Monthly Archives: May 2014

The HBCU Money™ Weekly Market Watch


Our Money Matters /\ May 30, 2014

A weekly snapshot of African American owned public companies and HBCU Money™ tracked African stock exchanges.

NAME TICKER PRICE (GAIN/LOSS %)

African American Publicly Traded Companies

Citizens Bancshares Georgia (CZBS) $8.51 (4.27% DN)

M&F Bancorp (MFBP) $4.85 (1.04% UP)

Radio One (ROIA) $4.49 (2.51% UP)

African Stock Exchanges

Bourse Regionale des Valeurs Mobilieres (BRVM)  230.61 (0.19% UP)

Botswana Stock Exchange (BSE)  9 061.52 (0.39% DN)

Ghana Stock Exchange (GSE)  2 308.96 (7.63% UP)*

Nairobi Stock Exchange (NSE)  149.80 (N/A)

Johannesburg Stock Exchange (JSE) 49 632.70 (0.19% DN)

International Stock Exchanges

New York Stock Exchange (NYSE) 10 735.58 (0.15% DN)

London Stock Exchange (LSE)  3 655.01 (0.26% DN)

Tokyo Stock Exchange (TOPIX)  1 201.41 (0.06% UP)

Commodities

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For The Greater Good, Make Donald Sterling Keep The Clippers


Don’t cut off your nose to spite your face. – 12th Century Idiom

ouch

I am a fan of prenuptial agreements. As a banker you come to realize that money, divorces, and emotions are a Molotov cocktail waiting to explode. A former associate of mine allowed car loans that both she and her now former husband purchased new vehicles with to be all in her name because of his poor credit. As the marriage dissolved and headed for divorce she just wanted it over and was willing to sign whatever to expedite the divorce. By the time she came to her senses she realized that she was stuck with a bundle of debt for two cars, her car was upside down, no recourse, and an ex-husband who basically got a vehicle free and clear. The point is that emotions of the short-term moment often end with long-term consequences that are more detrimental to the injured parties. Enter, Donald Sterling.

For those who are unaware Donald Sterling is a lawyer who made his wealth not through litigation, but through leveraging his earning into real estate holdings. According to Nadja Brandt of Bloomberg, “He owns at least 160 apartment buildings, office properties and single-family homes in the area, many of which he purchased with cash, according to county records compiled by data provider LexisNexis.” In addition, over the past eighteen months she reports, “They’ve purchased at least 12 houses and three multifamily buildings from the beginning of 2013 through last month for a total of $58.7 million, according to Los Angeles County Office of the Assessor records.” Now, with the NBA forcing the sale of the Clippers amongst public pressure, Mr. Sterling is about to be let loose with $1 billion in capital, the expected sale price of the team, to go on a real estate buying spree. Currently, the Los Angeles Clippers produce about $15 million net income per annum according to recent Forbes assessment. A significantly less amount of capital to accumulate property than a sale thanks to having to keep significant capital tied up in the operation of the team.

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Two significant items of importance to consider with a man who owns 160 apartment buildings before you let him loose with a billion bullets. He has already paid according to Housing Wire’s Trey Garrison, “The longtime Democrat and NAACP donor agreed to pay $2.625 million to a fund for tenants and prospective tenants injured by his discriminatory practices, plus $100,000 in fines” in 2009. Before that according to Garrison, “in 2005 after a settlement was reached, wherein a judge ordered Sterling to pay nearly $5 million in attorney’s fees to the plaintiffs.” Remember, he already owns at least 160 apartment buildings. Has anyone given any thought to how many he potentially could own by forcing the sale of the Clippers? No, because we are caught up in the emotions of the moment.

There are 12 players on the Los Angeles Clippers roster. The NBA is comprised of 30 teams with 12 players on each for a total of 360 players. So let us take a good hard look at the number of people potentially impacted by the sale because right now we are only talking twelve. Initially, Donald Sterling was going to fight the forced sale of the team, but I am sure he, his lawyers, and financial advisers may have come to the same conclusion I have looking at the numbers. He could arguably double his real estate holdings, which means he could potentially be the landlord of as few as 30 000 or potentially as many as 300 000 plus Los Angeles citizens versus the grumblings of twelve basketball players and staff. My math is still pretty sharp and the last I checked 12 is less than 30 000, so for the sake of the greater good please let this man keep his team. Most often it is best to take a step back and let the emotions clear the room to be sure a rational decision is being thought out and made. Otherwise, get out the scalpel.

HBCU Money™ B-School: Investing Across Borders Interesting Facts


By World Bank Group

20121027_INC343

Investing Across Sectors

  • More than a quarter of the 87 countries surveyed by Investing Across Borders (IAB) have few or no sector-specific restrictions on foreign ownership of companies.
  • Smaller countries have fewer restrictions on foreign ownership of companies, while larger countries — such as China, Mexico, the Philippines, and Thailand — are among those with the most.
  • Countries in Eastern Europe and Central Asia and Latin America and the Caribbean tend to be the most open to foreign ownership of companies.
  • Though services account for a growing share of global foreign direct investment (FDI), foreign ownership of companies is more restricted in the service sector than in the primary and manufacturing sectors.
  • Worldwide, restrictions on foreign ownership are strictest in media, transportation, electricity, and telecommunications industries.
  • Most countries allow foreign ownership of equity in alternative energy companies — with some countries in Middle East and North Africa being notable exceptions.

Starting a Foreign Business

  • In most countries measured by Investing Across Borders (IAB), starting a foreign company takes longer and requires more steps than starting a domestic company.
  • The most common additional procedure required of foreign companies is the foreign investment approval or declaration, required in 48% of the 87 surveyed countries.
  • In Eastern Europe and Central Asia, the additional procedures required of foreign businesses add only 4 days on average to the total start-up time.
  • Georgia and Rwanda have the fastest process for starting a foreign business of all measured countries.
  • Only 3 of the 87 surveyed countries do not have their commercial laws and regulations publicly available online.
  • Companies are able to download business registration forms in 59% of all measured countries, but only 18% of them offer electronic registration services.
  • Four out of the 87 surveyed countries do not allow foreign companies to hold foreign currency bank accounts.
  • Haiti is the only IAB country where the minimum capital requirements are more favorable for foreign than domestic companies.

Accessing Industrial Land

  • In 1 in 4 of the countries surveyed by Investing Across Borders (IAB), foreign companies cannot own private land.
  • All the countries surveyed allow foreign-owned companies to lease land.
  • More than half the countries surveyed do not allow foreign companies to use land leases as collateral.
  • It takes as little as 10 days to lease private land in Armenia — and as many as 149 days in Nicaragua.
  • Across the 87 IAB countries the average time it takes to lease land from the government is more than twice that required to lease land from a private holder.
  • Nearly two-thirds of countries require an additional approval to authorize the lease of government-held land to foreign companies.
  • In only one-third of countries with both a land registry and cadastre are the two public agencies linked to share data, facilitating information access.
  • Less than half the countries do not provide accessible public documentation on previous environmental impact assessments conducted on industrial lands.

Arbitrating Commercial Disputes

  • All Investing Across Borders (IAB) countries recognize arbitration as a tool for resolving commercial disputes, and only 8 of the 87 countries do not have a specific arbitration law: Albania, Argentina, Bosnia and Herzegovina, Ethiopia, Liberia, Mali, Montenegro, and Poland.1
  • About half of IAB countries have laws that distinguish between domestic and international arbitration.
  • The Czech Republic and Mexico are among 17 IAB countries where businesses can conduct arbitration proceedings online.
  • In most countries in Latin America and the Caribbean, foreign lawyers without local bar membership are not permitted to represent parties in arbitration proceedings.
  • There are no functional arbitration institutions in Cambodia and Sierra Leone, while Colombia and Malaysia have many active institutions.
  • In most countries in East Asia and the Pacific, laws do not require courts to assist during arbitration proceedings with orders for production of evidence or appearance of witnesses. In contrast, 4 of the 5 IAB countries in South Asia legally require domestic courts to assist in arbitrations.
  • Many countries in Eastern Europe and Central Asia have adopted special rules to ensure fast enforcement proceedings of arbitration awards, such as establishing special authorities outside the judiciary to issue writs of execution.

http://iab.worldbank.org/Data/Interesting%20Facts

1.Source: Investing Across Borders 2010.

HBCU Money™ Business Book Feature – Age of Ambition: Chasing Fortune, Truth, and Faith in the New China


osnos age ambition

A vibrant, colorful, and revelatory inner history of China during a moment of profound transformation

From abroad, we often see China as a caricature: a nation of pragmatic plutocrats and ruthlessly dedicated students destined to rule the global economy—or an addled Goliath, riddled with corruption and on the edge of stagnation. What we don’t see is how both powerful and ordinary people are remaking their lives as their country dramatically changes.

As the Beijing correspondent for The New Yorker, Evan Osnos was on the ground in China for years, witness to profound political, economic, and cultural upheaval. In Age of Ambition, he describes the greatest collision taking place in that country: the clash between the rise of the individual and the Communist Party’s struggle to retain control. He asks probing questions: Why does a government with more success lifting people from poverty than any civilization in history choose to put strict restraints on freedom of expression? Why do millions of young Chinese professionals—fluent in English and devoted to Western pop culture—consider themselves “angry youth,” dedicated to resisting the West’s influence? How are Chinese from all strata finding meaning after two decades of the relentless pursuit of wealth?
Writing with great narrative verve and a keen sense of irony, Osnos follows the moving stories of everyday people and reveals life in the new China to be a battleground between aspiration and authoritarianism, in which only one can prevail.

HBCU Money™ Dozen 5/19 – 5/23


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Did you miss HBCU Money™ Dozen via Twitter? No worry. We are now putting them on the site for you to visit at your leisure. We have made some changes here at HBCU Money™ Dozen. We are now solely focused on research and central bank articles from the previous week.

Research

How GE Uses Social Tools to Support its Digital Strategies l CIOonline http://trib.al/BS6UoMB

Does the CFO Need to Become a Technologist? l CIOonline http://ow.ly/xcUmz

Concentrating solar power research at PNN Lab & Sandia Labs l Energy http://t.co/39HC3izFD1

Deadline to apply for Illinois Coastal Management Program grants is in one week l IL-IN Sea Grant http://ow.ly/xcUFO

World’s Largest Tracking Solar PV Plant Completed In California l Clean Technica http://dlvr.it/5m2NFm

Check out these “5 Apps For A Citizen Science Summer” l Popular Science http://bit.ly/1gpDpIq

Federal Reserve, Central Banks, & Financial Departments

China’s economy will soon surpass the U.S.’s l St. Louis Fed http://bit.ly/RWnGWq

Teachers: Free interactive eBook to teach your students the basics of saving money l St. Louis Fed http://bit.ly/RHnRVq

Africa has 9% of the world’s water, and only 11% of the globe’s population l World Bank http://wrld.bg/xcfap

Watch: The New Geography of jobs l SF Fed http://ow.ly/xcVY6

Obama to announce Julian Castro’s nomination as HUD Secretary l Housing Wire http://hwi.re/5lxprg

Economists use micro-level banking data to shed light on global transmission of funding shocks l NY Fed http://nyfed.org/1ktRvYN

Thank you as always for joining us on Saturday for HBCU Money™ Dozen. The 12 most important research and finance articles of the week.