replaced. Ackman and the retailer's board also were bickering over how quickly the company should replace CEO Mike Ullman.

Ackman's investment firm, Pershing Square Capital Management, has a nearly 18 percent stake in Penney.

Penney named Ronald Tysoe as a director to fill Ackman's seat. Tysoe is former vice chairman of Federated Department Stores Inc., which is now Macy's Inc. Penney will name an additional new director in the near future.

Ackman said in a statement that the moves were "the most constructive way forward" for the Plano, Texas company and all other parties involved.

Euro Area Resumes Growth German Investor Confidence went Up

German investor confidence went up in August as the recovery in Europe’s largest economy helped pull the euro area out of its longest-ever recession.

The ZEW Center for European Economic Research in Mannheim said its index of investor and analyst expectations, which aims to predict economic developments six months in advance, rose to 42 from 36.3 in July. That’s the highest level since March. Economists predicted 39.9, according to the median of 42 estimates in a Bloomberg News survey.

Growth in Germany may have exceeded economists’ forecasts in the second quarter, according to a government estimate, coaxing the 17-nation region out of a six-quarter slump. Paired with accelerating growth in the U.S. and a pickup in Chinese exports and manufacturing, signs of a global economic recovery are increasing.

“Better-than-expected data from China and the U.S. are reflected in investor confidence,” said Aline Schuiling, senior economist at ABN Amro Bank NV in Amsterdam. “The fundamentals of the German economy are healthy and that should help other European countries grow. But there’s still a risk that the debt crisis will flare up again.”
Stronger Growth

ZEW’s gauge of the current situation jumped to 18.3 from 10.6 in July, while an indicator of euro-area investor confidence increased to 44 from 32.8. The group surveyed 252 investors and analysts from July 29 to Aug. 12.

“First signs of an end to the recession in important euro-zone countries may have contributed to the indicator’s rise,” ZEW said in a statement. “This is also reflected by the strong increase of economic expectations for the euro zone. Furthermore, the economic optimism is supported by the robust domestic demand in Germany.”

The euro rose after the report and traded at $1.3302 at 11:07 a.m. in Frankfurt.

The German economy probably expanded about 0.75 percent in the second quarter, the Economy Ministry estimates. Economists project growth of 0.6 percent, according to the median of 47 forecasts in a separate survey. The Federal Statistics Office will release the data at 8 a.m. tomorrow.
Rekindling Growth

The country’s benchmark DAX index has risen more than 5 percent since July 4, when European Central Bank President Mario Draghi pledged to keep interest rates low for an extended period to rekindle growth in the euro area. Gross domestic product in the region rose 0.2 percent in the three months through June, economists predict. That report is due at 11 a.m. tomorrow.

While parts of southern Europe remain mired in a slump and almost one in four young people in the euro area are without a job, German industrial production, factory orders and exports all rose in June, and business confidence improved for a third month in July. The data bode well for Chancellor Angela Merkel, who is seeking a third term in Sept. 22 elections.

Kloeckner & Co SE, a German steel trader part-owned by the Knauf family, said on Aug. 7 it expects profit to revive next year on gains in the U.S., an improvement in prices and restructuring efforts after lowering its 2013 earnings outlook.

Henkel AG, the German maker of Loctite glue and Fa soap and deodorant, reported second-quarter profit that beat estimates, helped by revenue growth in its home-care and laundry division in emerging markets.
‘Lackluster’ Sales

At the same time, Adidas AG cut its 2013 revenue forecast last week because of “lackluster” sales of sporting goods in Europe and unfavorable currency impacts after reporting second-quarter profit that trailed analysts’ estimates.

European countries accounted for 69 percent of German exports last year, according to the Federal Statistics Office. About 16 percent of goods went to Asia and 12 percent to the U.S.

The Bundesbank predicts Germany’s economy will grow 0.3 percent this year and 1.5 percent in 2014. That compares with a 0.6 percent contraction in the euro area in 2013 and growth of 1.1 percent next year, according to the latest ECB forecasts.

“The German economy has gained traction and continues to be a stable anchor in Europe,” said Lothar Hessler, an economist at HSBC Trinkaus & Burkhardt AG in Dusseldorf. “Low unemployment is supporting private consumption. The question is when investment activity will pick up again.”

Source: Bloomber.com

China's Surging Trade Growth

BEIJING, Aug. 9 (Xinhuanet) -- China's trade surplus used to be the focus of global attention. But it is now the country's surging trade growth that is in the spotlight.

After a 3.1 percent fall in June, exports rose 5.1 percent year-on-year in July, while imports soared by 10.9 percent year-on-year compared with a 0.7 percent year-on-year drop in June.

The stronger-than-expected growth rates have overshadowed the contraction in the country's monthly trade surplus, which dropped to 17.8 billion U.S. dollars in July, down 29.6 percent on a year ago.

But while the strong growth in both exports and imports points to a mild improvement in both external and internal demand, with domestic activities strengthening in a reassuring manner -thanks to the country's targeted measures to stabilize economic growth - it is apparent that foreign demand remains weak and domestic economic activities are still at low levels.

However, the morale-boosting figures were released at a time when the global economy is struggling with a slow and volatile recovery - among the other major economies, only the US economy has been showing signs of solid growth - so it is no surprise the data have been welcomed as a possible prelude to an eagerly awaited economic recovery in the world's second-largest economy.

After dipping to as low as 7.5 percent in the second quarter, the figures have raised expectations that China's economic growth might have bottomed out, as the government's efforts to boost growth amid economic restructuring start to take effect.

The increasing manufacturing and services activities, signaled by the rising official Purchasing Managers' Index for July, also suggest a gradual improvement in economic fundamentals.

Yet it would be rash to anticipate any strong surge in China's economic indicators.

An alarm was rung by the HSBC manufacturing PMI, which mainly tracks small enterprises in the export sector, as it dropped to 47.7 in July from 48.2 in June, signaling possible trade volatility in the coming months.

In particular, the sub-indexes measuring new export orders in both the official and HSBC PMI revealed contraction in July.

Therefore, more data, including inflation, industrial output and retail sales, need to be monitored before it can be confidently asserted without fear of contradiction that the Chinese economy is solidly on the up again.

(Source: China Daily)