Japanese Stockmarket Enjoys a Suga Rush As PM Steps Down

The Japanese stock market has hit a 30-year high following the resignation of prime minister Yoshihide Suga.

Japanese stocks have hit a 30-year high following the resignation of prime minister Yoshihide Suga. Suga, who has only been in office for a year, had become widely unpopular as his government failed to get on top of a surge in Covid-19 infections. A slow vaccine rollout and the controversial decision to go ahead with hosting the Olympics despite the pandemic also sapped his support. He will step down before a general election scheduled for later this year. 

Japan’s Topix index reacted to the news by hitting its highest level since April 1991, says Bloomberg. Investors had once had high hopes for Suga, who vowed to accelerate Japan’s digital shift (see also page 28). In February this year the Nikkei 225 index hit the symbolic 30,000-level for the first time since 1990. Yet it fell back as Covid-19 came to dominate his premiership: “Suga had created an atmosphere of uncertainty… there was a perception that Japan was ‘in a mess’”, says Richard Kaye of Comgest Asset Management Japan.  The Topix has gained 6.5% during the past month alone.

In most countries investors dislike the uncertainty of an upcoming election, says Takeshi Kawasaki for Nikkei Asia. Not in Japan. “Looking at the ten early elections held since 1990, stocks rose nearly every time between the day of the lower house being dissolved and the election date”. 

What seems to happen is that headlines about Japanese politics grab the attention of foreign money managers. They decide they like what they see and buy. “Typically at the mercy of trends in US equities” thanks to Wall Street’s tendency to set the tone for world markets, Japanese stocks are likely to go their own way over the coming months.

By: Alex Rankine

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Critics:

The Tokyo Stock Exchange (東京証券取引所, とうきょうしょうけんとりひきじょ), abbreviated as Tosho (東証) or TSE/TYO, is a stock exchange located in Tokyo, Japan. It is the third largest stock exchange in the world by aggregate market capitalization of its listed companies, and the largest in Asia. It had 2,292 listed companies with a combined market capitalization of US$5.67 trillion as of February 2019.

The exchange is owned by the Japan Exchange Group (JPX), a holding company that it also lists (TYO: 8697). JPX was formed from its merger with the Osaka Exchange; the merger process begins in July 2012, when said merger was approved by the Japan Fair Trade Commission.[2] JPX itself was launched on January 1, 2013.

The TSE is incorporated as a kabushiki gaisha with nine directors, four auditors and eight executive officers. Its headquarters are located at 2-1 NihonbashiKabutochō, Chūō, Tokyo which is the largest financial district in Japan. Its operating hours are from 8:00 to 11:30 a.m., and from 12:30 to 5:00 p.m. From April 24, 2006, the afternoon trading session started at its usual time of 12:30 p.m..

Stocks listed on the TSE are separated into the First Section for large companies, the Second Section for mid-sized companies, and the Mothers section for high-growth startup companies, and the TOKYO PRO Market section for more flexible alternative investment. As of October 31, 2010, there are 1,675 First Section companies, 437 Second Section companies and 182 Mothers companies.

The main indices tracking the TSE are the Nikkei 225 index of companies selected by the Nihon Keizai Shimbun (Japan’s largest business newspaper), the TOPIX index based on the share prices of First Section companies, and the J30 index of large industrial companies maintained by Japan’s major broadsheet newspapers.

Ninety-four domestic and 10 foreign securities companies participate in TSE trading. See: Members of the Tokyo Stock Exchange

Other TSE-related institutions include:

  • The exchange’s press club, called the Kabuto Club (兜倶楽部, Kabuto kurabu), which meets on the third floor of the TSE building. Most Kabuto Club members are affiliated with the Nihon Keizai Shimbun, Kyodo News, Jiji Press, or business television broadcasters such as Bloomberg LP and CNBC. The Kabuto Club is generally busiest during April and May, when public companies release their annual accounts.

Market Movers

Constituents of the Nikkei 225 with the highest percent gain over one day.

ListingLastChangeVolume
Shinsei Bank Ltd8303:TYO1,968.00
JPY
+228.00
+13.10%
9.68m
Toho Zinc Co Ltd5707:TYO2,841.00
JPY
+130.00
+4.80%
805.10k
Isetan Mitsukoshi Holdings Ltd3099:TYO808.00
JPY
+35.00
+4.53%
2.68m
Hitachi Zosen Corp7004:TYO947.00
JPY
+32.00
+3.50%
3.45m
DeNA Co Ltd2432:TYO2,167.00
JPY
+72.00
+3.44%
709.60k
Kawasaki Kisen Kaisha Ltd9107:TYO6,380.00
JPY
+190.00
+3.07%
5.45m
Mitsubishi Chemical Holdings Corp4188:TYO1,040.50
JPY
+26.50
+2.61%
5.67m
Meiji Holdings Co Ltd2269:TYO7,260.00
JPY
+170.00
+2.40%
537.60k
Pacific Metals Co Ltd5541:TYO2,094.00
JPY
+44.00
+2.15%
596.40k
Mitsui Mining and Smelting Co Ltd5706:TYO3,590.00
JPY
+75.00
+2.13%
587.70k

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Asian Stocks Mixed as Data Show Delta Sapped China: Markets Wrap

Asian stocks were mixed Tuesday as weaker economic activity in China and the latest escalation in Beijing’s crackdown on private industries overshadowed another record close on Wall Street.

Equities slipped in China, where data signaled that an outbreak of the delta virus variant led to a service-sector contraction for the first time since February last year. Hong Kong slid as Beijing’s stepped-up curbs on video-gaming firms weighed on Chinese technology stocks.

U.S. futures edged up after the S&P 500 hit its 12th all-time high in August and the Nasdaq 100 rose. Treasuries held gains made following Federal Reserve Chair Jerome Powell’s measured comments about a possible reduction in stimulus and any future interest-rate hikes. The dollar dipped.

Oil declined, with traders assessing the prospect of additional OPEC+ production. Aluminum and nickel advanced as Goldman Sachs Group Inc. raise target prices. In cryptocurrencies, Bitcoin fell to about $47,000.

Global stocks overall are set for a seventh monthly advance on strong company profits, expanding vaccinations to underpin economic reopening and supportive Fed policies. At the same time, the decline in Treasury yields from a March peak may partly reflect concerns of a slower recovery ahead on risks such as the impact of the delta strain.

“The bond market is getting a little nervous about the economic outlook,” Priya Misra, head of global interest rate strategy at TD Securities, said on Bloomberg Television. But she added the U.S. economy is “strong” and that “by year end, if the economy holds up, which we forecast it will, that’s when we expect rates — especially in the long end — to start to edge higher.”

In the latest U.S. data, pending home sales fell in July. Traders are awaiting key payrolls figures Friday for further guidance on the economy’s strength.

Here are some key events to watch this week:

OPEC+ meeting on output WednesdayEuro zone manufacturing PMI WednesdayU.S. jobs report Friday

Some of the main moves in markets:

Stocks

S&P 500 futures climbed 0.2% as of 1:42 p.m. in Tokyo. The S&P 500 rose 0.4%Nasdaq 100 futures increased 0.1%. The Nasdaq 100 rose 1.1%Japan’s Topix index rose 0.7%Australia’s S&P/ASX 200 index rose 0.6%South Korea’s Kospi added 0.8%Hong Kong’s Hang Seng index fell 1.4%China’s Shanghai Composite index retreated 0.8%

Currencies

The Bloomberg Dollar Spot Index shed 0.1%The euro was at $1.1818The Japanese yen was at 109.88 per dollarThe offshore yuan was at 6.4660 per dollar

Bonds

The yield on 10-year Treasuries held at 1.28%

Commodities

West Texas Intermediate crude was at $68.90 a barrel, down 0.5%Gold was at $1,815.12 an ounce, up 0.3%

By:

Source: Stock Market Today: Dow, S&P Live Updates for Aug. 31, 2021 – Bloomberg

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Why Big Investors Are Quitting Chinese Stocks – Bloomberg Wealth

Chinese companies once ticked a lot of boxes for investors trying to follow the market’s old adages.

Diversify, they say. Well then, why not look beyond the world’s largest economy to its second? Maybe you’ve got Facebook, Amazon and Google in your portfolio already. Shouldn’t you also be thinking about Tencent, Alibaba and Baidu? You can buy them on Robinhood, after all.

Check your politics at the door, they say. So in an era when China is a bipartisan flashpoint, why not tune out the rhetoric and focus purely on returns?

That all sounds promising in a theoretical world. But in the practical one we inhabit, investing in China has become riskier, particularly this summer. In this excellent breakdown, Matt Levine of Bloomberg Opinion explains in terms you will actually understand how opaque it is to own U.S.-listed China stocks.

When you buy shares of a Chinese company listed outside of China, what you are actually buying is “an empty shell that has certain contractual relationships with the Chinese company,” Levine explains.

Sound tenuous? SEC Chair Gary Gensler thinks so. The commissioner worries that Americans just don’t know enough about Chinese companies listed on U.S. exchanges. A few weeks ago, he blocked initial public offerings of certain firms until they boost disclosures of risks posed to shareholders.

This is all coming in the context of some serious developments in China. There are mounting concerns about human rights abuses in Xinjiang and the crackdown in Hong Kong. Both have led to negative views of the country globally and pose ethical and financial dilemmas for investors increasingly thinking about the moral side of investing.

And a Chinese clampdown on capitalism has spooked investors. At its most extreme, it erased $1.5 trillion from Chinese stocks. It has hit Chinese tech companies hard. It’s prompted superstar fund manager Cathie Wood to pare her China exposure. Wood’s ARKK ETF is now sitting with no exposure to shares of companies in the world’s second-biggest economy. Other high profile investors have taken similar steps, including George Soros and Paul Marshall, co-founder of one of the world’s largest hedge funds.

And it’s not just tech. In mid-June, Chinese President Xi Jinping indicated that private tutoring — a huge expense for middle-class Chinese families — should not be such a burden. The country went on to ban for-profit tutoring, a huge deal in the $100 billion education tech sector.

Yet with proof that there is an adage for almost any angle, I offer you another: Buck the consensus view. HSBC Chairman Mark Tucker says investment opportunities in China are “too big to ignore.” And while he wouldn’t recommend Chinese equities in general, one market expert in our latest “Where to Invest” series says he would recommend two ETFs that have exposure to Chinese solar and battery technology.

Where do these adages lead us? Probably to another: Trust yourself, not some old saying. — Charlie Wells

By:

Source: Chinese Stocks: Should You Invest in the World’s Second-Largest Economy? – Bloomberg

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Wall Street Seeks To Make Up For Long Hours With High Salaries

(Bloomberg) – Rooms at the Fairmont Royal Pavilion, located on Barbados’ platinum beaches, can cost more than $ 1,000 a night. In the morning, you can enjoy the catamaran snorkeling cruise and return ashore in time for afternoon tea.

For some Houlihan Lokey Inc. employees, this offer is now on the table: a five-night stay at this Caribbean haven, with money from the investment bank, as a reward for a year of record earnings. The offer is also a subtle plea to the company’s younger employees: please don’t quit.

That last phrase echoes across Wall Street, where turnover and burnout rates among young workers are accelerating. Banks have tried to turn the tide with raises, bonuses, vacations, and even free sports equipment. For all that, being a young banker in America has never been more lucrative.

However, the problem is that it has also never been more lucrative for aspiring workers to work outside the golden world of finance, as the gap between banks and other employers such as technology companies has narrowed.

“In terms of making money, is this the best time to be a banker? Sure, ”says executive recruiter Dan Miller of True Search. “Now, in terms of lifestyle, is this a terrible time? Absolutely”.

A presentation prepared by 13 first-year analysts at Goldman Sachs Group Inc. earlier this year prompted a reckoning on Wall Street after it highlighted the working conditions of junior bankers – some of them working 100 hours a day. the week while his physical activities and mental health suffered. Goldman responded by cutting weekend hours and promising to increase staff at its busiest businesses.

Earlier this year, a presentation prepared by 13 first-year analysts at Goldman Sachs Group Inc. prompted a reckoning on Wall Street after it highlighted working conditions for junior bankers – some of them working hundreds of hours a day. the week as his physical activities and mental health suffered. Goldman responded by cutting weekend hours and promising to increase staff at its busiest businesses.

However, some industry veterans have made harsh statements against those who complain about the workload. Cantor Fitzgerald’s Howard Lutnick suggested that some of the young workers considering leaving finance may simply not be ready for it. “Those young bankers who decide they are working too hard, choose another way of life,” he told Bloomberg TV earlier this month.

Furthermore, the exhausting workload of bank analysts has continued and, in some cases, worsened. When COVID-19 took over the nation last year, the “work hard, play hard” mantra became “work hard, sit on your couch,” all while the economy accelerated and deals proliferated.

Frustrated and overworked, many of them turned to the anonymous ex-banker behind the popular “Litquidity” financial meme account for support. In an interview, he said he was inundated with messages on Twitter and Instagram from young industry colleagues feeling fed up and weighing whether the work was worth it.

Lit, as he calls himself, was at the time a senior associate in investment banking and knew very well what they were going through. He too felt exhausted and stressed, and at one point he went to see a doctor to have his heart palpitations checked.

“Do you know the feeling when your stomach just sinks in? I felt it in my heart, “he said by phone from New York’s Central Park. The doctor concluded that his symptom was probably related to stress. Last winter, Lit quit her job to focus on growing the Litquidity brand and writing a daily newsletter. He says he is also working to launch a venture capital fund.

It is not only in finance where workers are becoming more demanding, a similar scenario that occurs throughout the country. Companies from McDonald’s Corp. to country clubs in Nashville, Tennessee, have raised wages and offered hiring bonuses to attract new workers. From March to May, the rate of American workers who voluntarily quit their jobs rose to its highest level in at least two decades. In Washington, lawmakers are arguing about raising the minimum wage to $ 15 an hour.

Of course, the isolated world of finance and some other professional services operate on a significantly higher plane in terms of pay. Last month, dozens of the nation’s top law firms raised first-year salaries to $ 202,500, roughly a couple thousand. They also offer multiple annual bonuses and additional time off as they struggle to retain talent and their workers face burnout.

Miller, who co-leads True Search’s financial services practice, says today’s young bankers have far more options than their peers previously had. Banks and consulting firms have long been a source of recruiting for private equity and, more recently, venture capital, technology, and fintech. These days, with many of those industries hiring at a record rate, many young bankers no longer have to hold out for two years. They can leave earlier or skip the stay in finance altogether.

Some bank bosses have promised to ease the pressure. After the junior analysts’ presentation, Goldman CEO David Solomon promised to better enforce the rule that they should have Saturdays off. But the sentiments carved in stone in banking culture for decades do not change easily. Additionally, Lit noted that Goldman’s policy of not working on Saturdays has been in effect since 2013.

“There has to be a way to make it stick,” he said. “What’s the use of earning half a million if you work 20 hours a day?

Source: Wall Street seeks to make up for long hours with high salaries – Explica .co

China’s Slowing V-Shaped Economic Recovery Sends Global Warning

China’s V-shaped economic rebound from the Covid-19 pandemic is slowing, sending a warning to the rest of world about how durable their own recoveries will prove to be.

The changing outlook was underscored Friday when the People’s Bank of China cut the amount of cash most banks must hold in reserve in order to boost lending. While the PBOC said the move isn’t a renewed stimulus push, the breadth of the 50 basis-point cut to most banks reserve ratio requirement came as a surprise.

Data on Thursday is expected to show growth eased in the second quarter to 8% from the record gain of 18.3% in the first quarter, according to a Bloomberg poll of economists. Key readings of retail sales, industrial production and fixed asset investment are all set to moderate too.

The PBOC’s swift move to lower banks’ RRR is one way of making sure the recovery plateaus from here, rather then stumbles.

The economy was always expected to descend from the heights hit during its initial rebound and as last year’s low base effect washes out. But economists say the softening has come sooner than expected, and could now ripple across the world.

“There is no doubt that the impact of a slowing China on the global economy will be bigger than it was five years ago,” said Rob Subbaraman, head of global markets research at Nomura Holdings Inc. “China’s ‘first-in, first-out’ status from Covid-19 could also influence market expectations that if China’s economy is cooling now, others will soon follow.”

Group of 20 finance ministers meeting in Venice on Saturday signaled alarm over threats that could derail a fragile global recovery, saying new variants of the coronavirus and an uneven pace of vaccination could undermine a brightening outlook for the world economy. China’s state media also cited several analysts Monday saying domestic growth will slow in the second half because of an uncertain global recovery.

China’s slowing recovery also reinforces the view that factory inflation has likely peaked and commodity prices could moderate further.

“China’s growth slowdown should mean near-term disinflation pressures globally, particularly on demand for industrial metals and capital goods,” said Wei Yao, chief economist for the Asia Pacific at Societe Generale SA.

The changing outlook reflects the advanced stage of China’s recovery as growth stabilizes, according to Bloomberg Economics.

What Bloomberg Economics Says…

“Looking through the data distortions, the recovery is maturing, not stumbling. Activity and trade data for June will likely paint a similar picture — a slower, but still-solid expansion.”

— The Asia Economist Team

For the full report, click here.

Domestically, the big puzzle continues to be why retail sales are still soft given the virus remains under control. It’s likely that sales slowed again in June, according to Bloomberg Economics, as sentiment was weighed by controls to contain sporadic outbreaks of the virus.

Even with the PBOC’s support for small and mid-sized businesses, there’s no sign of a broad reversal in the disciplined stimulus approach authorities have taken since the crisis began.

The RRR cut was partially to “manage expectations” ahead of the second-quarter economic data this week, said Bruce Pang, head of macro and strategy research at China Renaissance Securities Hong Kong.

“It also provides more policy room going forward, as the momentum of the economic recovery has surely slowed.”

— With assistance by Enda Curran, Yujing Liu, and Bihan Chen

Source: China’s Slowing V-Shaped Economic Recovery Sends Global Warning – Bloomberg

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Critics:

The Chinese economic reform or reform and opening-up; known in the West as the Opening of China is the program of economic reforms termed “Socialism with Chinese characteristics” and “socialist market economy” in the People’s Republic of China (PRC). Led by Deng Xiaoping, often credited as the “General Architect”, the reforms were launched by reformists within the Chinese Communist Party (CCP) on December 18, 1978 during the “Boluan Fanzheng” period.

The reforms went into stagnation after the military crackdown on 1989 Tiananmen Square protests, but were revived after Deng Xiaoping’s Southern Tour in 1992. In 2010, China overtook Japan as the world’s second-largest economy.

Before the reforms, the Chinese economy was dominated by state ownership and central planning. From 1950 to 1973, Chinese real GDP per capita grew at a rate of 2.9% per year on average,[citation needed] albeit with major fluctuations stemming from the Great Leap Forward and the Cultural Revolution.

This placed it near the middle of the Asian nations during the same period, with neighboring capitalist countries such as Japan, South Korea and rival Chiang Kai-shek‘s Republic of China outstripping the PRC’s rate of growth. Starting in 1970, the economy entered into a period of stagnation, and after the death of CCP Chairman Mao Zedong, the Communist Party leadership turned to market-oriented reforms to salvage the failing economy.

Citation:

Chinese Developer Woes Are Weighing on Asia’s Junk Bond Market

https://images.wsj.net/im-189934?width=620&size=1.5

Financial strains among Chinese property developers are hurting the Asian high-yield debt market, where the companies account for a large chunk of bond sales.

That’s widening a gulf with the region’s investment-grade securities, which have been doing well amid continued stimulus support.

Yields for Asia’s speculative-grade dollar bonds rose 41 basis points in the second quarter, according to a Bloomberg Barclays index, versus a 5 basis-point decline for investment-grade debt. They’ve increased for six straight weeks, the longest stretch since 2018, driven by a roughly 150 basis-point increase for Chinese notes.

China’s government has been pursuing a campaign to cut leverage and toughen up its corporate sector. Uncertainty surrounding big Chinese borrowers including China Evergrande Group, the largest issuer of dollar junk bonds in Asia, and investment-grade firm China Huarong Asset Management Co. have also weighed on the broader Asian market for riskier credit.

“Diverging borrowing costs have been mainly driven by waning investor sentiment in the high-yield primary markets, particularly relating to the China real estate sector,” said Conan Tam, head of Asia Pacific debt capital markets at Bank of America. “This is expected to continue until we see a significant sentiment shift here.”

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Such a shift would be unlikely to come without a turnaround in views toward the Chinese property industry, which has been leading a record pace in onshore bond defaults this year.

But there have been some more positive signs recently. Evergrande told Bloomberg News that as of June 30 it met one of the “three red lines” imposed to curb debt growth for many sector heavyweights. “By year-end, the reduction in leverage will help bring down borrowing costs” for the industry, said Francis Woo, head of fixed income syndicate Asia ex-Japan at Credit Agricole CIB.

Spreads have been widening for Asian dollar bonds this year while they’ve been narrowing in the U.S. for both high-yield and investment grade amid that country’s economic rebound, said Anne Zhang, co-head of asset class strategy, FICC in Asia at JPMorgan Private Bank. She expects Asia’s underperformance to persist this quarter, led by Chinese credits as investors remain cautious about policies there.

“However, as the relative yield differential between Asia and the U.S. becomes more pronounced there will be demand for yield that could help narrow the gap,” said Zhang.

Asia

A handful of issuers mandated on Monday for potential dollar bond deals including Hongkong Land Co., China Modern Dairy Holdings Ltd. and India’s REC Ltd., though there were no debt offerings scheduled to price with U.S. markets closed for the July 4 Independence Day holiday.

  • Spreads on Asian investment-grade dollar bonds were little changed to 1 basis point wider, according to credit traders. Yield premiums on the notes widened by almost 2 basis points last week, in their first weekly increase in six, according to a Bloomberg Barclays index
  • Among speculative-grade issuers, dollar bonds of China Evergrande Group lagged a 0.25 cent gain in the broader China high-yield market on Monday. The developer’s 12% note due in October 2023 sank 1.8 cents on the dollar to 74.6 cents, set for its lowest price since April last year

U.S.

The U.S. high-grade corporate bond market turned quiet at the end of last week before the holiday, but with spreads on the notes at their tightest in more than a decade companies have a growing incentive to issue debt over the rest of the summer rather than waiting until later this year.

  • The U.S. investment-grade loan market has surged back from pandemic disruptions, with volumes jumping 75% in the second quarter from a year earlier to $420.8 billion, according to preliminary Bloomberg league table data
  • For deal updates, click here for the New Issue Monitor

Europe

Sales of ethical bonds in Europe have surged past 250 billion euros ($296 billion) this year, smashing previous full-year records. The booming market for environmental, social and governance debt attracted issuers including the European Union, Repsol SA and Kellogg Co. in the first half of 2021.

  • The European Union has sent an RfP to raise further funding via a sale to be executed in the coming weeks, it said in an e-mailed statement
  • German property company Vivion Investments Sarl raised 340 million euros in a privately placed transaction in a bid to boost its real estate portfolio, according to people familiar with the matter

By:

Source: Chinese Developer Woes Are Weighing on Asia’s Junk Bond Market – Bloomberg

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Critics:

The Chinese property bubble was a real estate bubble in residential and/or commercial real estate in China. The phenomenon has seen average housing prices in the country triple from 2005 to 2009, possibly driven by both government policies and Chinese cultural attitudes.

Tianjin High price-to-income and price-to-rent ratios for property and the high number of unoccupied residential and commercial units have been held up as evidence of a bubble. Critics of the bubble theory point to China’s relatively conservative mortgage lending standards and trends of increasing urbanization and rising incomes as proof that property prices can remain supported.

The growth of the housing bubble ended in late 2011 when housing prices began to fall, following policies responding to complaints that members of the middle-class were unable to afford homes in large cities. The deflation of the property bubble is seen as one of the primary causes for China’s declining economic growth in 2012.

2011 estimates by property analysts state that there are some 64 million empty properties and apartments in China and that housing development in China is massively oversupplied and overvalued, and is a bubble waiting to burst with serious consequences in the future. The BBC cites Ordos in Inner Mongolia as the largest ghost town in China, full of empty shopping malls and apartment complexes. A large, and largely uninhabited, urban real estate development has been constructed 25 km from Dongsheng District in the Kangbashi New Area. Intended to house a million people, it remains largely uninhabited.

Intended to have 300,000 residents by 2010, government figures stated it had 28,000. In Beijing residential rent prices rose 32% between 2001 and 2003; the overall inflation rate in China was 16% over the same period (Huang, 2003). To avoid sinking into the economic downturn, in 2008, the Chinese government immediately altered China’s monetary policy from a conservative stance to a progressive attitude by means of suddenly increasing the money supply and largely relaxing credit conditions.

Under such circumstances, the main concern is whether this expansionary monetary policy has acted to simulate the property bubble (Chiang, 2016). Land supply has a significant impact on house price fluctuations while demand factors such as user costs, income and residential mortgage loan have greater influences.

References

US Jobs Report June 2021: Payrolls Jump 850,000, Unemployment Rate at 5.9%

The pace of U.S. hiring accelerated in June, with payrolls increasing by the most in 10 months, suggesting firms are having greater success recruiting workers to keep pace with the economy’s reopening.

Nonfarm payrolls jumped by 850,000 last month, bolstered by strong job gains in leisure and hospitality, a Labor Department report showed Friday. The unemployment rate edged up to 5.9% because more people voluntarily left their jobs and the number of job seekers rose.

The median estimate in a Bloomberg survey of economists was for a 720,000 rise in June payrolls. “Things are picking up,” said Nick Bunker, an economist at the job-search company Indeed. “While labor supply may not be as responsive as some employers might like, they are adding jobs at an increasing rate.”

The gain in payrolls, while well above expectations, doesn’t markedly raise pressure on the Federal Reserve to pare monetary policy support for the economy. Even with the latest advance, U.S. payrolls are still 6.76 million below their pre-pandemic level.

Demand for labor remains robust as employers strive to keep pace with a firming economy, fueled by the lifting of restrictions on business and social activity, mass vaccinations and trillions of dollars in federal relief.

Read more: Black Men’s Labor Force Rises to Largest Ever Amid Recovery

At the same time, a limited supply of labor continues to beleaguer employers, with the number of Americans on payrolls still well below pre-pandemic levels.

Coronavirus concerns, child-care responsibilities and expanded unemployment benefits are all likely contributing to the record number of unfilled positions. Those factors should abate in the coming months though, supporting future hiring.

Wage growth is also picking up as businesses raise pay to attract candidates. The June jobs report showed a hefty 2.3% month-over-month increase in non-supervisory workers’ average hourly earnings in the leisure and hospitality industry. Overall average earnings rose 0.3% last month.

“The strength of our recovery is helping us flip the script,” Biden said in remarks Friday. “Instead of workers competing with each other for jobs that are scarce, employers are competing with each other to attract workers.”

The Labor Department’s figures showed a 343,000 increase in leisure and hospitality payrolls, a sector that’s taking longer to recover because of the pandemic.

Job growth last month was also bolstered by a 188,000 gain in government payrolls. State and local government education employment rose about 230,000, boosted by seasonal adjustments to offset the typical declines seen at the end of the school year.

Hiring was relatively broad-based in June, including other notable gains in business services and retail trade. However, construction payrolls dropped for a third straight month and manufacturing employment rose less than forecast.

“Most of the new jobs now being created are in sectors that were slammed by the pandemic, while companies in other industries are struggling to find available workers,” Sal Guatieri, senior economist at BMO Capital Markets, said in a note.

Read More

The overall participation rate held steady and remained well short of pre-pandemic levels. The employment population ratio, or the share of the population that’s currently working, was also unchanged.

Digging Deeper

  • Average weekly hours decreased to 34.7 hours from 34.8
  • The participation rate for women age 25 to 54 rose by 0.4 percentage point; the rate among men in that age group also climbed
  • The number of Americans classified as long-term unemployed, or those who have been unemployed for 27 weeks or more, increased by the most since November
  • The U-6 rate, also known as the underemployment rate, fell to a pandemic low of 9.8%. The broad measure includes those who are employed part-time for economic reasons and those who have stopped looking for a job because they are discouraged about their job prospects

Stocks opened higher and Treasury securities fluctuated after the report.

 

By and

Source: US Jobs Report June 2021: Payrolls Jump 850,000, Unemployment Rate at 5.9% – Bloomberg

.

Critics:

The labor force is the actual number of people available for work and is the sum of the employed and the unemployed. The U.S. labor force reached a high of 164.6 million persons in February 2020, just at the start of the COVID-19 pandemic in the United States. The U.S. labor force has risen each year since 1960, with the exception of the period following the Great Recession, when it remained below 2008 levels from 2009-2011.

The labor force participation rate, LFPR (or economic activity rate, EAR), is the ratio between the labor force and the overall size of their cohort (national population of the same age range). Much as in other countries in the West, the labor force participation rate in the U.S. increased significantly during the later half of the 20th century, largely because of women entering the workplace in increasing numbers. Labor force participation has declined steadily since 2000, primarily because of the aging and retirement of the Baby Boom generation.

Analyzing labor force participation trends in the prime working age (25-54) cohort helps separate the impact of an aging population from other demographic factors (e.g., gender, race, and education) and government policies. The Congressional Budget Office explained in 2018 that higher educational attainment is correlated with higher labor force participation for workers aged 25–54. Prime-aged men tend to be out of the labor force because of disability, while a key reason for women is caring for family members.

The Congressional Budget Office explained in 2018 higher educational attainment is correlated with higher labor force participation. Prime-aged men tend to be out of the labor force due to disability, while a key reason for women is caring for family members. To the extent an aging population requires the assistance of prime-aged family members at home, this also presents a downward pressure on this cohort’s participation.

See also

Not Just AMC: These Are The Meme Stocks Reddit Traders Are Pumping Again As Experts Urge ‘Extreme Caution’

In this photo illustration, a Reddit logo seen displayed on...

After crashing earlier this year, a slew of so-called meme stocks skyrocketed again Wednesday as individual investors remounted an effort to pump up the prices of Wall Street’s most heavily shorted companies—prompting experts to warn that the saga pinning institutional investors against Reddit traders could end badly.

Key Facts

Headlining the recent resurgence among so-called meme stocks, shares of AMC spiked more than 100% Wednesday and have surged a staggering 570% over the past month, as heightened options activity and increasing short interest in the stock help retail traders squeeze institutional investors betting on a decline out of their risky bets.

Meanwhile, struggling brick-and-mortar retailer Bed Bath & Beyond is soaring nearly 51% Wednesday as traders on Reddit’s r/WallStreetBets discussion board tout that the stock’s short interest has climbed to nearly twice the level of fellow meme-stock GameStop, which led the January rally and is up about 60% in the past month.

In similar fashion, shares of former phone-maker BlackBerry surged as much as 15% Wednesday and have skyrocketed nearly 55% in the past month as retail hype picks up now that short interest has hit a nearly four-year high.

Other resurgent meme stocks embroiled in the latest frenzy include Beyond Meat and Koss Corporation, which have soared nearly 40% apiece in recent weeks.

Crucial Quote

“Right now, the majority of Wall Street is on standby until Friday’s employment report, so meme-stock mania and cryptocurrency trading could have little resistance,” Edward Moya, a senior market analyst at Oanda, wrote in a Wednesday email, pointing to “joke” token dogecoin’s meteoric same-day rise as a sign of further unabated market mayhem. “The retail force behind this movement is still strong, so it is anyone’s guess how much larger this bubble can grow.”

Chief Critic

“Although we have seen some exiting of positions throughout the year, the majority of short sellers have been happy to sit on significant paper losses in the hope that retail investors will blink first and the losses won’t be realised,” Ortex analysts wrote in a Wednesday note. “This now looks like a flawed strategy.”

Key Background

The recent meme stock rise follows a similar surge in January, when activist investors perched on Reddit’s r/WallStreetBets board pumped struggling firms like GameStop and BlackBerry in a bid to hurt short-sellers. “There’s a certain vigilante mindset amongst those traders being drawn into this social-media frenzy to pump certain stocks,” Nigel Green, the CEO of $12 billion advisory Devere Group, said in a Friday email, adding that “extreme caution should be exercised before joining stock frenzies of such nature.” Meme stocks have been incredibly volatile this year, with most crashing in late January once institutional investors piled out of their short bets after weeks of meteoric gains. Thus far, only AMC, which has also benefitted from businesses reopening, has recouped those losses.

What To Watch For

It’s unclear how long it may be before short interest once again wanes, but some analysts have said the market could sour again once the Federal Reserve indicates it will ease up on its accommodative policy, which has effectively facilitated high asset valuations by injecting unprecedented amounts of cash into the economy. That could happen as soon as June, when Fed officials meet again to discuss policy changes.

Tangent

In another sign of frenzied investing, shares of Mudrick Capital Acquisition Corporation II plunged 15% Tuesday after a slew of Reddit traders started placing bearish short bets on the stock following a Bloomberg report its namesake sponsor cashed out of its AMC stake because shares were “overvalued.”

I’m a reporter at Forbes focusing on markets and finance. I graduated from the University of North Carolina at Chapel Hill, where I double-majored in business journalism and economics while working for UNC’s Kenan-Flagler Business School as a marketing and communications assistant. Before Forbes, I spent a summer reporting on the L.A. private sector for Los Angeles Business Journal and wrote about publicly traded North Carolina companies for NC Business News Wire. Reach out at jponciano@forbes.com

Further Reading

AMC Skyrockets After Announcing New Perks For ‘Extraordinary’ Reddit Traders And Retail Investors (Forbes)

Here Are The Meme Stocks WallStreetBets Traders Are Pumping Up During This ‘Extremely Erratic’ Reddit Rally (Forbes)

Source: Not Just AMC: These Are The Meme Stocks Reddit Traders Are Pumping Again As Experts Urge ‘Extreme Caution’

.

r/wallstreetbets, also known as WallStreetBets or WSB, is a subreddit where participants discuss stock and option trading. It has become notable for its colorful and profane jargon, aggressive trading strategies, and for playing a major role in the GameStop short squeeze that caused losses for some U.S. firms and short sellers in a few days in early 2021.

The subreddit, describing itself through the tagline “Like 4chan found a Bloomberg terminal,” is known for its aggressive trading strategies, which primarily revolve around highly speculative, leveraged options trading. Members of the subreddit are often young retail traders and investors who ignore fundamental investment practices and risk management techniques.

The growing popularity of no-commission brokers and mobile online trading has potentially contributed to the growth of such trading trends. Members of the communities often see high-risk day trading as an opportunity to quickly improve their financial conditions and obtain additional income. Some of the members tend to use borrowed capital, like student loans, to bet on certain “meme stocks” that show popularity within the community.

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References

Microsoft System Blamed for New Jersey Vaccine-Booking Glitches

New Jersey officials are blaming Microsoft systems that were supposed to help vaccination efforts for allegedly glitching over the past five weeks, hindering the ability for a smooth vaccination rollout in the state. 

The state’s Microsoft system for running the vaccination rollout has had issues daily from booking appointments to losing registrations, state government officials told Bloomberg News

State officials blamed issues they said seem to stem from Microsoft not having enough employees staffed to deal with the issues and having employees in time zones that make them unavailable to help during business hours.

Vaccination rollout has been a major operation for states struggling to keep track of vaccinations and standardize strict guidelines for who medical facilities are allowed to vaccinate. 

Microsoft told Bloomberg that they know of some issues with the system in New Jersey, but did not comment further. 

“We are working with the state of New Jersey to deliver vaccinations as quickly, safely and efficiently as possible, and that includes addressing some technical issues,” a Microsoft spokesperson told Bloomberg.

Hospital and county websites have picked up the slack in New Jersey where the Microsoft system has failed, Bloomberg reported. More than 1.2 million vaccinations have reportedly been scheduled in the state. 

New Jersey was hit hard by the coronavirus pandemic, with more than 700,000 confirmed cases and more than 22,000 deaths from COVID-19, according to The New York Times.

Joe Biden is still aiming for 100 million people to be vaccinated within his first 100 days in office, but the process has been difficult, involving delivery delays, scheduling issues and vaccine hesitancy.

By Lexi Lonas

Tags MicrosoftJoe BidenNew Jerseycoronavirus vaccineCoronavirus

Bloomberg Quicktake: Now

Five weeks of stumbles by Microsoft Corp. on New Jersey’s Covid-19 vaccine-booking software have left the state pushing for daily fixes on almost every part of the system and doubting it will ever operate as intended, according to members of Governor Phil Murphy’s administration. The glitches — and attempted fixes that forced one megasite to go off-line temporarily — have led New Jersey to rely more on the county- and hospital-operated websites that are working well and have helped schedule more than 1.2 million doses in the most densely-populated state in the country.

Officials say those systems are successfully booking thousands of people. They fear the state’s booking portal, run on Microsoft software and functioning for just a limited number of residents, won’t withstand broad demand as eligibility eventually is opened to millions of more people. Health care has become a major focus for Microsoft, which unveiled a package of industry-specific cloud software in May. The world’s largest software company, which has hired executives with medical backgrounds, also has been researching machine learning and artificial intelligence tools for areas including clinical trials and patient care. In late January, the Redmond, Washington-based company touted its Microsoft Vaccination Management platform — usable by those seeking shots and by health providers — to register, schedule, track supplies and otherwise streamline the biggest inoculation effort in U.S. history.

The platform has yet to work correctly for New Jersey in the state’s effort to inoculate its residents against the coronavirus, according to two administration officials who asked not to be identified discussing contractual issues. Governor Murphy and State Health Commissioner Judith Persichilli acknowledged there was an issue with Microsoft in a Feb. 10 briefing, but didn’t go into detail about the problems. Since the state’s CovidVaccine.nj.gov website went live Jan. 5, the software has booked thousands of appointments. But it’s also blocked users, lost registrations, double-booked residents and crashed for periods of five minutes to three days, the officials said. Though Microsoft has worked daily on the troubles, the officials said they had no confidence that they’ll get all the features called for in its contract with the company. In a statement, Microsoft acknowledged difficulties with booking shots but didn’t specify the problems. “We are working with the state of New Jersey to deliver vaccinations as quickly, safely and efficiently as possible, and that includes addressing some technical issues,” a Microsoft spokesperson said in an email.

The New Jersey officials declined to say whether the state is considering canceling the Microsoft contract, but said they are seeking solutions and workarounds of all kinds. The cost of the contract wasn’t readily available. New Jersey was among the earliest and hardest-hit U.S. states by Covid-19, recording almost 21,000 deaths with a lab-confirmed link to the disease caused by the coronavirus. Murphy, a first-term Democrat running for re-election this year, has committed to vaccinating 4.7 million people, or 70% of the state’s population, by late June. So far, New Jersey has administered nearly 1.2 million doses, representing a tenth of the population who have received at least one dose, according to the Bloomberg Vaccine Tracker. State officials said Microsoft appears to be using too few staffers, with some key personnel in overseas time zones that leave them unavailable during U.S. business hours. The officials said they’ve conferred with other states using versions of the same software, which is built on the Microsoft Dynamics customer-relationship management platform.

The task appears to be going smoother, they said, in places that asked for fewer applications — just scheduling, say, rather than more complex services. Subscribe to our YouTube channel: https://bit.ly/2TwO8Gm​ Bloomberg Quicktake brings you live global news and original shows spanning business, technology, politics and culture. Make sense of the stories changing your business and your world. To watch complete coverage on Bloomberg Quicktake 24/7, visit http://www.bloomberg.com/qt/live​, or watch on Apple TV, Roku, Samsung Smart TV, Fire TV and Android TV on the Bloomberg app. Have a story to tell? Fill out this survey for a chance to have it featured on Bloomberg Quicktake: https://cor.us/surveys/27AF30​ Connect with us on… YouTube: https://www.youtube.com/user/Bloomberg​ Breaking News on YouTube: https://www.youtube.com/c/BloombergQu…​ Twitter: https://twitter.com/quicktake​ Facebook: https://www.facebook.com/quicktake​ Instagram: https://www.instagram.com/quicktake

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Our view: It is not blasphemy to identify problems in NHS vaccine booking system http://www.oxfordmail.co.uk – February 15THERE has been much rejoicing this weekend at the much anticipated announcement that the rollout of the coronavirus vaccine has passed the 15……1

Monty Don addresses ‘puzzled’ fan after his vaccine news causes confusion | Celebrity News | Showbiz & TV http://www.express.co.uk – February 13[…] A fan stepped in to help Monty Don explain the vaccine booking process to a follower Monty Don took to Twitter to share the ‘wonderful’ news that he had boked his […]3

Microsoft System Blamed for New Jersey Vaccine-Booking Glitches http://www.youtube.com – February 13N/A

CommonWealth Magazine commonwealthmagazine.org – February 13[…] and availability issues in many regions across the state, and communications breakdowns in the vaccine booking system,” the speaker said […]1

Microsoft System Blamed for N.J. Vaccine-Booking Glitches http://www.itprotoday.com – February 12HYBRID CLOUD Five weeks of stumbles by Microsoft Corp. on New Jersey’s Covid-19 vaccine-booking software have left the state pushing for daily fixes on almost every part of the system.N/A

Vaccine booking error further frustrates medically vulnerable Floridians cbs12.com – February 12Elizabeth Kahn turns 48-years-old next week and has just one birthday wish this year. “My wish is to get the vaccine, or at least schedule it,” Kahn said. And for a moment, she thought her wish was coming true.6

News from the UK’s largest union – Issue #1 | Revue http://www.getrevue.co – February 12[…] announcement that care workers who haven’t had a dose yet can make an appointment The article Vaccine booking system now open to frontline care workers first appeared on the UNISON National site […]0

Microsoft system blamed for N.J. vaccine-booking glitches http://www.bloomberg.com – February 12Five weeks of stumbles by Microsoft on New Jersey’s COVID-19 vaccine-booking software have left the state pushing for daily fixes on almost every part of the system, according to state…546

Pritzker’s Stats Obsession Will Intensify Vaccine Hunger Games patch.com – February 12[…] — without consulting her, and if it would create even more problems for an already-overwhelmed vaccine booking system […]11

U.S. Orders More Doses; Japan to Rule on Pfizer: Virus Update http://www.bloombergquint.com – February 12[…] Vaccine-Booking Glitches (6 a.m. NY) Five weeks of stumbles by Microsoft Corp. on New Jersey’s Covid-19 vaccine-booking software have left the state pushing for daily fixes on almost every part of the system an […]0

February 10, 2021: COVID-19: US State Policy Report http://www.natlawreview.com – February 11[…] over 75 can get vaccinated beginning February 1 (see here) Gubernatorial announcement regarding vaccine booking program (see here) Michigan: Stay at home order expired on June 1 Shelter in Place order expired on […]0

February 9, 2021: COVID-19: US State Policy Report http://www.natlawreview.com – February 10[…] over 75 can get vaccinated beginning February 1 (see here) Gubernatorial announcement regarding vaccine booking program (see here) Michigan: Stay at home order expired on June 1 Shelter in Place order expired on […]0

Seniors report problems with state’s 211 vaccination hotline http://www.capecodtimes.com – February 10[…] To make the vaccine booking appointment as equitable as possible for eligible Cape Codders — which include those in phase on […]4

Vaccine web portal lacks accessibility gpo.ca – February 9[…] many Ontarians who do not have access to the technology or broadband needed to access the online vaccine booking portal […]4

Getting the COVID-19 vaccine: what to expect – http://www.which.co.uk – February 9[…] These can look highly convincing (as per the example of a fake vaccine booking website above), so it’s worth being vigilant […]43

COVID-19 vaccine FAQs http://www.barnsleyccg.nhs.uk – February 9[…] uk/covidvaccine Last updated: 08/02/21 Vaccine booking update: If you are 70 or over, or 18 or over and have been advised to shield by letter because yo […]N/A

COVID State Policy Report for CO, CT, IL, NY, OR, RI, SC, SD http://www.natlawreview.com – February 9[…] over 75 can get vaccinated beginning February 1 (see here) Gubernatorial announcement regarding vaccine booking program (see here) Michigan: Stay at home order expired on June 1 Shelter in Place order expired on […]N/A

London hospital trust signs up to new Covid-19 vaccine booking app london-post.co.uk – February 8[…] keep track of who has received a Covid-19 vaccine within their workforce thanks to a new Covid-19 vaccine booking service […]N/A

Massachusetts COVID Vaccine Hotline: What to Know – http://www.nbcboston.com – February 6[…] Her daughter, Susan Parker, had found the state’s vaccine booking website hard to navigate, and the Marblehead family felt a sense of urgency to secure a slot […]1

Book now – vaccinations available at three local hospitals: but you must be eligible http://www.leicestercityccg.nhs.uk – February 6[…] A vaccine booking can be made at one of the following hospital sites by clicking on the relevant link: Glenfiel […]5

February 4, 2021 COVID-19 US State Policy Report http://www.natlawreview.com – February 6[…] over 75 can get vaccinated beginning February 1 (see here) Gubernatorial announcement regarding vaccine booking program (see here) Michigan: Stay at home order expired on June 1 Shelter in Place order expired on […]0

Covid vaccination available for limited period for priority groups at three hospital sites | Measham Parish Council http://www.meashamparishcouncil.gov.uk – February 5[…] A vaccine booking can be made at one of the following hospital sites by clicking on the relevant link: Glenfiel […]0

Temple Vaccine Booking outlook.office365.com – February 5You can now book and manage appointments using our booking page.7

COVID-19: US State Policy Report – February 3, 2021 http://www.natlawreview.com – February 4[…] pharmacist refill flexibility (see here) Massachusetts: Gubernatorial announcement regarding vaccine booking program (see here) New Jersey: Executive Order 219 Raising Indoor Capacity Limits from 25 Percen […] over 75 can get vaccinated beginning February 1 (see here) Gubernatorial announcement regarding vaccine booking program (see here) Michigan: Stay at home order expired on June 1 Shelter in Place order expired on […]N/A

Legislative leaders stepping up oversight over coronavirus response http://www.lowellsun.com – February 4[…] and availability issues in many regions across the state, and communications breakdowns in the vaccine booking system,” Mariano said […]N/A

The Pharmacy in Ludgershall to roll out Covid-19 vaccine http://www.salisburyjournal.co.uk – February 4[…] ” More vaccine news: These three sites will now appear on the national coronavirus vaccine booking system, along with the large vaccination centres at Salisbury City Hall and Bath Racecourse […]6

Covid-19 vaccine update 4 Feb 2021 :: Kent and Medway Clinical Commissioning Group http://www.kentandmedwayccg.nhs.uk – February 4[…] All bookings must be through the national Covid-19 vaccine booking service […]12

UK ‘getting safer every day’ as almost 1 in 5 adults have had first vaccine, says Nadhim Zahawi http://www.telegraph.co.uk – February 4[…] 2:50am Teachers skipping Covid vaccine queue Teachers are abusing the vaccine booking system and skipping the queue ahead of the elderly, a council warned as it introduced tighter rules […] Teachers are abusing the vaccine booking system and skipping the queue ahead of the elderly, a council warned as it introduced tighter rules […]N/A

Waiting for the COVID vaccine? Don’t ignore ‘unknown’ or ‘private’ callers for now http://www.khou.com – February 4[…] So again, if you’re waiting on an email response for your coronavirus vaccine booking, you will want to keep a close eye on all of your email folders […]41

Eight Best Practices for COVID-19 Vaccine Scheduling Online: Insights From Our Health System Customers http://www.kyruus.com – February 4[…] Add a one day lead time for vaccine booking (i […]0

Marco police & fire chief suspended over COVID-19 vaccine booking scandal nbc-2.com – February 4[…] – The Marco Island police and fire chief have been suspended for 30 days over the COVID-19 vaccine booking scandal […]

How One Bad Oil Bet Sparked A Global Trading Disaster

By now we are all keenly aware of the near-devastating impact that the novel coronavirus has had on oil markets and the fossil fuel industry around the world. (If this is news to you, what rock do you live under and is there room for one more?) But while a lot of the narrative here in the West has been about the historic oil price crash in what some are now referring to as Black April, the oil trading catastrophe actually started much earlier and can largely be traced back to the bad bet of just one man, Singapore’s commodities tycoon Lim Oon Kuin. 

The story of the oil market instability that ripped through Asia starting in China is not so much one of struggling oil companies, but a story of banking – that unsexy, behind-the-scenes sector that all too often gets none of the headlines and all of the control. It started way back in January, when most of us were just starting to gain some awareness of a strange and scary illness devastating the Chinese city of Wuhan.

Lim Oon Kuin, sitting in his office 2,000 miles away in SIngapore, watched as this news unfolded and made a decision. He decided that China would gain control of this epidemic before it turned into a pandemic and began stockpiling fuel, quietly adding to his already vast reserves. It should come as no surprise that that bet didn’t work out. 

As the coronavirus spread around the world and tanked global crude demand, as well as oil prices, a chain reaction of defaulted loans, was set off in Singapore that is still reverberating in global markets today.

“Banks tried to recover loans from Lim’s company, Hin Leong Trading Pte, triggering one of the biggest scandals in the oil industry this century,” Bloomberg reported about the bad deal that has left a permanent mark on oil trading.

“Lim’s empire collapsed, owing $3.5 billion to 23 banks, and the fallout from the debacle is still reverberating into 2021, shaking out large tracts of the vast and often opaque $4 trillion global oil-trading industry.”

While this may sound like an outright, unmitigated disaster, as with most financial meltdowns, there are winners as well as losers here.

The losers, as always, are the little guys:

“hundreds of small trading firms, many of them employing only a handful of people, who will find it expensive, if not impossible, to meet the increased demands for information from banks that have become wary of lending them money.”

This is to say that the big guys like Trafigura Group and Vitol SA will be gaining business lost by their small competitors, shoring up their oligopoly on trading. They not only benefit from increased confidence from finance companies who have become increasingly risk averse in this environment, they also have the capital to adapt to increased operational costs.

And, as usual, less developed countries will bear the brunt of the economic fallout from this sea change. As banks become more risk averse, re-prioritize their business models, and scale down, it’s going to impact small companies in small economies the most just while they are struggling with all of the other economic hardships related to this pandemic. In this case, the big banks truly were too big to fail. The same can’t be said for the little guys.

This is true, of course, for many market sectors, not just commodities trading. Across the world we’re seeing a sweeping consolidation as big companies are able to weather the financial storm of the COVID-19 pandemic and the little ones are folding. Look no further than the main street of your own town: as mom and pop restaurants struggle to make a sale, lines are down the block at the McDonald’s drive thru. As local shops shut down, Amazon becomes ever more of the globalized goliath it already was. 

More than anything, however, the story of Lim Oon Kuin and his bad oil bet is an object lesson in the butterfly effect and outsized might of the all-too opaque trading sector. His will never be a household name, but the impact of his oil gamble will continue to be felt around the world for years to come.

By: Tyler Durden

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Online Education Success Shares Effective Seo Strategies For Small Businesses | AutoTraffic autotraffix.com – TodaySEO or search engine optimization is a whole science that has been created to fine-tune websites into making them more visible to search algorithms. The visibility of the website is critical for a …N/A

Spanish Journal of Marketing – ESIC | Emerald Publishing http://www.emeraldgrouppublishing.com – TodayJournal description Spanish Journal of Marketing – ESIC is an international peer-reviewed journal publishing research in the fields of marketing. The journal is published open access in association with AEMARK (Spanish Association of Academic and Professional Marketing) and ESIC Business & Marketing School.N/A

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