MSCI Emerging Market Index and Chinese A shares

Investors will run across the initials MSCI and wonder, what is MSCI?  MSCI Inc. is a U.S. based company that compiles and publishes a series of indices such as the MSCI World Index and is the largest indexing firm in the world.   For example, the MSCI Emerging Market Index is used by global investors as … Continued

The Risk of Investing in North Korea

An article appeared in The Wall Street Journal yesterday discussing the Obama Administration’s plan to impose sanctions or fines on foreign banks who conduct business with North Korea.  After finishing the article I had to wonder why any company would wish to do business with North Korea after a very recent disastrous event for one … Continued

How Green is Green?

In the case of electric vehicles (EVs), it depends. Governments have become increasingly aggressive in encouraging the purchase of EVs, with subsidies, both at the manufacturing and consumer level, and through fuel economy mandates.  But is this really a good idea and will it reduce emissions? Bernstein Research, which studied the car market in Hong … Continued

Yield Hunting

Argentina is a serial defaulter. Argentina’s most recent default, more than $80 billion, began in 2001, and was only recently fully resolved after various classes of debt holders accepted significant losses. In April 2016 Argentina sold $16.5 billion of new dollar denominated debt ranging from three to 30 years, with a yield of 8% on … Continued

U.S. LNG Exports a Potential Game Changer

A few days ago, the first export cargo of liquefied natural gas (LNG) departed the U.S. for Europe.  While current export volumes of natural gas to Europe from the U.S. are nominal, the longer term implications are material. Western Europe is highly dependent on Russia’s Gazprom for natural gas supplies.  The availability of increasing volumes … Continued

Stock Market Circuit Breaker

As a Chinese native and resident for most of my life, I have been watching the equity markets there with great interest these past several days.  I am hopeful that my friends and family there are conducting their affairs with a clear mind. The Chinese stock market circuit breaker rule was implemented on January 4th … Continued

The Iran Nuclear Deal and Investors

It is becoming apparent that the administration’s proposed nuclear deal with Iran is likely to go forward.  While there is considerable uncertainty and reluctance in Congress, at the end of the day, there do not appear to be enough votes to halt the process. For investors, the key issue is uncertainty.  Not uncertainty as to … Continued

China Devalues its Currency. Good or Bad?

After an unexpected report of a year over year drop in Chinese exports of -8.5%, the Chinese government, literally overnight, devalued its currency, by just under 2%.  Translation: The Chinese government reduced the value of its currency, which makes the price of the goods it produces cheaper/more attractive to foreign buyers.  For example, a Chinese product that … Continued

Saudi Arabia, Oil and Predatory Pricing

According to Wikipedia, predatory pricing is a pricing strategy where a product or service is set at a very low price, intending to drive competitors out of the market, or create barriers to entry for potential new competitors.  The objective of this strategy is to eliminate enough competitors to allow monopoly pricing in the future. … Continued

The Greek Dilemma

The problem, in short, is that Greece cannot meet its financial obligations in a timely manner and, perhaps, not at all.  Negotiations with Greece’s creditors are at an impasse and both sides are engaged in a high stakes game of chicken. Neil Irwin, a senior economic correspondent of The New York Times, recently commented on … Continued


On April 8, 2015, Stratfor, a geopolitical research institution, reported the April 7th dispatch of the U.S. State Department Counselor, Dr. Thomas A. Shannon, Jr., to Caracas, Venezuela, following Venezuelan President, Nicolas Maduro’s public request for a meeting between ambassadors of the two countries. This meeting directly preceded the Seventh Summit of the Americas, hosted … Continued

Germany’s Problem With Greece’s Debts

J. Paul Getty (1892-1976) provided an excellent summary of Germany’s problem with Greece’s debts.  “If you owe the bank $100, that’s your problem.  If you owe the bank $100 million, that’s the bank’s problem.” With that in mind, it will be interesting to see how this issue plays out over time. All comments and suggestions … Continued