U.S. Treasury Sticks It To The China Haters

Treasury says it again, China  not manipulating its currency.

This is getting better and better.

On the market side, the China haters are looking more and more ridiculous. Not that I’m a China bull. I’m not smart enough to say that. And I have money in China. But I am smart enough and am surrounded by even smarter people who have led me to believe there is no hard landing.  So on the market side, the China naysayers are wrong.

On the political side, the China haters who think the country is stealing all our Nike shoe and Optimus Prime assemblying jobs thanks to their currency manipulation are also wrong. For the second time this year, the U.S. Treasury Department said in its report to Congress on international economic and exchange rate policies that, wait for it…China is not a currency manipulator.  The two or three guys advising Mitt Romney on China were wronger than Tim Tebow starting as QB for the Jets.

“The Treasury Department once again made the right call on China’s currency policy in its report to Congress. Labeling China a currency ‘manipulator’ would do little to help us reach the goal of a fully convertible currency and market-driven exchange rate for China,” said John Frisbie, president of the U.S. China Business Council, a lobby of multinationals working in China.

“Adding the very public ‘manipulator’ tag might simply produce pressure within China to slow down progress on this (forex) issue,” he said in a statement Tuesday.

China’s exchange rate has strengthened over 30 percent against the dollar over the past several years. The upshot is that the exchange rate has little to do with the U.S. trade balance or employment. Even as the renmimbi weakened, the U.S. trade deficit with China worsened.

Of course, not being a currency manipulator doesn’t mean that the renmimbi (RMB) is properly valued.

From the report:

The renminbi has appreciated by 9.3 percent in nominal terms and 12.6 percent in real terms against the dollar since June 2010. China’s trade and current account surpluses both have fallen to 2.6 percent of GDP from peaks of 8.8 and 10.1 percent of GDP, respectively.  The Chinese authorities have substantially reduced the level of official intervention in exchange markets since the third quarter of 2011, and China has taken a series of steps to liberalize controls on capital movements, as part of a broader plan to move to a more flexible exchange rate regime.  In light of these developments, Treasury has concluded that the standards identified in Section 3004 of the Act during the period covered in this Report have not been met with respect to China. Nonetheless, the available evidence suggests the RMB remains significantly undervalued, and further appreciation of the RMB against the dollar and other major currencies is warranted.” China’s real effective exchange rate (REER) – a measure of its overall cost-competitiveness relative to its trading partners – has appreciated since China initiated currency reform in mid-2005, after declining between 2001 and 2005. From July 2005 to October 2012, China’s real effective exchange rate appreciated by 27 percent. The REER appreciated particularly rapidly in the last several months of 2011, resulting in total REER appreciation of 6.2 percent over the course of 2011. Over the ten months of 2012, China’s REER has been unchanged.

The International Monetary Fund concluded that the RMB was moderately undervalued against a broad basket of currencies, and said that the RMB was undervalued by between 5 and 10 percent as of July 2012.

Reserve accumulation, an indicator of the degree of Chinese intervention in the currency market, has slowed markedly since the third quarter of 2011 as China buys less U.S. debt.

Even with the reduced pace of dollar accumulation, China’s official foreign exchange reserves remain exceptionally high compared to those of other economies, and well beyond established benchmarks of reserve adequacy. As of end-September 2012, the PBOC held $3.3 trillion in foreign reserves, equivalent to 42 percent of China’s GDP, or about $2,440 for every Chinese citizen. 

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Your espresso will get more expensive . . .

China, traditionally a tea-drinking nation, is now Starbucks’ largest market outside of the U.S., and the company plans to have more than a thousand cafés in the country by 2015. The Chinese middle class’ growing taste for premium coffee is causing commodity prices to soar; in 2011 Arabica bean prices hit their highest peak in over three decades, and analysts attributed that to fast demand growth in China as well as in Brazil and Indonesia.

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Covering Brazil, Russia, India & China.

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PAS messes up religion and politics again: Making one's hair stand!

  In a difficult position: Shoppers walking outside one of the unisex salons in KB Mall.

Datuk Takiyuddin Hassan's recent remarks about salons make us wonder if he has anything between the ears'. How then can he not know that PAS is messing things up in a respectable industry. 

DATUK Takiyuddin Hassan should be invited by hair stylists for a visit to their shops the Kelantan state executive councillor has no idea what he is talking about. To put it bluntly, he is talking rubbish.

He doesn't need to have a hair cut or a hair wash but simply observe the operations at a hair salon.

And sir, it is hair salon and not hair saloon. There is no drinking or entertainment of any kind.

A hair salon is different from a girlie barber shop, that's another point you should be aware of.

On Sunday, the PAS assistant secretary-general defended the PAS state government's decision to enforce gender-segregation rules on unisex salons, prohibiting women from cutting the hair of men, and vice-versa.

He said: “It is a well-known fact that hair salons and unisex establishments are the most convenient places for immoral activities.

“They provide a cover for men and women to engage in illicit activities. If I were a Chinese, I will never allow my wife to patronise such salons or even consider allowing my children to work in such places because of their reputation as a hotbed for immoral activities.

“And even a Chinese wife will feel uneasy to allow her husband to go to such places. Frequently such places will always lead to scandals.”

Like many Malaysians who read these remarks yesterday, I really didn't know whether to cry or to burst out laughing.

Many of us go to hair salons for hair cuts simply because, unlike barbers, these hair stylists are properly trained.

Many invested in diploma courses in famous training schools in London, Paris, Hong Kong and Bangkok.

We don't expect Takiyuddin to know what “a layer cut” is.

Huge sums of capital have been invested into their hair salons and many well-known hair stylists have turned entrepreneurs by setting up chains of hair salons nationwide.

These hair stylists work hard on their reputation, of which PAS may not be aware of, but clients are selective in their choice of hair salons.

Takiyuddin has no idea what he is talking about. We wouldn't blink an eye if our family members have their hair cut at hair salons - by a male or a female stylist.

And most of us have family members or friends who work at hair salons and we are proud of their skills and creativity. They make many Malaysians look good with their professionalism and abilities.

It is even more humorous when Takiyuddin said that “when a woman worker gives upper body massages to a male customer, one thing will eventually lead to another, ending with illicit activities”.

Hello, the nearest massage one gets at a hair salon is a neck-and-shoulder massage.

And from where Takiyuddin is coming from, he and his party leaders will surely shut down spas when they come to power.

Since male stylists cannot cut the hair of females and vice-versa, will we see PAS banning women doctors from treating male patients?

So if Takiyuddin suffers a heart attack while he is giving a press conference, will he wait for a male doctor to come, even if there is a female doctor nearby?

Next, women flight attendants won't be serving Takiyudidin when he is flying because it can lead to many things, what with their smiles and the uniforms they wear.

The hair on my hands are already standing on end just reading what Takiyuddin has reportedly said.

COMMENT By WONG CHUN WAI

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China now capable to deploy jets on aircraft carrier

Video: China conducts flight landing on aircraft carrier CCTV News - CNTV English

China has successfully conducted flight landing on its first aircraft carrier, the Liaoning, naval sources said.

A new J-15 fighter jet was used as part of the landing exercise.

After its delivery to the People's Liberation Army (PLA) Navy on Sept. 25, the aircraft carrier has undergone a series of sailing and technological tests, including the flight of the carrier-borne J-15.

Capabilities of the carrier platform and the J-15 have been tested, meeting all requirements and achieving good compatibility, the PLA Navy said.

Since the carrier entered service, the crew have completed more than 100 training and test programs.

The successful flight landing also marked the debut of the J-15 as China's first generation multi-purpose carrier-borne fighter jet, the PLA Navy said.

Designed by and made in China, the J-15 is able to carry multi-type anti-ship, air-to-air and air-to-ground missiles, as well as precision-guided bombs.

The J-15 has comprehensive capabilities comparable to those of the Russian Su-33 jet and the U.S. F-18, military experts estimated.

Successful aircraft landing exercises on China's first aircraft carrier mean the country is now capable to deploy fighter jets on the carrier, a senior navy officer said Sunday.

Pilots have mastered key skills to ensure the success of the take-off and the landing, especially under unfavorable conditions such as poor visibility and unstable airflow, said Vice-Admiral Zhang Yongyi, a deputy commander of the Chinese People's Liberation Army (PLA) Navy.

"It's like 'dancing on a knifepoint' as the aircraft have to land on a very limited space," Zhang said while commenting on the successful flight landing recently conducted on the carrier, the Liaoning.

The aircraft must land precisely over a very short and narrow runway on the carrier at a speed of several hundreds of kilometers per hour, Zhang said in an interview with Xinhua Sunday, after the J-15 fighter succeeded in the landing tests.

"We have done all these test flights from the very beginning, and finally we mastered the key skills for the landing of carrier-borne aircraft," said Zhang, who is also the commander-in-chief in charge of the tests and training program of the flight landing.

Currently, the Chinese pilots have found out the right ways to conduct the landing and they have consolidated their skills, according to the Navy officer, who himself is a meritorious pilot of the Chinese naval air force.

Zhang said the carrier-borne aircraft and special equipment for the landing flight have gone through strict tests, and fighter jets can be deployed on the aircraft carrier.

Penang's economy growth declines to 1.8% in 9 months 2012

GEORGE TOWN: Penang’s economy slowed down in the first nine months of the year, said Deputy Finance Minister Datuk Donald Lim.

“The state’s Gross Domestic Product (GDP) growth of about 5.7% in 2008 has dropped to 1.8% from January to September this year.

“The poor GDP record has put Penang, which used to record one of the highest growth rates in the country, in seventh position behind places like Kuala Lumpur and and Johor,” he said.

Lim said Johor recorded a GDP growth of more than 6%, exceeding the national average of 5.3%, adding that 1.8% was below average and the Chief Minister (Lim Guan Eng) had to answer for this.

“By right, Penang should be doing very well as many people are flocking to the state which has a service-skilled workforce.

“I’m surprised that Penang has done so poorly,” he said at the Malaysian Economy and 2013 Budget Economic Forum at a hotel here Saturday .

Asked why the Penang economy recorded such a slow growth, Lim quipped, “Probably he (the Chief Minister) didn’t work hard enough!”

“Perhaps his methods and direction are wrong or that he didn’t do enough homework. Maybe he is too busy with other things.

“I’m not saying that he’s not doing his job, this is for the rakyat to decide,” he said.

Lim added the Ministry of Finance was forecasting the last quarter of the year to record a GDP of about 5.2%.

He assured Malaysians that the country’s economy was not headed towards bankruptcy as speculated by certain quarters.

“We have a RM456bil debt as of last year but our revenue is RM881bil, and we incur a deficit of about 58.2%.

“Our economy is doing much better compared to our Asean counterparts such as Singapore which has a deficit of 107%. Even countries like the United States and those in European Union are suffering from a higher debt.

“Malaysia practices an open economic policy and as of Oct 15, our foreign reserve has reached RM424bil, making us the 19th biggest foreign reserve country in the world,” he said.

The forum, organised by the MCA Bukit Gelugor division, was attended by some 300 people comprising Barisan Nasional division leaders, community leaders and businessmen.

Also present were Penang MCA deputy chairman Datuk Dr Loh Hock Hun, Bukit Gelugor MCA division chairman Datuk Koay Kar Huah and Komtar Barisan co-ordinator Loh Chye Teik. - The Star

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Good property management, maintenance add value

Stratified developments becoming a way of life

As stratified developments become a way a life, good maintenance and management have become an issue.

 

EARLIER this year, a new set of property managers replaced the previous one in the condominium that Siti lives. Not having a current account, she paid her quarterly management fees in cash. She was told that the receipt would be put in her postbox. It never came and she soon discovered that the property management company had absconded with the money.

As stratified developments which include condominiums, service apartments and gated and guarded projects become a way of life, good maintenance and management have become an issue.

Good management and maintenance will improve the value of the asset. This applies to all segments of the property market, be it residential, commercial or industrial.

Hence, the third reading of the Strata Management Bill 2012 on Monday is crucial, says Assoc-Prof Ting Kien Hwa, head of Centre for Real Estate Research at Universiti Teknologi Mara.

“Currently, property management is part of a service provided by valuers, who are regulated by the Board of Valuers, Appraisers and Estate Agents.

The work of valuers can be broadly divided into three areas property management, valuation work and real estate agency work.

This means that property management is a regulated profession and delinquents risk having their licence suspended.

For the last five to six years, managing stratified properties has become an issue, he says. As more of us live in gated and guarded developments, and high rise condominium and serviced apartments, property management is evolving to become a lucrative industry.

Ting says the Board of Valuers is in the process of creating a third register to accommodate property managers. Valuers and real estate agents are governed by two registers and the Board of Valuers are working on creating a third one for property managers.

Says Ting: “This is a similar situation as in the early 1980s when there were many illegal real estate agents. They were given a one-year period to register with the board.”

Ting says the duty and responsibilities of property managers go beyond just collecting money and managing a property. The word “managing” covers a whole gamut of expertise and responsibilities. These include insurance valuation, the appropriate rate of service charges to levy on owners, managing service providers like security guards and cleaners, gardeners and managing tenants and rental rates among other duties.

Depending on whether it is a residential or commercial property, some issues may overlap.

To claim that valuers want to monopolise the property management industry is incorrect, Ting says.

“Some parties say they want to liberalise' the profession. Just as engineers and architects are regulated by the Institute of Engineers and Pertubuhan Akitek Malaysia respectively, so property managers are regulated by the Board of Valuers because property management is part of the work of valuers. This is the situation in the United States, Britain and Australia. Shall we then liberalise' the achitecture and engineering profession by allowing more people who are untrained to practise as architects and engineers because architects and engineers are monopolising' the industry?” Ting asks.

Ting says this argument to liberalise the profession and cut out the monopoly does not hold water at all.

He says there are currently 8,000 trained property managers in the country and every year, 450 more graduates enter the job market.

The local public universities provided courses in property management in the late 1960s because they knew there would be a need for this.

Malaysian Institute of Professional Property Managers president Ishak Ismail says: “The Government was visionary enough to foresee a time when stratified housing will become part of the Malaysian property landscape. The first condominium was Desa Kuda Lari in the KLCC area.

“Today about four million people live in stratified projects. About 80% of all the stratified projects are managed by joint management bodies and management committees. About 20% are outsourced and of this about 58% are managed by illegal property managers.”

Ishak said over and above the various issues that fall under property management, two sets of skills are needed the hard skills in managing the property and the soft skills in people management.

He says there is a need to put in the proper regulations to regulate property managers in order to improve the value of our property assets. There must be no conflict of interest because it involves public money, be it house owners or tenants of commercial properties, he says.

By THEAN LEE CHENG The Star

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