Pinterest Is Testing A Personalized Home Page Based On Your Interests

Pinterest is introducing a new way to browse its site with the addition of a category called “Personalized for You.” This new section is essentially a version of Pinterest based entirely on your interests. For example, a fashion-focused Pinterest user might see categories like boots, jackets, dresses, or jewelry on this page, which they could then click into and further explore.

The feature is not yet available to all users, indicating that it could be the first step within a larger rollout, or a public-facing personalization experiment. We asked Pinterest to clarify this, but the company declined to offer further details.

From our understanding, some selection of the Pinterest user base is seeing a notification asking them if they would like to try this new feature when they log in.

This option started appearing in select users’ accounts this week, where it becomes available in Pinterest’s top navigation. That’s where you find your “Home Feed,” the “Popular” feed, the “Everything” feed, and other categories like “Art,” “Food & Drink,” “Home Decor,” “Travel,” “Weddings,” and many more. For those users who are able to access the new personalized section, it is now the first option in this category list.

Your “personalized” page itself is a collection of words and topics that seem to be based on your pinning activity. What’s different about this section is not only the content, but also the look-and-feel, which is somewhat Flipboard-esque. Instead of uniformly sized pins, some sections here are larger than others, likely indicating you’re doing more pinning around that particular topic.

Also interesting is that each individual category page within your personalized section shows which pins inspired its suggestions.

As you may recall, Pinterest has been slowly working to better personalize its service since the middle of last year, when it first introduced a way for users to opt out of having their activity tracked. The company’s decision to implement this “Do Not Track” toggle switch was meant to head off any future complaints before the company scaled up its personalization efforts in full force.

At the time, Pinterest noted that it would introduce a new “Edit Your Home Feed” button on web and mobile which would make it easier for you to follow and unfollow boards. When users entered into this editing mode, they would then be met with personalized pin and board suggestions based on things they had already been pinning on the service.

Later, when Pinterest rolled out support for “Promoted Pins” (in beta testing with advertisers now), the idea was to not inflict an awful advertising experience on the Pinterest user base with things like flashy banners or pop-ups, but instead showcase native ads in the form of subtly marked sponsored pin placements that blend into the overall look-and-feel of the site.

And most importantly, which Promoted Pins a user sees is, again, dependent on their interests.

Source: TechCrunch

U.S. must seek just, impartial approach on Syria

Peace talks on Syria, which started Wednesday in Montreux, Switzerland, mark the first step towards a feasible and non-military resolution to the escalating conflict.

The United States, boasting of being the main propelling force behind the Geneva II conference, as it is known, was poised to steer the talks in a way based on its own perspective and interests.

On the eve of the conference, the U.S. popped up to oppose the U.N.'s invitation to Iran, in a bid to rule out any dissent from within the region.

This reminded others of the self-conceived stance of the U.S. at the start of the crisis, when it threatened to resort to military action against Syria based on allegations the Syrian government had used chemical weapons.

The U.S., however, gave up this objective in the face of strong opposition from Syria, Russia, and China, realizing military intervention might result in a chaotic outcome that could see chemical weapons fall into the hands of terrorists.

It is unsurprising the U.S. policy on Syria proved to be unfeasible, as it was out of step with the common wish of the Syrian people for peace and stability.

Now consensus has been reached that a political solution is the ideal way out, especially for a stalemate such as Syria, the U.S. must show its willingness to promote enduring peace in Syria by taking a just, balanced and impartial approach.

The result of the political means must be broad-based and inclusive, so the interests of all parties in Syria, who differ in their ethnicity, gender and religion, are taken into consideration.

The role of the U.S. in Syria was not welcome, but it has every chance to correct its arbitrary and biased approach through its actions at the Geneva II conference.

The Geneva II conference, an outcome of a joint wish for peace, offers an important opportunity to promote the political settlement of the Syrian issue.

With the window of opportunity open, Syria needs favorable conditions and a supportive external environment, not the external imposition of political solutions on Syria.

The U.S. must listen to the demands of all parties concerned, and promote a political transition process in Syria, the hope for realizing peace in Syria.

After all, only Syria can decide its future, and the destiny of Syria is in the hands of the Syrian people themselves.

It is imperative for both parties to reach an inclusive political transition process and oppose terrorism and restore stability and order in the region, with a benign environment created by the U.S. and the international community.

Egypt mulls minimum wage to appease protesters

Egypt's interim government plans to implement minimum wage regulations in an attempt to quell protesters who demand social justice and better living conditions, demands that led to the famous Jan. 25 upheaval, but some analysts said this move could harm the country's deteriorating economy.

The interim government announced it would raise public sector minimum wages from 700 to 1,200 Egyptian pounds (around 172 U.S. dollars) as of January 2014.

Many activists and economists said the figure will satisfy large segments of Egyptian workers despite still being relatively low compared to recent price hikes. Other experts said the changes will add more pressure on the economy hammered by three years of recession.

"The minimum wage is successful politically, but a failure economically," said Mohamed Salem, an economics professor at Cairo University. He describes the decision as "catastrophic," arguing it will have a negative impact on the investments, business sector companies and the state budget.

"The figure apparently will improve the conditions of the Egyptians but will cost the state budget around EGP 200 billion ( 28.7 billion U.S. dollars)," Salem told Xinhua.

In order for the government to secure the value of the minimum wages, it will be obligated to issue banknotes which could increase inflation from 20 to 30 percent, the professor said, noting that the inflation rate now stands at 12 percent. He added that the budget deficit, which currently stands at nearly 240 billion U.S. dollars, could also double.

Nevertheless, minimum wage remains a much desired change in a country where nearly 25 percent of its people live below the poverty line and spend less than 500 dollars a year. For many minimum wage is a step to ensure better living conditions for workers.

Salem argues that social justice can still be achieved through austerity policies, saying that reducing the inflation rate, facing the high prices, supporting public and private competitiveness, are better alternatives than increasing the minimum wage.

"The hike in prices will swallow salaries and lead investors to flee Egypt," Salem said, preaching against the dangers of minimum wage for businesses.

Egypt allocates EGP 172 billion for spending in the public- sector pay at a time when the country is suffering a budget gap of EGP 240 billion (34.5 billion U.S. dollars) or about 14 percent of its gross domestic product.

The new minimum wage scheme for public sector workers will cost the treasury EGP 9 billion (1.29 billion U.S. dollars) in the second half of the current fiscal year ending on June 30, according to a finance ministry statement in October.

Nearly 5.5 million employees in the governmental sector will be benefited from the new decision, according to official reports.

The government did not mention how they will fund the minimum wage. Salem said it will most likely be extracted from the underprivileged sectors by cancelling subsidies for certain commodities, or reducing subsidies on health and education sectors, or the government will impose more taxes.

According to the government decree, the maximum wage will be implemented as of Januart 2014 and its ceiling has been settled at 42,000 Egyptian pounds (nearly 6,000 U.S. dollars) per month, 35 times the minimum wage of the employees working in the public sector, but the decision excluded some professions including diplomats.

Any sudden rise in incomes concerns Salem, who says that these changes could drive inflation upwards and put pressure on the economy, given that the beneficiaries of the minimum rate have a tendency to direct all extra income towards consumption.

Abdel Rahman Khair, a member of the National Council for Wages disagrees. He said any economic outlook should consider the difficult living conditions of the majority of Egyptians.

Within the constraints of the budget deficit and the shortage of economic resources, the government should promise people reasonable minimum wages until the economy is revived, Khair told Xinhua, adding that it should control the market prices at the same time.

The interim government has postponed plan to implement minimum wage regulations pending further discussions, as business interest groups have resisted the initiative, saying it will raise unemployment, cause great losses in the revenues already suffering from the ongoing political unrest.

Expectations low for upcoming Syria peace talks

Expectations are "low" for this week's Syria peace talks in Geneva as violence continues unabated in the embattled Middle East country, U.S. experts told Xinhua.

"Low expectations surrounding the talks are appropriate given the iffy prospects for any meaningful progress," said Wayne White, former deputy director of the U. S. State Department's Middle East Intelligence Office.

He added that bringing together the two warring sides in Syria is the main reason the talks have been repeatedly postponed, finally beginning this week in Montreux before they'll move to Geneva.

The objective of the talks is to set up a transitional governing body that would put a stop to the fighting that has plagued the war-torn nation for three years and resulted in 100,000 deaths. But getting all rebel factions on board at this stage is a tall order, if possible at all, and experts said that is the main hurdle.

Indeed, only one coalition of rebels, largely confined to northwest Syria near Aleppo, has supported the main opposition leadership in exile, the Syrian National Coalition (SNC), in its decision to attend the peace talks. And most of the SNC is attending under heavy U.S. and Western pressure, White said.

Moreover, while some rebel factions are demanding that Syrian President Bashar al-Assad step down -- with some opposing attendance if Assad does not do so -- Assad's government knows it holds the upper hand militarily and has no reason to accept such terms, White said.

David Pollock, a Middle East expert with the Washington Institute for Near East Policy, told Xinhua he was skeptical that the conference would achieve any meaningful results.

"The only likely outcome will be some limited cease-fire or humanitarian relief, at best," he said. "Even that will probably not be very lasting or effective on the ground."

But other experts believe diplomacy is the only way out of the current impasse, with a military solution unlikely amid brutal fighting that continues with no end in sight.

RAND Corporation's senior policy analyst, Alireza Nader, said that despite low expectations for this week's meetings, diplomacy remains the best option for resolving the Syrian crisis, especially given that neither side seems able to win a decisive military victory.

While the talks are unlikely to produce immediate results, they could clear a path toward a final settlement, although that possibility remains far down the road, Nader told Xinhua. He added that all major players involved in the conflict, including Iran, need to be part of the diplomatic process.

The United Nations this week withdrew its invitation for Iran to attend the talks, as Tehran failed to get on board with the plan to establish a transitional governing body, the basis of the meetings in Geneva.

The SNC had earlier threatened to boycott the talks if Iran was invited, but the group now confirmed they would be present.

Steven Heydemann, a vice president at the U.S. Institute of Peace, told Xinhua the meetings are really about testing the viability of the Geneva process and identifying key obstacles.

"No one expects this meeting to produce anything close to an agreement," he said, explaining that the talks are expected to clarify participants' positions somewhat, inform diplomats of where further efforts might be justified and get involved parties used to the idea of having a diplomatic process.

"Those are not very high ambitions, but they are the best we are likely to get," he said.

Some experts said the U.S. and other Western nations have lost influence among some Syrian rebel forces, and that may impact on peace negotiations going forward.

Western and U.S. influence on some rebel factions has been undermined by what some rebels view as broken promises, which means the West and U.S. are less able to compel rebel forces to attend the peace talks, White said.

But other experts said the talks are crucial to the lives of thousands of displaced Syrian refugees who remain in limbo, and the meetings may be the last chance to find a political solution, as nearly two and a half million Syrians have fled the war-ravaged country and headed to neighboring countries.

Source: Xinhua

WEF starts amid upbeat news on global economy

The IMF warned that deflation and finance sector risks could still undermine a full recovery. That concern is echoed at this year's Davos forum.

The World Economic Forum is not only not in crisis mode this year, it has even kicked off with the IMF painting a rosier picture of global economic growth. But that doesn't mean it's time for complacency.

The International Monetary Fund has warned that as financial conditions slowly improve in advanced economies, there will be implications for emerging markets.

The same goes for America's quantitative easing policy of pumping money into the economy, which has also pushed the value of the U.S. dollar down boosting exports.

"The quantitative easing has led to a competitive policy. I mean if we look at Abenomics in Japan, which in turn cause a lot of concern for China with the rising RMB," said Hosuk Lee Makiyama, Director of the European Centre for International Political Economy.

Some think it's creating cracks in the system. "The global governance in the international finance structure, if you like, it's starting to fall apart. It's becoming every man for himself," said Makiyama.

At the World Economic Forum there are also questions about whether domestic consumption in China is growing fast enough and of course there's the number one perennial concern - Europe. The Eurozone still suffers from high debt, wobbly banks and combined growth that hovers just above zero as well as low inflation. But there's a feeling Europe's leaders may keep dragging their feet.

"In that case we could end up in a Japanese scenario of two decades of lost growth, so I guess those are the things we need to address in Europe: growth, inflation and the banks," said Stijn Verhelst, analyst from Egmont. "Those things we need to act on and if not we could have a nasty surprise."

Finding solutions to problems like these is what the forum likes to believe it does best. There are no big announcements, just an attempt to digest the year that has passed in order to better plan and prevent those potential future nasty surprises.

Source: CCTV

China's structural changes take centre stage on first day of Davos

2014 World Economic Forum has officially kicked off on Wednesday, featuring the first round of talks and debates among world's opinion leaders. This year's theme: The Reshaping of the World: Consequences for Society, Politics and Business."

China, which is a major talking point throughout 2014 winter Davos, is set as the main theme with eight China forums.

The first China forum opens on Wednesday, focusing on structurally reforming and reshaping the world's second largest economy. Discussion topics include pursuing growth sustainability, restructuring industries, SOE reforms as well as promoting innovation.

Source: CCTV

Chinese insurance industry to expand investment range

The China Insurance Regulatory Commission said Tuesday that China's insurance industry earned more than 1.7 trillion yuan, or over 280 billion U.S. dollars last year. That's a jump of about 11 percent from a year ago. The increase means that the industry has regained steam after a couple of years of slow growth.

Full-year revenues for China's insurance industry hit double-digit growth in 2013 and investment returns on insurance capital also saw their best performance in four years.

The CIRC says the industry's Return On Investment reached about 366 billion yuan, or 60 billion U.S. dollars last year.

The rate of investment return was 1.65 percent higher than in 2012. Last year's results were the best reading in four years as well.

Insurance firms will have more choices this year on where to invest their funds.

"One of our reforms this year is to further expand the capital operation measures. Insurance firms could adjust their investment policies according to market situations. It can reflect their own decision-making abilities," said Zhou Yanli, Vice Chairman of CIRC.

In fact, the CIRC ruled earlier this month that insurance funds could be invested in shares of Growth Enterprise Market. That was the first sign of an easing environment for insurance firms to run their money.

At the same time, Xiang Junbo, Chairman of the CIRC, released several other reforms this year. Those reforms include building up the catastrophe insurance system and extending reforms on the marketization of insurance rates.

Source:  CCTV

China's state firms return to profit in 2013

Official data says China's state firms returned to profitable growth in 2013 after a decline during the previous year.

The Finance Ministry says China's state-owned non-financial companies earned combined profits of 2.4 trillion yuan, or nearly 400 billion U.S. dollars. That represents a growth of 5.9 percent from the previous year.

Firms owned by the central government posted an increase in annual profits of 7.4 percent in 2013, while companies owned by local governments reported a 2.7 percent rise.

Companies in transportation, electronics, automobile and property development reported strong year-on-year profit growth.

Meanwhile, companies in the non-ferrous metal, coal, petrochemical and mechanical industries saw relatively large earnings drop.

Source:CCTV

Seeking Alpha: Apple Earnings Preview: China Is Critical

It's that time of year again. We are just a couple of days away from Apple (AAPL) releasing its quarterly earnings report, which will be its fiscal first quarter. Apple will report after the close on Monday, January 27th. Each quarter, I provide an extremely detailed preview of Apple's completed quarter and a brief discussion of the quarter to come. Each time around, I try to highlight one central theme as the key for both the reported quarter and the one Apple will be providing guidance to. It may not be much of a surprise, but the most important part this time around is China, and not just because of the China Mobile (CHL) deal. Today, I'll preview Apple's fiscal first quarter and look forward to the second quarter as well.

Looking at past results:

Before I get into the current quarter, it's always good to look back at past results. The table below shows fiscal Q1 in the last two years, with last year's Q1 period in yellow. I also included last fiscal year's Q4, so you can get an idea of how things are sequentially.

*14-week period. Results not adjusted for extra week in quarter.

Back in October when Apple reported fiscal fourth quarter results, the company gave the following guidance for fiscal Q1:

• revenue between $55 billion and $58 billion.
• gross margin between 36.5 percent and 37.5 percent.
• operating expenses between $4.4 billion and $4.5 billion.
• other income/(expense) of $200 million.
• tax rate of 26.25 percent.

This is Apple's biggest quarter of the year, and most likely, the Q1 report will show an all-time quarterly sales record for Apple. I mentioned in my opening that China was a key. In 2013, when Apple released the iPhone 5C and 5S, the phone was available in China the same day it was available in the United States. In the past, there has been a multi-week or multi-month wait for the phone in China. The availability of the phone earlier than in the past has pushed a bunch of sales into fiscal Q1, and remember, this was all before the China Mobile deal. More on that later in the Q2 guidance section. In the next few sections, I'll take a look at each product category individually, and discuss the important items to consider in terms of Apple's earnings.

Product overview - the iPhone:

It's going to be a monster quarter for the iPhone, and that makes sense. Apple released two separate versions of the phone, the 5C and 5S in September, but fiscal Q1 (a holiday quarter) is the first full selling quarter for the phone. As I mentioned above, the phone went on sale in China much earlier. Even though there was no China Mobile deal in place for Q1, China sales are expected to be very strong.

Current estimates for the iPhone call for sales of 55.3 million units in Q1. That would represent a 16% or so increase over last year's period, which was a little under 48 million. The link above is from Philip Elmer-Dewitt, who covers Apple for Forbes. At the moment, the iPhone and iPad are the only product categories for which he has a collection of analyst estimates, but as we get closer to earnings, you should probably check his site for other estimates as well.

There are two important items to consider when it comes to the iPhone, outside of total units sold. First, the mix of sales between the 5S, 5C, and other models will have a large say as to the average selling price for the iPhone line. A dollar or two here or there doesn't normally seem like much, but when you are talking about 55 million units or so, it's a big deal. The difference between $575 and $580 per phone, for example, could be as much as $300 million in total revenues if Apple came in at 60 million units. A dollar or two on the iPhone selling price could be the difference between Apple making and missing revenue estimates for the quarter.

The second item to consider is the percentage of Apple's total revenues that come from the phone. The iPhone will probably represent about 55% or so of Apple's total revenues this quarter. With the iPhone being a higher margin product than the iPad, for instance, a higher mix of iPhones versus iPads could really help gross margins. More on Apple's overall margins in a bit.

Product overview - the iPad:

Back in October, Apple launched a new version of its premium tablet, the iPad Air, along with a retina display iPad mini. Like the iPhone, the new iPads contained the 64-bit A7 CPU, which was a game changer at the time. Earlycommentary from the sell-side was positive, with the main argument being the higher quality new iPads could lead to a rise in average selling prices for the device.

Apple did not refresh the iPad early in 2013 like the company did in 2012, so this was a major launch, and that should mean pretty high demand. The retina mini iPad was supply constrained, so that could impact sales a little. Overall, it should be a strong quarter for the iPad, and analyst expectations call for 25.09 million to be sold. That would be a little less than 10% growth over the prior year period.

Product overview - the Mac:

The PC industry has been tough in recent years, and Apple is partially to blame for that with the introduction of the iPad. Tablets have taken away plenty of PC sales, but the PC industry decline seemed to improve a bit in calendar Q4. When it comes to the Mac, there are conflicting stories when it comes to US sales.

Gartner and IDC have provided very different figures for Q4 U.S. Mac sales, which benefited from a MacBook/iMac refresh. Gartner thinks they rose 28% Y/Y to 2.2M, leaving Apple with a 13.7% U.S. PC share (+380 bps Y/Y). But IDC thinks they fell 3%, and assigns Apple a 10.9% U.S. PC share (flat Y/Y).

Apple sold just over 4 million Macs in the year ago period, and I think that the company will do a bit better this year. If Gartner is right, Apple could potentially get back towards the 4.5 million unit sales level. I don't think Apple will be close to 5 million, but we shall see.

Product overview - the iPod and other revenues:

The iPod was once the bread and butter device for Apple. Those days are long gone. As was the case in recent quarters, the iPod will probably show a double digit decline in sales, perhaps even a 20% decline or more. My projections have the iPod representing less than 2.6% of Apple's revenues in the quarter.

Apple has some significant other revenues that I must detail as well. These are revenues generated from the iTunes store, as well as device accessories, etc. In last year's Q1, these other revenues were more than $5.5 billion, and they've been growing at a tremendous pace. App store sales topped $10 billion in 2013, with more than $1 billion in December alone. Apple's other revenues might not seem like much, but they could total as much as the Mac and iPod lines combined.

Quarterly gross margin analysis:

As I mentioned above, the sales mix for Apple will be key in determining Apple's margins for the quarter. Additionally, Apple's decision on the price point of the 5C, which I defended, should help margins a little. Those that complained about the 5C's high price also were complaining about weak margins for Apple. Apple used the 5C to defend its margin position, and I applauded the company for that. Also, Apple's margin guidance was a little light when Apple handed in the forecast due to nearly $1 billion in deferred hardware revenues pushed into Q1. With such a high percentage of Apple's sales coming from the iPhone, perhaps up to 60%, I do think Apple will be towards the higher end of its margin guidance.

Q1 estimates and my predictions:

Until Apple launched the new set of phones, analysts were actually cutting their Q1 estimates when it came to Apple. Once the new iPhones were launches, Q1 estimates started to rise a bit. Analysts started to get really positive in late November and December, but the overall tone calmed down a bit when a China Mobile deal was not reached when originally expected. The following table shows how Q1 estimates have trended since July. The yellow line is the day when Apple reported fiscal Q4 results and gave guidance for fiscal Q1.

As a reminder, these estimates are as of Wednesday. We still have a few days until Apple reports, so these estimates could easily change before then. I always get asked for my predictions, so here is what I believe Apple will report for the quarter.

• Revenues of $57.63 billion.
• Net income just under $12.8 billion. EPS of $14.28.
• Gross margins of 37.40%.
• Product sales - Mac sales of 4.50 million, iPod sales of 9.40 million, iPhone sales of 56.40 million, and iPad sales of 25.20 million.

Right now, I'm a little ahead of analyst expectations for revenues, and a bit further ahead for EPS. I do think it will be a strong quarter for Apple, although I'm not going to go above the top end of Apple's revenue guidance. My numbers, like many analysts, would have been a bit higher had a China Mobile deal started in December.

Looking forward to fiscal Q2:

When Apple reports on Monday, the company will give guidance for fiscal Q2. Apple has been giving more realistic guidance in the past year or so, and thus analysts have been able to estimate results a bit better. The following table shows how Q2 estimates have trended since early December.

In the prior year period, Apple reported revenues of $43.60 billion and earnings per share of $10.09. The current revenue estimate calls for 5.2% revenue growth over the prior year period. Obviously, investors are looking for the impact of the China Mobile deal in this guidance. However, investors must remember a key point from Q1. The other Chinese carriers got the iPhone a lot earlier in 2013 than normal, so a lot of sales were pushed into fiscal Q1. I wouldn't be surprised if Apple's guidance falls in the $43 billion to $47 billion range for revenues. I'm being a bit broad there, as I expect the company's actual guidance to be a range of $2 billion or $3 billion. I wouldn't be surprised if guidance looks a little light at first blush, as we are only days removed from the launch of the iPhone for China Mobile. Had we been a month or so into actual sales, guidance probably would be a bit more precise, but for now, I wouldn't be surprised if the range is a little wider and a little more conservative than many expect. Apple usually goes to the slightly conservative side, and I'm hoping that the bear camp does not come out in full force if Apple is a little bit under what most are looking for.

An update on short interest:

One important item to note outside of the earnings report is that Apple's short interest has been steadily declining for several months now. As you can see from the chart below, Apple's short interest ended 2013 at just over 14.15 million shares. That's down nearly 66% from the high in April 2013, which was over 41.5 million. This is the lowest Apple's short interest has been since September 2012.

There will be one more "update" on short interest with a date prior to Apple's earnings. The next short interest update is based on a settlement date of January 15th. However, because these updates are delayed, we won't see the data until January 27th. We'll get the short interest updates within minutes of Apple's earnings report, but unfortunately, the update will be too late to discuss pre-earnings.

Balance sheet / more Icahn:

Apple ended fiscal Q4 with a little under $147 billion in cash and investments, known as Apple's cash pile, or cash hoard. Of that money, only a little more than $35 billion was located inside the United States. Only US funds can be used for dividends and buybacks, which is why Apple launched a massive debt offering in 2013 to accelerate part of its buyback. You can see my latest post on the dividend and buyback here. My expectation is that Apple's cash pile will have risen above $150 billion during fiscal Q1, but that depends on how much stock was bought back. I also expect that the percentage of funds located outside the US will continue to rise.

Apple is still going to buy back a massive amount of shares in the next two years. However, Carl Icahn is arguing for more buybacks, and he pushed the button again recently. Icahn has been arguing for about $50 billion in share repurchases during the fiscal year, which will probably be about 2 or 3 times what Apple is expected to buy back under the current plan during the fiscal year. Apple will update investors sometime in early 2014 if there will be any changes to the current capital return plan, but I think investors should be fine with the status quo. $100 billion in capital returns over a three year plus period is a tremendous amount. I think Apple will raise the dividend nicely in 2014, and I'll be looking for a new buyback once the current plan ends. However, I wouldn't go overboard, cause Apple would either need to borrow more funds for additional buybacks, or repatriate foreign funds and pay taxes. Neither of those seem very appetizing at the moment.

Where Apple stands now:

In the end, Apple's stock will react to the earnings, whether they are good or bad. Right now, Apple seems like a decent long term investment, because the company offers a solid combination of growth and value. In the following table, I've compared Apple against some other top tier tech names: Google (GOOG), Microsoft (MSFT), Intel (INTC), and Cisco Systems (CSCO). Yes, there are plenty of other names you could use as comparisons, but I've used these four tech heavyweights in the past, so let's be consistent.

Source: Seeking Alpha. Article by Bill Maurer

Microsoft lawyer suggests non-U.S. data storage for overseas users: FT

Microsoft Corp's head lawyer has suggested that overseas customers will be allowed to have their personal data stored in non-U.S. data centers, the Financial Times reported on Wednesday.

It would be the most radical move yet by a U.S. technology company to combat concerns that U.S. intelligence agencies routinely monitor foreigners.

A Microsoft spokesperson declined further comment on the remarks that Brad Smith, Microsoft's general counsel, made to the comments to the Financial Times, which published them on Wednesday.

Source: Reuters

'Big Four' accounting firms to appeal against SEC China ruling

The "Big Four" accounting firms have said they intend to appeal against a ruling by the U.S. Securities and Exchange Commission (SEC) that recommends suspending their Chinese units for six months.

In a joint statement, Deloitte, Ernst & Young, KPMG and PricewaterhouseCoopers stressed that the decision was not final or legally effective until it has been fully reviewed and approved by the SEC.

"The firms intend to appeal and thereby initiate that review without delay," the statement said.

"In the meantime the firms can and will continue to serve all their clients without interruption, it said.

The statement follows a 112-page ruling by an SEC judge that has escalated the long-running dispute between U.S. and Chinese regulators over access to audit documents.

Source: Reuters

Asian shares worn down by China worries

Asian Markets, fell on Thursday after a survey of Chinese manufacturers proved surprisingly soft, while the Australian dollar weakened due to its role as a whipping boy when activity in the Asian giant disappoints.

The flash Markit/HSBC Purchasing Managers' Index (PMI) fell to 49.6 in January, from December's 50.5, suggesting a mild slowdown at the end of 2013 has continued into the new year.

"The weak flash PMI will inevitably inflame China slowdown worries, but this is only one data point," said Linus Yip, a strategist with First Shanghai Securities in Hong Kong.

"If more data start to also show a deeper slowdown, Beijing may be forced to stimulate in order to maintain a stable basis for growth that they need to execute reforms.

Shanghai shares slipped 0.5 percent, though investors were still relieved that the country's central bank was flooding money markets with cash to ease a credit squeeze.

Worst hit was the Australian dollar which shed a third of a U.S. cent to $0.8795 as speculators sold it as a liquid proxy for growth in the Asian region.

MSCI's broadest index of Asia-Pacific shares outside Japan also lost 1.1 percent, while Australia's main index dropped 1 percent.

Japan's Nikkei surrendered early gains to be down 0.5 percent on the day. The news from Japan had been better, with a Reuters survey of business sentiment improving for a third straight month in January to reach a high last seen in 2010 as optimists far outnumbered pessimists.

Later Thursday, Europe has its own version of early PMIs along with a round of unemployment figures.

The Eurozone composite PMI is seen edging up to 52.4 in January, from 52.1, led mostly by strength in Germany while France could again lag behind.

Sterling surged after a sharp fall in UK unemployment stoked speculation the Bank of England would have to bring forward the day when it starts hiking interest rates.

That kept the pound firm at $1.6562 on the dollar, while the euro was down at a one-year low of 81.65 pence.

Across the pond, the Canadian dollar fell yet further in the wake of the Bank of Canada's warning that it was growing more concerned about low inflation, leaving the door wide open to a cut in interest rates there.

The central bank also took a rhetorical razor to the Canadian dollar saying a weaker currency would be positive for both exports and inflation.

The contrast with the situation in Britain saw the pound climb to its highest on the Canadian currency since mid 2009 at C$1.8483, a rise of 2.3 percent in less than 48 hours.

The U.S. dollar powered ahead to C$1.1140, encouraged in part by expectations that the Federal Reserve will make another $10 billion cut to its monthly bond-buying programme at its policy meeting next week.

The dollar could not sustain any gains on the yen, however, and eased back to 104.30, while the euro stayed in a well-worn range at $1.3542.

In commodity markets, the Chinese data got the blame for a general softness in prices.

Gold lost ground after its repeated failure to break above key technical resistance at $1,260 an ounce prompted investors to take profits. Spot gold was off at $1,235.40 per ounce, leaving behind Monday's peak of $1,259.85.

Crude oil eased after an industry report showed a sharp rise in crude stockpiles in the U.S. - the world's biggest oil consumer. U.S. crude oil futures dipped 24 cents to $96.49 a barrel, after jumping more than a dollar overnight. Brent oil for March delivery lost 20 cents to $108.07.

Source: Reuters

PayPal challenger Stripe valued at $1.75 billion in funding deal

Stripe Inc has joined the billion-dollar club.

The online payment-processing startup announced Wednesday it raised $80 million from venture capital investors in a deal that values Stripe at a hefty $1.75 billion.

The transaction places the 90-person firm in the rarefied company of startups valued at more than $1 billion just three years after brothers Patrick and John Collison, now ages 25 and 23, debuted their service.

Chief Executive Patrick Collison said the lofty valuation reflected the promise shown by his company, which processed billions of dollars in payments last year for businesses ranging from Lyft, the ridesharing company, to the Museum of Modern Art in New York. The company did not disclose specific details on the total.

Stripe collects 2.9 percent of every transaction plus 30 cents.

"It's a nice validation of what everyone has gotten done over the last year," Collison, who dropped out of the Massachusetts Institute of Technology in 2009 to found Stripe, said of the recent investment.

Collison dodged any direct comparison to PayPal, but he said he was confident the demand for payment processing would only explode in the coming years because only 2 percent of all commercial transactions take place online today.

"There should be more transactions happening on the Internet on a macro basis, whether you believe that should be 20 percent or 40 percent," he said. "Well, what is holding it back? Our goal is to expand Internet commerce. We approach that problem rather than the competitive angle."

Stripe announced its funding on the day when activist investor Carl Icahn called on eBay to spin-off PayPal, a fast-growing unit that has thrived while eBay has grown at a more modest pace in recent years.

PayPal's co-founder, Peter Thiel, who has backed Stripe since its early days, led Stripe's most recent funding round through his venture capital firm, the Founders Fund.

Source: Reuters

Thai court to decide on election complaint; protest march to test state of emergency

Thailand's Constitutional Court said it would decide on Thursday whether to accept a case against holding February 2 election that would almost certainly extend the government's shaky grip on power as protesters try to force it from office.

The government declared a 60-day state of emergency from Wednesday hoping to prevent an escalation in protests now in a third month. That decree will face a fresh test on Thursday when popular anti-government firebrand Suthep Thaugsuban leads a march through the capital Bangkok.

A leading pro-government activist was shot and wounded on Wednesday in Thailand's northeast, a stronghold of Prime Minister Yingluck Shinawatra, in what police said was a political attack, adding to fears the violence could spread.

Nine people have died and dozens wounded in violence, including two grenade attacks in the capital last weekend.

The Election Commission, which has asked for a ruling on the election, argues that the country is in too volatile a state to sensibly hold a national vote and that technicalities mean it is bound to result in a parliament with too few MPs to form a quorum and approve a legitimate government.

"Around 1 p.m. (0600 GMT) today, the Court will decide whether the case would be accepted," Constitutional Court secretary-general Chaowana Trimas.

Source: Reuters

How Caterpillar got bulldozed in China

Asia's top mergers and acquisitions bankers gathered two years ago at the swanky Island Shangri La in Hong Kong to celebrate the top deals of 2012. As the transactions were being toasted, one was unravelling.

Advisers on Caterpillar Inc's $677 million purchase of ERA Mining Machinery Ltd picked up an award for cross-border deal of the year. The purchase was billed as a coup for Caterpillar, the world's top maker of tractors and excavators. ERA was the holding company for Zhengzhou Siwei Mechanical & Electrical Equipment Manufacturing Co Ltd, one of China's biggest makers of hydraulic coal-mine roof supports. Siwei would help Caterpillar gain traction in the world's largest coal industry.

"Siwei was going to be our Chinese business card," said a person with direct knowledge of Caterpillar's strategy.

The night of the awards on November 16 three Caterpillar lawyers were wrapping up an eight-hour grilling of Wang Fu, Siwei's chairman. Major accounting problems had been unearthed at Siwei headquarters in the gritty Chinese city of Zhengzhou. Two months later, on January 18, 2013, Caterpillar said it had discovered "deliberate, multi-year, coordinated accounting misconduct" at Siwei.

Wang was sacked. Caterpillar took a non-cash goodwill impairment charge of $580 million - 86 percent of the value of the deal. The company says it was caught unaware by the problems at Siwei and only discovered them in November 2012, five months after the deal closed.

A Reuters review of hundreds of pages of public documents, as well as interviews with former employees, board members, bankers and advisers, reveals a more complex story. Accounting problems were rampant at Siwei before Caterpillar bought it. Yet at multiple junctures, Caterpillar chose to ignore existing or potential problems and push ahead with the deal.

A year and a half after directors of the Peoria, Illinois-based company signed off on the deal, it has become a case study in how a foreign company with decades of experience in China can still flounder in that market. It also shows how willing some multinationals are to accept risks they might otherwise avoid to establish themselves in the world's second-largest economy.

The deal has triggered legal action against Caterpillar. In May, Caterpillar announced it had settled a dispute with Siwei's controlling shareholder, owned by an heir to the Crown Worldwide logistics company fortune and the former head of the American Chamber of Commerce in Beijing. Four shareholder suits filed in the United States in Caterpillar's home state of Illinois are continuing.

Meanwhile, Siwei has foundered. Former employees told Reuters that as of September, the company had no new orders in 2013, and it had fired or furloughed about half of its workforce.

When it bought Siwei, Caterpillar had been doing business in China for more than 30 years. It had amassed 20,000 China employees, dozens of manufacturing, research, logistics and parts centers and a broad dealer network. It had nine new facilities under consruction, and had just completed the $8.8 billion purchase of Bucyrus, a mining and earth-moving company with significant China operations.

When former Chinese president Hu Jintao dined with a group of American businessmen in 2011, Caterpillar Chief Executive Doug Oberhelman was included.

Source: Reuters