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General

On Slack: Yes Bank NPA battle, Vodafone IPO, China's housing bubble, 10% reservation, Facebook friends = Related Party, Bad-loan menace, Mr Modi & markets, Puerto Rico Default and much more…

The Slack Discussions

The Slack group at Capital Mind Premium has been extremely active and if you haven’t been there, pop us a note by replying to this email. (If you’re a trial member this probably sound like Greek to you; it will be available when you sign up!)

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A brief summary of some of the interesting things discussed there in the last few days:

#stocks: How YES Bank battled NPAs and came out unscathed

Despite 65 per cent of its loan book in the corporate sector, YES Bank has managed to keep its NPAs low, which needs appreciation. (Link)

#general: Vodafone India Mandates for Up To $3 Billion IPO: Report

UK telecom giant Vodafone has mandated Bank of America Merrill Lynch, Kotak and UBS as joint global co-ordinators for the IPO of its Indian unit, according to two sources.

The IPO is expected to raise $2 billion-$3 billion, potentially smashing the Rs 15,500 crore (US $2.3 billion) record of Coal India as the country’s largest float. (Link)

#general: Jeff Bezos made $6 Billion in 20 Minutes This Week. How Was Your Thursday?

Bezos’s take? He made $6 billion in 20 minutes. (Last October, on the same day that Brin and Page made so much money, Bezos pulled in $2.9 billion). (Link)

#macronomics: China’s housing bubble is starting to look a lot like the US in 2006

China’s property market is staging a major turnaround as property prices in tier 1 cities have heated up quickly over the past few months.

For the first quarter, residential prices in Shenzhen are up nearly 80% year-over-year, while those in Shanghai were up by roughly 65%, according to figures cited by Capital Economics analysts. (Link)

#general: Gujarat announces 10% reservation for economically backward in general category

The Gujarat government says families having an annual income of Rs6 lakh or below will be eligible to avail the reservation. (Link)

#stocks: Facebook friends will be treated as Related Party: SEBI

SEBI in a landmark judgement considered Facebook friends as related party. The result of such judgement led to a penalty of more than Rs. 2 crores. This will change the way the officers of a company look into the social media platforms and their approach in dealing with these platforms. (Link)

#general: the method in the madness of Leicester city’s success

Leicester City stand on the brink of English football’s greatest-ever miracle: a team widely tipped for relegation are about to win the Premier League title. This is unique enough in English football history. But in the context of such unequal wealth distribution between top-flight teams, it is verging on unfathomable. The scale of this achievement is unprecedented in English football, maybe even all team sports. (Link1) (Link2)

#macronomics: Recent rise in yen ‘extremely worrying’, says Japan’s Finance Minister Taro Aso

Japan’s finance minister said late on Saturday (April 30) that the recent sharp rise in the yen is “extremely worrying”, adding Tokyo will take action when necessary.

The remarks, which suggest Tokyo’s possible market intervention, came after the Japanese unit surged to an 18-month high against the dollar in New York on Friday. It extended the previous day’s rally, which was boosted by a surprising monetary decision made by the Bank of Japan. (Link)

#general: One Top Taxpayer Moved, and New Jersey Shuddered

Last month, during a routine review of New Jersey’s finances, one could sense the alarm. The state’s wealthiest resident had reportedly “shifted his personal and business domicile to another state,” Frank W. Haines III, New Jersey’s legislative budget and finance officer, told a State Senate committee. If the news were true, New Jersey would lose so much in tax revenue that “we may be facing an unusual degree of income tax forecast risk,” Mr. Haines said. (Link)

#macronomics: On Close Inspection, India’s Sharp Growth Picture Gets Fuzzy

World-beating GDP figure is based on infrequent surveys, rough estimates of tiny, cash-based enterprises (Link)

#macronomics: The Bank of Japan – When easing gets hard

As monetary policy hits the buffers, policymakers blame big companies. (Link)

#macronomics: Rajan asked to explain ‘real causes’ of bad-loan menace

The Governor had submitted his report to the Public Accounts Committee and put the blame on ‘overall economic downturn’. (Link)

#general: In a first, IWMI helps Gujarat farmers form solar cooperative

With the help of Colombo-based International Water Management Institute (IWMI), six Gujarat farmers have formed world’s first solar power cooperative society to sell surplus power generated from solar water pumps installed at their farms. (Link)

#general: Debashis Basu: Mr Modi & markets – The next 3 years

(Link)

#macronomics: China laying off millions: Why it will be a huge test of political tenacity

The massive shift from equality and egalitarianism to income inequality and unemployment considerably gnaw the heart of “Zhongguo Meng”—the “China dream” (Link)

#forex-commodities: Gold Keeps Shining as Funds Miss Out on Best Rally in Two Months

(Link)

#general: Craig Wright reveals himself as Satoshi Nakamoto

Mr Wright could well be Mr Nakamoto, but nagging questions remain. (Link)

#general: Thoughts on Business Insider

CNN journalist Tanzina Vega went on a tweetstorm this morning about the state of journalism, based on some thoughts about the CNN Money story this week about why so many people have left Business Insider over the last few months. (Link)

#stocks: JSW Energy to bail out JSPL by acquiring Chhattisgarh power plant

Sale of the power plant will help JSPL address its interest payment obligations, pare overall debt of Rs.42,500 crore. (Link)

#macronomics: Puerto Rico to Default on $422 Million Bond Payment

John Herrmann, rates strategist at Mitsubishi UFJ, and Michael Holland, chairman at Holland & Co., discuss Puerto Rico’s announcement that the commonwealth will default on a $422 million bond payment for its Government Development bank. They speak on “Bloomberg Surveillance.” (Link)

#general: Will be surprised if Nifty re-tests 7200: Rakesh Jhunjhunwala

Rakesh Jhunjhunwala, Partner at Rare Enterprises, said markets have been looking up of late. But they have mellowed somewhat from the time Narendra Modi took over as the prime minister. (Link)

#macronomics: 6 Indicators of India’s Looming Demographic Disaster

With fears that India is experiencing jobless growth and scepticism abounding that the country may not be able to cash in on its “demographic bonus”, the world’s largest working-age population—869 million by 2020—because of limited progress on health, education and job skills, we identified six warning signs. (Link)

#stocks: Value investing: myth and reality

(Link)

#macronomics: No Alternative to Low Rates for Now, ECB’s Draghi Says

(Link)

#general: U.S. data is being leaked, ECB study suggests

Key U.S. economic information may have been leaked ahead of its release, judging from the price moves in key equity and bond futures contracts, according to a study released Monday.

The European Central Bank published a working paper — which means it hasn’t been peer reviewed as yet — arguing that seven out of 21 market-moving announcements show evidence of “substantial informed trading” before the official release time. (Link)

#general: A Glimpse Into the Future of Banking: India’s First Bank in an App

(Link)

#forex-commodities: World’s Longest Negative Rate Experiment Shows Perversions Ahead

(Link)

#stocks: IndiGo continues to impress with Q4 and full year FY2016 results

(Link)

#general: India Is Desperate for Toilets but isn’t reaching Its Construction Targets

Indian authorities failed to achieve their last year’s target of constructing 2.5 million toilets in urban areas.

Authorities built only 1.32 million of the planned toilets for individual households by the end of the fiscal year ended March, falling short of the aim by 46%, according to the latest data announced by the Ministry of Urban Development in Parliament. (Link)

#general: Will not get fair trial or justice’, says Vijay Mallya, resigns from Rajya Sabha

Independent MP and liquor baron Vijay Mallya, facing a case of loan default of over Rs 9,400 crore, resigned from Rajya Sabha on Monday, a day before Ethics Committee of the Upper House was set to recommend his expulsion.

In his resignation letter to Rajya Sabha Chairman Hamid Ansari, he said he does not want his “name and reputation to be further dragged in the mud”. (Link)

#general: Bengaluru Will be Unliveable in Five Years, Warns IISC Study

India’s Silicon Valley will be unliveable in the next five years screams an ‘alarmist’ headline in leading English newspaper “Deccan Herald”. It has carried an article based on a study conducted by the reputed Indian Institute of Science (IISC), Bengaluru which presents a bleak picture for the city.

The IISC study claims that Bengaluru has witnessed an alarming growth of built–up area in the last 40 years. The growth has been a phenomenal 525%. It also says that the vegetation of the once “Green City” Bengaluru has seen a decline of 78%. (Link)

#macronomics: BOJ sees little reason to act when households aren’t listening

Bank of Japan Governor Haruhiko Kuroda has a big problem. His radical monetary policy experiment has always been aimed at convincing the public that an end to deflation is near – and right now the public aren’t listening.

Concerns that a fresh burst of stimulus would be wasted on households and businesses so far unconvinced by the bank’s foray into negative rates, on top of huge money printing, were among the key factors behind last week’s decision to hold off from further easing, according to sources familiar with BOJ thinking. (Link)

#general: The Unhappy Prince: How Reliance Buried a Book

(Link)

#general: Supreme Court to Modi government on pollution: You people are just sipping coffee and doing nothing

“You people are just sipping coffee and doing nothing,” the Supreme Court observed today while rapping the government for not coming forward with some solutions to reduce pollution levels due to vehicular emissions, saying “it is the matter of life.” (Link)

#general: Oh, mister, mister! Why won’t you offer a tip, mister?

(Link)

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