Saturday, September 26, 2009

China

With reference to Straits Times on the 22 Sep., 09, let’s look at China on the whole today, after the financial crisis.




Recently, we can see that export demands by the United States has only recently picked up. Manufacturers are obviously suffering from the depressed demand but right now we see a rise in the employment as shown by the China’s National Bureau of Statistics. “Number of unemployed migrant workers has fallen to 4.2million by end June from 20 million early this year in construction and manufacturing.”




Looking at the nature of China’s economy, we can see that they have a strong reliance on export demands because they are export-orientated. The recent demand is mainly due to the effects of new orders in preparation for Christmas up ahead. Local demand is definitely not enough to revive the industry and it fails to support the growth of the industry per se. The sudden rise in export demands is only temporary and should not be depended upon because once Christmas is over; United States is probably going to play safe on imports once again. If China placed too much emphasis on them again, it will have to suffer the disastrous consequences.



Nonetheless, we can see that the government are China is encouraging strong loans and stimulus spending. I believe that this move is to encourage local spending. With strong loans, companies will be able to purchase products locally which will probably come at a discount. With stimulus spending, the locals will naturally demand more as a result of tax relief and the provision of credits by the government. They will then feel more at ease when they purchase, on one hand they can help push the economy and on the other, they can satisfy their own needs.




Nonetheless, we can obviously see a recovery in China with the rise in investment and industrial production. There is a total of 7% rise in foreign investments in China. This is probably one of the best time to invest in China because the government is high on their stimulus package and their loans are relaxed with an all time low interest rates. If companies are able to sustain themselves in China through this dire period, they are probably going to reap fantastic and surreal rewards in the long run as China will definitely emerge as the next top economy ahead of United States and Japan.



But, looking at its stimulus package, it seems to be focussing on the prime sectors and bigger firms, such as the steel and cement industry which helps to provide materials for construction. Small and medium enterprises on the other hand are facing deep trouble because their demise is not going to have a huge impact on the gargantuan country.



It seems that they are pretty smart because right now, they are currently tailoring their production to suit the local needs since the demand from the West can no longer be relied upon. They won’t be able to sustain themselves if they do not feed on the local demands.



However, the local consumers are thrifty in nature and I do not think that will start to spend at this point in time. Like many others, they are probably going to sit back and relax for a while and see how this post-crisis period develops along the way before they start to enter the fray. It is understandable that they are not willing to take precarious purchase like buying of houses or investing in stocks. Conversely, they might be enticed in great deals if these smaller and medium enterprises can produce products that will attract them and yet be affordable at the same time. Right now, people in China are at the lower end of the Maslow’s Needs of Hierarchy, namely Psychological and Safety, which is to say food, clothing and protection. If the smaller firms can emphasis on all these and help them save at the same time, they might just be able to get a huge demand from this big group of people.

Credit -hydrogenassociation, -eicta

Friday, September 25, 2009

Hospitality

Isn't this exactly what we all have been dreaming for ?


The epitome of comfort and relaxation.

Thursday, September 24, 2009

Recession, Over or not

Recession is a thing of the past right now it seems. That’s what all the experts say. But personally, I think it will come back in a different form but with a milder impact for sure. Okay, away from the pessimism, let me sum up the current situation in the West and the East with reference to Straits Times.





We can see that Asia has managed to survive this crisis by itself as we can see the manufacturing and industrial sector stepping up their game. In addition, there is further support from positive export to the United States during the last month which is most likely triggered by the rush for the festive season, namely Christmas Day.



It is definitely not surprising that General Motor expects China to surpass United States by next year. China is the main consumer of the aircrafts made by Boeing, they are essentially supporting Boeing’s development by mass-ordering their aircrafts. In addition, China’s local demand has been strong and it needs to be because there has been weak demand for exports due to the current financial crisis which has obviously hit United States badly.




Let’s look at the few examples in Asia, Japan’s economy has rose by 3.7%, China’s by 8%, and we see that the semiconductor business in Malaysia is surging, accompanied by the rise in demand for real estates in Hong Kong and of course not forgetting the rise in automobiles demand in the superpower India.



The West, on the other hand is badly hit by the crisis. They are seemingly like a patient lying on the bed waiting for recovery and currently living on medicines such as the stimulus package plus a myriad of cash-for-clunkers program which has been consistently pushing consumer demand up the charts. This growth in demand however, should never be taken for granted because one thing for sure, it is not sustainable.



Statistics has shown that 77% of the people are still cutting down on their spending and 58% of the people are still paying off their debts.





With the subprime mortgage crisis over, people are still struggling to pay off their mortgage loans and businesses are initiating Initial Public Offering to increase their liquidity. Individuals, teams and even organizations at all level are all trying their best to come up with as much capital as possible to help them get past this tough period of time.



We can obviously see the government helping out by providing job credit schemes where the company gets money for each worker hired and they lower their interest rate so that businesses can make loans to help them sustain their business through this post-crisis period.



However, right now, people are both cynical and sceptical about whether it really is over, therefore, the spending is definitely slowing down and I do not believe that it is going to pick itself up anytime soon.



People cut down spending, consumer spending drops and business stop hiring and they start closing down outlets which are losing money at a rapid rate. At this rate, unemployment is still going to be on the rise. Without employment, people are not going to spend and the economy will still be languished for quite some time.



In conclusion, I believe that only sustainable growth will be able to help the economy to get past the crisis. In order for sustainable growth to happen, the exit strategy used by the United States, in terms of withdrawing credits and stimulus, has to be extra carefully and sensitive. It is going to be painful as usual, but it must be done. The knife has to be taken out before excess blood is lost. But is it more important to stop the bleeding first, before you take out the knife? The question is, when are you going to take out the knife? When sales are low, or when sales are at an all time high? If you take it out when the sales are low, won’t it go down even further and demoralise more? If you take it out when the sales are at its highest, won’t it plummet all of a sudden and cause a lot of companies to incur huge debts and collapse in the end? It is indeed going to be an arduous journey ahead, but the United States has to be assiduous and determined otherwise they will take a long time to get out of this recession.

Credit -Straits Time, -ldrinvestments, -travelblog, -transactint

Wednesday, September 23, 2009

Pablo Picasso

Portrait of Adele Bloch-Bauer by Gustav Klimt ($135,000,000)
This record breaking sale was enabled by a court order by the Austrian government to return the painting to the Artist's rightful heir. The entire dispute lasted over a year and was necessary to return the painting that was looted by the Nazis during World War II.


Skillfully painted in 1907 by the art nouveau master Gustav Klimt, the painting was purchased by Ronald S. Lauder, the cosmetics heir, in 2006.

Garçon à la Pipe by Pablo Picasso ($104,100,000)
Created during the Rose Period, Garcon a la Pipe showcases Picasso's exceptional use of cheerful orange and pink palatte.


The oil on canvas painting, measuring 100 × 81.3 cm (slightly over 39 × 32 inches), displays a Parisian boy holding a pipe in his left hand.

The record price auction at the time on May 4, 2004 in Sotheby's was a bit of a surprise to the core art buyers, because it was painted in the style not usually associated with the pioneering Cubist artist.

Dora Maar with Cat by Pablo Picasso ($95,200,000)
Another enormous surprise followed in 2006, when this painting near doubled its inaccurate presale estimate and brought in new record $95,200,000 at auction at Sotheby's on May 3, 2006.




Painted in 1941, Picasso's controversial portrait (one of his last) is sometimes described as an unflattering depiction of his mistress, Dora Maar, who was an artist/photographer and mistress of Picasso whose relationship lasted ten years during the 1930s and 40s.


Portrait of Dr. Gachet by Vincent van Gogh ($82,500,000)
This painting by the Dutch Impressionist master Vincent van Gogh suddenly became world-famous when Japanese businessman Ryoei Saito paid $82.5 million for it at auction in Christie's, New York. Saito was so attached to the painting that he wanted it to be cremated with him when he died. Saito died in 1996 ... but the painting was saved.
Vincent van Gogh actually painted two versions of Dr Gachet's portrait. You can view the other version, with a slightly different color scheme, at the Musée d'Orsay in Paris.

Bal Au Moulin de la Galette by Pierre-Auguste Renoir ($78,000,000)
Bal au moulin de la Galette, Montmartre was painted by French artist Pierre-Auguste Renoir in 1876. On May 17, 1990, it was sold for $ 78,000,000 at Sotheby's in New York City to Ryoei Saito, who bought it together with the Portrait of Dr Gachet (see above).
Credit http://www.karemar.com/blog/top-ten-10-most-expensive-paintings-all-time-w-pics

Tuesday, September 22, 2009

Fidelity vs Convenience at Starbucks




 Definitions :


Fidelity generally refers to the whole experience, the whole package so to speak. For example, you pay hundreds for a fine dining meal not just for the food, but also for the people around,the ambience and of course the service provided.


Convenience on the other hand means easy to get. You place way lesser emphasis on the quality or even the service, considering that you just want it instantly, nothing else matters.

So as the title suggest, fidelity and convenience are parallel terms, they will never and should never meet one another. One of the biggest mistake that Starbucks has made is that it is trying to put them together like Yin & Yang.

People give up fidelity for convenience and vice versa, but they will never settle for so-so fidelity and so-so convenience. It just doesn't seems right to them.

A few reasons why Starbucks is failing :

1.As economist and author Tyler Cowen told me: "Once Starbucks became ordinary, it was committing suicide."

2.People looking for convenience saw less reason to pay Starbucks' prices.

1. Speaking from my personal experience, I have to agree that once Starbucks become a commodity, people will not pay exorbitant prices for the drink itself anymore. In my country, Singapore, there can be as many as 3 Starbucks within a distance of 100m.

So, one day, as I was walking down the streets, I saw a Starbucks, I still retain the urge to get myself a nice cup of coffee to reward myself for a good day of performance. But on the way there, I thought to myself, okay, why not I buy it later since there is another Starbucks outlet down the street? So here I go, walking down the street and then I saw another outlet, but at this point in time, I contemplated again, I was thinking to myself, I'm not exactly thirsty right now and besides the coffee is pretty expensive, so why not I walk abit more before I come back again for my coffee? But as I was walking, I saw this awesome restaurant that serves Bombay's coffee, the idea was fresh and the concept was nifty, the layout was posh as well, and without any deliberation, I went in for my coffee.


The above experience of mine highlights the fact that Starbucks' new found convenience has led to much procrastination and deliberation on the purchase of their drinks. People starts to contemplate considerably as compared to the past. Starbucks' outlets, being so near one another, has caused others to think that they can simply walk back if they want to get a cup of coffee. Conversely, in the past, they are so far away from one another, if you miss this stop, you will have to spend a lot of time walking back for this extravagant fidelity. Therefore, you will not even hesitate to rush in for a cup of coffee, bathing yourself in a pool of mellifluous music.

2. People looking for convenience are not willing to pay such high prices for a drink anymore. Personally, I will rather save up the money and head towards the supermarket for a packet of fresh milk or a can of coke. The convenience factor has driven down the fidelity of Starbucks. It does not seems to be as prestigious as before. You neither feel exclusive nor luxurious at Starbucks anymore, especially when it is so empty nowadays. It seems like a commoner's drink at any coffee shop which everyone can afford.

The quality of the drink starts to drop, the taste of it seems to be ordinary and mundane, and the layout of the coffee club seems sloppy as compared to the posh layout of some other coffee clubs.

The truth is that if people wants convenience, they will probably head down towards the supermarket or Mcdonalds for a hot cup of coffee. Starbucks outlets being so ubiquitous nowadays has totally killed off the unique experience it once provides. Being so easily accessible, people are no longer enticed at the sight of Starbucks because it seems like just another boring outlet they see everyday.

The people at the city wants something fresh, novelty and eye-catching. They want to have a leverage in social status in the activities they engage in and having a cup of coffee at Starbucks is no longer fresh, novelty nor prestigious anymore. And when it comes down to that, people compare Starbucks with CoffeeBean, Mcdonalds and Wal-Mart for a drink because they are basing their decision on convenience and not fidelity anymore.


Credits -money.cnn.com, -menupages, -voicesweb, -farm3, -rohan, -

Monday, September 21, 2009

Armani Exchange

A tribute to my favourite brand of all times

Eyewear
Clothes
Jackets
Photo credits -1.bp, -fashionrat, -clovetwo

Sunday, September 20, 2009

Doubleclick Ad Exchange


 Yes, Google has done it once again. After spending so much time to fight Microsoft, Google has just diverted their attention back to Yahoo, it's all time rivals in the advertising industry.


Google holds a total market share of 64.7% in terms of market share in the search engines as researched by comScore. In the past, they have always been focusing on the relevant text ads where you will see them when you simply type a word in its search box. Relevant advertisements will appear automatically next to your search results.

Like before, advertisers simply have to bid for their own ad space and start advertising. However, the trick here is that they now have more flexibility in the control over who sees it, when they see it and where they see it. They now appear at the appropriate places at the right time in front of the right people.

This strategy further optimized the chances that they get more effective clicks. Effective clicks literally means that people who are interested in the advertiser's products sees the advertisements posted and click on them.

There are programmes around which track who visit the respective websites and at what point in time is there the highest traffic available on the website per se.

This new Doubleclick ad exchange helps to analyse who the advertisers are actually targetting based on a few questions. For instance, the advertiser might want to target students who are interested in getting ahead of Fashion. In this aspect, it is natural for them to post their advertisements after school hours when a lot more students will be able to surf the net. In particular, the advertisers will most probably post their advertisements on the top gaming websites such as World of Warcraft or Maplestory in order to attract their attention while they are gaming after school.

In turn, advertisers will bid on the ad space available on the particular websites if the website fits the bill. This new deal will definitely entice the advertisers who are interested in more effective clicks. In the past, they just spam advertisements everywhere possible, but now with the greater precision in time and location, the advertisers are bound to attract a larger percentage of the target market to their websites more effectively than before.

This will definitely translates to a bigger picture of cost savings for a lot of companies!

 Credit -money.cnn.com, -bizbox, -technologygear