Category: Sunday Papers

China isn’t the only place beastly short sellers are identified as a problem in poor markets. In recent years governments all over the world have intervened from time to time to suspend the work of these agents; but does this assist or retard price discovery? The authors of the paper (from 2013) highlighted this week, […]

Is there presently a bubble in the urban residential property market in China? It’d be hard to argue as prices have hardly moved in the last couple of years and are only now showing signs of modest growth. Have there been bubbles in the past though? Wasn’t the China property market ‘Dubai times 1,000!’ not […]

Yes, yes and a hundred more times YES! It’s said that scientific theory advances one death at a time and something similar could be said about finance. I’ve ranted before about how wrong the Capital Asset Pricing Model is [CAPM – The Cost of Constraints] and the paper I’m highlighting this week is another brick in […]

‘Shadow’ banking; sounds spooky right? Wasn’t it at the heart of the Global Financial Crisis? All those off balance sheet products that came home to roost at the same time and then, BOOM! All true, but the term ‘shadow banking’ when applied to China is really a misnomer as the vast majority of off-balance-sheet deals […]

From May 2014 to June 2015 China’s stock markets experienced strong upward momentum; but something unusual was going on compared to previous China bull markets. Leverage was in the mix as never before. In fact, in the paper I’m highlighting this week from Mr. Guoxiang Song from the Department of Accounting and Finance at the […]

Yawn-tastic? That depends; Presidents Obama and Xi will meet next month and if you care to get an early peek at the agenda, and the likely outcomes it’s all here. U.S.- China Strategic and Economic Dialogue The link above will take you to the full summary from Mr. Malcolm R. Lee, Nonresident Senior Fellow in the […]

Why do economists have such a high opinion of themselves (they do)? Why does society turn to them for answers to issues that other branches of social science may be in a better position to address (it does)? The answer is simple; math and money. In this paper it’s authors, Marion Fourcade, Professor of Sociology, University […]

That the multi-trillion dollar global institutional asset management business is built on various forms of the same incorrect theory is not something the industry likes to spend too much time thinking, or Heaven forbid, talking about; and it certainly has no interest in socializing this issue with its clients. I’m referring specifically to the Capital […]

More so than in recent years the debate about whether China can avoid the middle-income trap has recently assumed a high religious quality. Heretics point to an unsustainable growth model that isn’t being moved away from fast enough to allow China to shift down gears to a more orderly and sustained model. Believers respond that […]

When Mr. Jim Chanos described the China property market as ‘Dubai times 1000’ in 2010 he got a lot of attention; never let facts get in the way of a good trade. He has been proved not just wrong, but spectacularly so. Here we are in 2015, over five years on, and listed developers in aggregate […]

Why Can’t We Be Friends? The link above will take you to a paper from the National Bureau of Asian Research (Seattle, Washington) written by Mr. James P. Nolan, a US Air Force officer assigned to U.S. Pacific Air Forces (who recently completed an MA at Georgetown University). It’s a depressing read as it highlights, […]

Stature, Obesity, and Portfolio Choice The link above will take you to a paper by George Korniotis and Alok Kumar, from the University of Miami, where they extend work on how physical appearance affects how many of us live our lives. John Adams (1.7m) joked that George Washington (1.88m) was sure to become the first […]

Skyscraper Height and the Business Cycle It seems obvious there should be some relationship between the health of an economy and the willingness and ability of developers to create ever taller buildings. Moreover, since tall buildings are often not economically sound propositions a large part of the decision to construct them must rest on hubris […]

I’m part way through a disturbing new book that’s causing fresh chatter in the China nerdosphere and beyond [I’ve also seen a number of favorable reviews, the latest in the Weekend FT]. The book is ‘The China Model: Political Meritocracy and the Limits of Democracy’ by Mr. Daniel A. Bell, Chair Professor of the Schwarzman […]

From Fast to Smart Growth The link above will take you to a fact-packed 64-pager from JLL that dives deeply into the current  state of affairs in and prospects for the major property investment sectors in China. They turn over each of the retail, logistics, office and hotel markets and, notwithstanding their obviously partisan position, […]

Measuring the Quality of Management The link above will take you to one of the most powerful pieces I’ve seen in a while. Powerful because the idea is so simple. Why not analyze corporate communications and rank companies based on how much candor they display? That’s exactly what the author, Mr. L. J. Rittenhouse, CEO […]

Can China innovate? I have no doubt; but that’s not a widely held view by many in the West. Not a paper today but an interesting interview with Yiwu He, PhD, MBA, Senior Program Officer for Discovery and Translational Sciences at the Bill & Melinda Gates Foundation where he oversees the Biomarker Program and manages […]

Prejudice is sooo comforting. It removes the need for hard thinking, something I observe most of the world’s population seem to rarely engage in, and also it makes life easier if you just know you’re right about so much. Am I right, or am I right? Right? For investors though (and I’m as guilty as […]

A rest from China this week, although I spent last week in Chengdu and Chongqing and will post a summary of the trip together with some new thinking in the next few days. Today, instead, something on the Ukraine. My interest in this was piqued by the decision of many world leaders to stay away […]

XBRL, if you’re not fully up to speed, stands for Extensible Business Reporting Language. It’s a global standard for financial reporting which can be machine read and China was the first jurisdiction that made it mandatory in 2009. The paper I’m highlighting this week is from Songsheng Chan, Ling Harris, Wenyang Li and Donglin Wu […]