by Tony Sagami on March 26, 2009
in General
IBM announced that it is going to lay off 5,000 U.S. workers and shift many of those jobs to India.
Did you know that 71% of IBM’s 400,000 employees work outside of North America? That ups from 65% in 2007.
Getting computer nerd training was a sure-fire way to a successful technology career a few years ago. Today’s nerds are competing against similarly trained, English-speaking nerds in India.
Very few jobs in America are immune from cheap foreign competition. The next time you read any Reuters or Associated Press stories, check the byline and you will find that many of the personal finance and business stories you read were written by people across the ocean.
And it is why you should keep an eye on Indian technology outsource companies like Infosys (INFY: 60.70 -1.07 -1.73%).
Taiwan-based ChipMOS, a company I visited it during my last trip to Taiwan, is a chip testing company. The last thing you want your new computer to do is not work when you take it out of the box. ChipMOS (IMOS: 0.60 -0.14 -18.92%) makes sure that doesn’t happen.
Business stinks though. Q4 sales dropped by 50% to $93 million from the same period in 2007 and a fell by 30% from the previous quarter.
ChipMOS reported a loss of $178.2 million compared to a loss of $26.7 million the previous quarter.
One of ChipMOS’s largest customers is Intel. Connect the dots folks.
Skidmore, Owings & Merrill, one of the world’s largest architectural firrm and a big beneficiary of the China building boom, is laying off people because of the lack of work in China. “Six months ago we were turning down work,” says Silas Chiow, SOM’s China director, and “the next six months are going to be very, very uncomfortable.”
If SOM is right, you should connect the dots to China Architechtural Engineering (CAEI: 1.16 -0.04 -3.33%), the largest Chinese architectual firm.
by Tony Sagami on March 25, 2009
in General
Japan just won the World Baseball Classic yesterday but its exporting companies are conquering anything.
The Japanese Finance Ministry reported that exports shrunk by 49.4% in in February from the previous year. That is, by the way, the biggest drop in two decades.
That puts Japan on course for its worst depression since WWII.
By the way, the biggest drop in exports was to the U.S. and that should tell you something about the U.S. economy.
You can have capitalism without democracy. People tend to forget that about China.
According to Amnesty International, China lead the world in executions in 2008 with 2,390. That’s about seven people a day!
For perspective, Iran executed 376 people last year.
Don’t get into trouble in China.
by Tony Sagami on March 25, 2009
in General
If you’ve never enjoyed a Chinese ‘hot pot’ dinner, you’re missing out on one of the greatest meals in all of China. You do need a cast iron stomach and an affinity for HOT food. But I absolutely love them.
Yum Brands (YUM: 37.94 -0.21 -0.55%)is pay $63 million for a 20% stake in Little Sheep Group, a 375 Chinese restaurant chains that specializes in mutton hot pot dishes.
Good move. Little Sheep’s stocks has jumped 44% so far in 2009.
The Bank of China reported a 59% drop in its Q4 profits.
The Bank of China owns more U.S. subprime securities of any Asian institutions with $2.59 billion of toxic junk. How toxic? The Bank of China has aleady written off $2.25 billion of it.
by Tony Sagami on March 25, 2009
in General
You’ve probably never heard of him but Zhou Xiaochuan is the Governor of the People’s Bank of China, which makes him the Chinese equivalent of Ben Bernanke and Alan Granspreen. Except even more powerful.
Zhou is recommending a new “super-sovereign reserve currency” to replace the dollar as a the main global currency and “create an international reserve currency that is disconnected from individual nations and is able to remain stable in the long run.”
The world is getting sick of holding our rapidly depreciating dollars and that means that the U.S. dollar could be headed for a big, big haircut.
The Chairman of India’s top economic agency, the Planning Commission, described the corner that Bernanke has painted himself into pretty accurately.
“Fortunately, we have more room for further relaxation unlike some of the industrialized countries where the scope for monetary easing has been pretty much exhausted.”
Former Singapore Prime Minister Lee Kuan Yew said that the optmistic outlook for an economic recovery will be at least 2-3 years but could take up to six years.
The optimistic case is based on a rapid rebound of the U.S. economy. My advice to Singapore is to not hold their breath for the U.S. to recover any time soon.
