China central bank report raises GDP, inflation forecasts

China central bank report raises GDP, inflation forecasts
Gross domestic product expected to grow by 11.6%, inflation by 4.6%


PROPERTY BUBBLE: China has already raised lending rates five times so far this year, but these have failed to dampen demand for property, as investors continue to favour fixed assets. -- PHOTO: AP


SHANGHAI - THE People's Bank of China's research department has raised its economic growth forecast and said inflation will probably accelerate.

China's gross domestic product (GDP) may expand 11.6 per cent this year, according to the report published in the China Securities Journal, faster than the agency's June estimate for a 10.8 per cent expansion.

Inflation this year will quicken to 4.6 per cent from 1.5 per cent last year and up from the 3.2 per cent forecast previously.

The trade surplus will widen to about US$250 billion (S$373 billion) this year from US$177.5 billion last year.

The forecasts put pressure on central bank governor Zhou Xiaochuan to raise lending and deposit rates for the sixth time this year to cap surging asset prices and cool the overheating economy.

The bank late on Thursday raised interest rates on some home mortgages and increased minimum down payments in an effort to cool property price gains.

The rate on loans for second homes and on commercial real estate was pushed to at least 1.1 times benchmark rates that the People's Bank of China did not specify in a statement. Buyers will have to pay not less than 40 per cent of a property's value as down payment, up from 30 per cent.

Until now, banks were barred from charging less than 90 per cent of the benchmark rates for mortgages. Interest rates on loans for first homes are unchanged.

'The central bank may need to raise key interest rates again' to cool inflation, said Mr Tao Dong, chief Asia economist at Credit Suisse Group in Hong Kong.

The government is also concerned that a surge in lending is creating a bubble that will drive up bad loans if it collapses. Investments in real estate development jumped 29 per cent in the first eight months of the year.

China raised its one-year lending rate for the fifth time this year to 7.29 per cent on Sept 14. Those increases have failed to dampen demand for property, as China's economic growth raises incomes and people favour fixed assets amid a 10-year high inflation of 6.5 per cent.

China's economy, the world's fourth largest, expanded 11.9 per cent in the second quarter from a year earlier, the fastest pace in more than 12 years.

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China plays surge on talk of Beijing easing fund rules

China plays surge on talk of Beijing easing fund rules
Rumours swirl that China may soon let its funds invest in markets like S'pore
By Goh Eng Yeow, Markets Correspondent
SHARES of Chinese companies listed in the Republic soared on an adrenaline rush yesterday, following rife speculation that China would soon liberalise its rules to allow its funds to buy into overseas markets such as Singapore.

This caused several popular China counters such as shipbuilder Cosco and sports wear maker China Hongxin to race to record highs.

Dealers attributed the surge to a report by United States investment bank Merrill Lynch, which said an approved China fund had been given the mandate to buy the overseas-listed shares of firms that derive at least 50 per cent of their revenues in China.

'If this is true, it is something very significant, because when the same thing was allowed for Hong Kong, the Hang Seng Index shot up like mad,' said a remisier.

Yesterday's buying sent the PrimePartners China Index, which tracks China companies listed on the Singapore Exchange, up by 6.4 per cent to 280.05 points.

Some individual counters registered far bigger gains. Frozen dumpling maker Synear Food rose an eye-popping 16.9 per cent to $2.07, while soybean products firm Celestial Nutrifoods gained 17.2 per cent to $1.43.
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Since last month, when China said it would allow its citizens to buy directly into the Hong Kong market, the Hang Seng Index has surged by nearly 40 per cent from its August low.

Yesterday, interest in Chinese firms listed in Hong Kong stayed red-hot, rising 2.4 per cent.

Investors are hoping for a similar run-up in Singapore, as Beijing eases restrictions on overseas investments to cool the speculative bubble in the overheated Shanghai market and relieve the upward pressure on its currency.

Such a liberalisation would also mark a big improvement of the scheme, first announced by China in May, to let its banks invest their clients' money in stocks or structured products in Hong Kong through a Qualifed Domestic Institutional Investor (QDII) scheme.

Merrill identified the fund as the 'to-be-launched Jiashi QDII fund which will focus on all overseas Chinese equities, including those listed in Singapore, the United States and other markets'. It is one of the seven fund management firms approved by the China authorities under its QDII scheme.

While it has not raised any money so far, the fund is expected to be open-ended and targeted at retail investors investing as little as 5,000 yuan (S$994).

Besides fund management firms, China had also approved 21 domestic banks under the QDII scheme to invest a total of US$16.1 billion (S$24 billion) in Hong Kong shares and structured products.

Merrill said it expects about US$4.8 billion to flow from the mainland into the Hong Kong stock market by next year. 'This would represent about 7.4 per cent of the current free float of Hong Kong-listed China stocks.'

It reckoned China fund management firms would be able to raise US$30 billion in funds by the end of next year, half of which is expected to be earmarked for investing in the Hong Kong stock market. The remainder may flow to markets including Singapore.

'We believe it is time to explore stocks in these markets, including Synear Food, Yangzijiang and Wuxi Pharma,' said Merrill.

Lack of sleep may be deadly, says study

Lack of sleep may be deadly, says study
People who sleep less than five hours are twice as likely to die of heart disease


SLEEP ON IT: People who sleep more than nine hours have a higher mortality rate. -- PHOTO: ISTOCKPHOTO


LONDON - People who do not get enough sleep face more than double the risk of dying of heart disease, according to a British study released on Monday.

Although the reasons are unclear, researchers said lack of sleep appeared to be linked to increased blood pressure, which is known to raise the risk of heart attacks and stroke.

A 17-year analysis of 10,000 government workers showed those who cut their sleep from seven hours a night to five or less faced a 1.7-fold increased risk of death from all causes and more than double the risk of cardiovascular death.

The findings highlight a danger in busy modern lifestyles, according to professor of cardiovascular medicine at the University of Warwick's medical school Francesco Cappuccio.

Speaking to the annual conference of the British Sleep Society in Cambridge, he said: 'A third of the population of the United Kingdom and over 40 per cent in the United States regularly sleep less than five hours a night, so it is not a trivial problem.

'The current pressures in society to cut out sleep, in order to squeeze in more, may not be a good idea - particularly if you go below five hours.'

Previous research has highlighted the potential health risks of shift work and disrupted sleep.

But the study by Prof Cappuccio and colleagues, which was supported by British government and US funding, is the first to link duration of sleep and mortality rates.

The study looked at sleep patterns of participants aged 35 to 55 at two points in their lives - 1985 to 1988 and 1992 to 1993 - and then tracked their mortality rates until 2004.

The results were adjusted to take account of other possible risk factors such as initial age, sex, smoking and alcohol consumption, body mass index, blood pressure and cholesterol.

The correlation with cardiovascular risk in those who slept less in the 1990s than in the 1980s was clear but, curiously, there was also a higher mortality rate in people who increased their sleep to more than nine hours.

In this case, however, there was no cardiovascular link.

Prof Cappuccio said it was possible that longer sleeping could be related to other health problems such as depression or cancer-related fatigue.

'In terms of prevention, our findings indicate that consistently sleeping around seven hours per night is optimal for health,' he said.

Singapore in top five forex markets: Poll

Singapore in top five forex markets: Poll
SINGAPORE is the fifth-largest centre for foreign exchange trading, according to the Bank for International Settlements (BIS).

The average daily foreign exchange turnover in Singapore surged to US$231 billion (S$347 billion) in April, an 84 per cent jump over the same month in 2004 when the BIS survey was last taken, though it still slipped one place.

The poll of foreign exchange and over-the- counter (OTC) derivatives activities found Britain to be the leading trader, the United States second, Switzerland third and Japan fourth.

The survey, which is held every three years, ranked Singapore as the eighth-largest centre in terms of OTC derivatives trading. This is up from 12th place in 2004. Britain led with 42.5 per cent of global sales in OTC derivatives. The US trailed with 23.8 per cent, while Japan and Singapore were the only non-European nations to record sizeable trading in such derivatives.

Mr Ong Chong Tee, deputy managing director of the Monetary Authority of Singapore, said the findings affirm Singapore's continued strong growth as a key foreign exchange centre.

'A number of financial institutions have chosen Singapore as their Asian foreign exchange trading hub, and several have been expanding their operations here,' he said.

Best city in Asia to meet? It's still S'pore

Best city in Asia to meet? It's still S'pore
Globally, Republic up to 3rd spot after Paris and Vienna for Mice events, says think-tank
By Lim Wei Chean
SINGAPORE remains Asia's top city when it comes to hosting business meetings and major events.

It also climbed up one rung in the world ladder to third place - behind the likes of first-placed Paris, and Vienna.

This is according to an international report produced by a think-tank in Belgium - which ranked the cities by the number of big events they managed to attract last year.

The report by non-governmental organisation Union of International Association is closely watched by tourism officials around the world, as it is one of the few global indicators as to who is getting the largest piece of the lucrative international meetings pie.

The report also showed that Singapore's share of the meetings business doubled over the last five years.

From doctors gathering to hear about the latest medical innovations to grey-haired retirees travelling to understand more about the art of baking, these are all part of the meetings, incentives, conventions and exhibitions business, also known as the Mice industry.

In Singapore, it is already a multibillion-dollar business: Last year, the Republic had close to three million Mice tourists, and they spent about $4 billion here.

According to the international rankings, Paris ranked at the top of the charts while Singapore pipped Brussels to third spot.

Industry players here say that last year's International Monetary Fund (IMF) and World Bank meetings, which brought in 16,000 delegates, played a big role in improving the Republic's stature in the world Mice game.

For the Singapore Tourism Board (STB), the latest ranking was the icing on the cake for an already spectacular year for the Mice segment.

According to STB's assistant chief executive for business travel and the Mice group, Mr Aloysius Arlando, this is a strong signal that the 'buoyant outlook' for the industry was set to continue.

And the bookings look promising. For instance, Suntec Singapore - which hosted the IMF meetings - had a total of 1,176 events last year, of which 83 were international ones. Going forward, it expects to host more than 1,300 events this year, of which 107 are international ones.

Its chief operating officer Pieter Idenburg said Singapore is now 'bearing the fruits' of the marketing strategies it embarked upon a few years ago.

STB has stated publicly that the aim is for the Mice segment to bring in $10.5 billion in tourist dollars by 2015.

6 in 10 S'poreans bored with their sex lives: Survey

6 in 10 S'poreans bored with their sex lives: Survey
Findings of the latest Durex Sexual Wellbeing survey put couples here behind their counterparts in China, Malaysia and Thailand


RARING TO GO: Singaporeans say that romance and better communication would help them jump into bed. -- ST FILE PHOTO


MORE than half of Singaporeans yawn between the sheets - not because they are sleepy but because they are bored with their bedroom romps.

This is the finding of the latest Durex Sexual Wellbeing survey, which indicated that only 42 per cent of 1,000 Singaporean respondents - either single or married and aged between 20 and 65 - consider their sex lives exciting.

This puts them behind their counterparts in China, Malaysia and Thailand where, respectively, 64 per cent, 62 per cent and 43 per cent of the respondents report satisfactory sex lives.

The annual survey was conducted in August and September last year in 26 countries from France to Japan.

More than 26,000 people were questioned on health, general well-being, education, beliefs, sex and relationships and social circumstances.

Durex, owned by healthcare company SSL International, is the world's leading condom maker, accounting for 26 per cent of the global US$416 million (S$624 million) market.
Durex findings
Sexually active Singaporeans aged 20 to 65, either single or married, who:

Feel their sex lives lack excitement: 58 per cent
... more

The results, released yesterday, did reveal one area in which Singaporeans scored highest in the world.

Almost nine out of 10 Singaporeans, compared to eight out of 10 globally, have masturbated at some time. Four in 10 do it once a week.

Two-thirds of Singaporeans have sex at least once a week, but 63 per cent of those think that is not often enough.

But less-than-thrilled Singaporeans are not taking things lying down.

Asked to list things that would improve their sex lives, they mentioned more romance and better communication with partners.

For the record, the folks in Greece are the most eager to jump into bed - 87 per cent of them have sex at least once weekly.

Nigerians are happiest with their sex lives, with 78 per cent of them reporting that it is exciting.

The Japanese are the most miserable with just 10 per cent reporting the same.

Best way to give back? Create jobs, says billionaire

Best way to give back? Create jobs, says billionaire
Kenneth Fisher has also willed 80% of his estate to Johns Hopkins for medical research, rather than set up a trust
By Lorna Tan, Finance Correspondent


-- ST PHOTO: SHAHRIYA YAHAYA


HE HAD racked up a personal fortune of US$10 million (S$14.96 million) by the time he was 38, so it is no exaggeration to say that Kenneth Fisher knows a thing or two about making money.

The 56-year-old founder and chief executive of money management firm Fisher Investments has used those skills to build a huge business and propel himself into the ranks of America's super-rich.

Last week, he was ranked 271 on the Forbes 400 list of America's richest, with a net worth of US$1.8 billion.

Not bad for someone who had set his sights on a career in forestry - about as far removed from the jungle of high finance as you can get.

Although his father Philip Fisher owned an investment advisory firm, Mr Fisher did not initially aspire to follow in dad's footsteps.

He wanted to pursue his love for the woods and studied forestry at California's Humboldt State University. As fate would have it, a summer job in the forestry services industry changed his mind about his intended career path.
Coming out of the woods
Who he is

Mr Kenneth Fisher, the founder and chief executive of money management firm Fisher Investments, had originally set his sights on a career in forestry.
... more

'I like the forest but it's a poor career, and I would never work for the government because it is too stifling,' said Mr Fisher, who was in Singapore earlier this month for the Forbes Global CEO Conference.

He graduated in 1972 with a degree in economics and worked for his father's company before starting his own, California-based Fisher Investments, in 1979. The company now manages US$42 billion for private clients and institutions.

Mr Fisher has also written four investing books: Super Stocks, The Wall Street Waltz, 100 Minds That Made The Market and The Only Three Questions That Count. The fourth book touches on investor behaviour, and challenges investors to debunk conventional market myths and to 'invest by knowing what others don't'.

'It's what they know that others don't know that forms the basis for what they should do and the bets they take,' he said.

For passive investors who do not want to spend time or energy learning the ins and outs of bonds and stocks, he advises putting money into index funds.

'If you don't want to learn how to beat the market, own it,' he said.

'Put about 45 per cent in the S&P 400 Index (which covers the United States market), another 45 per cent in the MSCI EAFE Index (which covers 20 non-US developed countries) and 10 per cent in the MSCI Emerging Markets Index.'

Mr Fisher lives in Woodside, California, with his wife, Sherrilyn, 56. They have three grown sons.


Q How old were you when you started your own company?

A I was 23, too young to know I was too young to do it, so I could do it. If I had known I was too young, I wouldn't have done it. If you think you can't do it, you can't.

In the beginning, I sold research and research services to investment companies in the San Francisco area. My company was just me, and I was contracted to compile literature on a specific subject and sometimes provide financial analysis.

Internet didn't exist then and, in those days, investment companies wanted everything on a certain subject researched and summarised from information gathered from good business libraries.

Over time, I moved towards selling ideas about stocks, and people paid a quarterly retainer for ideas I came up with. In the mid-1970s, I started managing people's money and decided that was what I wanted to do.


Q What do you do with your wealth? Do you believe in giving back to society?

A Most philanthropy is water down the drain... Philanthropy is good, but I don't believe in it unless you know how to do it well.

In my lifetime, I believe it's better to keep the money in the company, and to grow and provide employment opportunities. Fisher employs 1,000 staff.

I don't believe in setting up family trusts or foundations because my sons or grandchildren might have ideals different from mine.

What I've done is to will 80 per cent of my estate to Johns Hopkins Medicine in Baltimore, where they can figure out how to use my money for good medical research. In a sense, I really work for Johns Hopkins. That makes it easy for me and I don't have to worry about people sucking up to my grandkids, as I would have if I had set up a foundation.


Q What financial planning have you done for yourself?

A None. I took a chance on building my business, which has paid off, and hence financial planning becomes superfluous. The only thing that really matters is running the company well and estate planning.


Q What's your investment philosophy?

A Global, opportunistic, top-down, thematic, sector and country rotation.


Q Any other investments?

A I own a lot of real estate - 300,000 sq ft of office space - that my company uses. For tax and estate planning purposes, I own it and lease the office space to the company. Forbes' valuation of my office space, which is mostly in California, is US$100 million. The remaining properties are in Washington, London and outside Frankfurt in Germany.


Q Moneywise, what were your growing-up years like?

A My family wasn't wealthy when I was young. But by the time I grew up, my father had become wealthy from running his investment business.

I was very frugal, a saver. I did yard work, washed dishes, made deliveries, and saved the income. In college, I did demolition and construction work, and saved the money. My father and mother were both pretty frugal, and that rubbed off on me.


Q How did you get interested in investing and become a money manager?

A My father was in the investment business and when I left college with a degree in economics, before going to graduate school, he said I could come work for him, try it, and if I didn't like it, go back to graduate school.

I worked for him for a year only, because I concluded it wasn't good to work in a father-son mode. But I did like the investing business and went out on my own immediately.


Q Tips to retail investors?

A Be sceptical, question everything, assume most conventional wisdom is mythology and false, and read my new New York Times bestseller, The Only Three Questions That Count. It teaches you to think about investing like a science.


Q What has been a bad investment?

A The first stock I ever bought was in a Florida real estate developer named Killearn Properties in 1971. I was 21 years old. It went from US$10 to 25 US cents in about 18 months, and I had no clue the whole time. I put about US$10,000 in and basically lost it all. Great way to start out because if you like it when you lose, then you will always like it, even when you win!

Then, in 1984, I bought about 3 per cent of a company called Charter Co for my clients, which also went bankrupt and I lost it all. I joined the equity committee for the bankruptcy proceedings just to learn from the inside out what had happened so I'd never make that mistake again. It is actually pretty easy to volunteer for bankruptcy committees, for anyone, and it is a great learning experience.


Q Your best investment to date?

A Rather obviously, it was the creation of my company, which I bootstrapped from sweat equity (slave labour, with me as the company's slave). It effectively had a zero cost basis and made me, according to the Forbes 400 and Forbes Global Billionaire lists, one of the world's wealthiest people.

In terms of a single stock, the best investment was buying into American steelmaker Nucor in 1976. The stock went up more than 100-fold. I led in a client group that bought 1 per cent of the company. It was so long ago, I don't remember the dollars.


Q What are your thoughts on sub-prime mortgage woes?

A They're small in scale and measurably not spreading into a problem. I expect to see the resumption of a bull market by Halloween.


Q And your home now is...?

A A 2,000 sq ft apartment over my company's headquarters. I can get to work in about two minutes.


Q And your car is...

A A red Volvo four-door sedan.