Interview in OpalesqueTV: ” Melvyn Teo, Singapore Management University, Director BNP Paribas Hedge Fund Centre “

From the page on the OpalesqueTV youtube channel. This is video from 2010, but I thought it still carries relevance and long-term logic:

Opalesque’s first CAMPUS series features Melvyn Teo, Associate Professor of Finance at Singapore Management University. Teo is also Director of the BNP Paribas Hedge Fund Centre at the Singapore Management University.

In this Opalesque CAMPUS, Teo shares his findings that hedge funds charging lower than average performance fees tend to have a higher liquidity risk, which will translate into problems for investors, when they try to pull money out of the fund. One example of such a problem is the “return impact” of redemptions, when the return of the fund tends to fall in the next month.

Teo also gives specific recommendations what investors can do to better understand the liquidity risk a fund may carry.

 

China and the renminbi matures | Jim O‘Neill at Bruegel.org

 

An excellent take by Jim O’Neill on the framework for People’s Republic of China monetary policy. Should we agree with China replacing Russia on G8…..:

” Many observers have noticed China’s weaker export performance — one cause of the smaller surplus. But the rise in Chinese imports gets less attention. In a new paper for Bruegel, a European think tank, Alessio Terzi and I discuss world trade (which is changing rapidly) and global governance (which isn’t). The paper emphasizes that China’s role as an importer is on the rise. Already, its share of global imports, at roughly 10 percent, is not far short of the U.S. share. The latest data strengthen my belief that by the end of 2015, China may well be the world’s biggest importer of goods and services.

China has successfully moved toward more balanced trade while managing its currency more closely than many would have liked. That ought to command some respect — and the same goes, if you ask me, for the thinking of the Chinese leadership on the pace of reform in domestic finance, and on whether and when the renminbi should be granted a bigger role in global finance. We’ll probably hear more from China on that second issue soon. I think it’s time for the International Monetary Fund to consider including the renminbi as part of the Special Drawing Rights basket. (An updated assessment of the SDR’s role is due by the end of 2015.)

Why not go further? Russia’s actions in Ukraine have prompted the idea that it should be kicked out of the Group of Eight. Maybe that place should be offered to China instead. ”

 

China and the renminbi matures | Jim O‘Neill at Bruegel.org.

The New South Sea Bubble…..?

This interesting Bloomberg article that I received as an alert, rightly reminded and alerted me to the possible potential conflicting situation regarding Southeast Asia Seas, with its increasing importance on the Global International Trade Landscape. The American Vice-President  Joe Biden does not share the concern of many, and in the recent visit to Singapore he made his demarches on this issue to  Japanese and Singaporean counterparts. We feature here his Bloomberg interview on the subject as well:

http://bloom.bg/15XCIw5

Important point is emphasized by Biden on the fact that the USA is a Pacific Power, America isn’t going anywhere and for the most part the success of the region rests on the stewardship of America’s military presence there.

Even if we could make this last point a bit contentious, it is without doubt that the increasing importance of Asia and Southeast Asia in the International Trade arena in general certainly stems in large part from the commitment of the United States to the region, and not just on Diplomatic, political or military fronts, as we could well easily notice the strong economic and corporate presence and interests of American companies of various sorts.

What is most relevant, I suppose in the article is the push of Biden to China to fend off and sign a ‘Code of Conduct‘ for operation on the region’s Seas, which indicates that there’s still the potential for diplomatic and political frictions on the issue. Despite the obvious interest of all parties that there will be a smooth and peaceful resolution of any friction. China, as a major player, and one that will certainly continue to grow in weight and importance, has also major responsibilities in avoiding any conflict or unpleasant difficulties for the free trade that benefits all in the end.

And given the huge yet to be discovered potential of the Southeast Sea….:

‘ China National Offshore Oil Corp. estimates the South China Sea may hold about five times more undiscovered natural gas than the country’s current proved reserves, according to the U.S. Energy Information Administration.

China, the world’s second-biggest economy, rejects U.S. involvement in South China Sea matters. While it has said it wants a code of conduct in the waters, it also seeks to resolve territorial disputes on a bilateral basis. It views the other countries as aggressors, accusing them of breaching a previous agreement on operating in the area.’

….it isn’t hard to see what is at stake.

With stakes that high, agreement is a common sense result.

Last but not least, there’s a reference to North Korea’s nuclear ambitions, that seemed to have escalated the tensions in the region, and the US concern and bid to contain it. As far as China’s views are of concern this is abusive on the part of the US. But  Japan, on its part just wants to be able to regain some military weight, after the heavy restrictions of the World War II defeat, which I see as understandable in a world unpredictable and with danger where we don’t expect! Shivering….Biden tell us that everything will just be economic and diplomatic…..peaceful diplomacy. The world hopes he is right and successful….