Internet Statistics

More policy aid expected for China's small companies

The Chinese government is planning more ways to develop small and micro sized businesses. That’s the word from experts and officials at the ongoing Boao Forum in Hainan Province. The companies can expect lower taxes and fees, and more financial assistance. 

China’s budding businesses say lower fees and taxes are their major want. A survey of China’s micro and small companies done for the Boao Forum shows that 60 percent of the respondents see fees and taxes as their biggest concerns.

The survey came after China already cut fees for small companies last August. The cut favors budding businesses with monthly sales of less than 20 thousand yuan by charging them no value added taxes. Even with the cut, half of the survey respondents said they still want less red tape, easier entry, and more financial aid.

Small and micro companies topped the discussion in the first day of the Boao Forum. Analysts say these companies account for about 60 percent of China’s overall economic output and are struggling with rising costs and policy limits.

More support is around the corner. Draft proposals from several ministerial agencies have been submitted to the State Council for policy review. Lightening the load for small companies would add weight to the most dynamic part of the Chinese economy.

Source: CCTV

Stephen Roach Thoughts on Lower GDP Growth of China

On the Sidelines of the Boa Forum CCTV interviewed Stephen Roach former Chief Economist for the Asian region of Morgan Stanley.
 Chinese  lower GDP Growth of between 7-8% represents a structural change of their economy from an industrial economy to a services economy.
 A more market based economy, will mean certain defaults in some companies, but not big enough to hamper the health of the Chinese Economy. 

Internet finance a hot topic at Boao Forum

Each year at the Boao forum experts from around the world debate hot issues in the business community. This year’s forum, the spotlight falls on internet finance. Academics and professionals are in deep discussion about its impact and significance. 

Heated debate and opposing views. Financial gurus were not holding back on what they think of internet finance at Tuesday’s panel. Alwyn Didar Singh, secretary general of the Federation of Indian Chambers of Commerce and Industry, holds a positive view on this nascent sector, and believe it would be a strong force to drive up economic growth.

On the other hand, former chief economist of the World Bank Justin Yifu Lin expressed his opposing view.

Some other economists at the panel agreed with Mr. Lin.

In a separate panel, professor Chen Zhiwu from Yale University also expressed his negative views on the popular internet finance product Yu’ebao, an online currency fund launched by Alibaba. He said the success of Yu’ebao is because it exploited loopholes in China’s financial supervision.
Source: CCTV

World Bank chief urges developing nations to "get fundamentals right" to tackle impact of U.S. taper

"Getting the fundamentals right" is a more effective way for developing countries to face market impact caused by U.S. taper, World Bank President Jim Yong Kim said Thursday.

The taper's impact was not the same across the entire developing world, as 62 percent of developing countries' currencies actually have appreciated since the Federal Reserve announced taper intention last May, Kim said in his opening press briefing at the IMF-World Bank Spring Meetings.

Market is picking on countries with greater imbalances, greater weaknesses, said Kim.

"So the message is really get back to fundamentals, tackle the basics, and if the fundamentals are in good shape, then the market will recognize that."

He also said that "our hope is that the taper will be gradual, and right now, indications seem to be that everyone intends, including the U.S. Federal Reserve, to make this as gradual as possible."

If the taper happens in a gradual fashion, the growth in the developed economies including the United States, Europe and Japan will offset the decrease in capital inflow into developing countries, Kim said.

"So even though there are these little blips, we think that the outlook for emerging market economies is still very good, " he added.

Source: Xinhua

Sell off on Wall Street spread to Asia

"Japanese shares sank to six-month lows on Friday as an escalating selloff on Wall Street spread to Asia and sluggedmarkets that had been fairly resilient up to now.

What was increasingly looking like a major portfolio shift from momentum plays in U.S. technology and biotechnology stocks was having a knock-on effect across all regions and sectors, pressuring even defensive shares.

Momentum investing involves buying stocks that are already trending higher, often taking their price/earnings ratios into the stratosphere. When the momentum turns it can do so viciously as investors rush to the exits at the same time.

Japan, in particular, was vulnerable both to the dive in tech stocks and to the strength of the yen, which crimps exports and corporate profits. The Nikkei .225 gapped lower right from the off and never looked back, shedding 2.6 percent to 13,936.

A key chart bulwark in the 14,000 to 14,200 zone snapped like a twig, opening the door for a potential retreat to support at 13,750. Tech bellwether Softbank (9984.T) led the way with a drop of 4.8 percent to its lowest in over two months.

The slide followed a brutal day on Wall Street, where the Nasdaq suffered its worst single-day drop since late 2011. The tech-heavy index .IXIC sank 3.1 percent, while the Nasdaqbiotechnology index .NBI plunged 5.6 percent.

Markets across Asia were spooked by the scale of the losses, with Korea .KS11 down 0.9 percent in morning trade and Australia .AXJO 0.7 percent. MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS lost 0.7 percent.

Even the MSCI emerging markets index .MSCIEF eased back a little, a day after reaching its highest for the year so far. The emerging sector has been on a tear in the last couple of weeks as funds cut back exposure to developed markets.

The afterglow from the Greek five year bond, deal combined with the latest drop in U.S. yields helped the euro higher on the dollar. On Friday, the single currency was up at $1.3892 having rallied two full cents over the past four sessions.

The dollar also lost ground to the yen, falling to 101.45 from a high of 102.14 on Thursday. The dollar is now nearing major chart support around 101.20 that has held for much of the past three months and a breach would be bearish.

The dollar index also hit a three-week low of 79.330 .DXY, well below a seven-week high of 80.599 set only last week. It last stood at 79.401.

The fall in the dollar helped gold hit a 2-1/2-week high at $1,324.40 an ounce, though it had eased back to $1,317.14 on Friday.

Oil prices remained soft in the wake of disappointing trade data from China out on Thursday. Brent crude eased 17 cents to $107.29 a barrel, while U.S. crude was quoted down 18 cents at $103.22 a barrel.

Source: Reuters

WSJ: A Warning Signal, Getting Louder

      The Wall Street Journal Reports,"just one day after rallying sharply, U.S. stocks took an even steeper nose-dive, led by the Nasdaq Composite, which saw its worst one-day plunge in terms of both points and percentage since 2011.

We noted in this space just yesterday there was a chance that Wednesday’s rally was a dead-cat bounce, but even we didn’t think the subsequent selloff would come so quickly. By almost any measure of momentum this was a damaging slide. Biotech was hammered hard again, with the iShares Nasdaq Biotechnology ETF down more than 5% on the day, and about 20% off its highs. Several high-tech darling type stocks — Facebook, Netflix, Tesla, Twitter — also got smacked around".

Silicon Valley has been dining out for more than a year on Wall Street's bottomless appetite for growth stories. Like all feasts, though, the bill eventually comes due.

Recently, it has been the hip newcomers picking up the tab. The bruising stock selloff over the last month has targeted newer tech firms with cool terms like "cloud," "big data" and "social" in their business plans. Tech's old-timers, which have lagged behind the market over the last year despite actual profits and positive cash flow, have found themselves in favor once again.

How long "value" will be in vogue is the big question. Clues to the answer may be found in the IPO market.

The willingness of the public market to continue bestowing high valuations on young companies that often lack profits will offer the biggest clue as to whether the recent selloff is a blip or something bigger.

So investors should watch the IPO market closely. This has been frothy: The first three months of 2014 saw 64 companies raise $10.6 billion in the U.S., making it the busiest first quarter since 2000, according to Renaissance Capital.

The tech sector saw 15 deals, raising $2.4 billion, according to Dealogic, making it the best first quarter for the sector since 2004. Barely into the second quarter, another $2 billion has been raised already. And the pipeline is packed: 103 companies submitted their initial IPO filings during the first quarter.

Existing NBG Warrants Date and Price of Exercise. Complete Information. RSVP

Add caption

3 European Banks That Could Be Seeing a Brighter Future Ahead. Getting out of the EURO CRISIS

 "As financial investors analyze the next couple years, it's important to know the current situation and plans in three banking nations that will have significant effects onLloyds Banking Group  (NYSE: LYG  ) , Bank of Ireland  (NYSE: IRE  ) , and National Bank of Greece  (NYSE: NBG  ) .

The reprivatization of Lloyds is being handled in a fairly standard method of share sales. Private sales reduced the government stake from 39% to 33% and the latest institution-only sale reduced the stake to 25%. The government has noted that it would like to offer shares to the public at some point but has stuck with private institutions so far. Based on the current share sale rate, Lloyds could be fully reprivatized by 2015 in time for elections.BritainThe British banking system can rival any nation's banks in terms of size, international presence, and fallout from the financial crisis. The British government currently has significant holdings in two of its major banks but the bank currently undergoing reprivatization efforts is Lloyds Banking Group.

IrelandIreland's financial system was among the worst hit over the past few years as a property and mortgage bubble popped. With many other institutions being wound down, Bank of Ireland remains the only major Irish bank in majority private hands.

Bank of Ireland came out better than its rivals but still left shareholders heavily diluted. The bank has repaid 1.8 billion euros in government assistance and put the government in the black on Bank of Ireland's portion of the bailout. The government retains a 14% stake in Bank of Ireland but doesn't seem to be in much of a hurry to sell it off. Seeing as the government is not playing an excessive role in Bank of Ireland, this stake is not a major drag on the bank.

GreeceGreek banks have been hit hard by a combination of high unemployment, a depressed economy, plunging property values, and major writedowns on Greek sovereign debt. As a result, all four major Greek banks are now majority owned by the government.

National Bank of Greece is the easiest bank for U.S. based investors to access and represents a way to invest in a turnaround in Greek financials. Currently 84% owned by the government, NBG has made operational improvements and was even able to post a profit for 2013. Even as the Greek government has its hands full with other policy and financial issues, there is a method already in place to reprivatize NBG.

During the recapitalization of NBG in 2013, the Hellenic Financial Stability Fund (HFSF) issued warrants to private investors allowing these investors to purchase HFSF's shares at a defined price until Dec. 2017. The warrants are currently out of the money but the exercise price looks well within reach of the Greek economy can come back to life. In that case, private investors would exercise the warrants and purchase HFSF's stake. If the warrants remain out of the money at expiration, HFSF will need to find a new approach".

Source: Motley Fool

WSJ: Greece not all is Beautiful, looking closer to Macro Data

"Not only have investors forgiven Greece for its sovereign debt default only two years ago, but they seem to have forgotten that many of the same economy’s problems persist.

Indeed, the scale of investors’ collective charitableness and amnesia towards what was until recently a market pariah is only made starker by the fact that Sweden couldn’t offload the whole of Wednesday’s bond issue.

Greece raised 3 billion euro in five-year bonds at a 4.95% yield, amid 20 billion euro of orders from 550 accounts. Sweden’s 3.5 billion krona 2025 government bond issued this week only received 3.31 billion krona in bids at an average yield of 2.25%".

Around the time of the default, Greek 10-year yields were hitting 30%. What a difference a couple of years makes.

The difference isn’t just Greece’s economic fundamentals, though they have changed somewhat for the better. The depression is expected to bottom this year, with the economy returning to modest growth of 0.6% after contracting 3.7% in 2013 and 6.4% in 2012.

Yet more than a quarter of the economically active population and half of youth are unemployed. Government debt is seen reaching an eye-watering 177% of GDP this year. And the process of restructuring government and the wider economy remains as fraught as ever.

But the real difference is European Central Bank President Mario Draghi’s promise in the summer of 2012 to do “whatever it takes” to ensure the single currency’s survival.

The effect has been to assure investors that they no longer face the risk of their bonds being converted into another currency if the country withdraws from the euro or of facing default because of such a move.

Press Briefing by IMF Managing Director Christine Lagarde on World Economic Outlook 2014-21015

"Welcome to the 2014 Spring Meetings. You will have seen our numbers in the WEO that was presented a couple of days ago. For those not in the room, we expect global growth at 3.6 percent this year and 3.9 percent in 2015.

The emerging markets and developing economies continue to be the main source of growth, even if a bit slower than in the past, at 5 percent in 2014 and 5.4 percent in 2015. The advanced economies are finally strengthening a bit, with growth projected at 2.3 percent this year, and next year as well. Our overall message, the global economy is turning the corner, but the recovery is still too weak and too slow. So, our bottom line is, fairly good, but not quite good enough, can do better. For some, despite the fact that growth is strengthening, they're not feeling it. We still have 200 million people unemployed.

So, bold actions are needed to generate more rapid, stronger, and sustainable growth, as is outlined in our global policy agenda, what we call our GPA, which I know you have received overnight and I hope has made good reading for you last night. We are sharing it with you for the first time in advance. So, you probably wonder what policymakers are going to discuss during these meetings. We believe that the overriding topic for discussion will be the topic of growth, quest for higher growth, better quality growth, more inclusive growth, and sustainable growth. Now, what does that mean in practice? It means in our view overriding a trio of hurdles.

First, an extended period of low inflation in the advanced economies. The topic has been discussed. We are concerned about this potential risk in advanced economies in general, in the euro area in particular, where we know that prolonged low inflation would hurt both growth and jobs. In this context, it is encouraging that the ECB has reiterated its commitment to use unconventional measures as needed.

Second, we need to act on growth because it is just too low, and we need to act now, and that requires policy actions across the board. In the advanced economies, they need to get the pace of fiscal adjustment right and the normalization of their monetary policy right in due course as well. It will be about timing. It will be about execution. It will be about communication.

In the emerging market economies, they need to strengthen macro and prudential policies to safeguard against market volatility.

In the low-income countries, where growth continues to be strong, they need to guard against the rapid debt buildup that needs to be watched. Short-term growth, but we need to also guard against the risk of low growth in the future. To deal with that we need ambitious and coherent policies to avoid years of subpar growth and to secure global financial stability. That means that all countries, advanced, emerging, and low income, need to step up structural reforms. That is certainly the case in product and service markets, but it is also the case in labor markets. Together with that well-targeted investments, whether private or publicly funded, are needed in quite a few countries, not all.

It also means renewing the momentum on global financial reform and containing financial vulnerabilities emerging in hot spots in various places. For instance, in the non-bank sector, both in the United States and in China, and high corporate debt in emerging economies. And all of that, obviously, is taking place against the rising risk of a geopolitical nature.

Now, how can we get to that destination and face those three hurdles? Clearly, the policies that I have briefly touched on are needed, but what is also needed is cooperation. At the recent G-20 meeting that took place in Sydney, it was noted that with the right policies undertaken by the various countries, and appropriate cooperation between them, growth could actually be higher by 2 percentage points over the next five years. And that is the kind of growth trajectory that would help create jobs and improve the situation of those economies".

WSJ: Greece's Parliament suspended, for one more year, most home repossessions. Approved Dec 22nd 2013

Greece's Parliament suspended, for one more year, most home repossessions. That will keep some 200,000 families off the streets, and their overdue property loans in a state of suspended animation.

The new legislation covers only primary residencies valued at up to €200,000 ($273,000) and households with an annual net income of under €35,000. The total worth of a household's real estate and liquid assets can't exceed €270,000, while bank deposits, shares and bonds can't be valued at more than €15,000. According to the Development Ministry, 90% of Greek homeowners are protected.

 Greece's Big Four banks,National Bank of Greece,Piraeus bank, Alpha Bank and Eurobank who control more than 90% of the market between them—had been pushing for the extension, in a reversal of the way banks normally function. Under normal circumstances, lenders generally want the freedom to seize the collateral of borrowers who have defaulted.

It is a measure of how deeply troubled Greece's banking system remains that the industry has lobbied, both in Athens and Brussels, to preserve the moratorium, which began in 2008.

  Some 24% of Greek mortgages, or €17.4 billion worth, are in default, according to Bank of Greece  data. Greek real-estate prices are already down a third from their peak. A wave of repossessions, followed by widespread sales of the homes at discounted prices, could push prices down another 10% to 15%, analysts say.

That would force the banks to mark down the collateral on their remaining property loans that haven't gone sour, potentially tearing a multibillion-euro hole in their balance sheets.

"The banks certainly agree with extending the ban and their efforts are aimed at making sure it's not eliminated," Paris Matzavras, an analyst at Pantelakis Securities, said prior to the vote. "Extending it is the best case for the banks, rather than a wave of foreclosures that will depress the real-estate market further and weigh on their loan books."

The Greek government, the banks and consumer groups all favor a go-slow approach. That would entail cracking down on the 10% to 20% of borrowers who have the means to repay their loans but are choosing not to because of the moratorium, while leaving genuinely troubled borrowers untouched.

"We have no interest or desire, or the administrative capacity, to turn our banks into real-estate agencies," said a senior banker at one of Greece's Big Four lenders.

In other wobbling euro-zone countries, banks have also been reluctant to recognize the full losses on their loan portfolios. The practice of "extend and pretend," in which banks repeatedly restructure loan terms to avoid having to recognize costly losses, has been widespread in countries such as Spain. But regulators in those countries have pushed the banks to end what they regard as unrealistic forbearance policies.

That probably won't happen in Greece until 2015 at the earliest. Regulators, the banks, the government and the country's international creditors are all grappling with how to begin restructuring the country's mountain of bad debt.

Greece's central bank has proposed taking on the role of an extrajudicial mediator to arbitrate between borrowers and banks. That approach, similar to that taken by Ireland, would allow banks and borrowers to avoid Greece's judicial system, where courts can take up to seven years to resolve a case.

Meanwhile, the country's two largest banks, National Bank of Greece and Piraeus Bank, are setting up in-house divisions to manage and potentially sell some of their bad loans to investors. "No other country has had to deal with such a flood of bad loans," a senior Piraeus executive said.

WSJ: Greek Banking System Needs Additional Capital, March 6th,2014

After a deep, six-year recession, a pricked property bubble, withdrawals by depositors and an unprecedented €200 billion sovereign-debt restructuring, Greece's banks are struggling. This year, they were recapitalized with the help of a European Union loan, but together they still hold some €70 billion in bad loans—a sum equal to a third of Greece's annual gross domestic product.

With bad loans still rising and not expected to peak until late this year, the Bank of Greece had commissioned outside consultant BlackRock Solutions to assess the banks' loan portfolios, something the firm also did in 2011.

The new report, based on the BlackRock stress test, comes almost two years after Greece first received that EU loan—of €50 billion—to recapitalize the Greek banking system. To date, Greece has used up most, but not all, of that loan with roughly another €8 billion still held in reserve. In a statement, Greece's bank rescue fund said it was ready to support the four big banks if they ask for help.

As such, the additional capital needs shouldn't present a major challenge, and are largely in line with market expectations. Just hours after the Bank of Greece released its report, No. 2 lender by assets Piraeus Bank said it planned to raise €1.74 billion through a sale of additional shares to cover capital needs and to retire special preference shares now held by the Greek government.

On Friday, Eurobank plans to follow suit and announce a €3 billion sale of stock, an official at the bank said.

However, in an unusual step, Thursday's long-awaited report was released by the central bank here without the endorsement of Greece's troika of international creditors—currently in Athens—who say the true sum may be €2 billion to €3 billion higher.

This week, talks between the Bank of Greece and representatives of the troika—the European Commission, the International Monetary Fund and the European Central Bank—hit a rare impasse over the issue. They agreed on the goal and some of the terms of the latest stress test: that the banks needed to meet a minimum capital ratio of 8% and that Greece's economy would record a modest 0.6% growth rate this year. But the central bank and the troika remained apart in their estimates of the final capital needs.

"We say it's around €6 billion the banks need, the troika says it's under €10 billion, around maybe eight or nine billion," says a Greek official familiar with the talks. "But they won't tell us how they arrived at their estimate."

That may become clear only later this year when the ECB, which is due to take on a fresh banking oversight role beginning in 2015, runs its own independent stress tests of Europe's banks. Those tests are tentatively scheduled to take place in July, with the final results likely to be released in October or November, analysts say.

WSJ: Articles providing information of NBG 2013 Financial Statements..........

     March 20, 2014 1:38 p.m. ET

  The National Bank of Greece, the largest Greek lender, swung to a robust fourth-quarter profit of more than half a billion euros on tax benefits carried over from earlier years that helped offset continuing large provisions for bad loans.

The bank said it earned 547 million euros ($754 million) in the three months to the end of December, compared with an EUR81 million loss in the third quarter, reflecting EUR531 million in income from deferred tax assets and exceptional items.

Excluding those tax assets and items, the bank had a net profit of EUR16 million in the final quarter of 2013, compared with EUR8 million in the third quarter. Provisions remained high at EUR388 million in the fourth quarter, little changed from the July-September period.

Due to mergers and material changes to Greece's banking system, NBG's latest earnings aren't directly comparable with year earlier data.

After a deep, six-year recession, the pricking of the Greek property bubble, withdrawals by depositors and a EUR200 billion sovereign-debt restructuring, Greece's banks are struggling. Last year, they were recapitalized with the help of a European Union loan, but together the banks still hold some EUR70 billion in bad loans among them, a sum equal to a third of Greece's annual gross domestic product.

After a deep, six-year recession, the pricking of the Greek property bubble, withdrawals by depositors and a EUR200 billion sovereign-debt restructuring, Greece's banks are struggling. Last year, they were recapitalized with the help of a European Union loan, but together the banks still hold some EUR70 billion in bad loans among them, a sum equal to a third of Greece's annual gross domestic product.

Earlier this month, Greece's central bank said the country's four big lenders—NBG,Piraeus Bank SA,  Alpha Bank AE  and Eurobank Ergasias—would need to raise another EUR5.8 billion in total to shore up their fragile balance sheets and cope with that mountain of bad loans.

Updated March 6, 2014 2:20 p.m. ET

"Eurobank, now under state control, faces the biggest shortfall—it needs another €2.9 billion in capital—followed by market leader National Bank of Greece, which must raise some €2.2 billion, the central bank said. Piraeus faces a €425 million shortfall, and Alpha Bank needs €262 million. Including two other, smaller lenders, the capital needs facing Greece's entire banking sector total €6.4 billion. The four big banks hold about 95% of the country's banking-sector assets".

• August 29, 2013, 11:59 a.m. ET

Leading Greek Lender Returns to Profit

ATHENS--National Bank of Greece SA (NBG), the country's leading lender, turned a profit in the first half of the year, boosted by gains from international operations and lower provisions for bad loans at home.

The bank reported a net profit of EUR344 million versus a loss of EUR1.9 billion in the same period a year earlier. For the second quarter of 2013, NBG postd an adjusted net profit of EUR126 million.

With the country in its sixth year of recession, NBG booked EUR853 million in losses on sour loans, down 29% year-on-year.

The bank, which had expanded into neighboring markets before the country's debt crisis erupted three years ago, said that operations in southeastern Europe were starting to turn profits. Its Turkish unit Finansbank added EUR180 million to the bank's core profitability.

"NBG has the comparative advantage of its significant presence both in Turkey and Southeast Europe, dynamic regions that enable it to diversify its sources of income, thus adding substantial value to the group," said CEO Alexandro Tourkolias in a statement.

"Our second quarter performance adds to the more optimistic climate. In particular, the group's core profitability was positive for a third consecutive quarter, pointing to a return to healthy results, a necessary condition for sustainable growth."

Net interest income, a measure of the bank's core revenue, fell 9% year-on-year to EUR1.6 billion.

Like other Greek lenders, NBG said that it has improved its funding mix and reduced its reliance on emergency loans from the Greek central bank, which fell below the one billion mark at the end of August.

Boao Forum: Premier Li highlights Asian integration, China's growth impetus

BOAO, Hainan, April 10 (Xinhua) -- Chinese Premier Li Keqiang on Thursday said China will forge ahead with other Asian countries, sharing weal and woe, to open up new vistas from Asia's development.

China's economy has got off to a stable and good start this year, Li said when delivering a keynote speech at the opening ceremony of the Boao Forum for Asia (BFA) Annual Conference 2014 held in Boao, a coastal town in south China's Hainan province.

Li's remarks came as China's stumbling trade figures weighed on the market confidence over the country's economic strength.

Exports slumped by 6.6 percent in March from a year ago and imports were down 11.3 percent, the General Administration of Customs said Thursday.

Li assured his audience of over 1,000 Asian political and business leaders that China's development has strong resilience, despite downward pressure and difficulties.

CHINA'S GROWTH IMPETUS

"We have the capabilities and confidence to keep the economy functioning within the proper range," Li said.

The world's second largest economy has set its target of economic growth for 2014 at about 7.5 percent.

"As long as there is sufficient employment and no major fluctuations, actual GDP growth will be within the proper range, be it slightly higher or lower than the target," he said.

China will generate impetuses for growth by deepening reform, adjusting the economic structure and improving people's livelihoods, the premier said.

Li also emphasized a new stage of quality and performance, after rapid growth over the past three decades and more.

The government will not resort to short-term stimuli because of temporary economic fluctuations and will pay more attention to sound development in the medium to long run, said Li.

Li is confident that the government has equipped itself with new weapons in the macro-control arsenal, and tried to disperse market jitters over future development, said Wang Jun of China Center for International Economic Exchanges, a government think tank.

During his speech, Li numerated conditions for the economy to achieve sustained and sound growth.

China has a big economy and large foreign exchange reserves. There is still great room and opportunity in the new type of industrialization, IT application, urbanization and agricultural modernization, the premier said.

Narrowing the gap between urban and rural areas and among different regions will also unleash huge potential for growth, he added.

Before elaborating on China's economy, Li gave time to calls for Asian countries to re-energize the region in face of new developments and new challenges.

Asian countries need to build a community of shared interests, common destiny and shared responsibilities, Li said.

"Economic integration is central to development in Asia," said the premier.

Asian countries need to work together in liberalizing trade and facilitating investment, as well as upgrading regional and sub-regional cooperation, he added.

China will work to advance negotiation on the Regional Comprehensive Economic Partnership (RCEP), and is taking an open position towards the Trans-Pacific Partnership (TPP), Li said.

Wang said RCEP will boost Asian integration by improving policy-making communication, infrastructure connectivity, trade, currency swaps and people-to-people exchanges in the region.

Li also highlighted the importance of a peaceful and stable regional environment, urging Asian countries to build consensus, make active efforts and jointly fulfill their due responsibilities.

Li underscored again China' s commitment to peaceful development and its resolution to defend its territorial sovereignty.

"We will give full support to initiatives that help strengthen maritime cooperation," Li said, "on the other hand, we will respond firmly to provocations that undermine peace and stability in the South China Sea."

The premier's speech made clear that China's development is based on cooperation with other Asian countries, which will in return benefit Asia' s overall development, said Zhao Qizheng, former minister of the State Council's information office

"The speech displays China's aspiration to realize Asia's common prosperity, and it also shows the country's willingness to shoulder its international responsibilities," Zhao said.

As an international non-governmental and non-profit organization founded in 2001, the BFA works to promote regional economic integration and bring Asian countries closer to their development goals.

The theme for this year's conference is "Asia's New Future: Identifying New Growth Drivers" .

Australian Prime Minister Tony Abbott said BFA now rivals Europe's Davos Forum held in Switzerland, and does so much to showcase the Asian-Pacific region.

"I'm pleased to be the fourth Australian Prime Minister to attend the forum, and will be a regular participant in the future," he said.

Source: Xinhua

Justin Yifu Lin said Tuesday,Emerging economies should help set world trade rules * former Chief Economist and Senior Vice President of the World Bank

Emerging economies, particularly China, should help draw up new world trade rules, former Chief Economist and Senior Vice President of the World Bank Justin Yifu Lin said Tuesday.

Lin made the remarks at a TV panel discussion at the ongoing Boao Forum for Asia in south China's Hainan Province.

As an important trading partner for all major economies around the Pacific rim, China should join in the discussion of the Trans-Pacific Partnership (TPP) that includes members like the United States, Australia and Japan.

The old world trade rules were set up by advanced industrial nations, Lin said, but with the rise of other economies, the world must accept a new scenario and allow emerging economies to draw up new rules for the world trade.

Zhiwu Chen, professor of finance at Yale University, who also joined the discussion, said Asian countries should build mutual trust to help ease geopolitical tensions in response to signs of slowdown in the economic integration process in Asia over the past several years.

Alwyn Didar Singh, secretary-general of the Federation of Indian Chambers of Commerce and Industry, said Asian countries should strive to promote the development of Asean+N free trade zone model in a bid to promote economic integration.

With deepening economic integration and global industrial division, the benefits of free trade can be demonstrated by places with comparative advantages churning out goods at competitive prices, said Singh.

Source: Xinhua

Nasdaq Tumbles, S&P 500 is on track to end below key support 50-day moving average

U.S. stocks sank on Thursday, with the Nasdaq Composite falling the most in a day since June 2012 as investors again sold high-flying names in the technology and biotech sectors.

The S&P 500 was on track to close below its 50-day moving average for the first time in more than two months. The broad index also broke below the 1,840 level that has served as technical support since late February.

The Dow Jones industrial average .DJI fell 259.19 points or 1.58 percent, to 16,177.99. TheS&P 500 .SPX lost 37.68 points or 2.01 percent, to 1,834.50. The Nasdaq Composite .IXIC dropped 130.017 points or 3.11 percent, to 4,053.884.

Source: Reuters

US TECH AND BIOTECH SLUMP

Putin warns gas Taps to Ukraine can be Turned OFF

  Source: Dow Jones Newswire

WSJ: U.S. Stock Indexes Data by Sectors

WSJ: Markets in Thrall to Central Banks,Dislike disappointing data

           The Wall Street Journal Reports,"'We’ve had more proof that financial markets are in thrall to central banks rather than caring about the health of the economy. Data out of Asia and Europe were disappointing, with China suffering a drop in both exports and imports and with industrial production in Italy softening as deflation worries persisted in France. Yet markets are stronger everywhere today. In Asia, that was partly explained by the largely expected but still significant news that China will allow Hong Kong shares to trade in Shanghai, marking a further easing in capital controls. But the real driver has been expectations of continued monetary accommodation from central banks. First, it was the minutes from the Federal Open Market Committee yesterday, which gave the impression that the Fed is eager to convey a message that it wants to keep providing long-term stimulus. Then it was the poor data in Europe, which, rather than unnerving investors, simply raised expectations that the European Central Bank will take aggressive steps to ward off deflation''.

''March trade data for China  surprised sharply to the downside, but analysts noted that it was largely due to the distorting effect on the comparative from a year ago, when overinvoicing artificially inflated the value of exports as companies tried to skirt limits on bringing cash into the country. Exports dropped 6.6% on-year vs. 4.2% growth expected, while imports fell 11.3%, leading to a trade surplus of $7.7 billion after an unusual monthly deficit in February.

The March trade data is important because it’s the first month not affected by the Lunar New Year distortion, and the headline figures raised questions about the strength of China’s economic growth. Still, most observers noted that overinvoicing was at its peak a year ago, so the apparent decline in exports especially should be taken with a big grain of salt (indeed, the decline compared to last year was most precipitous in exports to Hong Kong and Taiwan, the two key sources of false invoicing). Accounting for that discrepancy, analysts said exports likely grew 5%-7% on-year. More problematic is the decline in imports, which adds to the picture of China’s slowing growth. SpeakingThursday, Premier Li Keqiang reiterated that the leadership wouldn’t be troubled if growth comes in a bit below their 7.5% target for the year''.

A Contrarian Approach to Investment, Greece. Don't expect an hyperbolic Rise. Risk vs Reward have changed.

For most investors, Greece represents economic catastrophe and is seen as a good way to make money disappear. But the worst may be coming to an end in this mediterranean nation and investors could be ready to pour the money back into the Hellenic Republic.

Progress so farAlthough Greece still has unemployment figures north of 25%, meaningful progress is being made in other categories. In a recent article in The Guardian, Greece's finance minister, Yannis Stournaras, highlighted some of the examples.

• Current estimates predict positive economic growth for Greece in 2014
• 10 year Greek bond yields have dropped significantly to within 550 basis points of German debt
• Major Greek banks are successfully raising capital
• Unemployment appears to be stabilizing
• Government reforms are making Greece more competitive
• Net tourist receipts increased 18.1% for 2013 and exceeded targets
• Exports of goods and services rose 1.8% for 2013

Return of the money?For the past few years, raising money in Greece has been extremely difficult. In mid 2013, only three of the four major banks were able to raise even 10% of their capital needs from private investors and National Bank of Greece (NYSE: NBG  ) just squeaked over the minimum requirement for private capital sourcing. At the same time, the Greek government itself was reliant upon loans from the troika to meet its own obligations.

The situation is very different today for both Greek companies and their government. To meet capital requirements, Piraeus Bank and Alpha Bank raised a combined 2.95 billion euros from private investors. National Bank of Greece needs to come up with 2.2 billion euros in additional capital but has already said it will not need to issue new common shares while naming asset sales as a potential way to raise capital. Even virtually nationalized Eurobank is attracting private investor interest where interest from private investors currently exceeds the bank's minimum capital requirement.

The Greek government could also begin to tap the private sector again. Recent reports suggest that the government is looking to return to the private markets in the next three months through the sale of a five year bond.

Source: The Motley Fool

U.S. Jobless claims fall to nearly seven-year low

 The number of people who applied for U.S. unemployment benefits last week fell to a nearly seven-year low of 300,000, a sign the labor market might be experiencing a spring revival. Initial claims in the seven days ended April 5 sank by 32,000 from a revised 332,000 in the prior week, the Labor Department said Thursday. The last time claims were that low was in May 2007, six months before the Great Recession began. Economists polled by MarketWatch expected claims to total a seasonally adjusted 320,000. The average of new claims over the past month dropped by 4,750 to 316,250, marking the second lowest read since the end of the recession. The monthly figure smooths out the jumpiness in the weekly data and offers a better look at underlying labor-market trends. Also, the government said continuing claims decreased by 62,000 to a seasonally adjusted 2.78 million in the week ended March 29. Continuing claims reflect the number of people already receiving benefits. Initial claims from two weeks ago were revised up to 332,000 from 326,000.

Source:  Marketwatch

Greek Bond Sale Tops $4 Billion in Return to Markets Should we take a chance?

Greece ended a four-year exile from international markets with a bond sale of 3 billion euros ($4.2 billion), more than the government estimated.

The coupon on the bond, which will be settled next week, is 4.75 percent, with almost 90 percent of the issue going to long-term investors outside Greece, the Athens-based Finance Ministry said in an e-mailed statement announcing the sale. The order book for the issue exceeded 20 billion euros, according to a person familiar with the matter who asked not to be identified because he isn’t authorized to speak about it. A Greek government official told reporters in Athens yesterday that the country sought to raise 2.5 billion euros.

“Greece returns to the bond markets under the same or even better terms than Ireland andPortugal,” Greek Deputy Prime Minister Evangelos Venizelos told reporters in Athens earlier today after meeting with Prime Minister Antonis Samaras.

“We welcome this,” Poul Thomsen, the IMF’s mission chief to Greece, said yesterday. “It’s a fundamental objective of the program to bring Greece back to market and this is an important milestone in this regard, and that clearly speaks to the success of the program.”

The yield on Greek 10-year bonds climbed five basis points, or 0.05 percentage point, to 5.94 percent at 2:24 p.m. Athens time. The rate fell 27 basis points yesterday, and touched 5.80 percent, the least since February 2010.

Greek securities returned 33 percent in the year through yesterday, the most among sovereign-debt markets tracked by the Bloomberg World Bond Indexes.

Greece won approval this month from euro-area members for an 8.3 billion-euro aid payment, the first disbursement from its bailout program since December. The government and European Union predict that the Greek economy will expand 0.6 percent in 2014 after six consecutive years of contraction that has cost about a quarter of the nation’s economic output and sent theunemployment rate surging.

“The real economy is showing encouraging signs of recovery,” Greek Finance Minister Yannis Stournaras said at a conference in Athens today.

   Source: Bloomberg

   Not a bad idea to take a chance on Greece,now that the picture is much better.