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CEO pay survey


OPINION:
Inflation
U.S. chief executives win big on stock gains threatens China’s
economic miracle
Pages 16-17
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VO L . X X X V N O. 5 5 * * Tuesday, November 16, 2010


ASIA
(India facsimile Vol. 2 No. 116)

asia.WSJ.com

Ireland Islam’s hajj pilgrimage draws millions


Fresh attack
MICA (P) NO. 164/10/2010

feels heat
to solicit on Fed plan
SK. MENPEN R.I. NO: 01/SK/MENPEN/SCJJ/1998 TGL. 4 SEPT 1998

a bailout
BY DAVID ENRICH
to buy bonds
AND BRIAN BLACKSTONE BY PETER WALLSTEN makers, including incoming
AND SUDEEP REDDY House Budget Committee
DUBLIN—Wrangling over Chairman Paul Ryan of Wis-
whether Ireland needs an in- WASHINGTON—The Fed- consin, and began discussions
ternational bailout spilled eral Reserve’s latest attempt with potential GOP presiden-
into public Monday, with Irish to boost the U.S. economy is tial candidates over the week-
officials continuing to resist a coming under fire from Re- end, according to a person in-
rescue and European officials publican economists and poli- volved.
ramping up pressure on the ticians, threatening to yank The increasingly loud criti-
troubled country to accept the central bank deeper into cism of the Fed comes as
one. partisan politics. some economic officials out-
The standoff is likely to A group of prominent Re- side the U.S. are criticizing
dominate meetings of Euro- publican-leaning economists, the central bank’s move,
pean Union finance ministers coordinating with Republican which has the side effect of
in Brussels on Tuesday and lawmakers and political strat- pushing down the dollar on
Wednesday, as officials egists, is launching a cam- world currency markets.
scramble to defuse a crisis paign this week calling on Fed President Barack Obama
that is thrusting the EU into Chairman Ben Bernanke to last week defended the Fed.
crisis for the second time this drop his plan to buy $600 bil- The move to buy more bonds,
year. lion in additional U.S. Trea- known as quantitative easing,
In recent weeks, Ireland’s sury bonds. “was designed to grow the
borrowing costs have soared “The planned asset pur- economy,” not cheapen the
to unsustainably high levels, chases risk currency debase- dollar, he said.
and the country’s cash- ment and inflation, and we do The Fed, despite frequent
strapped banks, facing inten- not think they will achieve the criticism from both parties,
sifying liquidity problems, Fed’s objective of promoting has enjoyed considerable in-
have become reliant on the employment,” they say in an dependence from politicians
European Central Bank to fi- open letter to be published as on monetary policy for the
nance their daily operations. ads this week in The Wall past three decades. Organiz-
Getty Images
Hoping to prevent Ire- Street Journal and the New ers of the new campaign pre-
land’s crisis from infecting Muslim pilgrims praying at Mount Arafat, southeast of the holy city of Mecca, on Monday. Nearly York Times. dicted the Fed would increas-
other euro-zone countries three million Muslims were expected to perform the annual hajj in Saudi Arabia, climbing the rocky The economists have been ingly find itself caught in the
Please turn to page 18 desert mountain in one of the cornerstones of the pilgrimage. consulting Republican law- Please turn to page 18

Lone Star will sell KEB to Hana


BY PETER STEIN commercial bank with KEB’s
dominance in trade finance
Lone Star Funds has and foreign exchange. But it
agreed to sell its 51% stake in also means Hana will likely
Korea Exchange Bank to steer clear of the bidding for
Hana Financial Group Inc., the South Korean’s govern-
according to a person close to ment’s 57% stake in Woori Fi-
the transaction, a surprise nance Holdings Co. when
deal that thwarts a rival at- that process moves forward.
tempt by Australia & New Hana and KB Financial Group
Zealand Banking Group Ltd.
Agence France-Presse/Getty Images

Inc. have been considered the


to purchase the stake. most probable suitors for From the mind
Lone Star’s stake is worth Woori.
about $3.8 billion based on Dallas-based Lone Star’s to the marketplace.
KEB’s latest share price. long-running attempts to sell
While the exact terms of the the stake in KEB it acquired Intel is helping university students worldwide
deal weren’t yet known, Hana for $1.3 billion in 2003 have turn their thinking into the businesses of the
would likely pay a premium of been dogged by scandal and
10% or more to the current court cases as well as bad
future. Because encouraging new ideas fuels
market value, the person said. A Hana-KEB tie-up could create a strong domestic player. timing. innovation. Learn more at intel.com/inside.
Lone Star and Hana have After the 1997-98 Asian fi-
signed a memorandum of un- latory approval. bourne-based lender’s efforts nancial crisis, Lone Star and
derstanding, and a sales and ANZ has been conducting to expand in East Asia. other foreign investors
purchase agreement is ex- due diligence on KEB with the A Hana-KEB tie-up could bought assets cheaply and
pected to follow within sev- intent of purchasing Lone create a strong domestic Ko- sold some of them profitably
eral weeks, the person added. Star’s stake, which would rean player that marries as the country’s economy re- 2010 Intel Corporation. Intel, the Intel logo, Intel Sponsors of Tomorrow™ and Intel Sponsors of Tomorrow logos are
The deal will require regu- have vastly boosted the Mel- Hana’s strength as a retail Please turn to page 28 ©trademarks of Intel Corporation in the U.S. and/or other countries.
2 * * THE WALL STREET JOURNAL. Tuesday, November 16, 2010

PAGE TWO

What’s News— Inside


i i i n Carrefour sold its Thailand sto-
Business & Finance ries to Casino’s Big C unit for
$1.19 billion. 26
n Japan’s economy grew faster
than expected in the third quarter, n Facebook unveiled a service
but economists say the momen- that melds email, SMS and instant
tum is fading and there is risk of messaging. Users will get Face-
recession as incentives that book email addresses. WSJ.com
propped up consumption in recent
months have petered out. 3, 34 n Brambles of Australia plans to
spend $1.26 billion to acquire
n China announced new limits IFCO, a supplier of reusable plas-
on the ability of foreigners to buy tic containers for the fresh-pro-
residential or commercial prop- duce industry. 21
erty on the mainland, in its latest
effort to curb the inflows of spec- n Cathay Pacific forecast its full-
China: Beijing cites
ulative money into its economy year profit will be at least $1.61 pollution in tightening
and ease inflationary pressure. 4 billion, more than doubling to a
record thanks to a robust recovery
rare-earth exports. 5
n The collapse of BHP’s bid for in demand for passenger and
Potash raises questions about the cargo services in the region. 22
growth prospects of the world’s
biggest miner. 20 n AXA Asia Pacific is weighing a
new takeover proposal from AMP
n GM plans to price shares in its and its French parent, AXA SA,
initial public offering a few dollars that would end a yearlong battle
above the $26 to $29 range it pre- for the wealth manager. 26
dicted earlier. A decision on the
price was expected Monday but n India’s top court asked a Voda-
isn’t set to be made public until fone unit for a deposit of $558.2
Wednesday. 28 million within three weeks as the
U.K. telecommunications company
n U.S. retail sales rose more than appeals a $2.52 billion tax bill. 23
expected in October as autos re-
corded a strong gain. 3 Auto Industry: Toyota
i i i
n U.S. stocks climbed, as the bet- World-Wide and Honda lose their
ter-than-expected retail report edge in the U.S. 19
boosted investors’ hopes for the n Myanmar democracy icon
holiday shopping season. Japanese Aung San Suu Kyi indicated she
stocks rose on strong data. 25 may be revising her stance on
Western sanctions against Myan-
n Prices of U.S. Treasury debt mar’s military regime. 6
fell as the backlash continued
against the Federal Reserve’s sec- n India’s communications and IT
Associated Press

ond bond-buying program. 24 minister resigned, the third gov-


ernment official to step down
n Two Chinese wind-power com- amid corruption allegations in less
panies hope to raise a combined than two weeks. 5
$2.5 billion via Hong Kong IPOs, Fire engulfed a high-rise apartment building under renovation in Shanghai on
joining a list of renewable-energy Monday, killing 42 people and sending residents scrambling down scaffolding to n The number of North Koreans
firms flocking to the city’s stock escape. The state-run Xinhua news agency cited a witness saying the fire defecting to South Korea has
exchange. 27 began when building materials caught fire. The government said more than 100 surged in recent years because of
fire trucks were called to battle the blaze. economic suffering in the North,
n Mitsubishi UFJ is buying a with more than 10,000 defections Asia Deal Journal:
$6.13 billion portfolio of project- ment have hit a delay because the continued global boom in coal de- over the past three years, South
finance loans from RBS. The Japa- Fed wants to first hammer out mand. 21 Korea’s government said.
Financial companies
nese bank joined its counterparts guidelines on bank dividend in- are on the prowl. 19
in reporting strong results, raising creases. 33 n China unveiled a mock-up of a n Iran’s military will launch a
its full-year earnings forecast. 28 large passenger jet designed to five-day aerial war game on Tues-
n Caterpillar agreed to buy compete with Boeing and Airbus day across the country, one of the
n Goldman’s efforts to win ap- Bucyrus, a maker of mining equip- and predicted that hundreds of or- largest defense drills in the his-
proval to repay a Berkshire invest- ment, for $7.6 billion in a bet on a ders would be placed. 22 tory of the Islamic Republic.

ONLINE TODAY
Most read in Asia Korea Real Time Continuing coverage Driver’s Seat
blogs.wsj.com/korearealtime blogs.wsj.com/drivers-seat

Enjoying the ‘well- Terrafugia Transition


preserved’ nature is ‘indispensable for Aviation: China shows
along the easy day trips from off mock-up of its first
demilitarized zone Long Island to passenger jet. 22
1. Pacquiao Defeats Margarito
2. Backlash Aimed at Australia’s
Big Banks
between North and Martha’s Vineyard.’ THE WALL STREET JOURNAL ASIA
3. Meet in Korea Fuels G-20 Fever
4. Myanmar Frees Democracy
South Korea. On the cover of the latest Hammacher
Schlemmer, a flying car
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Tuesday, November 16, 2010 THE WALL STREET JOURNAL. 3

WORLD NEWS

Japan growth accelerated in quarter


BY ANDREW MONAHAN posed new stimulus steps—such as
support for growing business areas
TOKYO—Japan’s economy grew Japan's GDP and technologies—would push up
faster than expected in the third Annualized change from previous real gross domestic product by 0.6
quarter, but economists say the mo- quarter, seasonally adjusted percentage point.
mentum is fading and there is risk But economists say recent politi-
10%
of recession ahead as incentives cal bickering suggests any further
that propped up consumption in re- 5 stimulus may be difficult to enact,
cent months have petered out. giving the government little room to
Further efforts to support spend- 0 maneuver should the economy enter
ing may not be enough to counter a a sustained contraction.
–5
slowdown with exports, factory out- The opposition Liberal Demo-
put and business investment slow- –10 cratic Party has withheld support
ing as deflation and a strong yen for the current extra budget as it
persist. Real gross domestic product –15 demands sworn parliamentary testi-
increased 3.9% in annualized terms –20
mony from scandal-tainted DPJ

Associated Press
in the July-September period, up 1Q 2Q 3Q 4Q 1Q 2Q 3Q party power broker Ichiro Ozawa.
from revised 1.8% growth in April- 2009 '10 Private consumer spending,
June, the government said Monday. which accounts for nearly 60% of
Source: Cabinet Office
It was the fourth straight quarter of GDP, was up 1.1% quarter-to-quarter
expansion and better than the me- for the three months ended Septem-
Incentives that propped up Japan’s consumption, such as the rush to buy cigarettes before a new tobacco tax and
dian forecast of 2.5% growth in a ber. It rose a revised 0.1% in the pre-
subsidies on fuel-efficient cars helped spur Japan’s economy in the third quarter. Here, a tobacco shop in Tokyo
poll of economists by Dow Jones vious quarter. But so much reliance
Newswires. on stimulus spending suggests a risk
The bump from government growth in GDP in the U.S. in the statement after the GDP release. ber, cutting its key policy interest the economy could fall back into re-
stimulus was bigger than expected, third quarter, and the 1.5% annual- Stoking doubts that the economy rate to a 0.0%-0.1% range from 0.1%, cession as the programs wind down.
as shoppers bought a range of ized expansion in the euro zone. can keep from stumbling, Prime Min- and launching a new program to buy Crédit Agricole’s Mr. Kato expects
goods: cars before the expiry of gov- “The figures are misleading,” ister Naoto Kan’s government has five trillion yen in assets including GDP to contract 0.2% quarter-to-
ernment subsidies for fuel-efficient said Norihiro Fujito, senior invest- kept a lid on fresh stimulus spending government bonds. But the steps quarter in the fourth quarter.
vehicles, air conditioners amid a ment strategist at Mitsubishi UFJ as it tries to cut the country’s mas- could take as long as two years to Third-quarter export growth
scorching summer and cigarettes Morgan Stanley Securities, citing sive public debt, already the largest do much good, Gov. Masaaki Shi- slowed, further clouding the outlook
ahead of a new tobacco tax. the increases tied to the fuel-effi- among rich nations at nearly twice rakawa has said. “This will be the for an economy that heavily relies on
GDP grew 0.9% compared with cient vehicle subsidy and the to- annual economic output. last time for a while that we will see overseas shipments. Exports rose
the April-June quarter, when it rose bacco tax, and adding that con- With its hands tied, the govern- this high a rate of growth,” said Ja- 2.4% from the quarter before, com-
0.4% from the quarter before. sumption will “fall sharply” in the ment will likely bring even more pan Research Institute senior econo- pared with a revised 5.6% expansion
Economists said the results, due October-December period. pressure to bear on the Bank of Ja- mist Hideki Matsumura. The govern- in the previous quarter, as growth in
largely to temporary factors, high- Japan’s economy minister also pan to ease monetary policy further ment and the central bank should overseas markets such as China
light the likelihood of a sharp de- cautioned against optimism. Soften- to fight deflation and the strong “take a more serious look at how se- moderated and the yen strengthened.
cline in the fourth quarter. That ing overseas demand and the strong yen, said Crédit Agricole chief Japan vere the current state of the econ- —Takashi Mochizuki, Kazuhiro
means policy makers will have little yen “could push the economy down,” economist Susumu Kato. omy is,” Mr. Matsumura said. Shimamura, Megumi Fujikawa,
time to cheer, despite the reading said Banri Kaieda, minister of state The central bank unveiled new Mr. Kan’s Democratic Party of Kana Inagaki and Kosaku Narioka
topping the 2% annual rate of for economic and fiscal policy, in a monetary easing measures in Octo- Japan-led government says its pro- contributed to this article.

U.S. retail sales


cartier.com

jumped in October
BY JEFF BATER Excluding autos, all other retail
AND LUCA DI LEO sales rose 0.4%, just shy of the 0.5%
gain that was expected. Clothing-
U.S. retail sales surged in Octo- store sales rose 0.7% in October.
ber, rising above expectations on ro- Sales at sporting goods, hobby, book
bust car sales and solid spending for and music stores increased 1%.
a broad array of merchandise going October gas-station sales rose
into the holiday shopping season. 0.8%. Food- and beverage-store sales
Separately, inventories at U.S. increased 0.3%. Restaurant and bar
businesses in September rose above sales also rose 0.3%. Mail-order and
expectations, a sign of confidence Internet sales increased 0.8%.
among companies in the economic Furniture sales fell 0.7%, as did
recovery. sales at electronics and appliance
Retail sales rose 1.2% last month, stores. Sales at health- and per-
the Commerce Department said sonal-care stores dipped 0.1%.
Monday. Economists surveyed by Inventories increased 0.9% from
Dow Jones Newswires had projected the prior month to a seasonally ad-
sales would climb by 0.8%. The in- justed $1.403 trillion, the Commerce
crease was the biggest since March Department said. Economists sur-
and the fourth in a row. September veyed by Dow Jones Newswires ex-
sales rose 0.7%, revised up from a pected a 0.6% increase. August in-
previously estimated 0.6% increase. ventories also rose 0.9%, revised up
The gain is important for the from a 0.6% increase.
economic recovery. Consumer U.S. business sales accelerated in
spending makes up most of gross September, rising 0.5% to $1.101 tril-
domestic product, which is the lion after an upwardly revised 0.3%
broad measure of U.S. economic ac- gain in August.
tivity. GDP in the third quarter grew The increases in inventories and
a modest 2%, supported by a solid sales were positive signs for the
but not very big gain in consumer economy as companies prepared for
spending. Consumers have been fru- the crucial holiday shopping season.
gal, restrained by a U.S. unemploy- Monday’s inventories report said
ment rate of 9.6%. Still, the latest that at the current sales pace, busi- tortue de cartier
government data show nonfarm nesses had enough goods on hand in
PERPETUAL CALENDAR AND DAYS WITH RETROGRADE HAND 9422 MC CALIBRE
payrolls rose by a greater-than-ex- September to last 1.27 months, the
pected 151,000 jobs in October, a same as the level in August and be-
sign of improving labor conditions low 1.30 in September 2009. 18K WHITE GOLD CASE, OCTAGONAL CROWN SET WITH A FACETED SAPPHIRE, MANUFACTURE

that could lead to stronger spending U.S. companies cut inventories MECHANICAL MOVEMENT WITH AUTOMATIC WINDING CARTIER CALIBRE 9422 MC (33 JEWELS,

and economic growth. furiously during the recession, then 28,800 VIBRATIONS PER HOUR, DOUBLE-BARREL, APPROXIMATELY 52 HOURS POWER RESERVE),
October’s 1.2% increase in retail built supplies back up as the eco- PERPETUAL CALENDAR WITH DISPLAY OF DAYS BY MEANS OF RETROGRADE HAND, COUNTER
sales was powered by strong sales nomic recovery got under way. Now, WITH MONTHS AND LEAP YEAR.
of autos and parts, which climbed firms are trying to keep stockpiles
5%—also the highest since March. in line with demand.
4 THE WALL STREET JOURNAL. Tuesday, November 16, 2010

WORLD NEWS: ASIA

China limits foreign property buys


BY ESTHER FUNG AND JOY C. SHAW small interest group,” Mr. Liu said.
“But when it comes to curbing hot-
SHANGHAI—China announced money inflows, the measures won’t
new limits on the ability of foreign- be that effective.”
ers to buy residential or commercial Wang Tao, economist at UBS,
property on the mainland, in its lat- also said most of China’s capital in-
est effort to curb the inflows of flows stem from Chinese companies’
speculative money into its economy offshore units funneling money into
and ease inflationary pressure. China.
Observers said the effect would “The latest measures is part of a
likely be small, since foreigners basket of policies aiming to cool the
make up a tiny proportion of China property market,” Ms. Wang said.
property sales. But the lack of de- The joint statement also included
tails could add another element of a line saying that the authorities
uncertainty to a real-estate market have room for interpretation of how
that already contends with volatility the new rules could work, possibly
and sharp surges in values. allowing existing rules in the mar-
In a joint statement on Monday ket to still apply.
with the Ministry of Housing and It is still unclear if foreign real-
Urban-Rural Development, the State estate investment trusts or property
Administration of Foreign Exchange developers will be hurt by the rules
said on its website that foreign on commercial property, said UOB
companies can purchase only com- KayHian analyst Johnson Hu. “I
mercial property that they are plan- don’t think the government wants to
ning to use themselves. It also rein- kill off foreign direct investment in
forced existing rules to limit foreign this segment, but is really trying to
individuals to buying one residential clamp down on illegitimate inflows
unit per person for self-use. into the property market,” said Mr.
Foreign investments accounted Hu.
for 0.8% of property development in Xia Bin, a central bank adviser,
China last year, data from the Na- last week called for the authorities
Reuters

tional Bureau of Statistics showed. to investigate hot-money inflows as


The foreign-exchange adminis- some capital has been unlawfully
tration, which regulates China’s cur- A couple walks past a billboard advertising apartments in a new residential building in central Beijing. channeled into the country’s stock
rency and is known as SAFE, didn’t market and the property sector.
offer additional details or examples. sures to further crack down on hot- ber from a year earlier, down from with the purchase capped at one “Policy makers are trying to put
Analysts said the restrictions on money inflows, with senior officials September’s 9.1% increase. apartment for self-use. Both rules on the brakes on capital inflows,
commercial properties probably in the country expressing concern Though the year-on-year rise in are repeated in the current state- similar to what had been announced
pertain to companies that want to that the U.S.’s loose monetary policy October prices was the sixth ment, though the latter rule hasn’t back in 2006,” said Remy Chan,
own and occupy buildings. might send excessive amounts of straight month of falling growth, been effectively enforced. managing director of CBD Commer-
Inflows of what is known as hot money into emerging markets. the slowdown may be too gradual Liu Li-Gang, head of China eco- cial Investment Management. “How
money have complicated the central China’s consumer-price index for policy makers. nomics at Australia & New Zealand these rules are implemented is an-
government’s efforts to tame infla- rose 4.4% in October, accelerating The new restrictions announced Banking Group, said the measures other matter, and if these rules are
tion and lending in order to curb its from September’s 3.6% rise to its Monday are reminiscent of similar could damp some demand in China’s followed to the letter, there could
strong growth rates and contain in- highest level in two years. moves in 2006, when China an- property market, especially the possibly be no foreign investment in
flation. Hot money is speculative Overall property prices in China, nounced measures restricting prop- commercial property sector. commercial property at all, but I
capital that evades regulators in including residential and commer- erty purchases by foreigners. Offi- “Targeting foreign investors is have my doubts. The mature players
China, which keeps tight controls on cial, rose 0.2% in October from Sep- cials then said that only foreigners the easiest administrative means for will always find exceptions.”
its currency. tember, following a 0.5% increase in who have lived in China for more the Chinese government to under- —Owen Fletcher
SAFE last week announced mea- September. Prices rose 8.6% in Octo- than one year can buy property, take because they represent a very contributed to this article.

The rare-earth debate: Asking wrong question?


imports metals from China, has production base in Greenland. diocese released a statement in its
experienced extra scrutiny of A rare-earths case against church publication that expressed
documents by China Customs that China at the WTO, Molycorp’s Mr. “regret” for causing
add “just a couple of days” to Smith said, would likely produce “unpleasantness” for Mr. Li. The
shipments. results only “multiple, multiple statement also mentioned that Mr.
The main issue, Mr. Smith said, years down the road,” he said. Li has decided not to pursue the
is likely a “desire to make sure “Our problem right now is incident and will continue to fund
what is being exported from the immediate.” the diocese’s Caritas charity. The
Chinese ports is being legally —James T. Areddy diocese has otherwise remained
China’s control of the global
Agence France-Presse/Getty Images

exported” as the government silent about the incident.


rare-earth industry is surging pinches smugglers. The priest and the Rev. Law, who remained in
toward the top of the global Mr. Smith said the global Hong Kong, has plenty to say. He
policy agenda. But what should be priority should be to get
businessman insists that his comment was
done? And how much does it alternative producers going, A Catholic priest’s willingness made in a casual conversation
matter? including mines from Australia’s to speak his mind about Li Ka- among friends, in the school
U.S. Secretary of State Hillary Lynas Corp. and Molycorp that shing, the Hong Kong business playground after the Halloween
Clinton raised the issue ahead of are due to restart production in leader who is one of the city’s party.
last week’s Group of 20 nations 2011 and 2012, respectively. biggest real-estate developers, has “I was actually making jokes
summit in South Korea, as did Globally activity is already Hong Kong’s Li Ka-shing prompted meetings with a with my friends,” he says. “It was
business groups around the world. ramping up quickly, as old representative of Mr. Li and an not a talk nor a formal sermon.”
Meanwhile, some have said the industries like the oil sector and disparity between supply and unusual statement of “regret” He says that he didn’t mean to
U.S., Germany or Japan should file new ones like battery makers demand,” he said. from the church—though not from target Mr. Li, that it wasn’t a
a complaint over China’s export clamor for answers. As this Others said demand is merely the priest. personal attack on the
quotas at the World Trade production outside China comes delayed as a result of uncertainty It all started on Oct. 31, when businessman, and that Mr. Li was
Organization. online, supply will actually about what China will do. That Rev. Thomas Law of the Catholic merely used as an example of all
But, as important as rare outstrip demand by around may give impetus to find Diocese of Hong Kong compared property developers.
earths may be for high-tech and 20,000 metric tons in 2015, alternative technologies in Mr. Li to the devil in a discussion However, Rev. Law doesn’t
military applications, is all this according to a presentation by a industries like oil refining and as criticizing property practices. regret making the statements: “I
fuss worthwhile for an industry pair of leading rare-earth analysts new applications like magnetic After a Halloween party, Rev. Law have nothing to add to my
valued at only some $2 billion reviewed by China Real Time. refrigeration get delayed. said that ghosts couldn’t compare comments nor do I wish to
annually? And if it is, then is A California investor, “I wouldn’t take away the fact to greedy property developers and withdraw a sentence.”
confrontation the best strategy? commenting on the presentation, that they are reducing demand. mentioned Mr. Li as the “true —Cathy Yan
In an interview with China Real said such a figure suggests the They are only reducing demand devil that kills people.”
Time in Hong Kong last week, idea that China’s lock on rare because they can’t secure supply,” Local media picked up Rev. Keep up on China minute by
Molycorp Inc. Chief Executive earths will constrict global said James Tuer, president of Law’s comments, which made minute with The Wall Street
Officer Mark Smith said that his industry is mostly hype. “Now Hudson Resources Inc., which is their way to the property Journal’s China Real Time Report
company, which occasionally there’s a larger [looming] developing a rare-earth magnate. Last week, the Catholic at blogs.wsj.com/chinarealtime
Tuesday, November 16, 2010 THE WALL STREET JOURNAL. 5

WORLD NEWS: ASIA

China points to rare-earth pollution


Officials signal they will tie exports of key minerals to environmental standards, potentially tightening supplies
BY JAMES T. AREDDY als for export “should comply with
related regulations on development
Chinese officials are signaling plans, policies and management of
greater efforts to tie the export of A slice of the pie the rare-earth industry and obtain
rare-earth metals to tougher envi- 2010 world rare-earth reserves the ISO 9000 quality-system certifi-
ronmental standards, suggesting cation,” a reference to standards of
worries over supplies of the critical the International Organization for
elements could continue. Standardization representing good-
Others China
China’s Ministry of Commerce quality management practices.
22% 32.7%
said late Thursday that it will re- While the Commerce Ministry’s
quire applicants for quotas to export power to remake the rare-earths in-
the metals—used by everyone from dustry or dictate export policy is
battery makers to car compa- Former limited, industry participants say
Soviet
nies—to ensure that best practices India Beijing is serious about cleanup.
Union
are adopted during their mining and 1.0% Rare earths often exude radioactiv-
17.8%
processing. Exporters that can’t will ity, and dangerous chemicals are
be blocked from exporting. Australia used to separate them from other
The ministry said the strategy is 4.9% minerals.
U.S. Vietnam
intended to “increase rare-earth At the Hong Kong conference,
12.2% 9.4%
production concentration and cut Mr. Chen cited Chinese miners’
the number of export enterprises.” “sabotage of nature,” processors’
Source: Chinese Society of Rare Earths, Beijing
A top Chinese researcher out- “pollution by waste water, slag and
lined to an industry conference in gas in smelting and separation” and
A laborer works at the site of
Hong Kong last week the environ- the industry’s large-scale use of acid
a rare-earth metals mine at
mental toll the mining takes. The and alkali.
Nancheng county, Jiangxi province.
process produces waste that has He alleged that product smug-
“led to heavy pollution of the atmo- gled out of China often originates
sphere, water and land,” said Chen from the dirtiest facilities and that
Zhanheng, a researcher at the Chi- uncontrolled mine development has
nese Society of Rare Earths, accord- products like Swiss watches and ap- has moved in recent weeks to earth minerals] as some kind of a shrunk China’s untapped reserves to
ing to a presentation reviewed by plications including petroleum soothe worries over tight supplies. tool,” Japanese Prime Minister less than a third of the global total
The Wall Street Journal. cracking, but they also may have fu- The topic was broached over the Naoto Kan said in a news conference from more than 40% in 1998.
Beijing’s rare-earth policies re- turistic uses. weekend at the Asia-Pacific Eco- Sunday. “I’d like to calmly deal with Some industry experts who lis-
verberate globally even when they A tightening of export quotas nomic Cooperation forum in Yoko- this issue after determining how tened to Mr. Chen said the starkest
are designed to address domestic is- this year has sent global prices hama, Japan, which included the China will respond from here.” element of the presentation was his
sues such as pollution. China mines, soaring as buyers worry about sup- leaders of China, Japan, the U.S. and Details of the Chinese Ministry use of satellite imagery to illustrate
produces and processes about 97% plies, especially in the largest im- other Pacific rim economies. of Commerce’s environmental direc- how landscapes around China’s pro-
of rare-earth elements. porting nation, Japan. While Beijing “It seems that the Chinese side is tive were minimal. Its statement duction facilities now feature life-
The metals are used in everyday has said it will maintain quotas, it saying it doesn’t intend to use [rare- said companies handling the materi- less terrain and radioactive lakes.

Indian telecom
minister resigns
BY DHANYA ANN THOPPIL stepped down over separate corrup-
AND AMOL SHARMA tion allegations. Both have denied
wrongdoing.
NEW DELHI—Indian Communica- This comes at a time when Par-
tions and Information Technology liament is struggling to focus on its
Minister Andimuthu Raja resigned legislative agenda. The opposition,
late Sunday, the third government led by the Bharatiya Janata Party,
official to resign amid corruption al- has brought parliamentary proceed-
legations in less than two weeks. ings to a halt over the spectrum is-
Kapil Sibal, minister of human sue since Parliament’s winter ses-
resource development, was named sion started Nov. 9. Mr. Raja said he
to take up his duties, the Indian agreed to step down on the advice
government said late Monday. of M. Karunanidhi, leader of Mr.
Mr. Raja has faced scrutiny by Raja’s Dravida Munnettra Kazhagam
India’s political opposition over alle- party, a coalition partner of the rul-
gations that he favored some tele- ing Congress party.
communications firms over others One of the most serious accusa-
in their application for radio air- tions against Mr. Raja is that he al-
waves, or spectrum. Specifically, the legedly retroactively changed the
opposition has accused Mr. Raja of deadline for applying for spectrum
allegedly allocating spectrum to from Oct. 1, 2007, to Sept. 25, 2007,
nine telecommunications companies in order to favor firms that applied
in an irregular manner and at dis- earlier while leaving others out.
counted prices in 2008. The allega- Opposition party members also
tion is that these practices cost the accuse Mr. Raja of massively under-
country as much as $40 billion. valuing what is known as the 2G
The office of India Prime Minis- spectrum, frequencies used to trans-
ter Manmohan Singh said Mr. Raja’s mit phone calls and text messages to
resignation was accepted. mobile phones. They allege he sold
Mr. Raja wasn’t available to com- each license for a fixed price of about
ment. Speaking to reporters in Delhi $366 million, a small sum compared
after submitting his resignation Sun- with one slot of nationwide band-
day, Mr. Raja denied wrongdoing, width for third-generation, or 3G,
adding he resigned “in order to avoid services, that went for about 10 times
an embarrassing situation to the gov- that amount at a government auction
ernment and…Parliament.” He, this year. The 3G spectrum powers
added, “I’ll prove that I did every- internet wireless signals on phones.
thing in accordance with the law.” Mr. Raja says his move to allo-
Mr. Raja’s resignation comes cate spectrum to nine new industry
shortly after former Maharashtra players helped to drive down prices
Chief Minister Ashok Chavan and and sparked massive growth. India
former Congress Parliamentary now has more than 670 million cell-
party Secretary Suresh Kalmadi phone subscribers.
6 THE WALL STREET JOURNAL. Tuesday, November 16, 2010

WORLD NEWS: ASIA

Suu Kyi considers shift on sanctions


Key issue faces opposition leader as other dissidents’ view has swung in favor of lifting measures against regime
By a WSJ Staff Reporter on the effectiveness and humanitar-
ian impact of sanctions so far,” says
A top item on the agenda of Thant Myint-U, a historian and ex-
Myanmar democracy icon Aung San pert on Myanmar affairs in Bangkok.
Suu Kyi after seven years of house Attempts to reach the Myanmar
arrest is her stance on Western government, which rarely speaks to
sanctions against Myanmar’s mili- foreign journalists, didn’t succeed.
tary regime, and she has indicated Ms. Suu Kyi spent much of her
she may be revising her thinking. day Monday working with support-
Whether that means she may ers to develop strategies for revital-
throw her weight behind calls to re- izing her moribund political organi-
peal the sanctions may remain un- zation, the National League for
clear for a while as she settles into Democracy, which was officially dis-
a new work routine after her release banded by the government this year
Saturday. after it declined to participate in
Ms. Suu Kyi previously backed Myanmar’s first national election in
sanctions, but many dissidents who 20 years. The government has yet to
have become more prominent since release full results from the Nov. 7
she was confined to near-isolation vote, but state media have said the
in 2003 have argued publicly that at Union Solidarity and Development
least some of the sanctions imposed Party, considered a proxy for the re-
by the U.S., Europe and other West-
Agence France-Presse/Getty Images

gime, secured a majority in both


ern countries should be abandoned houses of the country’s new Parlia-
or revised because of fears they are ment.
harming everyday citizens more Many American and other West-
than they hurt the regime. ern companies have long hoped for
The rules include bans on im- more access to Myanmar, which has
ports of products made in Myanmar, vast natural resources including
also known as Burma, and restric- natural gas and timber, and a siz-
tions on Western corporate invest- able, though poor, consumer market
ment there. The sanctions have been Aung San Suu Kyi addresses supporters at the National League for Democracy headquarters in Yangon on Monday. of 53 million people. But they have
in place mainly since the mid-1990s largely steered clear of actively lob-
to put pressure on Myanmar’s mili- complicated to assess, and some ar- such a move would trickle through stopped short of committing herself bying for changes in the sanctions
tary regime, which has been accused gue it is primarily the economic pol- to at least some ordinary citizens. to either side. “If people really want out of fear of triggering a backlash
of widespread human-rights abuses, icies of the regime that are keeping In her first interviews and meet- sanctions to be lifted, I will consider from activists that oppose more cor-
including torture, forced labor and Myanmar from prospering. Simi- ings with diplomats since her re- this,” she told reporters on Sunday. porate investment in Myanmar.
bloody crackdowns on dissidents, larly, the effects of a lifting of the lease on Saturday, Ms. Suu Kyi said “This is the time Burma needs help.” “American firms would urge
since it took over in 1962. sanctions are also unclear, though she was willing to consider some re- People familiar with Ms. Suu Congress and the [Obama] adminis-
The effects of the sanctions are many believe that benefits from vision of sanctions, though she Kyi’s activities over the past several tration to consider easing the sanc-
years say she spent considerable tions, if Ms. Suu Kyi and the opposi-
time thinking about the sanctions tion signal an openness to revisions

Go issue while under house arrest, and


studied economic reports that made
in the sanctions regime,” said Tami
Overby, vice president for Asia at
ahe a case for revising them. the U.S. Chamber of Commerce. “It’s

TOU ad a She also discussed the issue with fairly clear that the sanctions ha-
Western diplomats in meetings held ven’t brought political change, but
nd in late 2009 and expressed a will- instead have outsourced jobs from

mak ingness to reconsider some of them,


the Associated Press reported.
U.S. firms to their competitors in
other countries that trade freely
e th Ms. Suu Kyi has already modified with Myanmar,” she said.

DEC G
her views on other approaches to Sanctions still have backing from
e bringing down the junta. In past some Myanmar dissidents who note

ISIO H
years she backed calls for tourists to that Myanmar’s military owns a ma-
boycott the country, but has soft- jority stake in virtually all enter-
ened her stance in recent years prises responsible for extracting
amid arguments from many dissi- natural resources, according to the
dents who believe more tourism will U.S. government, which means that
help boost incomes and expose resi- income from many major invest-
dents to other political views and ments would likely flow directly to

NS.
news of the outside world. the regime.
D&O insurance that This time, her supporters believe The recent release of Ms. Suu Kyi
will be there for you. she may be looking to get in step “is proof that sanctions and pres-
with the increasing number of dissi- sure work, and therefore collective
The risks faced by directors, dents who don’t believe the sanc- and effective pressure from the in-
officers and companies are tions are working. She may also be ternational community is required
looking to use the issue as a negoti- more than ever” to ensure the re-
constantly changing. That’s why ating tactic with the regime. lease of other prisoners and to dis-
It is highly unlikely that Western courage the regime from rearresting
we’ve enhanced our Directors
governments would consider any Ms. Suu Kyi, said Aung Din, execu-
and Officers liability insurance to sanctions revisions without a clear tive director of the U.S. Campaign
endorsement from Ms. Suu Kyi. The for Burma, a Washington-based dis-
safeguard individuals’ personal assets
U.S. and other governments ap- sident group.
and protect the organisations they proved progressively tougher sanc- The central argument against
tions largely out of protest of Myan- sanctions, echoed by many econo-
serve in today’s changing risk landscape.
mar’s treatment of Ms. Suu Kyi, and mists, is that some of them hurt
It’s market-leading coverage built on they have long taken cues from Ms. more people than they help. Econo-
Suu Kyi and her political allies in mists widely blame U.S. trade re-
40 years of D&O experience. Learn more
framing their policies toward the strictions for ripping apart Myan-
and find out if your current insurance is Myanmar regime. mar’s garment industry in the past
U.S. Secretary of State Hillary several years, throwing as many as
doing enough. www.chartisinsurance.com Clinton said in a statement Nov. 7 80,000 young women out of work.
that the U.S. “will maintain rigorous Many also question their effec-
sanctions against members of the tiveness, since Asian countries such
regime and their supporters.” as China and Thailand haven’t fol-
Canadian Prime Minister lowed suit, allowing Myanmar’s gov-
Stephen Harper also said Saturday ernment to sidestep negative impact
that Canada’s sanctions will remain from the rules. Trade between
in place. Myanmar and China has more than
All products are written by insurance company subsidiaries or affiliates of Chartis Inc. Still, Ms. Suu Kyi’s release, and quadrupled over the past decade,
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her comments, have already trig- while the government’s foreign-ex-
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“I hope that this will at least estimated $6 billion, from just $30
lead to an honest and open debate million in 1988.
Tuesday, November 16, 2010 THE WALL STREET JOURNAL. ** 7

WORLD NEWS

Italian resignations add


pressure on Berlusconi
BY STACY MEICHTRY The departures will also deepen tivity,” according to a statement by
a political feud between Mr. Ber- the president’s office on Monday.
ROME—Top Italian officials ten- lusconi and his former ally that has Both Mr. Berlusconi and Mr. Fini
dered letters of resignation to Prime paralyzed Italy’s political system for have refused to budge, because nei-
Minister Silvio Berlusconi on Mon- months. Mr. Fini has repeatedly ther wants to be blamed by voters
day, stepping up pressure on the called on the prime minister to step for triggering a government crisis at
premier to pull the plug on his em- down and allow Italy’s president, a time of economic uncertainty. Ana-
battled government. Giorgio Napolitano, to decide lysts, however, warn the paralysis it-
By offering to resign, Andrea whether to form a new government self is the biggest risk to Italy’s
Ronchi, minister of European policy; or dissolve Parliament—a step that slow-growing economy.
Adolfo Urso, deputy minister of in- paves the way for early elections. “Our main concern is that the
dustry; and two undersecretaries Mr. Berlusconi, however, has stead- complex political situation will lead
threw their support behind Gian- fastly refused to resign, demanding to a stalemate…leading to a failure
franco Fini, who leads a group of that Mr. Fini bring down his govern- to engineer policies aimed to boost

Zuma Press
conservative lawmakers who have ment in a confidence vote in Parlia- productivity,” said Deutsche Bank
broken away from Mr. Berlusconi. ment. analyst Marco Stringa.
If Mr. Berlusconi accepts the res- A confidence vote is expected to Mr. Berlusconi’s allies seized on
ignations, which were confirmed by take place after Parliament approves Monday’s resignations, painting the Italian Premier Silvio Berlusconi is resisting calls to dissolve his government.
the officials’ spokesmen, he will face amendments to Italy’s three-year moves as an act of political treach-
the challenge of finding successors budget. So far, the vote on the ery by Mr. Fini. “The betrayal has premier’s governing style. Mr. Fini courting other centrist parties for
in an increasingly hostile political amendments hasn’t been scheduled, begun,” Labor Minister Maurizio has now set up his own political support in Parliament.
landscape. Mr. Berlusconi recently but the budget is due by the end of Sacconi told reporters. party, Future and Freedom for Italy, In recent weeks, Mr. Fini has
named a new industry minister after the year. On Tuesday, Mr. Napolitano Mr. Fini and his allies helped Mr. which has enough lawmakers to de- ratcheted up criticism of Mr. Ber-
several months of searching—a de- will meet with Mr. Fini, who is also Berlusconi found his People of Free- prive the government of a majority lusconi as the premier grapples with
lay that stirred widespread condem- speaker of the lower house, and his dom party nearly three years ago. in the lower house of Parliament but a range of controversies.
nation from business leaders and Senate counterpart to “examine the This summer, however, the party ex- weaker support in the upper house, —Giada Zampano
unions. next deadlines of parliamentary ac- pelled Mr. Fini for criticizing the the Senate. Mr. Fini has also begun contributed to this article.
8 THE WALL STREET JOURNAL. Tuesday, November 16, 2010

WORLD NEWS: U.S.

A White House construction job: building bridges


comfortable Democratic majorities The need to build better ties to Oval Office meeting with Senate months ahead.
[ Capital Journal ] in Congress that served as his Republican leaders is obvious, but Republican leader Mitch These Democratic moderates,
lifeline for two years. the task may be even more McConnell on Aug. 4, 2010, a year particularly in the Senate, worked
BY GERALD F. SEIB To exit from that island, he arduous than it seems. One of the and a half into his presidency. over the last two years to nudge
needs to build bridges to three choices the Obama White House Relationships between the White legislation from the left toward
As the White groups: Republican leaders in both made early on was to essentially House and the Republican leaders the political center, in ways that
House fills some houses of Congress, moderate contract out details of its with whom the White House now annoyed the White House. But
important Democrats in the congressional legislative strategy to Democratic must work are minimal and now they have the ability in the
vacancies in rank and file, and the business leaders in Congress. Mr. Obama strained; they will need a lot of new Congress to nudge legislation
coming days, it community. Such bridges don’t often dived into legislative details, nurturing. from the Republican right toward
might want to simply materialize. They have to but largely in discussions with Second, consider rank-and-file the center, this time in ways that
include this new job: bridge be built, and the White House leaders of his own party, and moderates in Congress from the can benefit the White House.
builder. could use a respected figure from rarely with leaders from the other president’s own party. The corps Again, though, relations with
In his tenuous post-election the outside to help. party. of these lawmakers was ravaged this group suffered in the last two
condition, President Barack Let’s look at the three groups A simple illustration of that by this months’ election, so their years as the White House focused
Obama finds himself on a political where such a figure could prove reality: Mr. Obama held his numbers are down. Yet their on working with the more-liberal
island, no longer linked to the useful. first—and so far only—one-on-one importance actually may go up in Democratic congressional leaders.
Moreover, many moderates blame
the White House for their own
election shellacking. The
relationship needs work.
Third, there’s the business
community. Mr. Obama has held
plenty of meetings with business
executives, and his staff works the
account hard. Yet ties have grown
more strained anyway. There is a
tendency for the two sides to talk
past each other—a bad state of
affairs when much of the capital
to create jobs is locked up in
corporate bank accounts.
On all these fronts, a bridge
builder in the White House would
be useful. In today’s polarized
Washington, such figures are
rare—but they do exist. Here’s
just one example: Kenneth
Duberstein, former White House
chief of staff for Republican
Ronald Reagan, who reversed field
to endorse Democrat Barack
Obama in the 2008 presidential
campaign.
Mr. Duberstein has traversed
the partisan and ideological
landscape in a long Washington
career. He started as an aide to
liberal Republican Sen. Jacob
Javits, moved into the centrist
administration of Gerald Ford, and

Reason to rally. finally into the White House of


Mr. Reagan, a conservative
Republican.
His White House experience

Dow Jones Indexes, now most relevant to today’s situation


came not as chief of staff in the
final stage of the Reagan
presidency, but in his role as the

a CME Group Company. man in charge of relations with


the Democratic-controlled House
at the outset of the Reagan years.
The only way for a Republican
president to accomplish anything
then was to win support—lots of
Dow Jones Indexes, the name behind some of the world’s most it—from across the aisle. So Mr.
Duberstein learned to assiduously
esteemed and vital market indicators, is now backed by CME Group,
court Democrats, one by one.
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• Delivers powerful market insight through dynamic market Mr. Duberstein has built bonds
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measures, industry leading service and real-time information where the Obama White House
needs some help, the business
Join us in setting a new global standard in index services. community. He runs a consulting
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Help could come from other
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marks of Dow Jones Trademark Holdings, LLC (“Dow Jones”), and have been licensed for use by CME Indexes. “CME” is a trademark of Chicago Mercantile Exchange Inc. job—one requiring a bit of help.
Denim dilemmas 10
THE PRICE OF FAME 11

TUESDAY, NOVEMBER 16, 2010


LIFE & STYLE ** asia.WSJ.com

Art sales crack $1 billion, again


Impressionist, modern, contemporary works fare well at New York’s fall auctions
BY KELLY CROW

The U.S. art market is powering ahead.


During New York’s flagship fall art auctions
that concluded Thursday, leading houses So-

Heritage Auctions
theby’s and Christie’s International brought
in about $1.1 billion—nearly doubling their
sales total from last fall.
The latest tally also kept pace with the
houses’ $1.1 billion sale in May, indicating GOOD CONDITION: James Irwin’s space suit is
that price levels for high-end art have either up for sale at Heritage Auction Galleries.
reached a plateau or settled into a reliable
rhythm, after several roller-coaster seasons.
This round of Impressionist, modern and
contemporary art sales also contained 40%
Here’s hoping
space suit has
more works than last fall’s sale, and the mar-
ket passably absorbed the boosted volume:
Around 68% of the 2,266 offered works sold.

the right stuff


But the market remains far from its fever
peak of three years ago, when bidders regu-
larly paid triple the asking prices for even
untested artworks.
This time around, bidders were willing
to compete for pieces at a wider variety of BY KATHERINE BINDLEY
price levels, rather than holding out for the
trophies. This season’s included Amedeo In one small step for the space-memora-
Modigliani’s cranberry-colored “Nude Sit- bilia market, Heritage Auction Galleries will
ting on a Sofa (The Beautiful Romanian),” offer on Wednesday a space suit worn by
which Sotheby’s sold for $68.9 million. Top astronaut James Irwin during his training
honors at Christie’s went to Henri Matisse’s for the Apollo program. The suit is ex-
hard-edged bronze, “Back IV,” which sold pected to sell in the Dallas auction for at
the following day for $48.8 million. least $16,000.
Phillips de Pury & Co., a boutique auc- A space-market item’s value varies
tion house with a new Park Avenue show- greatly depending upon where it has been,
room, sold $143 million of contemporary and whom it belonged to. Objects that were
art—including the fall sales’ priciest piece taken into lunar orbit typically sell for
of postwar art: Andy Warhol’s $63.4 million more than those that stayed on Earth, but
“Men in Her Life,” a 1962 image of Eliza- not as much as those that actually landed
beth Taylor flanked by former flames. on the moon.
Hedge-fund billionaire Steve Cohen bought Mr. Irwin’s 1967 suit is advertised as being
Warhol’s “Coca-Cola [4] [Large Coca-Cola]” in “very good condition,” but it was worn
for $35.3 million at Sotheby’s on Tuesday. only for training and never went into space.
(lChristie’s (2); Sotheby’s (Nude Sitting on a Sofa (The Beautiful Romanian))

Christie’s won the latest series, selling Heritage also wants at least $8,000 for a boot
$682 million of art and besting Sotheby’s and $4,000 for a glove, both of which never
$535 million total. The big houses capital- left Earth. Prices for space memorabilia rose
ized on the recession-proof appeal of Pop with the 40th anniversary of Apollo 11 last
art, whose cheery colors and grocery-aisle year and have since leveled off, according to
imagery remain popular with international Mike Constantine, owner of the space-memo-
collectors who aren’t yet ready to splurge rabilia website Moonpans.
for edgy unknowns. Christie’s sold Jeff Unlike old master paintings, top space
Koons, Balloon Flower (Blue) for $16.9 mil- gear can still be amassed by the everyday
lion and Roy Lichtenstein’s “Ohhh…Alright…” collector. A Neil Armstrong signed photo-
for a record $42.6 million. graph can sell these days for around $4,000.
Those seeking value buys bypassed Pop. The Pittsburgh-born Mr. Irwin walked on
New York dealer Nathan Bernstein only had the moon for more than 18 hours during the
to place a single bid at Sotheby’s to win 1971 Apollo 15 mission, which focused on sev-
Ellsworth Kelly’s abstract “Cowboy” for $1.7 eral scientific projects. He died of a heart at-
million, under its $1.8 million low estimate. tack in 1991. Patches, or emblems, from a suit
“At a sale so big, some things can fall he wore to the moon fetched $358,000 at a
through the cracks,” he said. Christie’s auction in 2001. As far as auctions
go, he ranks behind Mr. Armstrong, whose
After several up-and-down memorabilia often commands higher prices
seasons, Sotheby’s and than that of other astronauts.
Christie’s New York fall art The players in the space-memorabilia
auctions turned in steady market have changed several times since
results. this time around the 1990s, according to Alan Lipkin, senior
Above, Amedeo Modigliani’s vice president of one of them, Regency-Su-
‘Nude Sitting on a Sofa perior. Houses like Bonhams New York and
(The Beautiful Romanian)’ Heritage have added space auctions to their
which was sold at regular calendars, while others like
Sotheby’s for $68.9 million; Christie’s have scaled back offerings.
Right, Jeff Koons, Balloon Collectors seem to prize anything an as-
Flower (Blue) which was tronaut took onto the surface that has
sold at Christie’s for 16.9 moon dust on it, like the nametag of Edgar
million; Left, Roy Mitchell that sold at a Heritage auction for
Lichtenstein’s $59,750 in April. At the same auction, a
“Ohhh...Alright...” which sold technical manual that never left Earth sold
for $42.6 million at for $35,850 because it was part of Apollo
Christie’s. 11, which first landed men on the moon.
10 THE WALL STREET JOURNAL. Tuesday, November 16, 2010

LIFE  STYLE

True blue: the importance of denim


As the weather changes, jeans help pad out holes in your wardrobe. How do you get the perfect fit?
Armani logo on their back pocket.
[ Style ] The great thing about Armani,
well, there are many great things
BY TINA GAUDOIN about Armani, but the principle
one is the company’s adherence to
A designer once  Relaxed skinny jeans by Gap the brand and brand values. Empo-
told me to only rio Armani jeans really are de-
buy my jeans from signer jeans; they look stylish, they
Gap, “because wear well, the quality is good and,
spending money of course, they bear “that” label.
on expensive Otherwise, here follows a list of
denim is a waste the designers whose jeans I rate,
of time.” I won’t mention the de- because they have something a lit-
signer’s name because I think they tle different about them and, more
now have a denim line; but I will crucially, they reflect the ethos of
say that generally speaking, I the brand (otherwise, as my de-
think they were right. signer friend so bluntly pointed
I’m writing about jeans this out, why spend the money?)
week, following swiftly on from For the leggy Italian look, try
parkas because like your outer- Dolce & Gabbana’s narrow-legged
wear, you need to be sure that denim jeans with a darker denim
during the transition of seasons stripe on the side seam. For the
you have your ducks (well, jeans) slightly loucher French silhouette,
in a row. We all know that jeans I like APC’s navy straight legs and
are no longer old faded faithfuls Vanessa Bruno’s loose-fitting,
that you sling on at the weekend; slightly distressed denims. Jeans-
and you might also know that aholics and celebs swear by J
thanks to Balmain, there’s a buoy- Brand’s long, lean lines and their
ant market for jeans worth $1,000 mega-stretch denim with a touch
plus. Perhaps you, like me, find of spandex—check out their web-
the idea of paying the same price site to see who wears what
for a pair of jeans as you might (www.jbrandjeans.com). Person-
for a pedigree dog or a month’s ally, I always feel as though I’m
groceries abhorrent. If you don’t, wearing tights when I’m wearing J
well, I respect your opinion, but I Brand (even their notorious, note-
sincerely hope that if you have worthy Houlihan pants have that
that sort of income, you donate at “suck it all in” feel about them,
least double that amount to char- which is also why they work). My
ity on a monthly basis. friend Jane, a fashion editor who
Jeans are important because ‘Sexy boot wears jeans like most people wear
they fill the gaps, such as those cut’ jeans their own skin, raves about Cur-
Gap (3)

left by a summer wardrobe which by Gap— rent/Elliott and a new brand


has been long packed away, and a for day.  Gap black legging jeans—for night. called Genetic Denim.
winter wardrobe which the I know there are a few of you
weather has yet to demand. I’m out there who frown upon jeans
not saying you should wear them It used to be that jeans weren’t wearing the results). money. I’m now the proud owner as a poor excuse for getting
to the office; but, then again, sev- good for your self esteem; but that Don’t fall for the “you can dress of one pair of “relaxed skinnys” for dressed. To a certain extent, I
eral male friends of mine in senior was in the days before stretch was jeans up or down” line. You can’t. weekends, one pair of “sexy boot- agree. As I pointed out initially,
positions, who frankly should know introduced, when lying down on You need to buy jeans for the occa- cut” for the daytime and a pair of jeans are a fail-safe, but that’s not
better, are to be seen sporting the floor and hauling on the coat sion. Your baggy Saturday touch- black “skinny jeggings” for the enough of a reason to wear them
jeans, blazers and brown suede hanger placed strategically into line specials will not translate to evening. Actually, scratch that. repeatedly and without imagina-
Tods on a Friday. Lazy male dress- your zipper was the only means of an evening outfit, even worn with Having previously been a jeggings tion. Repetitious denim wearing
ers aside, other gaps for us fe- “closure” should you have gained a heels and a silk shirt. I don’t care skeptic, I’m now a convert. Why can engender sartorial and intel-
males include those created by few pounds. Designing body-af- how many fashion magazines try did it take so long to create trou- lectual ennui. For those amongst
mandatory attendance at Saturday firming (if not life-affirming) jeans to tell you otherwise. All credit to sers that look like jeans but fit and us who just don’t ”do” denim, may
football games; “informal suppers” has become an art form and I Gap then for training their special- stretch like leggings? I point you in the direction of the
given by people we don’t know firmly believe that Gap is leading ists to make the very first question There’s a chance, of course, pricey Giorgio Armani black label,
well (be sure to wear some serious the way, not only because they are “what do you want the jeans for?” that you might be a denim snob. where their selection appears to
jewelry if you take this route—“in- affordable, but also because their In my case, weekend, daily work That’s O.K. I’m a chocolate elitist. be limited to two exquisitely cut
formal” is a ruse to test your met- denim “experts” are on hand to wear (to be worn with a simple We all have our weaknesses. In styles in expensive black denim?
tle and it certainly doesn’t mean guide you through their veritable cashmere sweater and boots) and which case, I heartily recommend “These,” said the saleswoman to
“don’t try”); and periods of unem- denim maze. one pair for the evening. I tried on Emporio Armani for jeans for ei- me proudly when I enquired about
ployment when Marni dresses and This was my second visit to the 10 pairs in varying styles, sizes ther sex and most especially for the high-legged, classic cut, “are
Chanel boucle simply get in the Gap denim specialist; my last was and shapes, and guess what? troublesome, fashion-aware teens. for people whose ‘thing’ is not
way of dishwasher loading. about four years ago (and I’m still Denim supremo was right on the Nothing satisfies quite like that jeans.” Perfect then.

ASK TERI | By Teri Agins

Tentative first steps for a junior fashionista


Q: I am a 16-year-old high-school A: I vividly recall the excitement and over leggings and boots—a great look favorite images of models and
student who would like to spice up uncertainty that swirled around for tall girls. Pile on ropes of long celebrities to adapt. Grab more
her wardrobe. I often wear jeans getting dressed in the 9th grade—for pearls and chains, long scarves, fitted ideas from the colorful
and a T-shirt, but I would like to me, back then, in the latest go-go jackets and bangle bracelets. Top it storyboards on Polyvore.com and
update my look [and make it] a boots and miniskirts. The hard part off with a sassy beret. Lucky, the shopping magazine.
little more fashion-conscious and for junior fashionistas without an When you’re back in jeans, doll Don’t fret about your modest
pulled together. I am tall and unlimited allowance or a part-time them up with tops featuring unusual bustline at this point, as tops with
relatively flat-chested. Could you job is turning 30 bucks into a details such as asymmetrical gathered necklines and ruffles will
give me some advice on accessories winning look for the party Saturday necklines. Try wearing a cropped top help make you look fuller up top.
and additions to my closet that night. But with a little practice you tucked in, so you can add a belt with Or why not play up your high-
would help me look cute and can get there. a medallion buckle. Instead of fashion figure in fitted tops—think
pulled-together at school? I don’t As you ditch your 24/7 jeans sneakers, try short boots, including of icons like Twiggy and Audrey
want to look too adult, but I feel habit, think vibrant colors, prints and cowboy styles. Hepburn? For the rest of your life
like it’s time to be a little more a mix of textures—from appliqués to Study the window displays at you will have to make fashion
Kim Rosen

trendy. sequins to chunk knits. A-line mini fast-fashion chains like H&M and work for your body, which will
—S.B., Yarmouth, Maine dresses and tunic tops are versatile Forever 21, and keep a folder of keep changing over the years.
Tuesday, November 16, 2010 THE WALL STREET JOURNAL. 11

LIFE & STYLE

Vend it like Beckham: Why some stars earn more


The economics of celebrity don’t always seem to add up. But there is a way to calculate the formula
Why do stars get paid so
much—and why do some stars get
paid so much more than others?
It can be a complicated formula.
The top celebrities are like small
economies unto themselves, gener-
ating enormous revenues and sup-
porting whole industries. Britney
Spears alone has accounted for hun-
dreds of millions of dollars in eco-
nomic activity over her career.
In “Starstruck: The Business of
Celebrity” (Faber and Faber, 2010),
Elizabeth Currid-Halkett looks at
Getty Images (4)

the financial mechanics of the celeb-


rity world, from art to sports to
Hollywood and even to academia.
Talent matters, to be sure, but
the stars who earn the most, ac-
cording to Ms. Currid-Halkett, are DAVID BECKHAM is one of the highest- TALENT IS MORE difficult to THE CONTROVERSIAL WORKS of the POP MUSIC is turning more and more
not always the ones who obviously paid football players in the world. For measure in Hollywood than in most British artist Damien Hirst always into a world of superstars, according to
possess the most talent. They tend the 2010 season, he will earn $6.5 other industries. Jennifer Aniston has create buzz. He first became famous in the economist Alan Krueger. He found
instead to be individuals who simply million in guaranteed compensation for never been nominated for an Oscar, the 1990s for suspending a dead shark that in 1981 the top 1% of artists took
have a knack for getting people to playing in Major League Soccer. His but she gets endless attention from in formaldehyde. A 2007 piece called in 26% of concert revenue. By 2003,
pay attention to them. And big audi- celebrity is a big draw. Studying the celebrity magazines, and she brings in “For the Love of God,” a diamond- the top 1% took in 56%. Among the
ences translate into big business. 2007 season, sports economists found audiences simply because they like encrusted skull, sold for $100 million. biggest winners is Beyoncé Knowles,
Here is a look at the economic that average ticket sales for all MLS her. She earns an estimated $25 “Hirst is as much or more known for his who has translated her fame into a
calculus for four famous people games were 16,758. When Mr. Beckham million a year, including endorsements lifestyle as for his art,” art historian vast empire, earning an estimated $80
from a variety of fields. was playing, sales went up to 37,659. and back-end revenues. Julian Stallabrass has said. million a year.
12 THE WALL STREET JOURNAL. Tuesday, November 16, 2010

THE MART ON OTHER FRONTS

BUSINESS OPPORTUNITIES
Lionfish creates uproar,
bringing out the hunters

    BY PAUL GLADER
Key Largo, Fla.
   

F



  
   
   
 

  
     
 


  

   
!
! " #  "
 $% 
&
LUCTUATIONS in the fish popu-
   

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lation are flummoxing ma-
!

 
 & rine scientists the world
) 
    
  
 

* 
  #

  +,  
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,, over. But few species elicit the so-
  * ! -# 
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1 && &
lution served up for the lionfish.


  
  2$34 / 3

#
,,&
“Kill it and grill it!” says Sean


 
 
#
  
 




 
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Morton, superintendent of the

566

&& &
Florida Keys National Marine
3 
  & ")7,,
Sanctuary, a 3,900-square-mile
National Park that is entirely un-
derwater. The park is licensing
AVIATION BUSINESS OPPORTUNITIES hundreds of scuba divers to exter-
minate red lionfish in “no-take”
areas where other fishing and
NEW 2010 CITATION CJ4 

 
 spearing isn’t permitted. “We

      want people to get out there and
2006 pricing. Available immediately. 2010
     
   !"! ##$
Bonus depreciation qualified. Four tube Collins
   
 
    
kill as many as possible,” he says.
Pro-Line, TCAS II, TWAS, HD Cabin   
  
 


 
    The marine community is giv-
entertainment. ing the same edict up and down
  
 

 
 

  
Rob 480-250-7744 or the East Coast. Just as its fellow
Jeff 602-321-2031   
   



emigre from the Far East, the
rob@coffmancompanies.com Asian carp, has shaken up the
Great Lakes, the lionfish is taking
 on new territory.
BOATING       The voracious species is breed-
ing by the thousands, gorging on
tropical fish near coral reefs and
 

  
Reduced $5,000,000 rapidly spreading from the Baha-
  
   
mas and Florida up to the Caroli-
161’ Trinity 2006    
  
 
 
   


 nas. The reddish-striped fish
Ciro de la Fuente

Cat powered

 
       snarfs up nearly anything it can
Gorgeous walnut interior swallow, from crabs to shrimp to

      
Best priced Trinity   
  
  !   angelfish and other species divers
1 954 646 3090      like to see. Its prickly, venom-
tipped spines fan out around its A scuba diver and a lionfish near sunken equipment in the Bahamas.
body and deter sharks and other
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predators. State University’s Department of spear it, you often miss.” The lion-
Now, the hunt for red lionfish Zoology who studies lionfish. fish learns and adapts. “If it sees
$100,000 MINIMUM is heating up. The nonprofit Reef As they have moved from deep a spear go by, it’s not going to
  
  FULLY SECURED Environmental Education Founda- to shallow waters, lionfish are eat- stick around to give you a second
John 615-236-9012 tion hosted its third “Lionfish ing up parrotfish, which help keep chance,” he says.
            
 
 

Derby” over the weekend in the algae from overgrowing coral Scuba divers and fishermen are
aimeevcat@aol.com


   
Florida Keys and handed out reefs. Fishermen worry lionfish finding statistics stacked against


$3,350 in prize money to teams gluttony will keep sport fish away. them in their hand-to-spine com-
 ! " !#!$ % that brought in the most fish—109 Jason Doty and hundreds of bat. “This could become one of
BUSINESSES FOR SALE were killed. Two derbies in the other scuba divers are experi- the worst marine invasive species
&'

Bahamas the past two years net- menting with new ways to elimi- in history,” says Dr. Hixon of Ore-
ted more than 2,000 lionfish. nate the legions of lionfish. “Six gon State. “We probably cannot
 
  Near scuba spots, divers are in- months ago, I hadn’t seen one,” completely eradicate lionfish. Only
BUSINESS OPPORTUNITIES  creasingly submerging with says Mr. Doty, who owns the Salty nature can do that.”

  
    spears, nets and protective gloves Dawg Scuba N Surf in Lake Park, Scientists agree hunting may
   
  to try to battle the intruder—al- Fla. “Now, I kill 12 on one dive.” help, but won’t halt the incredible
! " 
though divers say they still get Mr. Doty hunts lionfish with a population boom of lionfish that

#
$ 

stung through gloves. Websites, miniature pole spear with a para- have seen densities increase 700%
  
YouTube videos and Facebook lyzing tip. His dive shop is hosting from 2004 to 2008 in parts of
pages describe how to catch and a lionfish hunting derby in Decem- North Carolina. A lionfish can pro-
cook it. “People have a sense that ber, like dozens of others on the duce more than two million eggs
CAPITAL AVAILABLE the waters they love are being in- East Coast. While he keeps a few per year. “They are just too wide-
vaded,” says Renata Lana, a lionfish in a tank in his shop, he’s spread,” says Mr. Akins.
TAKE YOUR COMPANY PUBLIC spokeswoman with the National also tried feeding diced lionfish to The government says one way
Learn How Any Company Can Oceanic and Atmospheric Admin- eels from his boat, to lobsters on to fight the fish is to create a
GO PUBLIC TO RAISE CAPITAL istration. This year, the U.S. fed- the beach, eating it as ceviche market for eating them. NOAA
*Meet Investment Banks eral agency launched an “Eat Li- with his crew and giving fillets to calls the lionfish a “delicious, deli-
*Priv. Plcment Memo
*Pres. is Securities Attorney onfish” campaign, aimed at sushi chefs in local restaurants. cately flavored fish” with a taste
Going Public Makes It Easier To Raise Capital creating a taste for them at high- A few entrepreneurs are de- and texture similar to grouper,
We Take Companies Public end restaurants. signing special gear for the fight. snapper or hogfish. A few restau-
310-888-1870 www.tcc5.com
Stalking the lionfish isn’t easy. Gregg Waugh in Walterboro, S.C., rants in the U.S. and the Carib-
The fish, which grow up to about who has speared 100 lionfish in bean are serving it.
45 centimeters, are fast and feisty, the Bahamas, launched SafeSpear James Clark, executive chef at
CAPITAL WANTED divers say. Plus, the tips of their LLC in April to sell protective Waterscapes Restaurant in Myrtle
fanned spines give a sting more gloves and a 1.5-meter spear de- Beach, S.C., recently had a roasted
  painful than a bee’s. “They can get signed to shish-kabob lionfish lionfish on the menu, with a
  nasty,” says Bob Hickerson, of without a diver having to touch pumpkin chorizo puree and crab
 
    

     Vero Beach, Fla., who has killed the prickly fish. “We don’t want velouté for $22. “It’s tough for me
   
 
      
dozens in the past two years. “I’ve people to have to get too close to to get,” he says. “Sometimes fish-
   
              been charged twice, in the face,” ’em,” says Mr. Waugh. “These are ermen don’t want to handle it on
    he says. He has designed a 35-cen- very aggressive animals. Even the their boat.”
  
   !"#$%"& !      timeter spear that he has used in smaller ones swim right toward Ms. Lana, who organizes the
  
   derbies this year, his team placing you.” government’s “Eat Lionfish” cam-
first in one and winning $1,600. Lad Akins, operations director paign, says fishermen still often
Scientists aren’t sure just how at REEF, complains about ill- “throw [lionfish] overboard be-
 
Capital Wanted the lionfish came to the eastern trained vigilante hunters. “I’ve cause they are not aware what
 
 
  Secured loans for purchase of U.S. seaboard. One tale says six lion- seen people shoot and miss the li- they can do with them.” The gov-
based Security Companies. fish got loose when a beachside ernment is promoting lionfish as a
 
      onfish and spear a sea cucumber
5 year term, 22% interest,
      $25,000 min. Principals Only!
aquarium burst during Hurricane or sponge instead.” Lionfish are do-good dish that helps balance
Contact Mr. Vassell Andrew in 1992. The lionfish “al- an “ambush predator” with fast ocean ecology. It’s one of the few
     
914-260-2949 most certainly was released from reflexes, Mr. Akins says. “It’s very, fish, she says, people can eat out

  an aquarium” of some kind, says very quick at a short distance. of existence with a “clear con-
Mark Hixon, a professor at Oregon When you get close to the fish to science.”
Tuesday, November 16, 2010 THE WALL STREET JOURNAL. 13

OPINION: REVIEW  OUTLOOK

Goldilocks and the China Bears


R
ising inflation threatens China’s icy reports of the central bank. Over the yuan-dollar exchange rate stable, the cen- the mid-1990s, when inflation emerged.
goldilocks economy. That may last seven years, the required reserve ra- tral bank has to continue sterilizing those After the central bank started making
sound like hyperbole, given that tio has risen to a staggering 18% for large money inflows before it can even start to losses, it stopped sterilizing. All that de-
the country’s consumer price index re- banks and 17.5% for other banks, up from fight inflation. If it is unable to do so, in- ferred inflation came back in a rush. After
mains quiescent by most standards. Last 6% in 2003. The People’s Bank of China flation could accelerate. the bubble burst, the oversized export
week, the October figures showed prices has also been mopping up liquidity in Then there’s the PBoC’s own financial side of the economy went into a tailspin,
rising at 4.4% year on year, up from 3.6% other ways. For instance, as of the end of health. Raising the reserve ratio has been companies couldn’t pay back their loans
in September. As Victor Shih writes June, it had 4.4 trillion yuan ($665 bil- its preferred method of controlling the and a painful recession ensued.
nearby, this is particularly painful for lion) in central bank bills outstanding. money supply, since it doesn’t have to pay In the near term, tightening credit
China’s poor, and so officials need to con- The U.S. Federal Re- interest on the funds could also expose the weaknesses in
tain it right away to preserve social sta- serve is under fire for commercial banks are China’s corporations and put the banks
bility. expanding its balance Rising inflation exposes forced to keep on de- under strain. As long as the lending spree
But in a world in which many coun-
tries are worried more about recession
sheet, but the PBoC
puts it to shame. By
the Achilles’ heel of the posit bank.
at the central keeps going, companies appear healthy,
banks margins are fat and nonperforming
and deflation than overheating, it may holding down the value Chinese growth model. But on its central loan ratios are low. The PBoC recently
not seem like a big problem. Can’t a bit of of the yuan while also bank bills and repos, it raised borrowing rates by 25 basis points,
monetary tightening do the trick? Per- limiting the money sup- is borrowing at short- and the markets expect another rise be-
haps not this time. On monetary matters, ply, China’s central bank has enabled im- term rates of about 1.5% to 2%. On the as- fore the end of the year. Lending quotas,
China is an unusual case. pressive export-dependent growth. And set side of its balance sheet it is earning China’s main tool for controlling credit
For the last seven years or so, it has when the world economy stumbled, the less than 1.5% on five-year U.S. Treasurys. growth, could also be cut. For many com-
enjoyed a phenomenal economic run. Not government doubled down on investment, If the Fed succeeds in pushing down U.S. panies, this could come as a rude shock.
only has China’s growth since 2003 been encouraging banks to lend freely for in- borrowing costs further, and inflation in For a long time, the question put to
fast, it has also been less volatile than in frastructure. Now the bills are coming China forces more interest rate increases, China bears has been what would spark a
the 1990s or early 2000s and inflation has due. the spread on $2 trillion of foreign re- crisis. Capital controls mean that there is
remained at bay. While there were times For a start, there’s the question of how serves is going to become costly. Not to little possibility of capital flight, and the
when the economy slowed or overheated much more monetary policy ammunition mention that the yuan is appreciating government stands behind the state-run
a bit, it always recovered. Beijing won ku- the PBoC has left to fight inflation. A high against the dollar. banks so there seems to be no systemic
dos for its technocratic management. savings rate has helped keep the banks Unwinding even a portion of China’s risk. While we wouldn’t be so bold as to
How did the cadres do it? They de- liquid. Hot money will continue to come huge currency intervention would be predict a crash, inflation is one way in
ferred inflation by buying dollars and in, especially now that the Fed’s QE2 has painful. As economist John Greenwood of which China’s goldilocks economy could
then sterilizing the increase in the supply been announced, and the trade surplus Invesco has written, the Malaysians en- come to an end and the bears be proven
of yuan. The proof is in the monetary pol- for October was $27 billion. To keep the gaged in a similar monetary strategy until right.

Burmese Farce
S
aturday’s nominal release of Bur- imprisoned her in 1989. On previous occa- dalay, the country’s second largest city, harsh prison terms. More than 2,200 po-
mese dissident Aung San Suu Kyi sions—amounting to six years out of the the railway discovered mechanical prob- litical prisoners remain behind bars.
from seven years of house arrest is last 21—she has been at some liberty to lems in her carriage, or moved the train Today, there is no indication that the
being compared by some misty-eyed receive visitors in her home and even to another platform. government has any intention of reform-
Western well-wishers to Nelson Man- make or receive phone calls. Nor has the regime limited itself to ing its ways or allowing Ms. Suu Kyi and
dela’s release from prison in 1990. Would But her efforts to use her limited free- cheap trickery. In 1996, a band of thugs her political party to be politically ac-
that it were so. Mr. Mandela’s freedom doms to advance those of her people have attacked Ms. Suu Kyi’s motorcade with tive—which is precisely why they held
was a clear signal that South Africa’s been met by the regime with immediate stones and chains, injuring some of her sham elections before her release and
white rulers intended to do away with resistance. In the mid-1990s, she was in- colleagues. In multiple stand-offs on the disbanded her party. If Burma’s rulers ex-
apartheid. Ms. Suu Kyi’s release is yet an- vited to a meeting in a Rangoon suburb, road outside Rangoon, she was confined pect to rehabilitate their image abroad
other gambit by the Burmese regime to only to be told by security forces that the to her car for more than a week at a time. with this pretense of magnanimity, they
extend its grip on power. occasion was for ethnic Karen only; those Then in 2003 she was attacked in Depayin should be disabused of that view. Burma
This is not the first time Ms. Suu Kyi who issued the invitation were arrested. and as many as 70 of her supporters were can never be treated as a normal country
has been “freed” by the regime that first When she purchased train tickets to Man- killed. Other followers were sentenced to until Ms. Suu Kyi is truly free.

The GOP’s Spending Tests


R
epublicans return to Washington homa is a particu- the current politi- feat in 2006.
this week to organize themselves lar earmark de- cal context and Now the GOP is returning to power in
for the new Congress, and voters fender, as is
Republicans and Pork their own recent the House after Democrats have taken
will be looking for signs that the GOP has Minority Leader The number of pork-barrel projects by Congress, history. Republi- deficits to new heights and Republicans
1991-2010
learned its spending lessons while in the Mitch McConnell, cans helped to campaigned on spending restraint. It’s
wilderness. Two early tests will be ear- who recently said 16 thousand create the public true that earmarks make up only 2% to
marks and the big spending boiler rooms that “this debate 14 backlash against 3% of all federal spending, but that
known as the Appropriations Committees. [on earmarks] 12 earmarks because spending is what greases the political
On earmarks, the House GOP leader- doesn’t save any 10 of their own bad skids for passing trillion-dollar-plus
ship has rallied behind a ban, and 11 of 13 money, which is 8
behavior the last budget bills. Members get what they want
newly elected Republicans in the Sen- why it’s kind of time they ran in return for voting “aye” on what the
6
ate—including Marco Rubio, Pat Toomey, ex a s p e ra t i n g.” Congress. Administration and Congressional leaders
4
Ron Johnson and Rand Paul—campaigned These Republicans As the nearby want. That 2% or so is far more than the
against these special-interest spending have allies among 2 chart shows, the Members spend on spending oversight,
projects that are typically dropped into Senate Democrats, 0 number of ear- which ought to be a major undertaking by
bills with little debate or scrutiny. A Sen- who we hear are '92 '94 '96 '98 '00 '02 '04 '06 '08 '10 marks multiplied the Republican House. Voters should be
ate earmark moratorium is sponsored by likely to use the from nearly 1,500 told when their money is misspent.
Source: Citizens Against Government Waste
veterans Tom Coburn (Oklahoma) and Jim lame duck session in 1994 to a little Republicans will face many fiscal tests
DeMint (South Carolina) and newly of Congress to try under 14,000 in as the next Congress unfolds, not least
elected Kelly Ayotte (New Hampshire). to pass an omnibus spending bill of $1 tril- 2005—before voters ousted what had be- writing new budget rules that make it
They are meeting resistance from the lion or more for fiscal 2011. You can bet come the Grand Old Pork Party. It isn’t harder to tax and spend. But if Republi-
older generation of GOP leaders who de- that bill will contain hundreds, if not thou- easy to spend so much money so egre- cans mean it when they say they under-
fine earmarks as synonymous with the sands, of earmarks. giously that even Nancy Pelosi could cam- stand that their mandate from voters is
Constitutional power of the purse. The The Senators have a point about their paign as a relative fiscal conservative, but to stop the Washington spending spree,
otherwise conservative Jim Inhofe of Okla- Constitutional role, but they’re ignoring the Tom DeLay Republicans managed the they’ll start by restraining themselves.
14 THE WALL STREET JOURNAL. Tuesday, November 16, 2010

OPINION

In Defense of Ben Bernanke


BY ALAN S. BLINDER & Co. have lost their marbles and low its informal 1.5% to 2% target. much of a boost but will lead to
are embarking on a wild policy In fact, there’s some concern that rampant inflation. Both? How does
Ignorance is not bliss, especially misadventure. inflation will dip below zero—into that work?
when your economy is faltering All in all, it looks like the nation deflation. The Fed, thank goodness, If buying Treasurys is a weak
and sound policies are badly and the world need an Economics is determined to stop that. We policy tool, a view with which I
needed. 101 refresher. So let’s start with the don’t want to be the next Japan have some sympathy, then it
For months, we have witnessed basics. now, do we? shouldn’t be very inflationary.
the spectacle of people arguing The Fed’s plan is to purchase But might the Fed err and pro- There is no magic link between
that Keynes was wrong. Somehow, about $600 billion of additional duce too much inflation? Yes, it growth of the central bank’s bal-
additional government spending U.S. government securities over might, leaving us with, say, 3% in- ance sheet and inflation. People,
actually reduces employ- about eight months, creating more flation instead of 2%. Or it might businesses and banks have to take
ment—even when the economy has bank reserves (“printing money”) err in the opposite direction and actions—like spending more, in-
huge amounts of spare capacity to do so. This policy is one version produce only 1%. Neither outcome vesting more, and lending
and unused labor desperate for of quantitative easing, or “QE” for is desirable, but each is quite toler- more—to connect the two. If they
work; even when the central bank short. And since the Fed has done able. To create the fearsome infla- don’t, we will get neither faster
will prevent interest rates from ris- QE before, this episode has been tion rates envisioned by the more growth nor higher inflation, just
ing to “crowd out” private spend- branded “QE2.” extreme critics, the Fed would have more idle bank reserves.
ing. Really? Here’s the first Economics 101 to be incredibly incompetent, What the Fed proposes to do is
question: When central banks seek which it is not. neither foolproof nor perfect.
to stimulate their economies, how The final major charge, levied Frankly, it’s not the policy I would
To create the fearsome do they normally do it? If you an- especially by a number of foreign choose. As I’ve written on this
swered, “by lowering short-term officials, is that the Fed’s new pol- page, I’d like the Fed to purchase
inflation rates envisioned by

Ken Fallin
interest rates,” you get half credit. icy amounts to currency manipula- private securities and to reduce the
the more hysterical critics, For full credit, you must explain tion: deliberately lowering the in- interest rate it pays on reserves,
how: They create new bank re- ternational value of the dollar to even turning it negative. The latter
the Fed would have to be serves to purchase short-term gov- gain competitive advantage for U.S. language. After all, the U.S. dollar is would blast reserves out of banks
incredibly incompetent, ernment securities (in the U.S., exporters. Is there any truth to a floating currency. Many factors, into some productive uses.
that’s mostly Treasury bills). Yes, this? Not if words have any mean- including but certainly not limited But I don’t run the Fed. Maybe
which it is not. they print money. ing. to monetary policy, influence the Chairman Bernanke’s ideas are bet-
But short-term rates are practi- Economics 101 teaches us that exchange rate, which changes every ter than mine and, in any case, the
cally zero in the U.S. now, so the one standard side effect of a cen- minute. But the Fed will not inter- planned QE2 is far better than do-
One current catchphrase is “job- Fed wants to push down medium- tral bank reducing interest rates is vene to push the dollar down. If the ing nothing. It is not a shot in the
killing spending.” Hmmm. How, ex- and long-term interest rates in- a lower exchange rate. Actually, dollar should rise instead of falling, dark, not a radical departure from
actly, does more spending kill jobs stead. How? You guessed it: by cre- things don’t always work out that c’est la vie. conventional monetary policy, and
when there is idle capacity and no ating new bank reserves to pur- way in the real world; sometimes More important, the U.S. is a certainly not a form of currency
threat of rising interest rates? chase medium- and long-term the stronger growth pushes the sovereign nation with a right to its manipulation.
Stumped? So am I. government securities. currency up instead. This contra- own monetary policy. So I was I know Ben Bernanke. Ben Ber-
The anti-Keynesian revival has That sounds pretty similar to dictory evidence notwithstanding, stunned when a top aide to the nanke is a friend of mine. And crit-
been disheartening enough. But garden-variety monetary policy. Yet it is commonly assumed that ex- Russian president suggested that ics ranging from Mr. Schauble to
now the economic equivalent of the critics are branding QE2 a radical pansionary monetary policy depre- the Fed should consult with other Ms. Palin are no Ben Bernankes.
Flat Earth Society is turning its departure from past practices and ciates the currency. That’s why countries before making major pol-
fury on Ben Bernanke and the Fed- a dangerous experiment. some foreign governments, espe- icy decisions. Come again? An inde- Mr. Blinder, a professor of eco-
eral Reserve. Critics ranging from The next charge is that QE2 will cially the more mercantilist ones, pendent central bank doesn’t even nomics and public affairs at
German Finance Minister Wolfgang be inflationary. Partly true. The Fed are apoplectic. What’s down for us consult with its own government. Princeton University and vice
Schauble to tea party favorite actually wants a bit more inflation is up for them. Finally, there’s that old hobgob- chairman of the Promontory Inter-
Sarah Palin—which is quite a because, now and for the foresee- But calling QE2 “currency ma- lin: consistency. Critics tell us that financial Network, is a former vice
range—have spoken as if Bernanke able future, inflation is running be- nipulation” is a grotesque abuse of QE2 won’t give the U.S. economy chairman of the Federal Reserve.

The High Price of Journalism in Putin’s Russia


BY ELENA MILASHINA self-censorship and telling stories The government said there Natasha, promised to be back in a Orlov is in the middle of a criminal
from the point of view of ordinary were 354 hostages, but we re- month or so, and got on a plane trial for slander. The charges
Moscow citizens. ported the actual number, which bound for Moscow. We heard the stemmed from Mr. Orlov’s state-
As a journalist for Russia’s lead- Yet we have paid a heavy price exceeded 1,000. The government horrible news the next day and ment suggesting that Mr. Kadyrov
ing independent newspaper, for our independence. Over the said the initial explosions in the flew back for her burial. was responsible for Natasha Es-
Novaya Gazeta, I have been lucky. past 10 years, five of Novaya school building were triggered by I am exhausted from the funer- temirova’s murder. Mr. Orlov faces
For over a decade I’ve had the Gazeta’s journalists have been mur- the hostage-takers, whereas we als, and I am frightened for my up to three years in prison if con-
privilege to report extensively on dered. One of the victims was our proved that the secret services friends, my colleagues and myself. victed.
dramatic current events in my star correspondent and my mentor, This horrifying chain of murders Crushed by the killings of
country—including in Chechnya Anna Politkovskaya, who was as- will not be broken until the perpe- friends and active threats against
and other turbulent North Cauca- sassinated in 2006 after tirelessly Five of my colleagues trators are brought to justice. And their own lives, Russia’s already
sus republics. exposing brutal human-rights vio- at Novaya Gazeta we can hardly hope for a proper in- small community of independent
But press freedom is gradually lations in Chechnya. vestigation while Vladimir Putin reporters and human rights de-
becoming extinct in my country. In I got my break as a journalist in have been murdered. holds the reins of power. fenders is shrinking dramatically.
the past week alone, two reporters 2000, covering the sinking of the This May, at a meeting with Some are on the verge of giving up.
were brutally beaten because of Kursk submarine in the Barents groups working in the North Cau- Those who continue to coura-
their commitment to honest jour- Sea by getting a scoop from high- fired first. The human cost of the casus region, President Dmitry geously do their work need to
nalism. Novaya Gazeta has miracu- level sources in the Navy. This government’s “rescue operation” Medvedev repeatedly stated that know that they are not alone.
lously kept afloat—escaping gov- story taught me a lot about how was horrific: 333 dead, including local authorities must cooperate It is imperative that European
ernmental control, refusing the Putin government operates. In 186 children. We reported the with civil-society organizations. and American leaders show Russia
that case government officials truth, but no justice was rendered His message was welcomed by hu- that they will not tolerate this situ-
tried to cover up the fact that 23 for the victims. man rights defenders present at ation. At every bilateral or multi-
sailors aboard the submarine sur- Since then, independent report- the meeting, including Natasha Es- lateral forum, European Union
ASI A
vived for many hours after a ing and advocacy has become le- temirova’s colleagues from Memo- member states and the United
Almar Latour, Editor in Chief, Asia deadly explosion in the torpedo thal. Last year the body count was rial and Human Rights Watch. States should ask specific ques-
Peter Stein, Associate Editor unit—precious hours during which unprecedented for those working I reported on the meeting in my tions about the progress of investi-
Dean Napolitano, Senior Editor the authorities did nothing to try to expose abuses in the North Cau- newspaper, hoping that something gations into the killings of rights
Mary E. Kissel, Editorial Page Editor to save their lives. casus region: Six people were mur- might change. Nothing did. Ram- advocates and reporters. Ending
Shawn Hiltz, Vice President, Marketing I covered the biggest story of dered, all of whom I knew. zan Kadyrov and other high-level impunity is a prerequisite for fos-
Alice Chai, Research Director my life so far, the Beslan school One of the victims was Natasha Chechen officials continued threat- tering a normal environment for
Connie Cheng, Operations Director siege, in the fall of 2004, and it left Estemirova, a leading Chechen ening their critics. Less than a Russian civil society.
Simon Wan, IT Director me with an almost crippling sense rights activist from Memorial Hu- month later, Mr. Kadyrov described It is also a prerequisite for
Olivier Legrand, General Manager Digital of frustration. Journalistically, it man Rights Center and a very close human rights defenders and Me- keeping us alive.
Christine Brendle, Publisher was a success: In a series of front- friend. She was abducted and bra- morial activists in particular as
Published since 1889 by page stories, my team exposed zenly shot dead on July 15, 2009, a “enemies of the state, enemies of Ms. Milashina, an investigative
Dow Jones and Company what happened in that North Cau- day after she completed a joint the people, enemies of the law.” journalist for Novaya Gazeta, is a
© 2010 Dow Jones & Company. All Rights Reserved casus town when a group of armed mission with me and a Human The Kremlin has not condemned recipient of Human Rights Watch’s
militants took people hostage in a Rights Watch researcher. The re- this statement in any way. 2010 Alison Des Forges Award for
jk school for three days. searcher and I said goodbye to Today, Memorial Chairman Oleg Extraordinary Activism.
Tuesday, November 16, 2010 THE WALL STREET JOURNAL. 15

OPINION

Inflation Threatens China’s Growth


BY VICTOR SHIH cies to control deposit interest credibility.
rates. After the recent 0.25-per- To be sure, the sudden slow-
China is seeing the highest centage point lending-rate hike, down in credit expansion will
price increases in over two years, the rate paid on demand deposits cause illiquidity in some invest-
and this has officials worried. did not budge. Even without infla- ment projects and slowed real-es-
While the official consumer infla- tion, depositors are paid artifi- tate construction. Nonperforming
tion rate was 4.4% for October, a cially low rates because the gov- loan ratios may rise as cash-
10% rise in food prices is having a ernment prevents banks from starved projects become unable to
huge impact on poorer house- setting their own deposit rates. In meet interest payments.
holds. The domestic media is times of inflation, households, es- In the medium term, however,
filled with stories of hoarding by pecially poorer ones with money the policy will pay benefits. Mac-
both producers and consumers. mainly in demand deposits, suffer roeconomic retrenchment credibly
The government has responded negative returns on their savings. commits the government to both
with a small interest-rate increase Savings in demand-deposit ac- low inflation and a less invest-

Associated Press
and some hikes of the reserve re- counts today yield negative re- ment-intensive growth path by
quirement, though rates on de- turns after adjusting for inflation, cutting off liquidity from a large
mand deposits have not budged at for a real return of about -4%. number of projects. Local authori-
all. More action is needed. A reso- Even net of inflation, deposits in a ties will learn that they can no
lute drive to slow growth of the one-year time deposit earn -2%. Chinese food prices are increasing at a double-digit pace. longer pursue growth based
money supply will stop the hem- Meanwhile, banks are earning mainly on adding new investment
orrhaging of household savings large margins, and borrowers of households remain relatively flat, In the past, the Chinese gov- projects financed by bank loans
due to inflation. As an added bo- medium- to long-term corporate continual inflation alone will drive ernment has successfully stifled and bond issuance.
nus, it may also wean China off of loans, which tend to be state- many into destitution. The pres- inflationary pressure via the im- In the mid- to late-1990s, cash-
its heavy dependence on invest- owned or state-dominated firms, sure from negative earnings on position of a resolute credit ceil- starved local authorities became
ment-driven growth. are borrowing at an inflation-ad- savings has driven richer house- ing on banks. Today, regulators much more open to privatization,
The recent bout of inflation justed rate of about 2%. Given holds to speculate in the real es- would also need to monitor allowing private firms to domi-
may seem mild in comparison to that households currently have tate and stock markets. Rising in- closely the expansion of trust nate sectors previously monopo-
the double-digit price rises in the more than 11 trillion yuan ($1.7 flation has further incentivized all products and the inflow of hot lized by state-owned firms. The
1980s and ‘90s. But the social im- trillion) in demand deposits, an households to begin stockpiling money. The People’s Bank of competition that resulted was
pact may be almost as severe. Ac- annual inflation rate of 4% this food and commodities such as China and the China Banking Reg- good for the economy. Repeating
cording to research by a Chinese year would in effect see the trans- gold. Food hoarding, if sufficiently ulatory Commission have all the that process will not be painless,
government think tank, poorer fer of over 400 billion yuan ($60 widespread, can further increase tools necessary to fight inflation. but past experience has shown
households now face inflation that billion) from these households to inflationary pressure. A combination of interest rate that resolute macroeconomic re-
is twice the overall rate because banks and corporate borrowers, Although inflation might have hikes, a credit ceiling, a freeze in trenchment can put China on a
their consumption basket is domi- both dominated by the state. been boosted by some recent sup- trust product issuance and ag- healthier path for growth.
nated by food items, which have This erosion of poor house- ply shocks, the rapid expansion of gressive sterilization of foreign
seen the most rapid price in- holds’ purchasing power goes di- the money supply in recent years, exchange inflows can halt infla- Mr. Shih is associate professor of
creases. So even though wage rectly against the goal of “raising especially the spectacular explo- tionary expectations and stop the political science at Northwestern
gains seem robust, many house- the income of medium and low in- sion of lending last year, is the erosion of household savings. University and author of “Fac-
holds are seeing flat or negative come urban and rural residents,” root cause. Thus, a key ingredient China’s top leadership, however, tions and Finance in China”
increases in purchasing power. as outlined by the Party plenum of future inflation fighting will be needs to make clear its collective (Cambridge University Press,
Household savings have also last month. Given that nominal to slow down substantially the ex- determination to fight inflation in 2007). A related editorial ap-
been eroded by government poli- wages for a large number of pansion of money supply. order to give these measures pears today.

More Code, Not Enough Clues


George Church at Harvard Univer- but what nobody can give you is cheap and easy information from bracingly honest and open-minded
[ Bookshelf ] sity to sequence the genomes of much idea of what that informa- DNA tests—from the propensity for survey, told as a personal story, of
10 volunteers. Their genetic infor- tion means. Except for a handful certain illnesses to ethnic ances- a field that will one day surely
mation, along with their medical of disorders, the predictive power try—but without much scientific matter hugely to medicine. But
records, will be made public on of genetic sequences is just too context. Others, like Sciona, felt it daunting work remains to be
the Internet so that researchers poor—so far. The consequence is was more important to link genetic done, so ultimately Mr. Angrist
around the world will be able to that, at least for now, uncertainty information to the customer’s life- does not really leave us much the
analyze the data and, it is hoped, protects privacy. Even as his ge- style, in the belief that finding out wiser. Is it possible that the aura
speed the evolution of “personal netic background is slowly re- about bad heart genes would mean of disappointment that now marks
genomics,” or the application of vealed over the course of “Here Is more to bad eaters. The medical personal genomics is here to stay,
genome knowledge for the benefit a Human Being,” neither Mr. An- profession, by and large, wished or will we soon break through into
of individuals. grist nor the reader knows much this impertinent dabbling in genetic the sunlit uplands of powerful ge-
As a writer and former genetic about his medical destiny by matters would go away—simply netic knowledge? Certainly the
counselor, Mr. Angrist makes an book’s end. miraculous breakthroughs envi-
apt chronicler of personal genom- When the author sits down to sioned a decade ago, in the heady
ics, not least because he is happy to go through a detailed catalog of The genome-related days of the Human Genome Proj-
invade his own privacy, personally his gene sequences, he finds little ect’s competition with J. Craig
as well as genetically. Actually, of interest: “I kept on in hand-to- breakthroughs envisioned Venter’s Celera enterprise, are not
happy is the wrong word. He has a hand combat mode, going gene by a decade ago are not close close to being realized. There are
Hamlet-like tendency to agonize gene. And time and again, the glimmers of hope: It is surely only
over each decision, especially when paucity of information was strik- to being realized. a matter of time, for instance, be-
confronted with the implications of ing: I would find mutations in fore we start working out which
Here Is a Human Being letting his genes all hang out on- genes that coded for pro- genes make one person resistant
By Misha Angrist line. Should he redact the genes teins”—that is to say, code knowing that you have a genetic to a certain drug and which ones
(Harper, 341 pages, $26.99) that might—or might not—show a changes that could affect Mr. An- mutation associated with a particu- make another person especially
heightened risk of his developing grist’s body directly—“but the lar disease means little beyond pos- sensitive to the same drug.
BY MATT RIDLEY Alzheimer’s? James Watson chose proteins’ ascribed functions would sibly causing a few sleepless nights. But as we begin to discover the
to withhold that very information be so general and/or tentative As for the sequencing technol- complex ways that genes interact
The cost of sequencing a hu- when the DNA pioneer’s genome (‘may be involved in transcrip- ogy itself, a certain confusion has with each other, the goal of predic-
man genome for the first time was was sequenced in 2007, but a quick- tional regulation’) as to be mean- reigned there, too. Having hitched tive knowledge may recede yet fur-
about $3 billion. It has now witted sleuth soon managed to work ingless. In some cases, the pro- his wagon to George Church’s ther into the mist. As I was reading
dropped below $10,000, and soon out the genes anyway by using adja- teins didn’t even have names, let project, Mr. Angrist watches in Mr. Angrist’s book, a thought oc-
the price to have your entire ge- cent sequences. alone functions assigned to them.” dismay as the machine on which curred to me: Trying to predict
netic make-up deciphered will “As an adult, I was not about The uncertainty is exacerbated Mr. Church had pinned so much someone’s life course from his ge-
surely drop into the hundreds of to put my Social Security number for our genomic Hamlet by the va- hope fails to deliver on its prom- nome may be like trying to under-
dollars. When it does, and if you or the GPS coordinates of my garies of technologies, people and ise to sequence genomes relatively stand “Hamlet” from a list of the
decide to have your genome se- house on the Web,” Mr. Angrist markets. As the field of direct-to- inexpensively and quickly. h]In the words it contains. The meaning
quenced, Misha Angrist’s “Here Is muses. “Maybe this meant the customers genetic testing went personal-genomics field, the domi- comes from how those words are
a Human Being” will come in PGP was not for me.” through its growing pains in recent nant player is a company called Il- put together.
handy. The problem of privacy soon years, Mr. Angrist talked to its dif- lumina, but it has had a hard time
Mr. Angrist was the fourth per- pales, however, next to the prob- ferent practitioners and found bringing down costs to a commer- Mr. Ridley, who writes the Mind &
son to join the Personal Genome lem of uncertainty. Many busi- many strategies. Some firms, such cially workable level. Matter column for the Journal, is
Project, or PGP, a valiant venture nesses are now offering to give as 23andMe and Navigenics, In many ways “Here Is a Hu- the author of “The Rational Opti-
started by molecular geneticist you genetic information for a fee, wanted just to supply people with man Being” is a delight. It is a mist.”
16 THE WALL STREET JOURNAL. Tuesday, November 16, 2010

THE CEO PAY SURVEY

Chieftains score on stock gains


Liberty Media’s Maffei is on top as the executives’ compensation tracks closely with shareholder returns
BY JOANN S. LUBLIN

Gregory B. Maffei won the exec- Power


utive-pay sweepstakes during a year
when his investors also fared well. pay
Mr. Maffei, the leader of Liberty The five
Media Corp., enjoyed total direct highest-paid
pre-tax compensation of $87.1 mil- CEOs by total
lion last year, four times his 2008 direct pretax
package and enough to land him compensation,
atop the rankings in The Wall Street for the most
Journal’s latest CEO pay survey, recent fiscal Gregory B. Maffei Larry Ellison Ray R. Irani Carol Bartz Leslie Moonves
which includes all 456 of the big- year
gest U.S. public companies. LIBERTY MEDIA ORACLE OCCIDENTAL YAHOO CBS
The recent survey, which cov-
ered companies with annual reve- PETROLEUM
nue of more than $4 billion that
filed proxies from Oct. 1, 2009, to
TOTAL DIRECT
Sept. 30, 2010, expanded a smaller
COMPENSATION,
analysis completed in April.
The expanded sample, collected
by Philadelphia management-con-
IN MILLIONS*
$87.1 $68.6 $52.2 $44.6 $37.6
sulting firm Hay Group, includes
more highly paid media chiefs as CHANGE
well as some newly appointed CEOs, FROM YEAR UP UP UP
who often enjoy one-time boosts
from signing bonuses or payments
PRIOR
300% 17% 5% First year as CEO 83%
DOWN
to make them whole for stock and
stock options they left behind. It
also includes companies like Oracle Note: Includes salary, bonuses and the value of long-term incentives, including stock and stock options at the time of the grant Photos: Bloomberg News (4); Reuters (Ellison)
Corp., that pay well but close their Source: Proxy statement analysis by Hay Group
fiscal years later.
Annual bonuses rose nearly 11%
in the latest study to a median of rose 3.0% during their latest fiscal new policy that cut his maximum Oracle and Viacom declined to 2009,’’ a Thermo Fisher spokesman
$1.67 million, compared with a 3.4% year, as total shareholder return compensation by nearly three-quar- comment. said. Boston Scientific declined to
rise in the initial analysis. About came in at 29%. Total direct com- ters. The roughly $33 million for comment.
53% of the CEOs got restricted- pensation includes salary, bonuses Mr. Irani’s 2009 pay package Marc N. Casper, named CEO of A performance bonus accounted
stock grants, up from about 48% in and the awarded value of stock, op- “reflects his outstanding leader- Thermo Fisher Scientific Inc. in for the biggest piece of the $27 mil-
the April study. tions and other long-term incen- ship” and “exceptional returns for October 2009, landed him at No. 7 lion for No. 9-ranked Ralph Lauren,
Similarly, a smaller proportion tives. The gains were driven by shareholders,’’ an Occidental and largely stemmed from options, founder and leader of Polo Ralph
of the enlarged sample got perform- higher company share prices and spokesman said. restricted shares and performance Lauren Corp., whose stock roughly
ance awards. annual bonuses. Not far behind Mr. Maffei was awards. It was a similar story for doubled in value over the year.
The latest survey shows chief Occidental Petroleum Corp.’s Larry Ellison, Oracle’s billionaire No. 8, J. Raymond Elliott, who col- McKesson Corp.’s John H. Ham-
executives’ pay increasing along Ray Irani, who topped the best-paid founder. Long ranked among the lected a package valued at $32.1 mergren rounded out the top 10
with shareholder returns. Liberty’s list in April, fell to No. 3 in the best-paid CEOs, he received a $68.6 million from Boston Scientific with total compensation of $24.5
total shareholder return for 2009 at most recent survey. His $52.2 mil- million package that mainly con- Corp., including a $1.5 million sign- million, primarily from options and
247% was the highest among the lion total primarily reflects the ini- sisted of options valued at $61.9 ing bonus after becoming CEO in performance awards, as the com-
top 10. The measure includes gains tial or target value of incentive million. Philippe P. Dauman at Via- July 2009. pany kept his salary flat.
in the stock price plus reinvested awards linked to Occidental’s per- com Inc., No. 6 on the list, got most More than 90% of Mr. Casper’s Polo and McKesson didn’t pro-
dividends. formance. of his $33.7 million total from his total direct compensation consisted vide comment.
Overall, median total direct com- After a shareholder backlash, the annual bonus and performance of long-term awards “put in place —Joe Light
pensation for CEOs in the sample company agreed in October to a awards. when he was named CEO in October contributed to this article.

Executive paychecks likely to climb again


BY DANA MATTIOLI
Time is money Real money
Corporate chief executives will
CEOs at companies that had later fiscal years saw bigger pay increases on Some CEOs reaped millions in their most recent fiscal year from the
likely see their compensation im-
average than peers at companies with fiscal years ending around or before payout of long-term incentives, the vesting of restricted stock or
prove again in the current year.
the end of calendar year 2009. Their pay periods caught less of the exercising stock options.
CEOs will benefit from a shift by
recession and more of the recovery. Total realized long-term
boards to peg more pay to perform- Company Executive incentives (millions)
ance—and so far earnings have been Total direct
healthy and the stock market has Number of compensation* Danaher H. Lawrence Culp Jr. $140
Fiscal year ends companies (millions) Change from previous year*
rebounded. The combination means
chief executives are likely to receive UnitedHealth Group Stephen J. Hemsley 99
Before Dec. 25 49 $5.5 –7%
larger bonuses for 2010 and report Occidental Petroleum Ray R. Irani 96
larger compensation packages over-
all as new proxy statements roll in Dec. 25-Jan. 3 342 7.4 1% Yum Brands David C. Novak 72
next year.
“Many companies are beating Gilead Sciences John C. Martin 57
After Jan. 3 65 7.5 13%
earnings expectations, stock prices Cisco Systems John T. Chambers 33
are up and performance is good, so *Median pay for CEOs who had been in office for two years
bonuses will be good,” says Mark Source: Proxy statement analysis by Hay Group Source: Proxy statement analysis by Hay Group
Reilly, a partner with the Chicago-
based compensation consulting firm
Compensation Consulting Consor- essarily granted more shares, but the tax deductibility of compensa- that of the rest of their work force, Consultants also expect to see
tium LLC. because the underlying stock values tion that isn’t performance-related, and boards will have to give share- time-based awards of restricted
Through the first nine months of have improved, says David Swinford, salaries likely will hover around the holders a nonbinding “say on stock continue to be replaced by
2010, sales at companies in the S&P president of compensation consult- tax-deductible $1 million range, Mr. pay”—a yes or no vote of confidence awards tied to performance. Time-
500 rose 8.8%, and earnings per ing firm Pearl Meyer & Partners. Reilly says. in a company’s executive compensa- based grants were criticized during
share jumped 58%, according to Salaries will be modestly higher Amid the general uplift, however, tion. the downturn, after executives
Standard & Poor’s. The S&P 500 In- for the year as well, as base pay and boards are facing new pressures to As a result, it isn’t uncommon in cashed in on stock awards even as
dex, as of Friday’s close, was up raises were restored for CEOs who keep pay increases defensible. The boardrooms to hear directors ask, shareholders suffered losses.
7.5% so far this year. took pay cuts or salary freezes, says Dodd-Frank Act includes a pair of “What will shareholders think of Some of the trends are expected
In addition to annual bonuses, James Reda, managing director of measures that will increase the visi- this,” Mr. Swinford says. to continue to gather steam. They
the value of executives’ long-term compensation at consulting firm bility of compensation issues. That pressure is pushing boards include the move away from “gross-
equity grants will be higher for James F. Reda Associates LLC. Companies will have to report to emphasize long-term incentives ups” that cover tax bills and the
2010—not because companies nec- With accounting rules limiting how executives’ pay compares to over short-term bonuses. shift to lower overall value of perks.
Tuesday, November 16, 2010 THE WALL STREET JOURNAL. 17

THE CEO PAY SURVEY

A closer look at three big packages


BY JOANN S. LUBLIN

Here is a closer look at the pack-


Biggest paydays | These CEOs had the most total direct compensation in their most recent fiscal year
ages for three CEOs in the Top 5 of
REALIZED
The Wall Street Journal’s latest pay NAME/ ANNUAL STOCK OPTION RESTRICTED PERFORMANCE TOTAL DIRECT PERCENTAGE LONG–TERM
survey: Liberty Media Corp.’s Gre- COMPANY BASE SALARY INCENTIVES GRANTS STOCK GRANTS AWARDS COMPENSATION CHANGE IN TDC INCENTIVES
gory B. Maffei at No. 1, Yahoo Inc.’s
Carol Bartz, No. 4; and CBS Corp.’s
Leslie Moonves, No. 5. 1 Gregory B. Maffei
Liberty Media
$1,000,000 $6,750,003 $79,345,879 $87,095,882 300% $5,016,421

Gregory B. Maffei
Mr. Maffei, who got compensa-
tion of $87.1 million last year, has
2 Larry Ellison
Oracle
$250,001 $6,453,254 $61,946,500 $68,649,755 –17%

worked to streamline Liberty’s com-


plex structure since taking com-
mand in February 2006, moving
3 Ray R. Irani
Occidental Petroleum
$1,170,000 $3,752,550 $47,258,827 $52,181,377 5% $96,427,869

around its many assets and buying a


stake in satellite-radio company Sir- 4 Carol Bartz
Yahoo
$969,872 $1,500,000 $29,169,334 $9,522,631 $3,452,091 $44,613,928 N/A $10,070,330

ius XM Radio Inc. at a discounted


price. He has also presided over a
turnaround at its home shopping 5 Leslie Moonves
CBS
$3,513,462 $15,000,000 $12,993,600 $6,079,998 $37,587,060 83% $5,378,167

business, QVC. Liberty reported im-


proved operating performance for
the third quarter.
6 Philippe P. Dauman
Viacom
$2,500,000 $12,540,000 $5,999,997 $12,688,932 $33,728,929 22% $1,869,214

7
In December 2009, Liberty of-
Marc N. Casper $790,220 $824,533 $12,809,444 $9,312,000 $9,312,000 $33,048,197 N/A $879,375
fered Mr. Maffei a new five-year
Thermo Fisher Scientific
contract that heavily links his com-

8
pensation to its stock performance. J. Raymond Elliott $598,356 $2,107,766 $15,232,000 $9,510,000 $4,654,400 $32,102,522 N/A
Boston Scientific

Certain pay critics question


the wisdom of Mr. Maffei’s
9 Ralph Lauren
Polo Ralph Lauren
$1,250,000 $19,500,000 $2,213,000 $4,061,250 $27,024,250 25% $21,569,465

options grant. ‘Some


significant portion of the
10 John H. Hammergren
McKesson
$1,580,000 $4,728,150 $7,647,826 $10,508,780 $24,464,756 5% $25,344,866

options should have multiple


performance measures.’
11 Louis C. Camilleri
Philip Morris
$1,500,000 $7,560,000 14,950,000 $24,010,000 –34% $20,575,218

“During his tenure, our equities


12 James T. Hackett
Anadarko Petroleum
$1,567,500 $3,749,460 $5,293,585 $5,843,792 $6,314,568 $22,768,905 5% $14,841,633

have significantly outperformed the


broader market and our media 13 Laurence D. Fink
BlackRock
$500,000 $22,150,000 $22,650,000 27% $9,439,915

peers,” Chairman John Malone said


at the time. The cable mogul con-
trols the conglomerate. 14 Richard C. Adkerson
Freeport–McMoRan
Copper & Gold
$2,500,000 $12,900,000 $6,775,000 $22,175,000 –1% $11,974,243

Mr. Maffei’s 2009 agreement in-


cluded options initially valued at
$79.3 million, a retention grant
aimed at keeping him with the com-
15 Brian L. Roberts
Comcast
$2,908,483 $8,234,238 $5,656,300 $5,257,200 $22,056,221 8% $2,756,483

16
pany. The 50-year-old chief execu-
Rex W. Tillerson $2,057,000 $2,400,000 $16,963,875 $21,420,875 –9% $4,992,240
tive can’t make money from any of
Exxon Mobil
these options until they begin vest-

17
ing in four years. Robert A. Iger $2,038,462 $9,260,000 $3,598,402 $5,940,006 $20,836,870 –59% $9,736,350
Certain pay critics question the Walt Disney
wisdom of Mr. Maffei’s options

18
grant. “Some significant portion of Samuel J. Palmisano $1,800,000 $4,750,000 $13,517,401 $20,067,401 3% $17,562,208
the options should have multiple IBM
performance measures,” observed
Amy Borrus, deputy director of the
Council of Institutional Investors in
Washington. The group represents
19 William C. Weldon
Johnson & Johnson
$1,802,500 $3,600,000 $4,713,177 $2,773,851 $6,899,998 $19,789,526 13% $12,689,862

pension funds that manage more


than $3 trillion in assets.
Liberty directors don’t expect to
20 Jay S. Fishman
Travelers
$1,000,000 $7,500,000 $4,400,000 $6,600,000 $19,500,000 59% $12,804,944

award Mr. Maffei a new options Notes: Annual incentives: annual bonus in cash or stock earned in the most recent fiscal year. Stock option grants: grant–date value, as disclosed by the company, of stock options granted in the most recent fiscal year.
Restricted stock grants: grant–date value, as disclosed by the company, of restricted stock granted in the most recent fiscal year. Performance awards: grant–date target value of performance–linked cash and equity
grant for 2010 and “do not expect awards granted in the most recent fiscal year. Total direct compensation: the sum of salary, annual incentives, stock option grants, restricted stock grants and performance awards. Total realized long–term incentives:
him to be among the top-paid CEOs gains on options exercised in the most recent fiscal year, restricted stock that vested in the most recent fiscal year and long term performance cash and equity awards that paid out in the most recent fiscal year. This
in 2010,” a company spokeswoman represents value realized from awards that have been granted over time.

said. Source: Proxy statement analsis by Hay Group

Carol Bartz
Yahoo’s Ms. Bartz is the highest- 41% from its close of $11.73 on Jan. vive. His compensation nearly dou-
paid female CEO tracked by the 30, 2009. bled from $20.6 million in 2008.
Journal since 1999, when Carly Ms. Bartz, 62, also got $10 mil- Mr. Moonves’s compensation re- How the pay survey was completed
Fiorina scored $90.6 million in total lion in cash and restricted shares to flected a $15 million bonus and op-
direct compensation as Hewlett- make up for equity grants and bene- tions initially valued at $13 million. The Wall Street Journal CEO- dents of executive compensation
Packard Co.’s new leader. fits she left behind at Autodesk Inc., CBS shareholders saw returns of compensation survey was con- consider those components the
In recruiting Ms. Bartz to lead the software concern she previously 76% last year. ducted by Hay Group, a manage- best measure of what a board of
Yahoo early last year, directors of ran. Her initial package “is much The media giant previously said ment-consulting firm. It analyzes directors intended to pay a CEO
the struggling Internet company more performance-oriented than the bulk of its CEO’s 2009 compen- chief executives’ pay from 456 in a given year. The rankings ex-
gave her a package tightly tied to other comparable company hiring sation was “keyed to performance- U.S. public companies with reve- clude the value of exercised
the share price. Her $44.6 million packages,” the spokeswoman said. based measures” and “will continue nue in their most recent fiscal stock options and the vesting of
package featured five million stock Last month, Yahoo reported an- to be closely aligned” with share- year of at least $4 billion, that restricted stock. Some totals
options initially valued at $29.2 mil- other quarter of sluggish revenue holder value. filed their proxy statements be- from prior years have been ad-
lion. The CEO can start exercising growth. Though Ms. Bartz has cut A spokesman declined to com- tween Oct. 1, 2009 and Sept. 30, justed.
the options only if Yahoo shares costs and pulled off a search deal ment further. 2010. The full database, which in-
climb by at least 50% between Jan. with Microsoft Corp., this year, she The 61-year-old Mr. Moonves The Journal’s rankings of top- cludes each element of CEO pay
30, 2009, and Jan. 1, 2013. said she needed more time to turn took the helm at the end of 2005. earning CEOs are based on total for each company and some
“Ms. Bartz would receive no Yahoo around. Last week, CBS said the advertising direct compensation, which in- summary results by industry, can
value from the options unless ap- rebound and cost cuts boosted its cludes salary, bonuses and the be seen online at www.wsj.com/
proximately $8 billion of value were Leslie Moonves third-quarter net income by 53%. value of long-term incentives, in- executivepay. For more analysis
created for shareholders,” a Yahoo Mr. Moonves collected a $37.6 Hay Group, a Philadelphia con- cluding stock and stock options of this year’s results, go to
spokeswoman said. At Friday’s close million package from CBS last year, sultancy, conducted the latest CEO at the time of the grant. Stu- www.haygroup.com/wsj.
of $16.55, Yahoo shares had risen as the media industry began to re- survey for The Wall Street Journal.
18 THE WALL STREET JOURNAL. Tuesday, November 16, 2010

FROM PAGE ONE

Fresh attack on Fed plan to buy Treasurys


Continued from first page tain the recovery. Bernanke’s second term early this former president of the Federal Re-
political crosshairs, though. A tea- Some prominent liberal econo- year. The critiques had ebbed until serve Bank of Dallas and a backer of
party-infused GOP is eager to heed mists, including Nobel laureates Jo- its new move to buy bonds. But last the Fed’s latest step. Mr. McTeer, a
voters’ rejection of big-government seph Stiglitz and Paul Krugman, al- week, potential GOP presidential fellow at the National Center for
programs, and conservatives say a ready have challenged the efficacy candidate Sarah Palin delivered a Policy Analysis, a right-leaning think
new move by the Fed to essentially of quantitative easing, arguing that stinging speech on the move and tank, added: “What populists on the
print more money makes it ripe for more fiscal stimulus is needed to re- then, in a Facebook post, criticized right and the left have in common is
scrutiny by the incoming Republican store the economy to health. Mr. Obama for defending the Fed. a distrust of the establishment, and
House majority and potentially an Signers of the new manifesto Last Tuesday evening, about 20 to them the Fed personifies the es-
issue in Mr. Obama’s 2012 re-elec- criticizing the Fed include: Stanford economists and others met over sea tablishment.”
tion campaign. University economists Michael bass at the University of Pennsylva- To fight a deep recession pro-
“Printing money is no substitute Boskin, who was chairman of Presi- nia Club in Manhattan and hashed voked by a global financial crisis,
for pro-growth fiscal policy,” said dent George H. W. Bush’s Council of out a broad strategy. Mr. Ryan, who the Fed has been keeping its target
Rep. Mike Pence, an Indiana Repub- Economic Advisers, and John Taylor, has gained notice for a plan to bal- for overnight interest rates near
lican who has been privy to early a monetary-policy scholar who ance the federal budget through zero since December 2008 and
discussions with the group of con- served in both Bush administra- deep spending cuts, joined the bought $1.7 trillion in U.S. Treasury
servatives rallying opposition to the tions; Kevin Hassett of the conser- group amid discussion over ways to debt and mortgage securities to
Fed plan. He said the signatories to vative American Enterprise Insti- encourage the GOP’s new House ma- push down long-term interest rates,
the letter “represent a growing cho- tute; Douglas Holtz-Eakin, former jority to unite behind “sound money hoping to spur borrowing and
rus of Americans who know that we Congressional Budget Office director Reuters policy.” spending. That program ended in
should be seeking to stimulate our and adviser to John McCain’s presi- “We talked about the importance the spring. With unemployment at
economy with tax relief, spending dential campaign; David Malpass, a Fed Chairman Ben Bernanke of the right being outspoken and 9.6%, well above its mandate of
restraint and regulatory reform former Bear Stearns and Reagan unified on this,” said a participant. “maximum sustainable employ-
rather than masking our fundamen- Treasury economist who made an bond buying and “is confident that Mr. Ryan couldn’t be reached to ment,” and inflation running under
tal problems by artificially creating unsuccessful run for a U.S. Senate it has the tools to unwind these pol- comment. its target of a bit below 2%, the Fed
inflation.” seat from New York; and William icies at the appropriate time.” Over the weekend, organizers be- policy committee voted to resume
The Fed faces potential pressure Kristol, editor of the Weekly Stan- “The chairman has also noted gan discussions with possible GOP bond buying to try to move inflation
of a different sort from the left, as dard and a board member of e21, a that the Federal Reserve does not presidential candidates, including up a bit and unemployment down.
well. Some prominent Democratic new conservative think tank seeking believe it can solve the economy’s former Massachusetts Gov. Mitt Signatories to the letter criticiz-
congressmen, including the current a more unified conservative view on problems on its own,” she added. Romney and former House Speaker ing the Fed insisted they aren’t try-
chairman of the House Financial economic policy. “That will take time and the com- Newt Gingrich. On Tuesday, Mr. ing to undercut the central bank’s
Services Committee, have endorsed A spokeswoman for the Fed said bined efforts of many parties, in- Boskin and another signer, Paul independence.
the quantitative-easing move. Sunday: “The Federal Reserve...will cluding the central bank, Congress, Singer, head of hedge fund Elliott “It’s fair to have a public debate
But if the economy continues to take all measures to keep inflation the administration, regulators, and Management, will brief GOP gover- about what the right monetary pol-
disappoint as November 2012 ap- low and stable as well as promote the private sector.” nors at a conference in San Diego. icy is,” Mr. Holtz-Eakin said. “I’m a
proaches, the White House and growth in employment.” She noted Criticism of the Fed broke out “It is unfortunate that econo- long way away from being comfort-
Democrats in Congress may be that the Fed “is prepared to make amid the unpopular bailout of Wall mists are overhyping this and trying able with the idea of the Congress
pressing the Fed to do more to sus- adjustments as necessary” to its Street and the Senate fight over Mr. to politicize it,” said Bob McTeer, running monetary policy.”

Ireland resists EU pressure to request a bailout


Continued from first page is no need to so do.” uous speculation against all the IMF. 2011—to reduce the country’s bud-
such as Spain and Portugal, ECB and Mr. Roche also said that the li- available evidence.” An Irish finance ministry spokes- get deficit to the EU’s target of 3%
other European officials have been quidity needs of Irish banks have Irish officials argue that after person repeated earlier Monday of gross domestic product by 2014.
urging their Irish counterparts to been “fully supported” by the ECB, pumping tens of billions of euros of that the country hasn’t applied for Ireland’s budget deficit is ex-
seek financial aid from the Interna- while acknowledging that Irish fi- taxpayer capital into their battered external financial support, amid re- pected to swell to 32% of GDP by
tional Monetary Fund and a Euro- nancial institutions have gone banking industry, they have stabi- ports the government has come un- the end of the year.
pean Union rescue fund. through a very difficult patch be- lized the sector. And while Irish der pressure from the ECB and na- Investor concerns about the four-
Preliminary talks took place over cause of their own bad operations. bond yields have soared in a sign of tional governments to seek a bailout year plan, its effect on Ireland’s
the weekend about the mechanics of He said the fundamental issue is market anxiety, the government to ease risks that its problems hurt growth prospects, and whether the
a potential bailout, but Irish govern- that Ireland is well-funded, repeat- says it has enough cash to fund it- other euro-zone nations. government will muster the political
ment officials say they haven’t re- ing the position the government has self through the middle of next year. IMF Managing Director Domin- support to push it through, have
quested help—and have no intention been stating since Friday, after Eu- But officials with the ECB and the ique Strauss-Kahn said Saturday driven up the country’s bond yields
of doing so. ropean financial markets swung on Spanish and Portuguese central that the fund is ready to support in recent days. The government is
“It’s not just a question of na- reports that the debt-laden country banks on Monday publicly escalated Ireland, but it hasn’t received any due to present the budget Dec. 7.
tional pride. It is very important is seeking emergency EU funding. their pressure on Dublin. specific request from the country However, the yield on Irish 10-
that any sovereign nation retains “There is no need for us to trig- Portugal’s finance minister and he thinks it could manage alone. year bonds declined Monday, stand-
control over key issues,” said Dick ger any [financial support] mecha- Fernando Teixeira dos Santos said Irish officials reiterated Monday ing at 8.002% in mid-afternoon in
Roche, Ireland’s minister for Euro- nism; we haven’t triggered a mecha- Monday that the Irish government that the government is concentrat- London from Thursday’s high of
pean Affairs, on a national radio nism; there’s been no political must take into account what is best ing on putting together its four-year around 9%, according to Tradeweb.
broadcast Monday. “It would not be discussions about triggering a for the euro zone as well as the plan to make €15 billion ($20.52 bil- —Nicholas Winning
a good thing for us to go running to mechanism,” Mr. Roche said. “It is country when it decides whether to lion) of budget cuts over the next —and Paul Hannon
the IMF when it is clear that there very damaging that we have contin- seek financial help from the EU and four years—€6 billion of them in —contributed to this article.

Greece maintains commitment to austerity steps


BY ALKMAN GRANITSAS “Despite the data revision, the goals, and to decide on its eligibility of €4 billion. We can’t do this with- markets—the Greek government had
deficit reduction in 2010 is larger to receive a third installment of that out cutting salaries and pensions carefully leaked the size of the ex-
ATHENS—The Greek government than initially targeted; six percent- loan this year. and raising taxes. The prime minis- pected revision over the past few
Monday vowed to press ahead with age points of GDP against a targeted Under the terms of the loan, ter said this won’t happen. So we weeks so as to assuage investor jit-
tough fiscal action despite an up- reduction of 5.5 percentage points,” Greece must cut its budget deficit to will likely come back with a pro- ters.
ward revision in its 2009 deficit by the Greek finance ministry said. 8.1% of GDP this year—from a previ- posal of around €2 billion through In midday trade, the interest-
the European Union’s statistics “The 2010 deficit resulting from the ously estimated 13.8% gap in cost-cutting.” rate spread between 10-year Greek
agency. new revised figures and general 2009—and to 7.6% of GDP in 2011. government bonds and their bench-
In a statement following the re- government accounts after the re- With a higher starting point for mark German counterpart—a mea-
lease of Eurostat’s revised data, the classification is estimated to be 9.4% the deficit last year—and combined Eurostat’s revision to sure of credit risk—narrowed
finance ministry said Greece had al- of GDP, a reduction in excess of €14 with lagging tax revenues this slightly in line with the trend for
ready surpassed its 2010 budget billion ($19.17 billion) compared to year—the government will have to Greece’s 2009 deficit comes other peripheral euro-zone issuers,
goals by shrinking its deficit to 9.4% 2009.” adopt an estimated €4 billion in fur- as the government scrambles such as Ireland and Portugal.
of gross domestic product this year. The revision comes as Greece ther spending cuts to meet its fiscal The Athens stock market was
It also reaffirmed its plan to cut the scrambles to meet its deficit targets targets for 2011, government offi- to meet its deficit targets for also narrowly higher, with the gen-
deficit to below 3% of GDP by 2014, for this year and next under the cials said. this year and next under the eral index up 0.6% at 1506.2.
in line with its agreement with in- terms of a €110 billion bailout A senior official said on Sunday “Generally, the revision was
ternational lenders. agreed to in May with the Interna- that he expects the country to face terms of a bailout loan. slightly lower than expected and
Eurostat earlier Monday said tional Monetary Fund and the Euro- “substantial pressure” from the EU [has] already been priced in so it’s
Greece’s budget deficit in 2009 pean Union. A delegation of IMF, EU and IMF in talks this week. not a shock for the market,” a se-
reached 15.4% of GDP, nearly two and European Central Bank officials “To make up for the difference in In marked contrast to previous nior local bond trader said.
percentage points higher than previ- were in Athens Monday to review 2011, our guests will probably ask Eurostat revisions of Greece’s public —Costas Paris
ously forecast. Greece’s progress in meeting those for tough extra measures in excess accounts—which had roiled financial contributed to this article.
As of 11 a.m. ET Euro 1.3594 g 0.80% Yen/US$ ¥82.98 À 0.74% Yen/A$ ¥81.96 À 0.61% Oil 85.19 À 0.37% Gold 1372.60 À 0.53% 10-year Treasury g 25/32 yield 2.845% 3-month Libor 0.28438

AMP bids again A deceptive surge


for AXA Asia Pacific for Japan’s economy

BUSINESS& FINANCE.
MARKETS 26 HEARD ON THE STREET 34

Tuesday, November 16, 2010 THE WALL STREET JOURNAL. asia.WSJ.com

Toyota, Honda lose U.S. market edge


Auto giants are seeing other car makers closing in on their leads due to recalls and a narrowing gap in quality
BY MIKE RAMSEY todata Corp. So far this year, some people who would have con-
AND CHESTER DAWSON Honda’s U.S. share is down six- sidered [Toyota models] in the past Turning a corner
tenths of a point at 10.6%. may not have considered them at
U.S. market share
For the past three decades, Japa- The last time Toyota’s and the same level,” Mr. Kull said by
20%
nese auto makers Toyota Motor Honda’s market shares failed to rise telephone.
Corp. and Honda Motor Co. have ex- was 1998, when Toyota’s was flat at Both Toyota and Honda are hop- Toyota
15
perienced almost uninterrupted suc- 8.7% and Honda’s fell just one-tenth ing to generate some buzz this week
cess in the U.S., their market share of a point, to 6.4%, at the height of at the Los Angeles auto show. Toy- 10
rising as they built plants, expanded the sport-utility vehicle boom, be- ota will unveil an electric version of
Honda 5
their model lines and were held up, fore resuming their march upward. its RAV4 small sport utility vehicle.
usually in tandem, as the industry’s Larry Kull, a principal of an auto It uses a battery pack and motor 0
benchmarks for quality. retailing group in Vineland, N.J., from Tesla Motors Inc., the Califor- ’96 2000 '10*
Now, as a result of Toyota’s recall that owns stores selling vehicles nia start-up that partnered with
crisis earlier this year and the nar- from Toyota, Honda, Hyundai Motor Toyota earlier this year. Honda will
rowing auto quality gap by rivals, Corp. and other manufacturers, said show off its first battery-powered
their long run in the driver’s seat Toyota’s recalls “obviously” had an car, as well. Both are due out in
appears ready to come to an end. impact on its sales. 2012—in time for new California
Barring a surge in sales in the Privately, Toyota executives ac- zero-emission-vehicle mandates.
last two months of this year, both knowledge they are concerned about The electric vehicles reflect shifts
Honda and Toyota are likely to suf- Hyundai’s fast rise. Hyundai’s rede- in the U.S. market. Only a few years
fer drops in their U.S. market share. signed mid-sized sedan, the Sonata, ago, Toyota was the clear leader in
Through the first 10 months of 2010, has been stealing sales from the advanced, fuel-saving technology
Toyota’s share is down 1.5 percent- Toyota’s Camry and Honda’s Accord. with its Prius hybrid. Honda was *Jan. through Oct. Source: Autodata Photo: Associated Press
age points at 15.2%, according to Au- But “there is no question that Please turn to page 20

Asian financial firms gain


firepower for acquisitions
increasing, after two years where
[ Asia Deal Journal ] boards lacked confidence in the
environment and a lot of the M&A
BY NISHA GOPALAN involved the divestment of
multinationals’ Asian units,” said
Asia’s financial Willard McLane, head of financial
firms are on the institutions for Asia at Morgan
prowl—for deals as Stanley. “That process is tailing
well as for new off. Now we’ll see intra-Asian
investors. M&A picking up significantly with
Even as they deals that are driven by strategic
continue to strengthen their rationale and reflect a greater
capital base through stock confidence in Asia’s
offerings, Asian banks, insurers macroeconomic growth and
and other financial firms are stability.”
converting the flood of capital in Recent deals by Asian financial
the region into firepower for firms include Singapore
acquisitions. Low global interest Exchange Ltd.’s bid of US$8.3
rates also help to make expansion billion for Australia’s ASX Ltd.,
through mergers and acquisitions announced last month; Industrial
more attractive than organic & Commercial Bank of China
growth. Ltd.’s symbolic $1 acquisition of
So far this year, financial firms the Prime Dealer Services unit of
have generated US$2.76 billion in Fortis Securities from BNP
investment-banker fees, or 23.8% Paribas SA; and a new 13 billion
of the fee pool for deals for banks Australian dollar (about US$12.8
in the Asian-Pacific region, billion) proposal by France’s AXA
according to data tracker SA and AMP Ltd. in the ongoing
Dealogic. Technology, at US$845 battle for the French insurance
million, or 7.3%, is a distant giant’s AXA Asia Pacific Holdings
second. Ltd. arm, announced Monday.
Initial public offerings of After the financial crisis, by
banks, such as the US$22.1 billion contrast, Asian financial-sector
share sale from Agricultural Bank deals primarily involved Western
of China Ltd., or insurers, such as investment banks selling stakes in
American International Group Chinese banks or sales of Asian
Inc.’s just-completed $20.5 billion assets. MONARD DATE, ref. 342.502-003. 18K rose gold. Large date.
share sale of its AIA Group Ltd. Chinese banks are likely to be
Hand-wound movement cal. HMC 342.502. Min. 7 days power reserve.
unit, have set new records for in the next wave of buyers. They
their sectors, and their popularity have raised US$9.7 billion this Power reserve indication on movement side. See-through back.
underscores the flow of capital year from rights offers and US$9.5
into the region. billion from convertible bonds as
“We’re in a transition period they strengthen their finances. www.h-moser.com
where M&A [for financial firms] is Please turn to page 33
20 THE WALL STREET JOURNAL. Tuesday, November 16, 2010

BUSINESS  FINANCE

BHP’s failed Potash bid


spurs strategy debate
BY DAVID FICKLING annual meeting in Perth, Australia, 2007, Mr. Kloppers has pursued ac-
said it would reactivate US$4.2 bil- quisitions. He announced a bid for
SYDNEY—The collapse of BHP lion remaining in its US$13 billion Rio Tinto within weeks of taking the
Billiton’s US$38.6 billion bid for share-buyback program. job, but the deal was abandoned
Potash Corp. of Saskatchewan Inc. Dropping the takeover will mean amid the global financial crisis.

Bloomberg News
raises questions about whether the a US$350 million hit to BHP’s De- A plan for a joint venture of the
world’s biggest miner will remain cember interim accounts. companies’ iron-ore operations in
committed to making big acquisi- Governments increasingly have Australia’s Pilbara region was
tions, amid increased government become wary of foreign resource dropped last month after European
resistance to major takeovers. takeovers amid booming commodity regulators came out against the
The Anglo-Australian miner on prices and dwindling tax revenue in deal. Marius Kloppers, who has dropped three big deals since becoming BHP’s CEO,
Monday abandoned its third attempt the global downturn. Born in South Africa, Mr. Klop- is under pressure to return cash to shareholders.
at a major deal in two years, despite Analysts have argued that with pers was 44 years old when he was
attempting to placate concerns in the collapse of the Potash bid, an ac- appointed chief executive of BHP. A it’s reasonable to expect that they’re ada’s economy.
Saskatchewan and New Brunswick quisition in the oil-and-gas sector, graduate of France’s Insead business subject to a larger degree of scru- Canadian Prime Minister Stephen
that the offer wouldn’t benefit the such as of Woodside Petroleum school and a former employee of tiny.” Harper said his government’s rejec-
two Canadian provinces. Ltd., would be one of the few areas consulting firm McKinsey & Co., he Still, there is little sense that tion of the deal didn’t signal a turn
Potash said the bid’s collapse vin- in which BHP could expand without is an anomaly in an industry in shareholders and BHP’s board are away from foreign investment. “It
dicated the company’s rejection of running up against regulatory prob- which many executives are dirt-un- losing patience with Mr. Kloppers. would be an interesting question to
the US$130-a-share offer, which Pot- lems. der-the-fingernails geologists. BHP remains enviably profitable, ask whether any other country
ash said “substantially undervalued” Meanwhile, current and former Recently he drove the move to with US$12.72 billion in net attribut- would approve a similar other trans-
the company. BHP employees complained that CEO price iron ore and coal through mar- able earnings in its latest fiscal year. action,” he told reporters.
The withdrawal, meanwhile, Marius Kloppers’s focus on acquiring ket-based pricing mechanisms, un- Shareholder activist Stephen BHP on Monday said that to win
drives attention to BHP’s plans for major assets, such as those held by derlining BHP’s vision of being a Mayne said Mr. Kloppers’s drive for approval of the Potash offer from
distributing its net operating cash rival Rio Tinto and Potash, has di- low-cost, high-volume producer. major deals still has appeal. the Canadian government, the miner
flow, which came to US$17.92 billion verted focus from mining opera- But his failure to put BHP’s huge “They’re now the world’s biggest had offered to forgo tax benefits,
in the fiscal year ended June 30. tions. war chest to use looks like a lost op- Western company by market capital- spend US$820 million on explora-
BHP shareholders said manage- Mr. Kloppers said in a prepared portunity given the quick turn- ization, after Exxon Mobil Corp. and tion and infrastructure in
ment should return cash to inves- statement Monday that the company around of the resources sector after Apple Inc.,” Mr. Mayne said. Saskatchewan and pursue a listing
tors, rather than spend it on deals. would invest US$15 billion in its glo- the global downturn. “Shrinking the company [through a on the Toronto Stock Exchange. BHP
“Clearly, BHP’s generating a lot of bal business this fiscal year and con- “Part of the challenge of putting share buyback] when it’s on its way also offered to remain a member of
cash and if they can’t utilize it im- tinue to build its presence in potash. together these sorts of deals is that to being the world’s biggest isn’t the Canpotex potash-marketing car-
mediately and have an acquisition, BHP currently doesn’t produce the the [political and regulatory] frame- necessarily the right thing to do.” tel for five years.
it’s right to give it back to share- fertilizer, though BHP’s Jansen proj- work is incredibly volatile and dy- Canadian Industry Minister Tony —Ben Dummett in Toronto
holders,” said Paul Xiradis, chief ex- ect, close to Potash properties in namic at the moment all over the Clement said the BHP-Potash deal contributed to this article.
ecutive of Ausbil Dexia, a top-10 Saskatchewan, is slated to start pro- world,” said Mike Elliott, global min- was rejected because it wouldn’t
holder in BHP’s Australia listing. duction in 2015. ing leader at Ernst & Young in Syd- bring new mining techniques nor  Heard on the Street: It’s time for
BHP, which Tuesday will hold its Since becoming chief executive in ney. “If the projects are larger, then boost potash sales to improve Can- BHP to think smaller .......................... 34

Toyota, Honda appear poised to lose U.S. market share


Continued from page 19 threat. Hyundai, based in South Ko- but we are still going to grow,” he Hyundai’s went to 4.7% from 4.3%, buyers reasons to look elsewhere.
seen as one of its only serious chal- rea, will introduce a new Elantra said. Nissan’s increased to 7.8% from 7.4% The most recent Consumer Reports
lengers and had put out a hydrogen compact car promising to get 40 For one thing, Toyota’s steady and Ford’s rose to 16.7% from 15.2%. survey found that while Toyota and
fuel cell electric car, the FCX Clarity. miles per gallon—better than the 36 gains in market share in the past 20 In 2009, Toyota’s share reached a Honda ranked high among the most
Now both are behind in the cur- offered by Honda’s Civic and the 34 years came as the company added record high of 17%. Then it recalled reliable vehicles, Hyundai and Ford
rently hip battery-electric vehicles. of Toyota’s Corolla. It also will be models in new segments—sport util- more than eight million vehicles were nearly equal.
Japan-based Nissan Motor Co.’s priced about $1,500 less. ity vehicles, luxury cars under its world-wide to correct defects that Honda’s stall out is partly the re-
Leaf and Detroit-based General Mo- In an interview, Steve St. Angelo, Lexus brand and small cars under its could cause its vehicles to suddenly sult of a lull in new model launches.
tors Co.’s Chevrolet Volt will both Toyota’s quality chief in North Scion line. Now, few open segments accelerate. It also briefly was re- Its redesigned Odyssey minivan is
beat Toyota and Honda to the mar- America, said the company knows it are left for easy growth. quired to stop making and selling out now and sales are just ramping
ket in the next month or so. faces a tougher market than in the This year, Hyundai, Nissan and a several models in the U.S.. up. Its Insight hybrid, released last
Across the hall at the Los Ange- past. “I don’t think we will have the revived Ford Motor Co. have all in- Quality had long been Toyota’s year, hasn’t sold as well as the com-
les show will be a more immediate kind of growth we had in the past, creased their U.S. market share. top selling point, but the crisis gave pany had hoped.

INDEX TO BUSINESSES AND PEOPLE


Businesses AXA................19,25,26,34 Credit Suisse Group.....27 .......................................25 Sumitomo Mitsui Buffett, Warren............33 Malone, John................17 Ruskin, Alan ................. 24
This index of businesses Bank of China...............33 Dai-ichi Life Insurance.25 Liberty Media .......... 16,17 Financial Group .... 25,28 Casper, Marc N.............16 Mayne, Stephen ........... 20 Sarhan, Adam...............25
mentioned in today’s Bank VTB......................27 Deutsche Bank..............27 Lowe’s ........................... 25 Swire Pacific.................22 Chen Zhanheng...............5 McLane, Willard Adrian Smith, Mark....................4
Berkshire Hathaway.....33 Dow Chemical...............33 Lynas...............................4 Swiss Reinsurance ....... 33
issue of The Wall Street Macquarie Group..........27
Dan, Pauline..................27 .......................................19 St. Angelo, Steve.........20
BHP Billiton........20,25,34 European Aeronautic Tech Mahindra..............23
Journal is intended to BNP Paribas..................19 Defence & Space.......22 Mazda Motor................25 Terex..............................21
Dauman, Philippe ......... 16 Moonves, Leslie............17 Sutton, Camilla.............25
include all significant McKesson......................16 Deripaska, Oleg ............ 27 Morgan, Daniel.............25 Swinford, David............16
Boeing...........................22 EuroSibEnergo..............27 Tesla Motors.................19
reference to companies. Boston Scientific..........16 Ford Motor...............20,25 Microsoft.......................17 Thermo Fisher Scientific Dernoncourt, Marie- Nagayasu, Katsunori....28 Tan, Michael ................. 33
First reference to the Brambles..................21,25 Fortis Securities...........19 Mitsubishi UFJ Financial .......................................16 Soazic Geffroy...........33 Oberhelman, Doug........21 Tuer, James .................... 4
Group..........................28 Durgashankar, S...........23
companies appears in Bucyrus International General Electric..20,22,33 Toyota Motor................19 Olofsson, Lars...............26 Tyler, Tony .................... 22
..................................21,25 General Motors.............20 Mizuho Financial Group UBS ............................... 27 Edmonds, Brian ............ 24
bold face type in all ..................................25,28 Overby, Tami...................6 Wang Tao........................4
Carrefour.......................26 Goldman Sachs Group..33 Viacom .......................... 16 Elliott, J. Raymond.......16
articles except those Molycorp ......................... 4 Raju, B. Ramalinga.......23 Xiradis, Paul..................20
Caterpillar................21,25 Hainan Airlines.............22 Vodafone Group............23 Elliott, Mike..................20
on page one and the Cathay Pacific...............22 Hay Group.....................17 Morgan Stanley............27 Reda, James ................. 16 Yoo, Simon....................33
Woodside Petroleum....20 Ellison, Lawrence J. ..... 16
editorial pages. CBS................................17 Hewlett-Packard...........17 National Australia Bank
Wrigley Wm. Jr............33 Reilly, Mark...................16 Zhang Xinguo ............... 22
.......................................34 Fiorina, Carly ................ 17
Chevron...........................6 Honda Motor.................19 Xinjiang Goldwind Fisher, Ryan..................26
Nissan Motor................20
China Construction Bank Hong Kong Aircraft Science & Technology
Acom.............................28 Occidental Petroleum...16 Flabbee, Pierre..............26
Agricultural Bank of .......................................33 Engineering................22
Office Depot ................. 25 .......................................27
Goncalves, George........24 Corrections  Amplifications
China..........................19 China Datang Corp. Huaneng Renewables...27 Oracle............................16 Yahoo.............................17
Renewable Power......27 Hudson Resources..........4 Zijin Mining Group.......25 Gorman, Tom................21
AIA Group.....................19 Polo Ralph Lauren...16,25 General Electric Co. Chief Executive Jef-
China Eastern Airlines.22 Hutchison Essar ........... 23 Hammergren, John.......16
Air China.......................22 Potash Corp. of frey Immelt said at a news conference in
Aluminum Corp. of China China Longyuan Power
Group..........................27
Hutchison Whampoa....23
Hyundai Motor..............19
Saskatchewan..20,25,34 People Hu, Johnson....................4
Immelt, Jeffrey.............20 Beijing on Nov. 9 that China’s govern-
.......................................25 Prime Dealer Services..19 This index lists the ment has taken steps to resolve concerns
American International China Southern Airlines IFCO Systems..........21,25 Promise.........................28 Irani, Ray.......................16
.......................................22 Industrial & Commercial names of business- about its “indigenous innovation” poli-
Group..........................19 Rio Tinto.......................20 Ishii, Jun.......................24
AMP................19,25,26,34 Coach.............................25 Bank of China.......25,33 Royal Bank of Scotland people and government cies, which have been criticized by for-
Kato, Susumu...............24
ASX ............................... 19 Commercial Aircraft.....22 ING Groep ..................... 19 Group.....................19,28 regulators who receive eign businesses, and that GE feels wel-
Kloppers, Marius.....20,34
Autodata.......................19 Commercial Bank of James F. Reda & Safran............................22 significant mention in come to invest in China. A Business &
Kull, Larry.....................19
AutoDesk ...................... 17 China..........................19 Associates ................. 16 Samsung Life Insurance Today’s Journal. Finance article Nov. 10 incorrectly char-
Aviation Industry Corp. Commonwealth Bank of Joy Global.....................21 Co ............................... 33 Lauren, Ralph................16
of China ..................... 22 Australia....................33 J.P. Morgan Chase........27 Satyam Computer le Mesurier, Brett.........26 acterized his comments as saying that GE
AXA Asia Pacific Compensation Consulting Komatsu........................21 Services ..................... 23 Bartz, Carol...................17 Liu Li-Gang ..................... 4 is still concerned about the policies.
Holdings......19,25,26,34 Consortium................16 Konica Minolta Holdings Singapore Exchange.....19 Borrus, Amy..................17 Maffei, Greg ............ 16,17
Tuesday, November 16, 2010 THE WALL STREET JOURNAL. 21

BUSINESS  FINANCE

Caterpillar bets on coal Brambles to buy IFCO,


BY JAMES R. HAGERTY as much as $2 billion from a sale of
new Caterpillar shares.
a plastic-container firm
Caterpillar Inc. agreed to buy The planned acquisition is the BY ROSS KELLY Spain and Australia, generating
Bucyrus International Inc., a maker third by Caterpillar this year. In Oc- more than 80% of its earnings from
of mining equipment, for $7.6 billion tober, the Peoria, Ill., company said SYDNEY—Brambles Ltd., the its CHEP pallet rental businesses. It
in what amounts to a bet on a con- it would buy engine maker MWM world’s largest pallet-rental com- leases about 300 million wooden
tinued global boom in coal and Holding GmbH of Germany for about pany by volume, plans to spend pallets and plastic containers to cart
other minerals. $810 million. In August, Caterpillar €923 million (US$1.26 billion) to ac- goods world-wide. The remainder of
Demand from China, India, Brazil completed the purchase of railroad- quire IFCO Systems NV, a supplier the company’s earnings come from
and other emerging markets will locomotive manufacturer Electro- of reusable plastic containers for its global Recall information-man-
“push demand” for coal, other min- Motive Diesel for $820 million. the fresh-produce industry. agement unit.
erals and “everything that comes Bucyrus, based in South Milwau- Amsterdam-based IFCO claims Buying IFCO would give Bram-
out of the ground,” Doug Oberhel- kee, Wis., makes equipment used in that the containers deliver better- bles 100 million more plastic con-
man, Caterpillar’s chief executive, mining coal, iron ore, copper, oil quality produce, are more environ- tainers. “IFCO is a natural fit with
said Monday during an interview. sands and other minerals. The com- mentally sustainable and provide Brambles’s existing RPC and pallet
The planned purchase, subject to pany, which traces its roots to the lower supply-chain costs than businesses,” Brambles Chief Execu-
regulatory approvals, would make 1880s, provided excavators and dig- wooden or cardboard boxes. tive Tom Gorman said.
Bloomberg News

Caterpillar the world’s “broadest ging equipment for the construction The containers, also known as The logistics company is funding
supplier” of mining equipment, Mr. of the Panama Canal. In the RPCs, currently comprise about 3% the deal through a combination of
Oberhelman said. mid-1990s, the company was reorga- of Brambles’s revenue but would ac- 50% equity and 50% debt. The eq-
The proposed acquisition would nized in U.S. bankruptcy court after count for 13% if the acquisition uity component would be derived
accelerate consolidation among glo- Caterpillar CEO Doug Oberhelman. a leveraged buyout left it with more gains regulatory approval, which from a 110-million-Australian-dollar
bal makers of mining equipment. In debt than it could handle. Brambles expects to occur within ($US108.5 million) share-purchase
February, Bucyrus bought Terex The cash offer from Caterpillar, Bucyrus has manufacturing facil- nine months. plan and underwriting the next
Corp.’s mining-equipment division already the world’s largest maker of ities in South Milwaukee, Houston The other half of IFCO’s revenue three dividend-reinvestment plans.
for $1.3 billion. Other big rivals in construction and mining equipment, and Germany. comes from the company’s U.S. Debt would come from existing
the mining-equipment segment in- values Bucyrus at $92 a share, a Mr. Oberhelman said there is vir- wooden-pallet-recycling business. facilities.
clude Komatsu Ltd. of Japan and 32% premium over last week’s clos- tually no overlap between the types Owning IFCO would help Brambles Separately, Brambles said sales
Joy Global Inc. of the U.S. ing price for Bucyrus on the Nasdaq of mining equipment made by manage its own pallet pool. revenue for the four months ended
“Our customers have told us they Stock Market. Bucyrus and Caterpillar. Many min- Sydney-based Brambles, with in October totaled US$1.43 billion,
want fewer suppliers” of mining Caterpillar said it would finance ers use Bucyrus shovels to load Cat- business in at least 45 countries, up 2% from a year earlier and 3% on
equipment, Mr. Oberhelman said. the purchase partly with debt and erpillar-made mining trucks. primarily operates in the U.S., U.K., a constant currency basis.
22 THE WALL STREET JOURNAL. Tuesday, November 16, 2010

CORPORATE NEWS

China displays large passenger jet


BY JEREMY PAGE two years later. The mock-up un-
veiled Monday was life-size but con-
ZHUHAI, China—China unveiled sisted of only the front half of the
a mock-up of a large passenger jet fuselage, with a cockpit simulator.
designed to compete with Boeing Several U.S. and other foreign
Co. and Airbus, predicting that hun- suppliers are working on the C919,
dreds of orders would be placed including CFM International Inc., a
during this week’s Zhuhai air show. venture of GE and France’s Safran
Orders for the single-aisle, 160- SA that won a $10 billion contract
seat C919 likely would come from to make the Chinese plane's engines.
domestic Chinese airlines and for- China’s civil-aviation market is
eign-leasing firms, said Zhang Xin- undergoing enormous growth, with
guo, vice president of state-owned nationwide airline traffic for the
Aviation Industry Corp. of China, a first nine months of this year up
major shareholder in the plane’s 18% from a year earlier to 200.7 mil-
maker, Commercial Aircraft Corp. lion passengers, according to the
The C919 is meant to compete Civil Aviation Administration of
with Boeing’s 737 and the A320, China. Boeing predicted this month
which is made by European Aero- that China would likely require
nautic Defence & Space Co.’s Air- 4,330 new commercial airplanes
bus unit. The two Western aircraft over the next 20 years, making it
manufacturers currently dominate a the world’s biggest airplane market,
Chinese market estimated by Boeing after the U.S.
to be valued at $480 billion over the Even as Beijing has sought to
next two decades. compete with foreign aircraft manu-
“During this air show, I believe facturers, China has continued to
Bloomberg News

hundreds” of orders for the C919 buy foreign jetliners, placing orders
will be announced, Mr. Zhang said for 102 planes from Airbus this
at a news conference on the eve of month.
the six-day air show. The ARJ21 already has had some
He didn’t name prospective buy- The C919, on display at the Zhuhai air show, is designed to compete with jets made by Boeing and Airbus. success in the global market, at-
ers. But industry observers said tracting 240 orders from home and
they are expected to include state- regional jets. Executives of the U.S. its space program in terms of na- order announcements. abroad. First deliveries of the air-
run domestic airlines Air China company have said GE plans to lease tional prestige. Some industry insiders also have craft are expected to be made next
Ltd., China Eastern Airlines Corp., the 70-seat ARJ21s to China’s do- Still, it was unclear how firm the questioned whether the C919 will be year, Commercial Aircraft told the
China Southern Airlines Co. and mestic airlines for use within the expected orders will be, and completed on schedule—noting that official Xinhua news agency on
possibly Hainan Airlines Co. country. whether Commercial Aircraft will the ARJ21 is already almost two Monday. Four aircraft were under-
Another possible buyer is Gen- The expected order for the C919 require a nonrefundable deposit years behind its original introduc- going test flights while another two
eral Electric Co.’s leasing arm, would represent a vote of confi- from prospective buyers, as is de- tion date of 2009. were being tested on the ground to
which agreed two years ago at the dence in China’s decades-long quest manded by most foreign manufac- The C919 isn’t expected to make earn airworthiness certificates.
previous Zhuhai air show to pur- to develop a large passenger jet—a turers. Given the importance of the its first flight until 2014, and the —Norihiko Shirouzu
chase 25 Commercial Aircraft ARJ21 project that Beijing rates alongside C919 project, politics could drive the first deliveries aren’t expected until contributed to this article.

Cathay Pacific sees


strong 2010 profit
BY JOANNE CHIU
Cathay Pacific Airways
HONG KONG—Cathay Pacific
Airways Ltd. said Monday its full- Net profit/loss, in billions of Hong
year profit will be at least 12.50 bil- Kong dollars
lion Hong Kong dollars (US$1.61 bil- HK$20
lion), more than doubling to a re- Forecast
cord thanks to a robust recovery in
demand for passenger and cargo 10
services in the region.
The global financial crisis that
began in late 2008 led to a sharp 0
fall in air travel and export volume,
but the airline industry has re-
bounded with a revival in interna- –10
tional trade. 2006 ’07 ’08 ’09 ’10
Hong Kong-based Cathay Pacific Source: the company
in March posted a profit for 2009 of
HK$4.69 billion, reversing a loss of
HK$8.7 billion in 2008. Demand for the airline’s first-
The company said Monday its and business-class services have re-
2010 profit forecast includes a bounded significantly, though not
HK$2.17 billion gain from the sale of yet back to 2008 levels.
its stakes in Hong Kong Air Cargo Cathay Pacific and its China-fo-
Terminals Ltd. and Hong Kong Air- cused unit, Hong Kong Dragon Air-
craft Engineering Co., as well as a lines Ltd., have been adding capac-
€57.12 million ($78.2 million) fine ity and launching new routes to
from the European Commission over meet the rebound in demand.
a cargo price-fixing case. The airline, which is controlled
The company has said it is con- by conglomerate Swire Pacific Ltd.,
sidering its legal options on the also said it expects a HK$1.70 billion
case. net profit contribution for the sec-
“We are expecting an outstand- ond half from Air China Ltd., in
ing financial result following a very which it has a 19.27% stake. Air
difficult period brought about by China owns a 30% stake in Cathay
the global financial crisis,” Cathay Pacific.
Pacific Chief Executive Tony Tyler Jim Wong, head of Asia trans-
said. port and infrastructure research at
Cathay Pacific’s cargo and pas- brokerage Nomura, said tight capac-
senger business has improved mark- ity supply as well as robust demand
edly since the last quarter of 2009 have boosted the airline industry
and the airline said cargo traffic is and its load factors during the sec-
now back to precrisis levels. ond half of this year.
Tuesday, November 16, 2010 THE WALL STREET JOURNAL. 23

CORPORATE NEWS

Vodafone is pressed
in India tax case Db 13 - 14 2010, itc m , mb
BY R. JAI KRISHNA AND ROMIT GUHA Vodafone International failed to
withhold tax when it paid $11.2 bil-
NEW DELHI—India’s top court lion to buy Hong Kong-based
Monday asked a unit of U.K.’s Voda- Hutchison Whampoa Ltd.’s 67%
fone Group PLC to pay a deposit of stake in Hutchison Essar. Hutchison
25 billion rupees ($558.2 million) Essar was renamed Vodafone Essar
within three weeks as the U.K. tele- after the stake transfer. Tax depart-
communications company appeals a ment officials couldn’t be reached
massive $2.52 billion tax bill. for comment.
The court set Feb. 24 as the final Vodafone has since claimed that
date for an appeal hearing in the the Indian government is not enti-
case, which involves Vodafone Inter- tled to tax the transaction since it
national Holdings BV. was agreed outside India by two
The appeal is against a lower foreign companies.
court ruling that permitted a tax Meanwhile, Vodafone said in a
claim on the company’s 2007 acqui- statement that it has been in talks
sition of a majority stake in Hutchi- with the Dutch government, which
son Essar Ltd. it said probably appealed to an In- Driving your investments through the new silk roaD
India’s tax department had sent dia-Netherlands tax treaty to re-
Vodafone International a tax de- solve the dispute.
mand of 112.18 billion rupees, in- Vodafone International is regis- www.chimeinvestment.com
cluding interest. Vodafone has said tered in the Netherlands.
it “strongly disagrees” with the tax “The Dutch government’s inter- P   d:
calculation. vention is a standard mechanism
The court registry payment of 25 which can be invoked between coun-
billion rupees would be paid back to tries to review tax matters,” Voda-
Vodafone if the company wins the fone said Monday, responding to lo-
court case. A three-judge panel cal media reports.
asked the income tax department to Officials at the Netherlands High
provide a guarantee that it would Commission in India couldn’t be
bear the applicable interest on the reached Monday.
25 billion rupees deposited by Voda- During its address in court Mon-
fone if the company were to win the day, company lawyers reiterated its F
 f f

, 
  : +971 4 367 1383
appeal. argument that the deal wasn’t tax-  q   @  b.

The court, headed by Chief Jus- able in India.
tice S.H. Kapadia, also asked Voda- India’s Central Board of Direct p      
fone International to provide a bank Taxes had calculated capital gains of
guarantee valued at 85 billion ru- 374.14 billion rupees on the transac-
pees with a state-run bank in the tion. The tax on the gains was calcu-
next eight weeks. lated at 79 billion rupees as of Feb.
India’s tax department says 11, 2007, the board said.

Satyam profit plunges


amid push for new clients
BY KENAN MACHADO to 233 million rupees, or 0.20 rupee
AND ROMIT GUHA a share, from 975 million rupees, or
0.83 rupee a share, in the first quar-
HYDERABAD—Satyam Com- ter ended June 30. Revenue in the
puter Services Ltd., recovering just-ended quarter came in at 12.42
from India’s biggest corporate scan- billion rupees, marginally down
dal, said Monday its second-quarter from 12.48 billion rupees in April-
consolidated net profit plunged 76% June.
from the first quarter, hurt mainly “Basically, profit fell mainly be-
by salary rises and foreign-exchange cause of two reasons—employee
losses, even as the company strug- costs and also because in the first
gled to add clients. quarter, we had forex gains,” Chief
This is the first time the Hydera- Financial Officer S. Durgashankar
bad-based company is reporting told reporters.
quarterly results since the July-Sep- The company recorded foreign-
tember quarter of 2008. In January exchange losses of 91 million rupees
2009 it was plunged into turmoil af- in the second quarter compared
ter its founder, and then chairman, with a gain of 336 million rupees in
B. Ramalinga Raju, confessed to the first quarter. As a result, other
overstating profit for years, using a income more than halved to 313 mil-
fictitious cash balance of more than lion rupees compared with 732 mil-
$1 billion. lion rupees.
Satyam Computer this past Sep- But revenue growth for the con-
tember reported results for the last tining third quarter may be ham-
fiscal year that ended March 31, pered by the holiday season in the
when it posted a net loss of 1.25 bil- U.S., which could hurt billing rates,
lion rupees ($28 million) on revenue Mr. Gurnani said, adding that he
of 54.81 billion rupees. expects revenue in the current fis-
The accounting scandal has cal year ending March 31, 2011, to
taken a toll on the company’s fi- be higher than the previous fiscal
nances over the years. In the imme- year.
diate aftermath of the scandal, the The U.S. accounts for about 59%
company’s revenue and profitability to 60% of the company’s revenue.
suffered as it lost clients and staff. Satyam Computer was taken
Satyam Computer is still in the pro- over by software company Tech
cess of restating accounts for the Mahindra Ltd. following a govern-
past six to seven years. ment auction in April 2009, and its
But the results for first two services were rebranded Mahindra
quarters of this fiscal years indicate Satyam, although the company is
company is recovering, albeit at a still listed as Satyam Computer Ser-
slow pace, say analysts. vices Ltd.
For the quarter ended Sept. 30, —Dhanya Thoppil in Bangalore
net profit for the company slumped contributed to the article.
24 THE WALL STREET JOURNAL. Tuesday, November 16, 2010

THE INTERNATIONAL INVESTOR

Treasury prices decline Ten-year yield FUND SCORECARD


in Japan rises Global Large-Cap Blend Equity
over Bernanke backlash back above 1%
Funds investing in equities of large-cap companies across the globe. Funds for which neither growth nor
value characteristics predominate. Ranked on % total return (dividends reinvested) in Euros for one year
BY DEBORAH LYNN BLUMBERG ing earlier this month has sparked ending November 15, 2010
sharp selling of those issues. BY MEGUMI FUJIKAWA Leading 10 Performers
NEW YORK—Treasury prices fell The latest catalyst were com- FUND FUND LEGAL % Return in $US **
amid a continued backlash against ments from a group of prominent TOKYO—Japan’s benchmark 10- RATING * NAME FUND MGM'T CO. CURR. BASE YTD 1-YR 2-YR 5-YR
the Federal Reserve’s second bond- Republican-leaning economists, co- year bond yield jumped above 1% on NS Manulife GF Manulife Global USDLUX 33.34 35.43 57.99 NS
buying, or quantitative-easing, pro- ordinating with Republican lawmak- better-than-expected third-quarter Glbl Contrarian AA Fund
gram. ers and political strategists. They economic growth. NS Fuh Hwa Fuh-Hwa Investment TWDTWN 12.76 20.50 NS NS
The 10-year yield reached a level are launching a campaign this week Government data released earlier Greater China Trust Co., Ltd
last seen in early August, though by calling on Fed Chairman Ben Ber- in the day showed that the nation’s 5 Schroder Sel Schroder JPYLUX 21.14 19.26 28.65 NS
midday the market nanke to drop his plan to buy $600 real gross domestic product in- Yld Eq A JPY Acc Investment Mgmt (Luxembourg)
U.S. CREDIT had recouped some billion in additional U.S. Treasury creased 3.9% in annualized terms in
MARKETS 5 Polaris Polaris Intl Secs TWDTWN 18.56 18.58 31.67 NS
of its losses as the bonds. Traders said some market the July-September period, higher
Global ETF Growth Invmt Tr Co., Ltd
Fed stepped in to participants were speculating that than the 2.5% growth expected.
buy Treasurys under the so-called the Fed may not run through the However, solid growth figures 5 PCA Global Prudential TWDTWN 16.63 17.63 25.82 NS
QE2. $600 billion it dedicated to buying. are unlikely to weigh for long on Equity Fund of Fund Securities Taiwan
The 10-year note was down 13/32 Treasurys have weakened ever bond prices, and 3 ING MPF MT ING (HK) Life HKDHKG 11.55 17.05 21.75 6.40
to yield 2.831%, after rising as high since the Fed announced its newest BOND push up yields, be- Comp Growth
as 2.904%. The five-year note was program, designed to fight deflation MARKETS cause the Bank of NS Franklin Franklin Templeton TWDTWN 11.63 16.53 30.26 NS
down 9/32 to yield 1.420%. and help stimulate the economy by Japan is committed TempletonFirstTaiwanNewWld Sinoam Sec Inv Mgmt
The Federal Reserve Bank of New keeping rates low and pushing in- to maintaining its easy monetary 5 Pacific S&P Pacific Mutual MYRMYS 15.70 16.07 27.58 NS
York bought $7.92 billion in Trea- vestors to branch out into higher- policy until the end of deflation is in Global Stars Fund Berhad
sury bonds on Monday. The amount yielding assets. Governments across sight, said Susumu Kato, chief Japan 3 Access PCP Access Investment USDCYM 10.14 15.79 19.19 3.80
includes purchases to be made un- the globe and even Fed officials have economist at Crédit Agricole.
Global Opportunities Management (HK) Ltd
der a previous program to reinvest expressed concerns about the im- The 10-year yield gained 0.05
cash from its maturing mortgage-re- pact of the bond-buying effort and percentage point to 1.045%, its high- NS AB SICAV AllianceBernstein USDLUX 13.58 15.62 40.79 6.14
lated holdings back into Treasurys. doubts about whether it will help est level since Sept. 21. Glbl Thematic Rsch A (Luxembourg) S.A.
Dealers offered to sell the Fed $28.01 the U.S. economy. The 10-year yield This week, the market is focused NOTE: Changes in currency rates will affect performance and rankings. Source: Morningstar, Ltd
KEY: ** 2YR and 5YR performance is annualized 1 Oliver’s Yard, 55-71 City Road
billion. The Fed had said it would has risen by about 0.3 percentage on the government’s sale of 1.1 tril- NA-not available due to incomplete data; London EC1Y 1HQ United Kingdom
NS-fund not in existence for entire period www.morningstar.co.uk; Email: mediaservice@morningstar.com
buy $7 billion to $9 billion in debt point in the last few weeks, as has lion yen ($13.34 billion) of 20-year Phone: +44 (0)203 107 0038; Fax: +44 (0)203 107 0001
maturing from 2016 to 2017. The Fed the five-year yield. bond Thursday. Analysts expect the
will buy Treasury securities every “It’s really a vicious unwind of coupon to be raised to 1.9% on the
day this week. some very popular trades that have new issue from the current 1.8%. yield back to as low as 0.965% this Vinacomin, as the Vietnamese
Treasury prices dropped early as been longstanding,” said Brian Ed- “If auction results show solid de- week, he said. government-owned company is
market participants continued to un- monds, head of interest rates at mand from life-insurance companies Among Asian borrowers, Viet- known, began meeting with pro-
wind trades they put on when expec- Cantor Fitzgerald & Co. in New York. at [an expected] 1.9% coupon, that nam National Coal & Mineral Indus- spective investors Monday. Those
tations for QE2 first hit. Investors To put Fed buying in perspective, may be a trigger to reverse a recent tries Holding Corp. is seeking to meetings will wrap up Thursday.
bought five- and seven-year Trea- in about eight months the Fed will weak bias in the superlong sector,” raise between $500 million and $1 The company has hired ANZ Se-
surys as anticipation grew that the accumulate more Treasurys than are said Jun Ishii, chief strategist at billion through the sale of 10-year curities, Citigroup and Crédit Agri-
Fed would announce another bond- held by China, the largest holder of Mitsubishi UFJ Morgan Stanley Se- dollar bonds, a person familiar with cole CIB to handle the sale.
buying program. But increased criti- U.S. Treasurys. China has about curities. the situation said Monday. Pricing is —P.R. Venkat in Singapore
cism of the program after its unveil- $868.4 billion in Treasury securities. It also could push the 10-year likely this week. contributed to this article.

Advertisement INTERNATIONAL INVESTMENT FUNDS [ Search by company, category or country at asia.WSJ.com/funds ]


NAV —%RETURN— NAV —%RETURN— NAV —%RETURN—
FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR
Eur Income C EU EU LUX 11/12 USD 9.48 9.7 10.6 19.9 Gl Bond B EU EU LUX 11/12 USD 9.65 7.1 7.2 11.0 Gl Thematic Res. I GL EQ LUX 11/12 USD 18.78 14.3 16.6 42.0
Eur Income C2 EU EU LUX 11/12 EUR 14.11 10.0 10.7 19.9 Gl Bond B2 EU EU LUX 11/12 USD 15.02 7.1 7.1 11.0 Gl Value A EU EU LUX 11/12 USD 11.24 0.9 2.0 19.7
Eur Income C2 EU EU LUX 11/12 USD 19.30 10.0 10.7 19.9 Gl Bond B2 EU EU NA 11/12 HKD 116.44 7.1 7.1 11.0 Gl Value B EU EU LUX 11/12 USD 10.23 -0.1 1.0 18.5
Eur Income I EU EU LUX 11/12 EUR 6.93 10.6 11.7 21.0 Gl Bond BT EU EU LUX 11/12 HKD 75.04 7.2 7.1 11.0 Gl Value C EU EU LUX 11/12 USD 10.88 0.5 1.6 19.3
Eur Income I EU EU LUX 11/12 USD 9.48 10.6 11.7 21.0 Gl Bond BT EU EU LUX 11/12 USD 9.68 7.2 7.1 11.0 Gl Value I EU EU LUX 11/12 USD 12.04 1.6 2.9 20.7
Data as shown is for information purposes only. No offer is being made by Eur Strat Value A EU EU LUX 11/12 EUR 8.96 5.0 7.6 13.1 Gl Bond C EU EU LUX 11/12 USD 9.65 7.5 7.7 11.6 Greater China A AS EQ LUX 11/12 USD 45.15 12.8 14.0 39.8
Morningstar, Ltd. or this publication. Funds shown aren’t registered with the Eur Strat Value A EU EU LUX 11/12 USD 12.25 5.0 7.6 13.1 Gl Bond C2 EU EU LUX 11/12 USD 14.95 7.6 7.7 11.6 Greater China B AS EQ LUX 11/12 USD 39.61 11.8 12.9 38.4
U.S. Securities and Exchange Commission and aren’t available for sale to United
Eur Strat Value I EU EU LUX 11/12 EUR 9.23 5.6 8.3 14.1 Gl Bond I EU EU LUX 11/12 USD 9.65 8.4 8.8 12.7 Greater China C AS EQ LUX 11/12 USD 44.40 12.3 13.5 39.2
States citizens and/or residents except as noted. Prices are in local currencies.
All performance figures are calculated using the most recent prices available. Eur Strat Value I EU EU LUX 11/12 USD 12.62 5.6 8.3 14.1 Gl Conservative A EU EU LUX 11/12 USD 15.34 4.8 5.3 12.0 India Growth A EA EQ LUX 11/12 USD 154.28 21.6 28.1 NS
Eur Value A EU EU LUX 11/12 EUR 9.65 4.9 7.8 15.3 Gl Conservative A2 EU EU LUX 11/12 USD 17.74 4.8 5.3 12.0 India Growth AX EA EQ LUX 11/12 USD 135.20 21.9 28.5 52.1
NAV —%RETURN— Eur Value A EU EU LUX 11/12 USD 13.20 4.9 7.8 15.3 Gl Conservative B EU EU LUX 11/12 USD 15.31 3.9 4.3 10.9 India Growth B EA EQ LUX 11/12 USD 160.22 20.5 26.8 NS
FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR Eur Value B EU EU LUX 11/12 USD 12.03 4.0 6.8 14.1 Gl Conservative B2 EU EU LUX 11/12 USD 16.71 3.9 4.3 10.9 India Growth BX EA EQ LUX 11/12 USD 114.57 20.8 27.2 50.6
Eur Value B EU EU LUX 11/12 EUR 8.80 4.0 6.8 14.1 Gl Conservative C EU EU LUX 11/12 USD 15.35 4.4 4.9 11.5 India Growth I EA EQ LUX 11/12 USD 140.72 22.4 29.1 52.8
Eur Value C EU EU LUX 11/12 USD 12.70 4.5 7.3 14.7 Gl Conservative C2 EU EU LUX 11/12 USD 17.28 4.3 4.9 11.5 Int'l Health Care A EU EU LUX 11/12 USD 133.40 -3.0 1.8 8.6
Eur Value C EU EU LUX 11/12 EUR 9.29 4.5 7.3 14.7 Gl Conservative I EU EU LUX 11/12 USD 15.44 5.4 6.1 12.9 Int'l Health Care B EU EU LUX 11/12 USD 111.54 -3.8 0.8 7.5
Eur Value I EU EU LUX 11/12 USD 15.34 5.6 8.7 16.2 Gl Eq Blend A GL EQ LUX 11/12 USD 11.90 2.1 3.7 19.2 Int'l Health Care C EU EU LUX 11/12 USD 127.36 -3.3 1.3 8.1
Eur Value I EU EU LUX 11/12 EUR 11.22 5.6 8.7 16.2 Gl Eq Blend B GL EQ LUX 11/12 USD 11.07 1.1 2.6 17.9 Int'l Health Care I EU EU LUX 11/12 USD 146.77 -2.3 2.6 9.5
EuroZone Strat Val AX EU EU LUX 11/12 EUR 7.78 10.7 13.4 17.2 Gl Eq Blend C GL EQ LUX 11/12 USD 11.64 1.6 3.1 18.6 Int'l Technology A EU EU LUX 11/12 USD 122.96 11.4 18.8 33.3
EuroZone Strat Val AX EU EU LUX 11/12 USD 10.64 10.7 13.4 17.2 Gl Eq Blend I GL EQ LUX 11/12 USD 12.64 2.8 4.5 20.1 Int'l Technology B EU EU LUX 11/12 USD 105.62 10.4 17.6 32.0
EuroZone Strat Val BX EU EU LUX 11/12 USD 9.49 9.8 12.3 16.1 Gl Growth A EU EU LUX 11/12 USD 43.45 3.7 5.8 18.8 Int'l Technology C EU EU LUX 11/12 USD 118.36 11.0 18.2 32.8
n AHW CAPITAL MANAGEMENT EuroZone Strat Val BX EU EU LUX 11/12 EUR 6.94 9.8 12.3 16.1 Gl Growth B EU EU LUX 11/12 USD 35.96 2.8 4.8 17.6 Int'l Technology I EU EU LUX 11/12 USD 138.83 12.2 19.7 34.4
Tel (+49) 1805 - 23 82 82 EuroZone Strat Val CX EU EU LUX 11/12 EUR 5.87 10.1 12.9 16.7 Gl Growth C EU EU LUX 11/12 USD 41.53 3.3 5.4 18.3 Japan Eq Blend A EU EU LUX 11/12 JPY 5668.00 -5.9 0.4 5.3
www.ahw-capital.com EuroZone Strat Val IX EU EU LUX 11/12 USD 11.68 11.3 14.3 18.2 Gl Growth I EU EU LUX 11/12 USD 48.58 4.4 6.7 19.8 Japan Eq Blend B EU EU LUX 11/12 JPY 5421.00 -6.7 -0.6 4.3
AHW Top-Div.Int. EU EU LUX 11/11 EUR 51.17 -6.3 -5.2 -1.0 EuroZone Strat Val IX EU EU LUX 11/12 EUR 8.54 11.3 14.3 18.2 Gl High Yield A EU EU LUX 11/12 USD 4.68 15.2 19.0 34.9 Japan Eq Blend C EU EU LUX 11/12 JPY 5555.00 -6.3 -0.1 4.8
Gl Balanced (Euro) A EU EU LUX 11/12 USD 16.53 5.4 7.9 13.7 Gl High Yield A2 EU EU LUX 11/12 USD 10.72 15.8 19.4 34.9 Japan Growth A EU EU LUX 11/12 JPY 5330.00 -9.3 -3.8 -0.5
Gl Balanced (Euro) B EU EU LUX 11/12 USD 15.96 4.5 6.8 12.6 Gl High Yield A2 EU EU NA 11/12 HKD 83.10 15.8 19.4 34.9 Japan Growth B EU EU LUX 11/12 JPY 5100.00 -10.0 -4.7 -1.5
Gl Balanced (Euro) C EU EU LUX 11/12 USD 16.36 5.1 7.6 13.4 Gl High Yield AT EU EU NA 11/12 HKD 36.05 15.8 19.4 34.9 Japan Growth C EU EU LUX 11/12 JPY 5225.00 -9.6 -4.2 -0.9
Gl Balanced (Euro) I EU EU LUX 11/12 USD 16.93 6.0 8.6 14.5 Gl High Yield AT EU EU LUX 11/12 USD 4.65 15.8 19.4 34.9 Japan Strat Value A EU EU LUX 11/12 JPY 6017.00 -1.7 5.2 11.5
Gl Balanced A EU EU LUX 11/12 USD 17.26 4.7 5.8 16.9 Gl High Yield B EU EU LUX 11/12 USD 4.68 14.3 17.8 33.3 Japan Strat Value B EU EU LUX 11/12 JPY 5766.00 -2.5 4.2 10.4
Gl Balanced B EU EU LUX 11/12 USD 16.27 3.8 4.7 15.7 Gl High Yield B2 EU EU LUX 11/12 USD 17.08 14.8 18.1 33.6 Japan Strat Value C EU EU LUX 11/12 JPY 5892.00 -2.1 4.7 11.0
Gl Balanced C EU EU LUX 11/12 USD 16.96 4.4 5.5 16.5 Gl High Yield B2 EU EU NA 11/12 HKD 132.40 14.8 18.1 33.6 Real Estate Sec. A EU EU LUX 11/12 USD 16.40 14.3 18.4 30.6
n ALLIANCE BERNSTEIN Gl Balanced C EU EU LUX 11/12 EUR 12.40 4.4 5.5 16.5 Gl High Yield BT EU EU NA 11/12 HKD 36.67 14.7 18.2 33.6 Real Estate Sec. B EU EU LUX 11/12 USD 14.85 13.2 17.1 29.2
Gl Balanced I EU EU LUX 11/12 USD 18.01 5.4 6.5 17.7 Gl High Yield BT EU EU LUX 11/12 USD 4.73 14.7 18.2 33.6 Real Estate Sec. I EU EU LUX 11/12 USD 17.74 15.0 19.3 31.6
www.alliancebernstein.com/investments Tel. +800 2263 8637 Gl Bond A EU EU LUX 11/12 USD 9.65 7.9 8.2 12.1 Gl High Yield C EU EU LUX 11/12 USD 4.68 14.8 18.5 34.2 Short Mat Dollar A EU EU LUX 11/12 USD 7.39 4.0 5.3 5.2
Am Eq Blend A EU EU LUX 11/12 USD 10.81 4.2 6.0 18.1
Gl Bond A2 EU EU LUX 11/12 USD 17.30 8.1 8.2 12.1 Gl High Yield C2 EU EU LUX 11/12 USD 15.82 15.3 18.7 34.3 Short Mat Dollar A2 EU EU LUX 11/12 USD 10.18 4.0 5.2 5.1
Am Eq Blend B EU EU LUX 11/12 USD 10.07 3.3 5.0 17.0
Gl Bond A2 EU EU NA 11/12 HKD 134.11 8.1 8.2 12.1 Gl High Yield I EU EU LUX 11/12 USD 4.68 15.8 19.7 35.8 Short Mat Dollar AT EU EU LUX 11/12 USD 7.38 4.1 5.2 5.2
Am Growth A EU EU LUX 11/12 USD 32.03 2.5 5.5 25.3
Gl Bond AT EU EU LUX 11/12 HKD 74.81 8.2 8.3 12.1 Gl Thematic Res. A GL EQ LUX 11/12 USD 16.73 13.6 15.6 40.8 Short Mat Dollar B EU EU LUX 11/12 USD 7.39 3.6 4.9 4.7
Am Growth AX EU EU LUX 11/12 USD 34.75 3.1 6.1 26.0
Gl Bond AT EU EU LUX 11/12 USD 9.65 8.2 8.3 12.1 Gl Thematic Res. B GL EQ LUX 11/12 USD 14.50 12.5 14.4 39.3 Short Mat Dollar B2 EU EU LUX 11/12 USD 10.10 3.7 4.8 4.7
Am Growth B EU EU LUX 11/12 USD 26.70 1.7 4.4 24.0
Short Mat Dollar BT EU EU LUX 11/12 USD 7.40 3.7 4.8 4.5
Am Growth C EU EU LUX 11/12 USD 28.87 2.2 5.0 24.7
Short Mat Dollar C EU EU LUX 11/12 USD 7.39 3.6 4.9 4.7
Am Growth I EU EU LUX 11/12 USD 35.75 3.3 6.3 26.3
Short Mat Dollar C2 EU EU LUX 11/12 USD 14.28 3.7 4.8 4.7

[ALTERNATIVE INVESTMENT FUNDS www.WSJ.com] Advertisement


Am Income A EU EU LUX 11/12 USD 9.03 12.3 13.6 21.1
Short Mat Dollar I EU EU LUX 11/12 USD 7.39 4.4 5.9 5.8
Am Income A2
Am Income A2
EU
EU
EU
EU
LUX
NA
11/12 USD
11/12 HKD
21.43
166.13
12.6
12.6
13.7
13.7
21.2
21.2
Advertisement US Thematic Portfolio A EUR H EU EU LUX 11/12 EUR 17.56 NS NS NS
US Thematic Portfolio B EUR H EU EU LUX 11/12 EUR 17.50 NS NS NS
Am Income AT EU EU NA 11/12 HKD 70.00 12.5 13.6 21.2
US Thematic Portfolio C EUR H EU EU LUX 11/12 EUR 17.53 NS NS NS
Am Income AT EU EU LUX 11/12 USD 9.03 12.5 13.6 21.2
US Thematic Portfolio I EUR H EU EU LUX 11/12 EUR 17.60 NS NS NS
Am Income B EU EU LUX 11/12 USD 9.03 11.6 12.8 20.2
Am Income B2 EU EU LUX 11/12 USD 18.35 11.8 12.8 20.3
NAV —%RETURN— NAV —%RETURN— US Thematic Research A EU EU LUX 11/12 USD 9.80 14.9 17.1 24.6
Am Income B2 EU EU NA 11/12 HKD 142.25 11.8 12.8 20.3 FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR US Thematic Research B EU EU LUX 11/12 USD 8.94 13.9 15.8 23.4
US Thematic Research C EU EU LUX 11/12 USD 9.76 14.4 16.5 24.1
Am Income BT EU EU NA 11/12 HKD 70.39 11.8 12.9 20.4
n ALEXANDRA INVESTMENT MANAGEMENT Platinm-Gbl Dividend HS HS CYM 09/30 USD 74.10 18.0 27.1 2.0 US Thematic Research I EU EU LUX 11/12 USD 10.62 15.7 18.0 25.6
Am Income BT EU EU LUX 11/12 USD 9.08 11.8 12.9 20.4
Platinm-Nordic HS HS CYM 10/29 SEK 632.27 2.4 4.0 6.8
Am Income C EU EU LUX 11/12 USD 9.03 11.8 13.1 20.5 Tel: +1 212 301 1800 Fax: +1 212 301 1810
Am Income C2 EU EU LUX 11/12 USD 27.35 12.1 13.1 20.6 Platinm-Premier HS HS CYM 12/31 USD 21.20 -55.9 -66.0 -44.3
AlexandraConvertibleBondFundI,Ltd.(ClassA) VGB 08/31 USD 2174.86 28.6 51.1 47.6
Am Income I EU EU LUX 11/12 USD 9.03 12.8 14.3 21.8 Platinm-Turnberry $F $F USA 10/29 USD 60.72 1.1 7.3 NS
Emg Mkts Debt A GL BD LUX 11/12 USD 16.95 14.7 16.0 33.9
Emg Mkts Debt A2 GL BD LUX 11/12 USD 23.12 15.0 16.1 34.0
Emg Mkts Debt AT GL BD LUX 11/12 USD 17.04 15.0 16.1 34.0
Emg Mkts Debt B GL BD LUX 11/12 USD 16.95 13.8 14.9 32.7
Emg Mkts Debt B2 GL BD LUX 11/12 USD 22.08 14.0 14.9 32.6 n ALLIANZ GLOBAL INVESTORS KAPITALANLAGEGESELLSCHAFT
Emg Mkts Debt BT GL BD LUX 11/12 USD 17.01 14.1 15.0 32.7 Concentra AE EU EU DEU 11/12 EUR 59.08 14.0 19.5 26.5
Emg Mkts Debt C GL BD LUX 11/12 USD 16.95 14.3 15.5 33.3 n CREDIT PACIFIC ASSET MANAGMENT Industria AE EU EU DEU 11/12 EUR 75.00 6.0 10.3 16.1
Emg Mkts Debt C2 GL BD LUX 11/12 USD 22.63 14.5 15.6 33.3 n SUPERFUND ASSET MANAGEMENT GMBH InternRent AE EU EU DEU 11/12 EUR 41.12 16.8 18.6 8.6
Emg Mkts Debt I GL BD LUX 11/12 USD 16.95 15.2 16.6 34.6 www.creditpacific.com For info about open funds, contact info@superfund.com and www.superfund.com
Emg Mkts Growth A OT OT LUX 11/12 USD 38.60 11.4 17.1 43.0 CPS-Master Priv Fund HS HS WSM 11/12 USD 117.36 17.4 21.6 19.3
*Closed for New Investments n CHARTERED ASSET MANAGEMENT PTE LTD - TEL NO: 65-6835-8866
Emg Mkts Growth B OT OT LUX 11/12 USD 32.43 10.4 15.9 41.6 Superfund Cayman* EU EU CYM 11/09 USD 53.65 31.6 32.4 -14.9 Fax No: 65-6835 8865, Website: www.cam.com.sg, Email: cam@cam.com.sg
Emg Mkts Growth C OT OT LUX 11/12 USD 33.33 11.0 16.6 42.4 Superfund GCT USD* EU EU LUX 11/09 USD 2555.00 16.4 18.3 -14.1 CAM-GTF Limited AS EQ MUS 11/04 USD 402986.09 46.8 66.1 76.2
Emg Mkts Growth I OT OT LUX 11/12 USD 43.09 12.2 18.1 44.2 Superfund Green Gold A (SPC) $F $F CYM 11/09 USD 1291.88 33.9 34.2 15.3
Eur Income A EU EU LUX 11/12 USD 9.48 10.1 11.1 20.4 Superfund Green Gold B (SPC) $F $F CYM 11/09 USD 1266.82 35.4 35.5 7.3
Eur Income A EU EU LUX 11/12 EUR 6.93 10.1 11.1 20.4 Superfund Q-AG* EU EU AUT 11/09 EUR 7448.00 12.5 NS -5.8
Eur Income A2 EU EU LUX 11/12 EUR 14.21 10.4 11.2 20.4
Eur Income A2 EU EU LUX 11/12 USD 19.43 10.4 11.2 20.4 n WINTON CAPITAL MANAGEMENT LTD
Eur Income AT EU EU LUX 11/12 EUR 6.94 10.6 11.3 20.5 n PLATINUM CAPITAL MANAGEMENT Tel: +44 (0)20 7610 5350 Fax: +44 (0)20 7610 5301
Eur Income B EU EU LUX 11/12 EUR 6.93 9.5 10.4 19.6 Tel: +44 207 024 9840, www.platinumfunds.net Winton Evolution EUR Cls H CYM 10/29 EUR 1082.68 14.6 15.2 NS
Eur Income B EU EU LUX 11/12 USD 9.48 9.5 10.4 19.6 Winton Evolution GBP Cls G CYM 10/29 GBP 1090.00 14.8 15.6 NS
Eur Income B2 EU EU LUX 11/12 EUR 13.14 9.8 10.4 19.6
Platinm-All Star $F $F CYM 10/29 USD 100.35 3.2 5.6 5.6 n GAM FUND MANAGEMENT LIMITED
Platinm-All Weather $F $F USA 10/31 USD 129.92 2.4 3.2 3.8 Winton Evolution USD Cls F $F $F CYM 10/29 USD 1375.39 14.7 15.6 6.7
Eur Income B2 EU EU LUX 11/12 USD 17.97 9.8 10.4 19.6 Winton Futures EUR Cls C $F $F VGB 10/29 EUR 221.41 12.5 15.1 7.3 George's Court, 54-62 Townsend Street, Dublin 2, Ireland
Platinm-Dynasty HS HS USA 10/29 USD 117.66 1.4 8.5 5.5
Eur Income BT EU EU LUX 11/12 EUR 6.94 9.8 10.4 19.6 Winton Futures GBP Cls D $F $F VGB 10/29 GBP 239.71 12.6 15.4 7.7 Tel +353 1 609 3927 Fax +353 1 611 7941, Internet: www.gam.com
Platinm-Emancipation HS HS USA 10/29 USD 106.78 14.7 14.1 11.7 GAM Asia Eq Hdg JPY Op HS HS VGB 11/08 JPY 14773.69 -4.9 5.2 26.7
Eur Income C EU EU LUX 11/12 EUR 6.93 9.7 10.6 19.9 Winton Futures JPY Cls E $F $F VGB 10/29 JPY 15806.88 13.8 16.3 7.0
Platinm-Equity Plus HS HS USA 05/29 USD 35.02 -18.2 -63.7 -45.6 GAM Asia Equity Hedge US VGB 11/08 USD 279.10 -3.9 5.5 27.8
Winton Futures USD Cls B $F $F VGB 10/29 USD 787.41 12.6 15.5 7.3

For information about listing your funds, please contact: Carson Wong tel: +852 2831-6481; email: carson.wong@dowjones.com
Tuesday, November 16, 2010 THE WALL STREET JOURNAL. 25

THE INTERNATIONAL INVESTOR

Retailers, Caterpillar Dollar climbs GDP growth spurt sends


against yen;
lead U.S. stocks higher euro retreats
Japanese shares higher
BY DONNA KARDOS YESALAVICH this gives some credence for some BY COLIN NG and Sumitomo Mitsui Financial
hopefulness that the holiday shop- BY BRADLEY DAVIS AND CHRIS OLIVER Group. But the banks gave back
NEW YORK—U.S. stocks climbed, ping season…will be better than last most of the gains, with Mizuho end-
as a better-than-expected retail year’s,” said Daniel Morgan, portfo- NEW YORK—The euro dropped Asian stocks ended mostly ing flat and SMFG adding 0.4%.
sales report boosted investors’ lio manager at Synovus Securities. against the dollar Monday as con- higher Monday, with better-than-ex- Chinese banking stocks were
hopes for the holiday shopping sea- The strong auto sales helped cerns continued over the long-sim- pected growth data helping lift generally higher after an expected
son. boost shares of Ford Motor, which mering crisis of sovereign debt in stocks in Japan and investors in tightening in reserve-ratio require-
The Dow Jones Industrial Aver- climbed 4.8%. Retail stocks also the euro-zone periphery. China shrugging off concerns over ments over the weekend didn’t ma-
age was up 63.99 points, or 0.6%, to gained on the report, with Office In late-morning trade, the euro further tightening measures from terialize. Industrial & Commercial
11256.57, in midday Depot up 2.7%, Coach up 2% and was at $1.3600 from $1.3693 late Beijing. Bank of China rose 6.8% in Shang-
ABREAST OF trading. Polo Ralph Lauren up 1.8%. Friday. The dollar Japan’s Nikkei Stock Average hai after falling 1.9% in the previous
THE MARKET Caterpillar led Lowe’s said its fiscal third-quar- CURRENCY traded at 82.92 yen added 1.1% to 9827.51, China’s session. But its Hong Kong-traded
the measure’s gains ter earnings rose 17% as revenue MARKETS from 82.44 yen. The Shanghai Com- shares fell 1.8%.
with a 2.3% jump after the heavy- and margins improved, though sales euro was at 112.75 ASIAN-PACIFIC posite rose 1% In Hong Kong, Zijin Mining
equipment giant said it will buy were lower than expected. Its shares yen from 112.86 yen. The U.K. pound STOCKS to 28332.93, In- Group fell 0.8%, while Aluminum
mining-equipment company firmed 0.9% even as the home-im- was at $1.6055 from $1.6136 and the dia’s Sensex Corp. of China dropped 2.6%.
Bucyrus International for about provement retailer lowered its earn- dollar fetched 0.9855 Swiss franc edged up 0.8% to 20309.69 and Australia’s S&P/ASX 200 edged
$7.6 billion. Under the agreement, ings forecast for the year. from 0.9803 franc. Hong Kong’s Hang Seng Index fell down 0.1% to 4688.04. In Sydney,
Caterpillar will pay $92 for each The ICE Dollar Index, which 0.8% to 24027.18. takeover activity and the announce-
Bucyrus share, a 32% premium to European stocks tracks the dollar against a trade- Japan’s gross-domestic product ment of a share-buyback plan by
Friday’s closing price. Shares of Key indexes recovered from early weighted basket of currencies, was for the July-September quarter pro- miner BHP Billiton helped offset
Bucyrus, which isn’t a Dow stock, losses to end higher, as investors at 78.519 from 78.103. vided a boost, rising 3.9% compared weaker overseas markets.
surged 29% to $89.66. put fears over Ireland’s financial The dollar also gained against to the median forecast for 2.5% BHP Billiton fell 0.4% after it
The Nasdaq Composite edged up health to one side and focused in- the yen after Japan reported its growth. Some Japanese exporters abandoned its US$39 billion bid for
0.3% to 2525.01. The Standard & stead on upbeat euro-zone and U.S. economy grew faster than expected were higher as the euro gained on Canadian fertilizer company Potash
Poor’s 500-stock index added 0.5% data. in the third quarter. The better- the yen. Among companies with rel- Corp. of Saskatchewan and prom-
to 1215.15. The Stoxx Europe 600 index rose than-expected figures dented de- atively high exposure to Europe, ised to return US$4.2 billion to
The advance came as data 0.8% to 272.36. The U.K.’s FTSE 100 mand for the safe-harbor yen, to Mazda Motor added 1.4%, and Kon- shareholders through a previously
showed U.S. retail sales surged in index firmed 0.4% to 5820.41, which investors often turn when the ica Minolta Holdings rose 1.6%. suspended buyback program.
October, topping expectations on ro- France’s CAC-40 index gained 0.9% global picture darkens. Shares of Dai-ichi Life Insur- AXA Asia Pacific Holdings
bust car sales and solid spending for to 3864.24 and Germany’s DAX Better-than-expected U.S. retail- ance closed up 1.6% after announc- climbed 6.8% and AMP added 2.3%
a broad array of merchandise going added 0.8% to 6790.17. sales figures, which showed their ing first-half business results that after AXA Asia Pacific said it is con-
into the holiday shopping season. Invensys shares rose 9.1% in best month in October since March, topped guidance. Morgan Stanley sidering a new takeover proposal
Retail sales rose 1.2% last month, London, despite the company’s de- helped the dollar tick to its highest MUFG Securities analysts noted that worth at least 13 billion Australian
the fourth consecutive increase and nial that it is in talks about a possi- level since Oct. 5, at 83.28 yen. expectations for upside to the dollars (US$12.83 billion) from
the biggest rise since March, al- ble takeover, after its chief executive On the euro front, investors stock’s year-end enterprise value French parent AXA SA and AMP.
though excluding autos, all other re- suggested that China Southern Rail speculated Ireland might soon re- could become a share-price driver. Brambles added 5.4% after
tail sales rose 0.4%, just shy of an might do a deal at the right price. quest a European Union lifeline, and Banks outperformed the market agreeing to buy IFCO Systems for
expected 0.5% gain. German truck maker MAN rallied worries over the situation spreading early on because of stellar earnings €923 million ($1.23 billion), saying
“We’re just starving for some- 6.2% after it and Scania confirmed throughout the region again came to results and full-year upward revi- it would be immediately accretive to
thing in terms of positive data, and merger talks. Scania added 1.4%. the forefront, analysts said. sions from Mizuho Financial Group earnings per share.

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NAV —%RETURN— NAV —%RETURN— NAV —%RETURN— NAV —%RETURN—
FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR
GAM Asia Equity USD AS EQ VGB 11/11 USD 735.30 12.5 17.1 39.5 GAMStar-EurpEqEUR Inc EU EU IRL 11/11 EUR 174.17 4.8 7.5 11.7 American Growth AA EU EU LUX 11/12 USD 0.95 7.7 10.9 16.9 Money Market USD A EU EU LUX 11/11 USD 15.87 0.3 0.3 0.6
GAM Asia-Pacific Eq USD OT EQ VGB 11/09 USD 1341.73 4.6 9.3 10.0 GAMStar-EurpEqUSD Acc EU EU IRL 11/11 USD 16.00 0.0 -1.9 16.8 Asian Equity AS EQ LUX 11/12 USD 2.82 15.1 17.8 39.8
GAM Com Glb Bal EUR Op EU EU VGB 11/08 EUR 103.20 8.3 10.4 10.6 GAMStar-EurpEqUSD Inc EU EU IRL 11/11 USD 14.45 0.0 -1.9 16.8 Asian Equity AA AS EQ LUX 11/12 USD 0.91 14.9 17.4 39.4
GAM Com Glb Bal USD Op EU EU VGB 11/08 USD 138.40 8.3 10.4 10.6 GAMStar-FrontierOppUSD Acc OT OT IRL 11/11 USD 6.20 13.0 4.1 8.4 Asian Sm Cap Equity AA OT EQ LUX 11/12 USD 1.52 32.5 38.9 64.1
GAM Comp Glb Eq EUR Op GL EQ VGB 11/08 EUR 107.71 9.8 14.3 13.1 GAMStar-JpnEq EUR Acc EU EU IRL 11/11 EUR 90.90 3.3 7.9 2.2 China Value A AS EQ LUX 11/12 USD 8.57 20.6 22.5 46.8
GAM Comp Glb Eq USD Op GL EQ VGB 11/08 USD 139.97 9.8 14.3 13.1 GAMStar-JpnEq EUR Inc EU EU IRL 11/11 EUR 90.71 3.3 7.9 2.2 China Value AA AS EQ LUX 11/12 USD 2.69 20.3 22.2 46.4
GAM Comp Glb Gr EUR Op EU EU VGB 11/08 EUR 94.50 8.3 11.5 10.2 GAMStar-JpnEq JPY Acc EU EU IRL 11/11 JPY 884.85 -3.9 -0.2 1.0 Dragon Growth EU EU LUX 11/12 USD 1.85 12.7 13.1 40.8
GAM Comp Glb Gr USD Op EU EU VGB 11/08 USD 137.63 8.3 11.5 10.2 GAMStar-JpnEq USD Acc EU EU IRL 11/11 USD 11.09 -0.3 1.9 4.1 Dragon Growth AA EU EU LUX 11/12 HKD 8.97 12.5 12.9 40.2
GAM CompAbsRT EUR Op EU EU VGB 11/08 EUR 148.58 3.9 5.4 5.6 GAMStar-US All CapEqUSD EU EU IRL 11/11 USD 8.92 7.7 10.7 20.4 Emg Eastrn Europe A OT EQ LUX 11/12 USD 5.23 13.5 13.4 50.4
n THE NATIONAL INVESTOR
GAM CompAbsRT SGD Op EU EU VGB 11/08 SGD 107.38 4.3 5.5 6.0 GAMStar-World EqUSD Acc GL EQ IRL 11/11 USD 2325.02 4.8 5.0 18.5 Emg Eastrn Europe AA OT EQ LUX 11/12 USD 2.24 13.4 13.2 50.2
GAM CompAbsRT USD Op EU EU VGB 11/08 USD 891.13 4.6 5.8 6.4 European Growth EU EU LUX 11/12 USD 9.53 4.6 4.6 24.4 TNI Tower | Zayed 1st Street Khalidia| Web:www.tni.ae
GAM Cptal Apprec Eq Inc EU EU VGB 11/05 USD 280.95 13.0 24.3 21.8 n HSBC TRINKAUS INVESTMENT MANAGERS SA European Growth AA EU EU LUX 11/12 USD 0.68 4.4 4.3 24.1 TNI Mena Real Estate Fund BMU 11/04 USD 818.60 -14.8 -24.5 -13.0
GAM Cross Trading Inc $F $F VGB 11/08 USD 497.09 6.7 7.0 7.6 Global Contrarain AA GL EQ LUX 11/15 USD 1.16 33.3 35.4 58.0 TNI MENA Special Sits Fund BMU 10/31 USD 1120.56 3.8 -1.7 8.1
E-Mail: funds@hsbctrinkaus.lu Telephone: 352 - 47 18471 TNI MENA UCITS Fund IRL 11/04 USD 1062.93 NS NS NS
GAM Diversity CHF Op HS HS VGB 11/08 CHF 91.58 -2.9 -2.0 -0.9 Prosperity Return Fund A EU EU LUX 11/08 JPY 10382.20 5.0 NS NS Global Property AA EU EU LUX 11/12 USD 0.78 16.6 20.1 32.2
GAM Diversity EUR Op HS HS VGB 11/08 EUR 629.94 -2.9 -1.9 -0.3 Global Resources AA EU EU LUX 11/12 USD 1.26 16.5 16.2 44.7 TNI UAE Blue Chip Fund ARE 11/04 AED 5.22 -2.0 -19.0 -12.3
Prosperity Return Fund B EU EU LUX 11/08 JPY 9357.28 -5.0 NS NS
GAM Diversity USD 2.5XL HS HS VGB 11/08 USD 71.62 -8.5 -6.7 -4.5 Prosperity Return Fund C EU EU LUX 11/08 USD 103.54 7.7 NS NS Healthcare AA EU EU LUX 11/15 USD 0.97 4.0 9.1 10.7
GAM Diversity USD Op EU EU VGB 11/08 USD 665.53 -2.3 -1.3 -0.2 Prosperity Return Fund D EU EU LUX 11/08 EUR 112.63 15.8 NS NS India Equity AA EA EQ LUX 11/12 USD 1.30 18.2 24.5 47.5
GAM Dvrsty II CHF Op $F $F VGB 11/08 CHF 96.08 -3.4 -2.8 -1.4 Renaissance Hgh Grade Bd A EU EU LUX 11/08 JPY 10466.86 6.0 NS NS International Growth GL EQ LUX 11/12 USD 3.15 3.2 3.4 13.3
GAM Dvrsty II EUR Op HS HS VGB 11/08 EUR 133.81 -3.6 -2.8 -1.1 Renaissance Hgh Grade Bd B EU EU LUX 11/08 JPY 9353.21 -4.9 NS NS International Growth AA GL EQ LUX 11/12 USD 0.73 3.0 3.2 13.0
GAM Dvrsty II USD Op $F $F VGB 11/08 USD 203.74 -3.1 -2.3 -0.9 Renaissance Hgh Grade Bd C EU EU LUX 11/08 USD 102.76 7.8 NS NS Japanese Growth EU EU LUX 11/12 USD 2.84 3.2 6.3 7.7
GAM DvrstyIII EUR Op HS HS VGB 11/08 EUR 111.37 -3.6 -2.9 -1.1 Renaissance Hgh Grade Bd D EU EU LUX 11/08 EUR 107.81 11.0 NS NS Japanese Growth AA EU EU LUX 11/12 USD 0.73 1.8 4.8 6.8
GAM DvrstyIII USD Op HS HS VGB 11/08 USD 118.20 -3.1 -2.4 -0.9 Latin America Equity AA OT EQ LUX 11/12 USD 1.43 12.0 14.7 51.0
GAM Euro Eq Hdg EUR Op HS HS VGB 11/11 EUR 223.48 2.1 5.2 4.9 Manulife GF Strategic Income Fund AA EU EU NA 11/12 USD 1.10 11.4 NS NS
GAM Euro Eq Hdg USD Op EU EU VGB 11/11 USD 207.71 2.1 5.0 5.6 MGF Asia Value Dividend Equity Fund AS EQ Lux 11/12 USD 1.36 19.4 24.4 NS
GAM GAMCO EU EU VGB 11/09 USD 984.97 21.5 30.3 24.0 Russia Equity AA EE EQ LUX 11/12 USD 0.75 17.2 17.5 60.9 n WEBSITE: WWW.VALUEPARTNERS.COM.HK, TEL: (852) 2880 9263, FAX: (852) 2564 8487
GAM Gb EmMkts Hdg EUROp HS HS VGB 11/11 EUR 102.98 5.2 NS 6.8 Taiwan Equity AA EU EU LUX 11/12 USD 1.19 10.2 16.8 45.8
GAM Gb EmMkts Hdg USDOp
GAM Gbl Divers USD Inc.
GAM Grtr China Eq Hdg Op
GAM Intrst Trend Inc
HS
EU
HS
EU
HS
EU
HS
EU
VGB
VGB
VGB
VGB
11/11
11/08
11/08
11/08
USD
USD
USD
USD
110.00
267.69
264.04
327.21
6.6
7.1
-7.9
30.1
5.1
11.0
0.3
28.0
8.2
15.9
43.4
44.0
LIST YOUR
n J.P. MORGAN ASSET MANAGEMENT
For additional fund prices, please visit www.jpmorganam.com.sg
Turkey Equity AA
U.S. Bond AA
U.S. Sm Cap Equity AA
U.S. Special Opportunities
EU
EU
EU
EU
EU
EU
EU
EU
LUX
LUX
LUX
LUX
11/12
11/12
11/12
11/12
USD
USD
USD
USD
1.12
1.18
0.99
1.00
46.4
10.4
21.6
27.5
57.1
11.1
26.2
42.7
83.6
15.6
38.6
44.2
*formerly known as China ABH Shares Fund
Intel-Chin Mainlnd Foc
Intel-China Converg*
VP Classic - A
VP CLassic - B
AS
AS
AS
AS
EQ CYM
EQ CYM
EQ CYM
EQ CYM
10/29
10/29
11/12
11/12
USD
USD
USD
USD
38.16
140.43
231.50
107.43
27.9
23.2
24.1
23.6
41.3
35.3
27.7
27.1
55.0
53.2
57.9
57.1
GAM Japan Eq Hdg EUR Op HS HS VGB 11/08 EUR 119.07 2.0 2.1 3.4 U.S. Tsy Inf-ProtSec AA EU EU LUX 11/12 USD 1.23 8.3 7.7 10.7
VP High Dividend Stk AS EQ CYM 11/08 USD 60.41 33.0 43.0 61.3
GAM Japan Eq Hdg USD Op
GAM Japan Eq Hdg YEN Open
GAM Japan USD
GAM Japan YEN
GAM Money Mkt EuroOp
$F
HS
EU
EU
EU
$F
HS
EU
EU
EU
VGB
VGB
VGB
VGB
VGB
11/08
11/08
11/11
11/11
11/11
USD
JPY
USD
JPY
EUR
120.79
8327.64
1109.31
8516.99
51.13
-1.0
-0.9
0.6
-3.5
0.6
-1.0
-2.1
3.0
0.3
0.6
2.1
2.4
5.1
1.6
0.5
FUNDS
Tel: +65 6882 1328
JF ASEAN Eq (SGD)A(acc)
JF ASEAN Eq (USD)A(acc)
JF Asia Pac ex-Jap Eq(SGD)A(acc)
JF Asia Pac ex-Jp (USD)A(acc)
AS
AS
AS
AS
EQ
EQ
EQ
EQ
LUX
LUX
LUX
NA
11/12
11/12
11/12
11/12
SGD
USD
SGD
USD
15.55
15.80
15.04
20.63
NS
38.8
NS
13.7
NS
46.0
NS
16.5
NS
NS
NS
48.1
n PT CIPTADANA ASSET MANAGEMENT
Tel: +62 21 25574 883 Fax: +62 21 25574 893 Website: www.ciptadana.com
Indonesian Grth Fund EU EU CYM 11/03 USD 179.87 41.2 59.0 99.4

GAM Money Mkt USD EU EU VGB 11/10 USD 100.19 0.3 0.2 0.1 JF China (SGD)A(acc) AS EQ LUX 11/12 SGD 14.11 2.1 NS NS
GAM Multi-Arb EUR Op HS HS VGB 11/08 EUR 96.47 -13.3 -14.7 -9.7 JF China (USD)A(dist) AS EQ LUX 11/12 USD 52.94 10.8 11.5 43.5
GAM Multi-China EUR Op HS HS VGB 11/08 EUR 170.87 1.7 7.4 7.7 JF Greater China (SGD)A(acc) AS EQ LUX 11/12 SGD 14.93 5.4 NS NS
GAM Multi-China USD Op HS HS VGB 11/08 USD 181.67 2.9 8.5 8.5 JF Greater China (USD)A(dist) AS EQ LUX 11/12 USD 28.94 14.4 16.6 43.6
GAM Multi-Emer Mkts GBP $F $F VGB 11/08 GBP 137.84 4.8 7.8 13.3 JF India (SGD)A(acc) EA EQ LUX 11/12 SGD 16.61 15.4 NS NS
GAM Multi-Emer Mkts USD $F $F VGB 11/08 USD 684.19 5.1 8.0 13.2 JF India (USD)A(acc) EA EQ LUX 11/12 USD 29.07 25.2 32.1 49.9
GAM Multi-Eur EUR Op HS HS VGB 11/08 EUR 269.51 0.2 1.5 3.4 JF Korea Equity (USD) A (acc) AS EQ LUX 11/12 USD 10.27 22.4 29.7 49.7 n YUKI INTERNATIONAL LIMITED
n SENSIBLE ASSET MANAGEMENT LIMITED
GAM Multi-Eur II EUR Op
GAM Multi-Eur II USD Op
$F
$F
$F
$F
VGB
VGB
11/08
11/08
EUR
USD
138.69
113.67
0.3
0.5
1.6
1.7
3.4
3.1 In print & online. Contact:
JF Pacific Tech (USD) A (acc)
JF Singapore (SGD)A(acc)
OT
AS
EQ
EQ
LUX
LUX
11/12
11/12
USD
SGD
15.54
16.35
3.6
13.6
10.4
NS
28.7
NS www.samfund.com.hk Tel: (852) 2868 6848 Fax: (852) 2810 9948
Tel +44-207-269 0203 www.yukifunds.com

GAM Multi-Eur USD Op HS HS VGB 11/08 USD 470.88 0.7 1.9 3.3 JF Singapore (USD)A(dist) AS EQ LUX 11/12 USD 33.80 23.4 31.4 53.2 Asia Value Formula Fd-B AS EQ CYM 11/12 USD 10.19 27.1 31.5 57.3
GAM Multi-Nth Am EUR Special $F $F VGB 11/08 EUR 134.63 0.5 1.5 5.3 JPM Africa (USD) A (acc) OT OT LUX 11/12 USD 11.35 31.8 30.5 51.7 n YMR-N Series
GAM Multi-Nth Am USD Special
GAM Multi-Pac EUR Op
$F
HS
$F
HS
VGB
VGB
11/08
09/30
USD
EUR
219.68
138.69
0.7
-3.3
1.7
-1.4
5.9
0.5
carson.wong@dowjones.com
JPM Asia Pac Bond (USD)A(acc)
JPM Brazil Alpha+ (USD)A(acc)
AS
OT
BD
EQ
LUX
LUX
11/12
11/12
USD
USD
10.88
11.95
NS
11.9
NS
16.0
NS
57.3
n SGAM FUND YMR-N Growth Fund
YMR-N Small Cap Fund
EU
EU
EU IRL 11/15 JPY
EU IRL 11/15 JPY
8784.00
6139.00
-7.8
-12.5
-2.3
-10.8
-0.3
-0.8
Amundi Hong Kong Limited
GAM Multi-Pac USD Op $F $F VGB 09/30 USD 161.14 -2.6 -0.8 1.1 JPM Brazil Alpha+(SGD)A(acc) EU EU LUX 11/12 SGD 14.81 NS NS NS
GAM Portable Dvr/S&P500 HS HS VGB 08/24 USD 70.11 17.7 -27.7 -22.9 JPM East Eur (EUR)A(dist)(JF) OT EQ LUX 11/12 EUR 33.84 29.8 37.6 57.3
Hotline in Hong Kong 2166 5099 n Yuki 77 Series
JPM Emerg EMEA (SGD)A(acc) OT OT LUX 11/12 SGD 15.24 NS NS NS
www.sgam.com Yuki 77 General EU EU IRL 11/15 JPY 5428.00 -12.4 -9.0 -5.9
GAM Selection Hdg HS HS VGB 11/05 USD 3155.57 19.6 26.9 39.1 Bonds Eur Hi Yld A EU EU LUX 11/11 EUR 23.06 12.0 14.0 26.2
GAM Sing/Malaysia AS EQ VGB 11/11 USD 2981.92 18.1 23.0 34.5 JPM Emerg EMEA (USD) A (dist) OT EQ LUX 11/12 USD 63.95 24.9 27.5 57.8
JPM Emerg Mid East Eq(SGD)A(acc) EU EU LUX 11/11 SGD 15.39 NS NS NS
Bonds EURO A EU EU LUX 11/11 EUR 42.80 4.3 3.8 5.9 n Yuki Chugoku Series
GAM Sterling Spe Bd Inc EU EU VGB 11/08 GBP 267.64 16.4 18.4 28.0 Bonds EUROPE A EU EU LUX 11/11 EUR 40.92 4.6 4.2 5.3 Yuki Chugoku Jpn Gen EU EU IRL 11/15 JPY 6340.00 -8.0 -3.0 -1.3
GAM Trading EUR Inc EU EU VGB 10/29 EUR 340.86 4.8 4.6 6.2 JPM Emerg Mid East(USD)A(dist) OT OT LUX 11/11 USD 26.45 31.3 26.6 32.8 Bonds US OppsCoreplus A EU EU LUX 11/11 USD 40.56 9.9 9.9 14.8 Yuki Chugoku JpnLowP EU EU IRL 11/15 JPY 7143.00 -5.7 -5.5 -6.1
GAM Trading USD Inc HS HS VGB 11/08 USD 1039.74 6.9 7.2 7.7 JPM Emerg Mkt Eq (SGD)A(acc) OT OT LUX 11/12 SGD 15.14 6.4 NS NS Bonds World A EU EU LUX 11/11 USD 44.83 6.7 2.8 10.8
GAM Trdg II IncEUR Op HS HS VGB 11/08 EUR 148.20 6.6 6.8 7.5 JPM Emerg Mkt Eq (USD)A(dist) OT OT LUX 11/12 USD 32.84 15.4 18.6 44.0 Eq. AsiaPac Dual Strategies A AS EQ LUX 11/12 USD 11.56 10.9 13.0 36.1
GAM Trdg II IncUSD Op HS HS VGB 11/08 USD 337.71 6.9 7.2 7.7 JPM Emerg Mkt Infra(USD)A(acc) OT OT LUX 11/12 USD 8.86 19.2 22.7 50.5 Eq. China A AS EQ LUX 11/12 USD 25.34 5.0 6.2 36.2 n Yuki Hokuyo Japan Series
GAM Trdg IV IncEUR Op EU EU VGB 11/08 EUR 156.07 6.3 6.6 7.3 JPM Emerg Mkt LC Debt(USD)A(mth) GL BD LUX 11/12 USD 16.54 17.4 NS NS Eq. Concentrated Euroland A EU EU LUX 09/30 EUR 86.45 -7.0 -5.2 -3.5 Yuki Hokuyo Jpn Gen EU EU IRL 11/15 JPY 4121.00 -12.3 -7.4 -6.9
GAM Trdg IV IncUSD Op HS HS VGB 11/08 USD 165.02 6.8 7.1 7.5 JPM Glb Dyn (SGD)A(acc) GL EQ LUX 11/12 SGD 14.34 0.8 NS NS Eq. ConcentratedEuropeA EU EU LUX 11/11 EUR 29.45 9.0 12.5 18.5 Yuki Hokuyo Jpn Inc EU EU IRL 11/15 JPY 4718.00 -10.6 -6.3 -6.4
GAM Trdg V IncEUR Op HS HS VGB 11/08 EUR 131.96 6.0 6.3 7.1 JPM Glb Dyn (USD)A(dist) GL EQ LUX 11/12 USD 13.07 9.4 10.3 20.7 Eq. Emerging Europe A OT EQ LUX 11/11 EUR 28.32 20.2 25.6 34.9 Yuki Hokuyo Jpn Sm Cap EU EU IRL 11/15 JPY 4450.00 -12.9 -11.6 -1.2
GAM Trdg V IncUSD Op HS HS VGB 11/08 USD 138.11 6.6 6.9 7.4 JPM Glb Nat Res (EUR)A(dist) GL EQ LUX 11/12 EUR 20.81 37.2 42.5 66.7 Eq. Euroland A EU EU LUX 11/11 EUR 10.85 0.3 3.8 8.3
GAM TrdgIII IncEUR Op HS HS VGB 11/08 EUR 166.68 6.2 6.5 7.3 JPM Glb Nat Res (SGD)A(acc) GL EQ LUX 11/12 SGD 25.52 21.1 NS NS Eq. Euroland Small Cap A EU EU LUX 11/11 EUR 162.84 15.4 17.8 25.5
n Yuki Mizuho Series
GAM TrdgIII IncUSD Op HS HS VGB 11/08 USD 173.57 6.8 7.1 7.5 JPM Glb Nat Res (USD)A(acc) GL EQ LUX 11/12 USD 20.38 31.5 31.4 74.8 Yuki Mizuho Gen Jpn III EU EU IRL 11/15 JPY 3882.00 -12.7 -7.3 -7.5
Eq. EurolandCyclclsA EU EU LUX 11/11 EUR 19.35 8.7 13.1 20.0
GAM USDSpecBondInc EU EU VGB 11/08 USD 646.05 21.9 23.7 46.6 JPM Latin Amer (USD)A(dist)JF OT EQ LUX 11/12 USD 46.41 16.2 19.8 57.9 Yuki Mizuho Jpn Dyn Gro EU EU IRL 11/15 JPY 4090.00 -12.9 -10.6 -8.2
Eq. EurolandFinancialA EU EU LUX 11/11 EUR 9.92 -12.3 -17.0 3.3
GAM Worldwide GL EQ VGB 11/11 USD 2323.98 4.4 4.6 17.8 JPM Latin Amer Eq(SGD)A(acc) OT EQ LUX 11/12 SGD 15.10 NS NS NS Yuki Mizuho Jpn Exc 100 EU EU IRL 11/15 JPY 6082.00 -13.3 -7.1 -2.9
Eq. Glbl Emg Cty A OT OT LUX 11/11 USD 9.77 0.9 0.9 30.3
GAMut Investments EU EU VGB 11/10 USD 8068.37 6.4 6.6 7.7 JPM Russia (USD) A (dist) EE EQ LUX 11/12 USD 15.08 17.4 19.8 68.0 Yuki Mizuho Jpn Gen EU EU IRL 11/15 JPY 8004.00 -7.7 -3.1 -1.8
Eq. Global A GL EQ LUX 11/11 USD 30.13 8.2 8.7 20.4
Yuki Mizuho Jpn Gro EU EU IRL 11/15 JPY 5856.00 -8.5 -5.0 -3.9
Eq. Global Energy A EU EU LUX 11/11 USD 18.40 1.5 0.3 13.3
n GAM Star Fund Plc Eq. Global Resources A GL EQ LUX 11/11 USD 129.86 18.9 19.8 47.2
Yuki Mizuho Jpn Inc EU EU IRL 11/15 JPY 7023.00 -8.5 -2.9 -7.1
GAMStar-AsEqCHF Ord Ac AS EQ IRL 11/11 CHF 11.65 5.6 12.8 24.9 Yuki Mizuho Jpn Lg Cap EU EU IRL 11/15 JPY 4695.00 -10.1 -5.6 -5.0
Eq. Gold Mines A EU EU LUX 11/11 USD 41.34 36.5 30.1 71.4
GAMStar-AsEqEUR Ord Ac AS EQ IRL 11/11 EUR 14.01 17.6 28.0 33.1 Yuki Mizuho Jpn LowP EU EU IRL 11/15 JPY 10382.00 -10.3 -8.9 -2.9
Eq. India A EA EQ LUX 11/12 USD 154.86 18.4 24.4 47.2
GAMStar-AsEqGBP Ord Ac AS EQ IRL 11/11 GBP 1.76 12.5 20.0 35.9 Yuki Mizuho Jpn PGth EU EU IRL 11/15 JPY 6897.00 -13.5 -11.1 -6.8
Eq. Japan CoreAlpha A EU EU LUX 11/12 JPY 7055.01 -2.7 -0.9 7.8
GAMStar-AsEqUSD Ord Ac AS EQ IRL 11/11 USD 15.05 12.2 16.7 39.3 Yuki Mizuho Jpn SmCp EU EU IRL 11/15 JPY 6221.00 -13.0 -11.4 1.1
Eq. Latin America A OT EQ LUX 11/11 USD 130.48 12.2 14.4 43.5
GAMStar-AsPacEqEUR Acc OT EQ IRL 11/11 EUR 111.50 10.2 15.6 9.5 Yuki Mizuho Jpn Val Sel OT EQ IRL 11/15 JPY 5218.00 -8.3 -5.9 0.0
Eq. US Lg Cap Gr A EU EU LUX 11/11 USD 16.74 9.7 12.0 22.0
GAMStar-AsPacEqEUR Inc OT EQ IRL 11/11 EUR 107.12 10.2 15.6 9.5 Yuki Mizuho Jpn YoungCo OT EQ IRL 11/15 JPY 2245.00 -17.5 -20.3 -6.2
n MANULIFE ASSET MANAGEMENT TEL:(852)2108 1110 Eq. US Rel Val A EU EU LUX 11/11 USD 22.16 7.6 9.0 19.4
GAMStar-China EqUSD AS EQ IRL 11/11 USD 21.75 23.6 31.4 64.3 Eq. US Sm Cap Val A EU EU LUX 11/11 USD 17.81 11.6 17.2 16.3
GAMStar-ContEurEqEUR Ac EU EU IRL 11/11 EUR 12.05 9.5 13.3 15.1 Internet:http://www.manulife.com.hk 47/F Manulife Plaza, Causeway Bay, Hong Kong
American Growth EU EU LUX 11/12 USD 16.48 7.9 11.1 16.8 Money Market EURO A EU EU LUX 11/11 EUR 27.49 0.4 0.4 0.9 n Yuki Shizuoka Japan Series
GAMStar-EurpEqEUR Acc EU EU IRL 11/11 EUR 191.89 4.8 7.5 11.7 Yuki Shizuoka General Japan EU EU IRL 11/15 JPY 4555.00 -15.6 -11.4 -6.7

For information about listing your funds, please contact: Carson Wong tel: +852 2831-6481; email: carson.wong@dowjones.com
26 THE WALL STREET JOURNAL. Tuesday, November 16, 2010

MARKETS

AMP puts in new bid for AXA APH


BY CYNTHIA KOONS “clearly better” than the last and es-
AND REBECCA THURLOW AXA Asia Pacific | Daily share price timated the guarantees being of-
fered to AXA Asia Pacific minority
A$7
SYDNEY—AXA Asia Pacific shareholders could add €300 million
Holdings Ltd. is considering a new Dec. 17: NAB/AXA launches April 19: Australian Competition Nov. 15: AMP/AXA launches to AXA SA’s costs if AMP shares fall
takeover proposal submitted by A$13.3 billion all-cash rival and Consumer Commission blocks NAB bid A$13 billion cash-and-shares substantially.
French parent AXA SA and AMP bid that gets recommended bid; AXA Asia Pacific says it will AXA Asia Pacific’s independent
Ltd. that may conclude a yearlong 6 by AXA Asia Pacific board consider proposal directors in December rejected
battle for the wealth manager. AMP’s A$6.22-a-share cash and
The deal, valued at about A$13 Nov. 9: AMP/AXA stock offer for the business as too
billion (US$12.8 billion), would be a A$11.0 billion low and said the offer didn’t include
coup for AMP, whose previous bid cash-and-shares a big enough cash component.
was rejected by the target in favor 5 offer is rejected Under the new and more compli-
of an all-cash offer from National by the AXA Asia cated proposal, minority AXA Asia
Dec. 14: AMP/AXA increases Sept. 9: ACCC maintains opposition
Australia Bank Ltd. in December. Pacific board Pacific shareholders would receive
offer to A$12.9 billion; to NAB bid after bank revises
The NAB deal was later blocked by AXA Asia Pacific says it will deal structure 0.73 AMP share and a variable cash
the Australian Competition and 4 consider the proposal amount based on AMP’s average
Consumer Commission, which said share price for 10 trading days after
Sources: Thomson
it wouldn’t oppose a takeover by Reuters Datastream; 2009 2010 the deal becomes effective.
AMP of AXA Asia Pacific, which is WSJ reporting Shareholders would receive
sometimes called AXA APH. Photo: Bloomberg A$6.43 if the average AMP share
The latest cash-and-stock offer News price was equal to, or greater than,
has a floor of 6.43 Australian dollars A$4.50 but less than A$5.60.
a share—the same level as NAB’s all- If the AMP average share price
cash offer—subject to AMP’s share was A$5.60 or higher, AXA Asia Pa-
price remaining above A$4.50. AMP cific shareholders would receive
shares last traded at A$5.59. 50% of the benefit of that higher
The offer is an 11% premium to share price.
AXA Asia Pacific’s last traded price If the average share price was
Friday. The headquarters of AXA Asia Pacific stand in the central business district in Melbourne. below A$4.50, the value of the bid
“It would be very hard for the would fall below A$6.43.
AXA APH board to say it wasn’t a to AXA SA. The French insurer owns kets where AXA APH Asian opera- Paris-based Keplar analyst Pierre Goldman Sachs analyst Ryan
good idea given they accepted 54% of the target company, but AXA tions continued to perform very Flabbee said a revised offer had Fisher said the proposal is “a well
A$6.43 from NAB, and this deal Asia Pacific is controlled by a strongly in 2010,” AXA SA said in a been expected and makes it more thought-out structure, intended to
comes with an ACCC green light,” largely independent board. statement. likely that AXA SA will finally get a satisfy AXA APH’s desire for price
said Brett le Mesurier, an analyst at The deal is crucial to the French AXA SA will pay about €1.8 bil- deal. However, Mr. Flabbee warned protection.”
Axiome Equities. company’s global strategy of in- lion ($2.46 billion) in cash under that uncertainties remain, as the of- —Lyndal Mcfarland in Mel-
AXA Asia Pacific’s shares fin- creasing exposure to developing terms of the new deal, up from the fer needs to be approved by the AXA bourne and Digby Larner in Paris
ished up 6.8% at A$6.17. markets. €1.4 billion it would have paid in the Asia Pacific independent directors contributed to this article.
AMP plans to keep the Australian “This transaction, if successful, failed NAB bid. who rejected the previous joint
and New Zealand assets of AXA Asia would allow AXA to increase its ex- AXA SA said the deal would in- AMP/AXA bid.  Heard on the Street: AMP gets help
Pacific and sell the Asian business posure to high-growth Asian mar- crease earnings-per-share in 2011. He said the latest offer was from a French friend .......................... 34

French retailer sells


What’s News stores in Thailand
meets what’s next. BY MIMOSA SPENCER good price for its 42 Thai stores.
“Carrefour should be congratulated
PARIS—French retail giant Car- for the price achieved ... and we
refour SA Monday said it has sold contend that Casino will have to
its Thailand stores to Big C, a local work hard to make an attractive
subsidiary of its smaller rival Casino economic return from its invest-
Guichard-Perrachon SA, for an en- ment,” said Shore Capital.
terprise value of €868 million ($1.19 Carrefour Chief Executive Lars
billion). Olofsson, who restructured the com-
The sale generated a flurry of in- pany’s operations in Belgium re-
terest from retailers seeking to so- cently and decided that Carrefour
lidify positions in the fast-growing should exit Russia altogether in fa-
region. The purchase will double Big vour of reviving operations in the
C’s store network in the Bangkok re-
gion and propel Big C to the posi-
tion of co-leader in large hypermar- Casino’s Big C unit
ket stores in the country. Tesco PLC
is the market leader in Thailand, purchases Carrefour’s 42-
and was considered an obvious po- store Thai network for
tential purchaser for Carrefour’s as-
sets. $1.19 billion.
Carrefour didn’t release the ini-
tial value of the deal. Enterprise
value is a company’s market capital- company’s home market of France,
ization plus its debt, less cash and has said he is open to offers for
cash equivalents. stores in regions where it isn’t one
The deal will increase the scale of the top two leaders. Carrefour
of Big C by more than 30%, making didn’t comment on the sale of its
the company a much stronger com- stores in Malaysia and Singapore,
petitor to Tesco, especially in the both much smaller operations,
© 2010 Dow Jones & Company, Inc. All rights reserved.

TM

Introducing The Wall Street Journal Asia for iPad . greater Bangkok area, said Jefferies
analysts. Tesco declined to comment
which are also expected to be sold
soon.
TM
Download The Wall Street Journal Asia for iPad from the iTunes App Store Now. on the deal. While Carrefour got a price for its
Casino said the acquisition will Thai business that exceeded expecta-
generate synergies of 1.2% esti- tions, its move to exit countries re-
mated-2010 sales by 2013. It will fi- mains controversial. “There are some
nance the deal using existing re- strategic implications of exiting
sources and debt. Casino also said it countries that together raise the key
now intends to sell assets valued at question of what is the sustainable
€700 million in 2011, in addition to long-term growth rate of Carrefour,”
the €1 billion asset-disposal pro- said Bernstein in a note, citing Carre-
gram already in place. four’s exposure to the lower-growth
Analysts said Carrefour fetched a markets in Western Europe.
Tuesday, November 16, 2010 THE WALL STREET JOURNAL. 27

MARKETS

Energy firms flock to Hong Kong


BY PRUDENCE HO Huaneng Renewables IPO, while J.P. ment Management (Hong Kong)
Morgan Chase & Co., UBS AG, Ltd., adding that investors will com-
HONG KONG—Two Chinese Green deals Value, Credit Suisse Group AG and Mac- pare the valuations of the two with
in millions
wind-power operators are preparing Renewable-energy companies recently quarie are handling Datang’s unit Longyuan, which raised US$2.6 bil-
of U.S.
to raise a combined US$2.5 billion listed on the Hong Kong stock exchange. dollars IPO, people familiar with the deals lion from an IPO in December 2009.
from initial public offerings in Hong have said. Longyuan, Datang and Huaneng
Kong, joining a list of renewable-en- Dec. 2009 China Longyuan Power $2,595 Hong Kong, which has dominated were the three largest wind farms in
ergy firms turning to the stock ex- global IPO activity this year, hasn’t China in 2009, with a combined 40%
Oct. 2010 Xinjiang Goldwind Science & Technology 1,054
change. only attracted mainland Chinese of national capacity, according to a
Huaneng Renewables Corp., the companies but also overseas firms. Goldman Sachs report in October.
Oct. 2010 China Suntien Green Energy 425
wind-power unit of China Huaneng Huaneng Renewables Corp., EuroSibEnergo, which is con-
Group, plans to list Sept. 2010 Trony Solar 257 which aims to sell 2.49 billion trolled by Russian billionaire Oleg
IPO shares on the Hong shares, plans to use the proceeds Deripaska, plans to start investor
OUTLOOK Kong stock exchange Oct. 2009 Comtec Solar Technology 68 from the IPO to expand its wind- presentations for its IPO on Nov. 29
Dec. 16 following its power business, repay bank loans before listing on the Hong Kong
IPO to raise about US$1.5 billion, ac- Jan. 2009 China Singyes Solar Technologies 8 and acquire wind-power projects in stock exchange Dec. 17, according to
cording to a term sheet. Source: Dealogic
China and overseas, the term sheet a term sheet seen by Dow Jones
China Datang Corp. Renewable said. Huaneng Group, its parent, is Newswires on Monday.
Power, a unit of power generator the country’s biggest power pro- The company is selling a 25%
China Datang Corp., plans to list its Dec. 17, after raising about US$1.5 companies have listed to raise a to- ducer by capacity. stake to investors in Hong Kong be-
shares in Hong Kong on Dec. 9 in an billion from an IPO that would be tal of US$4.4 billion in Hong Kong, The Datang unit, which aims to fore the end of the year, a person fa-
effort to raise as much as US$1 bil- the third by a Russian company in among them China Longyuan sell 2.14 billion shares, plans to use miliar with the matter said last
lion, according to a term sheet. Hong Kong. Power Group Corp., the biggest so the proceeds to fund wind-power week. Premarketing is set to start
Both companies began premar- Beijing’s push to expand the con- far, and wind-power equipment pro- projects in Inner Mongolia, repay Nov. 22 and pricing is scheduled for
keting the deals Monday and plan to sumption of cleaner forms of energy ducer Xinjiang Goldwind Science & bank loans and purchase wind tur- Dec. 10, according to the term
price their offerings in early Decem- has heightened investor interest in Technology Co., which raised bines, the term sheet said. sheet.EuroSibEnergo supplies elec-
ber. the renewable-energy sector this US$1.05 billion from its IPO last “Market response to the two tricity to aluminum producer Rusal.
Details also emerged Monday of year and has led to a spate of list- month. IPOs will highly depend on their val- Bank of China International,
electricity producer EuroSibEn- ings in Hong Kong. Macquarie Group Ltd. and Mor- uations,” said Pauline Dan, chief in- Deutsche Bank AG and Bank VTB
ergo’s plans to list in Hong Kong on Since 2009, six “clean-energy” gan Stanley are handling the vestment officer of Samsung Invest- OAO are global coordinators.
28 * * THE WALL STREET JOURNAL. Tuesday, November 16, 2010

MARKETS

Lone Star to sell KEB to Hana


Continued from first page that its country head during the by ongoing court cases. After the
covered. But the size of those prof- KEB purchase, Steven Lee, embez- collapse of Lehman Brothers in
its, and the fact that foreign private- zled millions of dollars from his September 2008, HSBC dropped its
equity funds weren’t subject to firm, causing Lone Star to file inac- offer, citing the turmoil in global fi-
South Korean taxes, later stoked lo- curate tax returns. Upon looking nancial markets.
cal resentment. into the matter, Lone Star discov- A former government official and
In 2006, Lone Star reached a deal ered that Mr. Lee had submitted two former KEB employees were ac-
to sell its KEB stake to South Ko- dozens of phony invoices during his cused of making KEB’s financial con-
rea’s Kookmin Bank for more than seven years in Korea, diverting dition look worse than it actually
$7 billion, but a probe into the cir- about $12 million to pay for prop- was to facilitate Lone Star’s 2003
cumstances under which Lone Star erty, works of art and cash gifts to purchase. In another case, Lone Star
bought KEB ended up derailing the family members. The firm has said and one of its executives were found
transaction. A person involved in it resolved tax discrepancies associ- guilty of manipulating the stock
the sale process said the acquisition ated with Mr. Lee’s actions. price of a KEB affiliate, but the ver-
had become too politically sensitive In September 2007, Lone Star dict was overturned on appeal.
for Kookmin to consider. reached a deal to sell the stake to Lone Star hired Credit Suisse in
Bloomberg News
Lone Star’s standing was also HSBC Holdings PLC for $6.3 billion, March to manage the sale of the
hurt when regulators discovered but regulatory approval was held up KEB stake. MUFG President Katsunori Nagayasu says the bank wants to use the purchase
of RBS’s project-finance assets as a way to pursue further overseas growth.

GM to raise expected IPO issue price MUFG to purchase


BY SHARON TERLEP currently holds a majority stake in Ford Motor Co. and Chrysler LLC

DETROIT—General Motors Co.


plans to price shares in its initial
public offering a few dollars above
the auto maker.
Steven Rattner, the Obama ad-
ministration’s former auto czar who
engineered last year’s $80 billion
deliver impressive financial results.
“There is definitely a greater
level of confidence around the abil-
ity of auto makers to perform. Every
portfolio from RBS
the high end of the $26-to-$29 metric Ford, GM and Chrysler have BY ATSUKO FUKASE while it ranks No. 1 in the U.S.
range it had forecast, a person fa- been reporting has been remark- A final agreement is expected by
miliar with the matter said Monday. GM, in the IPO, will seek to able,” said Mr. Rattner, speaking at TOKYO—Mitsubishi UFJ Finan- the end of this year, MUFG said.
GM stock probably will be priced an automotive event in Detroit. cial Group Inc. agreed to buy Royal For RBS, its project-finance as-
at between $31 and $33 a share raise some $14 billion by GM, in the IPO, will seek to raise Bank of Scotland Group PLC’s $6.13 sets are no longer considered cen-
when the IPO launches, this person selling common and some $14 billion by selling common billion project-finance loan portfolio tral to its operations after it re-
said. A decision on the price is ex- and preferred shares. The U.S. Trea- for an undisclosed sum, in a move ceived a state bailout during the
pected later Monday but won’t be preferred shares. sury would sell shares valued at that will help Japan’s largest bank financial crisis. Its balance sheet ex-
made public until Wednesday. about $8.3 billion. A United Auto expand its lending operations in the panded heavily after it bought a
Strong demand for shares is Workers trust, which pays for re- Middle East and other untapped portion of ABN Amro in late 2007.
prompting GM, the U.S. Treasury bailout of the U.S. auto industry, tiree health care, would sell more $2 markets. MUFG’s purchase of the project-
and banks underwriting the deal to said Monday that investors who billion of its shares, while Canada Separately, the Tokyo bank finance business highlights how
set a price higher than originally long shunned automotive stocks are and Ontario would sell some $1 bil- joined rivals in reporting strong re- Japanese banks are seeking over-
projected. The federal government giving the sector a fresh look as GM, lion of shares. sults for the first half of its fiscal seas growth as they contend with
year and raised its forecast for the limited potential at home.
full year ending March 31. The bank booked a 356.78 billion
The key loan assets included in yen ($4.33 billion) net profit for the
Q

the RBS portfolios are worth £3.8 six months ended Sept. 30, more
EX ISWSJ AAD
uo
te

10 US UNdersen re

billion and are mainly loans for in- than double its year-earlier earn-
D for SJ
C COA rea" wh
"M

% IV T ! gist
L

frastructure projects in Europe, Af- ings. It also raised its net-profit


PW

rica and regions where the Tokyo- forecast for the fiscal year to 500
based lender doesn’t have a strong billion yen from 400 billion yen.
E

presence in project finance and The strong results were due


hopes to gain a foothold. mainly to gains from bond trading
The Japanese bank will also take as well as lower credit costs and not
on several dozen employees, includ- from its traditional banking busi-
e

ing top managers from RBS’s proj- ness of lending, a trend that was
rin
g

ect-financing business. also seen in the earnings of other


 One-day conference: 19 January 2011  Venue: The St. Regis Hotel, Beijing Over the past few years, MUFG Japanese banks. Mizuho Financial
has been involved in a number of Group Inc. and Sumitomo Mitsui
cross-border transactions, including Financial Group Inc. reported solid
24 CFO speakers • Only 1 day out of the office a $9 billion purchase of a 21% stake profits for the first half fiscal,
in Morgan Stanley in 2008. thanks to gains from bond trading
OUR DISTINGUISHED CFO SPEAKING FACULTY INCLUDES: “We want to use [the purchase and improved credit costs.
of RBS’s project-finance assets] as MUFG’s net interest income
an avenue for pursuing further over- dropped 9.5% to one trillion yen.
seas growth,” MUFG President Kat- Although all of the top three
sunori Nagayasu said at a news con- banks raised their full-year profit
ference Monday, adding the bank outlooks due to strength in the first
JOYCE FANG, ROBERTO MELLO, TAN LI XIA, NINA TAN, ALAIN BRIDOUX, WARREN WANG
CFO, CFO, CFO, CFO, CFO, FENG,
hopes to reach a top-level position half, executives at each bank said
Comau, Fiat Group GE Healthcare Haier Group Jurong Port The Sandvik Group CFO, in world-wide project finance. the future won’t be all that rosy due
Zhongpin Inc. MUFG, the ninth-ranked arranger to uncertainties in the global mar-
of project finance by dollar volume ket, capital regulations and the
this year, would vault into the top tough conditions weighing on their
five globally. According to Dealogic, consumer-finance businesses.
MUFG was ranked 20th in Europe in MUFG reports its earnings under
project-finance volume this year, Japanese accounting standards.
FANG WEI, VINCENT HU, MICHELLE LIU, TERENCE YAP, FRANK TSENG, JAMES TONG,
CFO, CFO, CFO, CFO, CFO, CFO,
Gome Electrical Yuhe Lanxess Greater China Security & Asia Pacific Wire Tianyin

SEC to weigh fund rules


Applicances International China Surveillance and Cable Pharmaceutical
Holdings Ltd. Technology, Inc. Co. Inc.

To see the full list of speakers, email enquiry@iqpc.com.sg, call +65 6722 9388 or visit www.cfo-chinasummit.com

To ensure maximum interaction


Official Newspaper Partner: BY JESSICA HOLZER such a move, thousands of smaller
Why you should and learning among CFO hedge funds and other investment
NOT MISS CFO participants we have 4 hours WASHINGTON—The Securities advisers would be overseen by state
of scheduled networking and Exchange Commission will meet regulators.
China Summit 2011: opportunities plus a dedicated
Online Media Partner:
Friday to consider new rules to The SEC will propose language
speed networking session and force hedge funds and other private creating an exemption from regis-
100% CFO speakers evening networking cocktail funds to register with the agency tration for venture-capital funds and
reception that will allow you to
100% Case studies meet fellow CFOs and industry
Researched & Developed by: and to undergo exams. hedge funds with less than $150 mil-
The SEC, which placed a notice lion under management in the U.S.
100% Panel discussions peers in China.
of the meeting on its website, also The proposed rules, which the
will vote on proposing rules to qua- agency hasn’t fully revealed yet,
PHONE: (65) 6722 9388  FAX: (65) 6720 3804  EMAIL: enquiry@iqpc.com.sg druple the threshold for SEC over- would implement provisions of the
sight of investment advisers, to new Dodd-Frank financial law. The
www.cfo-chinasummit.com $100 million of assets under man- commission would open a public-
agement from $25 million. Under comment period before voting.
Tuesday, November 16, 2010 THE WALL STREET JOURNAL. 29

Time®, Red Border Design® and TimeFrames are trademarks of Time Inc.
What happens when China
catches up with China?

Some stories deserve more time, which is why we created the TimeFrames project.
Join our reporters as they reveal surprising perspectives on today’s biggest issues.
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Understanding comes with


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30 THE WALL STREET JOURNAL. Tuesday, November 16, 2010

BLUE CHIPS  BONDS


Dow Jones Asia Titans: Monday's best and worst...
Major players  Market value,
in billions
Previous
close, in STOCK PERFORMANCE

benchmarks
At right, a look at the Asia Titans, the biggest and best known
Company

Samsung Electronics
Country

South Korea
Industry

Semiconductors
of US$

$91.4
local currency

808,000
Previous session

3.86%
52-week

13.2%
Three-year

41.8%
Sony Japan Consumer Electronics 33.6 2,790 2.65 9.4 -48.4
companies in Asia. Below, some of the Dow Jones Titans indexes of
biggest and most liquid stocks in individual countries and regions Shinhan Financial Grp South Korea Banks 18.2 43,450 2.60 -9.1 -19.8
Nintendo Japan Toys 33.0 21,360 2.05 -7.0 -66.3
Giants around the world In U.S.-dollar terms. Panasonic Japan Consumer Electronics 30.2 1,209 2.03 -0.4 -44.7

Dow Jones Country Titans


INDEX PERFORMANCE
PetroChina Hong Kong Integrated Oil Gas $27.4 10.06 -1.95% 1.1 -34.2
Previous session Year-to-date 52-week
Reliance Industries India Exploration Production 76.8 46.95 -1.88 3.0 -35.9
Turkey 0.72% 32.6% 44.0% Indl Comm Bk China Hong Kong Banks 69.5 6.49 -4.6 1.4
-1.82
Sweden 0.83 17.5 14.7
CNOOC Hong Kong Exploration Production 98.9 17.16 -1.72 36.8 28.8
South Africa -0.13 14.0 17.0
China Life Insurance Hong Kong Life Insurance 33.3 34.70 -1.70 -10.3 -22.6
Singapore -0.58 12.9 17.4
Hong Kong -1.13 12.7 7.3
Russia -0.02 12.1 15.3
...And the rest of Asia's blue chips
South Korea 0.38 10.7 16.8 Latest, Latest,
Germany 0.89 9.9 12.4 Market value, in local STOCK PERFORMANCE Market value, in local STOCK PERFORMANCE
Company/Country (Industry) in billions (U.S) currency Latest 52-week Three-year Company/Country (Industry) in billions (U.S) currency Latest 52-week Three-year
U.K. 0.30 6.0 6.7
Honda Motor 66.9 3,035 1.71% 4.7% -20.8% Nippon T&T 61.2 3,835 ... 2.0% -99.2%
Canada -0.21 5.3 6.8 Japan (Automobiles) Japan (Fixed Line Telecommunications)
Nissan Motor 38.6 785.00 1.55 18.8 -33.0 Mizuho Financial Grp 29.5 127.00 ... -29.1 -100.0
Netherlands 0.62 4.6 6.8 Japan (Automobiles) Japan (Banks)
Switzerland 0.89 1.7 2.4 Toyota Motor 119.3 3,140 1.45 -10.5 -49.5 Mitsui 29.0 1,326 -0.08% 12.0 -49.1
Japan (Automobiles) Japan (Industrial Suppliers)
Brazil 0.39 0.7 1.6 Taiwan Smcndtr Mfg 54.6 63.90 1.43 3.4 4.9 Westpac Bking 63.1 21.92 -0.09 -15.1 -22.3
Taiwan (Semiconductors) Australia (Banks)
France 0.87 -2.2% -0.3 Nippon Steel 20.9 275.00 1.10 -17.9 -59.3 Woolworths 33.7 27.70 -0.11 -1.2 -14.4
Australia -0.10 -4.0 -2.3 Japan (Steel) Australia (Food Retailers Wholesalers)
Commonwlth Bk of Aus 74.1 48.86 0.64 -10.1 -19.2 KDDI 25.1 470,500 -0.21 2.1 -40.4
Japan 0.62 -6.6 -0.5 Australia (Banks) Japan (Mobile Telecommunications)
National Australia Bk 51.7 24.67 0.57 -14.6 -43.9 Tokio Marine Hldgs 22.4 2,352 -0.21 -2.4 -43.6
Italy 0.53 -8.6 -9.6 Australia (Banks) Japan (Property Casualty Insurance)
Spain 1.19 -10.1 -10.6 Seven I Hldgs 21.1 1,981 0.56 2.3 -31.3 JFE Hldgs 17.2 2,699 -0.22 -11.8 -54.7
Japan (Broadline Retailers) Japan (Steel)
China 88 0.30 -13.8 -15.3 QBE Insurance Group 17.3 16.88 0.48 -25.0 -46.4 Mitsubishi UFJ Finl 65.6 391.00 -0.26 -23.0 -59.4
Australia (Reinsurance) Japan (Banks)
Tokyo Elec Power 36.5 1,914 0.42 -11.0 -32.1 BHP Billiton 146.4 44.14 -0.36 13.2 7.3
Japan (Electricity) Australia (General Mining)
Dow Jones Regional Sector Titans Sumitomo Mitsui Finl 42.5 2,519 0.40 -22.3 -99.7 Takeda Pharm 37.3 3,920 -0.51 11.4 -42.0
Japan (Banks) Japan (Pharmaceuticals)
Canon 58.9 3,955 0.25 15.6 -29.0 Aus NZ Bk 58.4 23.08 -0.60 2.7 -18.0
Travel Leisure -0.21% 28.0% 28.3% Japan (Electronic Office Equipment) Australia (Banks)
Auto Parts 0.93 27.0 30.1 Cheung Kong 38.1 127.50 0.24 30.2 -11.8 POSCO 31.7 467,000 -0.64 -14.0 -20.8
Hong Kong (Real Estate Holding Development) South Korea (Steel)
Real Estate -0.28 15.3 16.4 Rio Tinto Ltd. 52.2 87.04 0.21 25.2 -35.3 East Japan Railway 23.5 4,925 -1.01 -13.6 -99.5
Australia (General Mining) Japan (Travel Tourism)
Chemicals 0.01 15.2 17.3
Japan Tobacco 32.4 280,000 0.18 12.2 -57.1 NTT DoCoMo 68.6 136,100 -1.02 4.6 -22.2
Media 0.02 14.3 17.3 Japan (Tobacco) Japan (Mobile Telecommunications)
Kansai Elec Power 22.2 2,041 0.15 2.1 -22.8 Westfield Grp 27.2 11.94 -1.08 -3.6 -41.6
Ind Gds Svcs -0.06 14.1 14.6 Japan (Electricity) Australia (Retail)
Arab 50 -0.07 10.7 6.7 Mitsubishi 41.7 2,106 0.14 5.0 -35.0 China Construction Bank 227.6 7.34 -1.21 6.1 -3.2
Japan (Industrial Suppliers) Hong Kong (Banks)
Tiger 50* -0.54 9.2 8.1 Shin-Etsu Chml 21.2 4,140 0.12 -13.0 -37.8 Hon Hai Precision Ind 35.3 112.00 -1.32 -5.7 -39.7
Japan (Specialty Chemicals) Taiwan (Electrical Components Equipment)
Asian 50 -0.15 3.0 3.3 Sun Hung Kai Prop 46.6 140.80 0.07 20.8 -4.9 Woodside Petroleum 32.6 42.49 -1.37 -13.2 -11.8
Global 50 -0.19 -0.8% -1.5 Hong Kong (Real Estate Holding Development) Australia (Exploration Production)
China Mobile (HK) 203.6 79.40 0.06 7.7 -43.1 Bank of China 48.4 4.49 -1.54 -3.1 3.4
*Asia excluding Japan Hong Kong (Mobile Telecommunications) Hong Kong (Banks)
Source: Dow Jones Indexes Sources: Dow Jones Indexes; WSJ Market Data Group

Credit derivatives
Tracking Spreads on credit derivatives are one way the market rates
Credit-default swaps: Asian companies
At its most basic, the pricing of credit-default swaps measures how much a buyer has to pay to purchase-and

credit
creditworthiness. Regions that are treading in rough waters can see how much a seller demands to sell-protection from default on an issuer's debt. The snapshot below gives a
spreads swing toward the maximum—and vice versa. Indexes below sense which way the market was moving yesterday.
are for five-year swaps.

markets  Markit iTraxx Indexes


Index: series/version
Europe: 14/1
Mid-spread,
in pct. pts. Mid-price Coupon
SPREAD RANGE, in pct. pts.
since most recent roll
Maximum Minimum Average
Showing the biggest improvement...
CHANGE, in basis points
And the most deterioration
CHANGE, in basis points

dealmakers
1.04 99.83% 0.01% 1.18 0.95 1.04 Yesterday Yesterday Five-day 28-day Yesterday Yesterday Five-day 28-day
Eur. High Volatility: 14/1 1.56 97.40 0.01 1.79 1.45 1.59 Marui Group 130 –4 –13 –7 Shin Han Bk 120 7 15 8
Europe Crossover: 14/1 4.62 101.55 0.05 5.37 4.24 4.74 Bk of Tokyo Mitsubishi 56 –3 –4 –8 GS Caltex Oil 109 8 16 11
Asia ex-Japan IG: 14/1 1.08 99.59 0.01 1.25 0.93 1.08 Kajima 160 –2 –22 –30 Korea Dep Ins 80 8 16 11
Japan: 14/1 0.99 100.04 0.01 1.10 0.96 1.02 Kawasaki Heavy Inds 94 –1 –5 –5 Rep Indonesia 140 8 17 13
Note: Data as of November 12 Sumitomo 59 –1 –4 –4 KT 85 8 14 18
In percentage points Kawasaki Kisen Kaisha 142 ... –5 ... Expt Import Bk Korea 104 8 16 10
Spreads
— NOTICE TO READERS — Europe
Index roll
2.00
Asahi Kasei 32 ... ... –2 Kookmin Bk 115 9 17 11
Spreads on five- Takashimaya ... Ptt Pub 11
t

All statistics published in Senior Financials


75 –5 –11 96 13 15
year swaps for 1.50 Sumitomo Metal Inds ... KT&G 18
The Wall Street Journal 71 –4 2 85 23 17
corporate debt; Daiwa Secs 1 Promise 44
Asia from markets outside 1.00
105 –1 –1 829 –26 –171
based on Markit
the Asian-Pacific region t Source: Markit Group
iTraxx indexes. Europe 0.50
reflect preliminary data.
0 Behind Asia's deals: Bank revenue rankings, Japan
June July Aug. Sept. Oct. Nov.
2010 Behind every IPO, bond offering, merger deal or syndicated loan is one or more investment banks. Here are
Source: Markit Group investment banks ranked by year-to-date revenues from recent deals.
PERCENTAGE OF TOTAL REVENUE
Revenue, Market Equity Debt Mergers &
in millions share capital markets capital markets acquisitions Loans
Nomura $754 23.0% 74% 11% 15% ...
Mizuho 620 18.9 59 17 10 14%
Sumitomo Mitsui Financial Group 368 11.2 62 12 10 16
Daiwa Capital Markets
WSJ.com Goldman Sachs
264
213
8.0
6.5
61
82
23
5
16
13
...
...

Follow the markets throughout the day, with updated stock Mitsubishi UFJ Financial Group 204 6.2 36 20 17 27
quotes, news and commentary at WSJ.com. Morgan Stanley 144 4.4 40 24 37 ...
Bank of America Merrill Lynch 129 3.9 60 14 25 2
Also, receive emails that summarize the day’s trading in Eu-
Citi 128 3.9 62 9 27 3
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Source: Dealogic
Tuesday, November 16, 2010 THE WALL STREET JOURNAL. 31

GLOBAL MARKETS LINEUP


Commodities Prices of futures contracts with the most open interest Currencies London close on Nov. 15
EXCHANGE LEGEND: CBOT: Chicago Board of Trade; CME: Chicago Mercantile Exchange; NYBOT: New York Board of Trade; MDEX: Bursa Malaysia Per In Per In
Derivatives Berhad; LIFFE: London International Financial Futures Exchange; LME: London Mercantile Exchange; NYMEX: New York Mercantile Exchange; AMERICAS Per euro In euros U.S. dollar U.S. dollars EUROPE Per euro In euros U.S. dollar U.S. dollars
ICE: IntercontinentalExchange Argentina peso-a 5.3915 0.1855 3.9663 0.2521 Euro zone euro 1 1 0.7356 1.3594
ONE-DAY CHANGE Contract Contract
Commodity Exchange Last price Net Percentage high low Brazil real 2.3406 0.4272 1.7219 0.5808 1-mo. forward 1.0003 0.9997 0.7358 1.3590
Corn (cents/bu.) CBOT 561.25 13.25 617.50 356.75 Canada dollar 1.3701 0.7299 1.0079 0.9922 3-mos. forward 1.0010 0.9990 0.7364 1.3580
2.42%
1-mo. forward 1.3709 0.7294 1.0085 0.9916 6-mos. forward 1.0023 0.9977 0.7373 1.3562
Soybeans (cents/bu.) CBOT 1279.50 10.50 0.83 1,348.50 872.75
3-mos. forward 1.3730 0.7283 1.0100 0.9901 Czech Rep. koruna-b 24.621 0.0406 18.113 0.0552
Wheat (cents/bu.) CBOT 714.50 5.00 0.70 864.25 504.75
6-mos. forward 1.3762 0.7266 1.0124 0.9877 Denmark krone 7.4543 0.1342 5.4837 0.1824
Live cattle (cents/lb.) CME 102.350 0.650 0.64 104.550 88.750
Chile peso 656.36 0.001524 482.85 0.002071 Hungary forint 276.73 0.003614 203.58 0.004912
Cocoa ($/ton) ICE-US 2,789 10 0.36 3,477 2,410
Colombia peso 2537.91 0.0003940 1867.00 0.0005356 Norway krone 8.1452 0.1228 5.9920 0.1669
Coffee (cents/lb.) ICE-US 205.70 2.35 1.16 221.45 131.40
Ecuador US dollar-f 1.3594 0.7356 1 1 Poland zloty 3.9280 0.2546 2.8897 0.3461
Sugar (cents/lb.) ICE-US 27.10 0.89 3.40 33.39 11.90 Mexico peso-a 16.7791 0.0596 12.3435 0.0810 Russia ruble-d 42.137 0.02373 30.998 0.03226
Cotton (cents/lb.) ICE-US 132.79 -1.39 -1.04% 151.95 61.89 Peru sol 3.8157 0.2621 2.8070 0.3563 Sweden krona 9.3594 0.1068 6.8852 0.1452
Crude palm oil (ringgit/ton) MDEX 3,370.00 17 0.51 3,452 1,793 Uruguay peso-e 26.915 0.0372 19.800 0.0505 Switzerland franc 1.3394 0.7466 0.9853 1.0149
Cocoa (pounds/ton) LIFFE 1,836 9 0.49 2,322 1,610 U.S. dollar 1.3594 0.7356 1 1 1-mo. forward 1.3391 0.7468 0.9851 1.0151
Robusta coffee ($/ton) LIFFE 1,900 25 1.33 2,098 1,342 Venezuela bolivar 5.84 0.171294 4.29 0.232848 3-mos. forward 1.3383 0.7472 0.9845 1.0157
Copper (cents/lb.) COMEX 391.00 1.20 0.31 408.75 230.00 ASIA-PACIFIC 6-mos. forward 1.3371 0.7479 0.9836 1.0166
Gold ($/troy oz.) COMEX 1372.80 7.30 0.53 1,424.30 675.00 Australia dollar 1.3762 0.7266 1.0124 0.9878 Turkey lira 1.9698 0.5077 1.4491 0.6901
Silver (cents/troy oz.) COMEX 2634.50 40.30 1.55 2,934.00 895.50 China yuan 9.0312 0.1107 6.6438 0.1505 U.K. pound 0.8459 1.1821 0.6223 1.6069
Aluminum ($/ton) LME 2,370.00 -86.50 -3.52 2,481.50 1,857.00 Hong Kong dollar 10.5385 0.0949 7.7526 0.1290 1-mo. forward 0.8461 1.1819 0.6225 1.6065
Tin ($/ton) LME 25,550.00 -1200.00 -4.49 27,325.00 14,700.00 India rupee 61.4086 0.0163 45.1750 0.0221 3-mos. forward 0.8466 1.1812 0.6228 1.6057
Copper ($/ton) LME 8,560.00 -121.00 8,920.00 6,120.00 Indonesia rupiah 12190 0.0000820 8968 0.0001115 6-mos. forward 0.8474 1.1801 0.6234 1.6042
-1.39
Japan yen 112.79 0.008866 82.98 0.012052 MIDDLE EAST/AFRICA
Lead ($/ton) LME 2,438.00 -112.00 -4.39 2,616.00 1,580.00
1-mo. forward 112.77 0.008868 82.96 0.012054 Bahrain dinar 0.5125 1.9513 0.3770 2.6525
Zinc ($/ton) LME 2,325.00 -128.50 -5.24 2,659.00 1,617.00
3-mos. forward 112.69 0.008874 82.90 0.012063 Egypt pound-a 7.8176 0.1279 5.7510 0.1739
Nickel ($/ton) LME 22,595 -1,100 -4.64 27,590 15,910
6-mos. forward 112.56 0.008884 82.80 0.012077 Israel shekel 4.9950 0.2002 3.6746 0.2721
Crude oil ($/bbl.) NYMEX 85.19 0.31 0.37 93.29 69.08 Malaysia ringgit-c 4.2677 0.2343 3.1395 0.3185 Jordan dinar 0.9621 1.0394 0.7078 1.4129
Heating oil ($/gal.) NYMEX 2.3936 0.0130 0.55 2.5235 1.5200 New Zealand dollar 1.7524 0.5706 1.2892 0.7757 Kuwait dinar 0.3822 2.6167 0.2811 3.5569
RBOB gasoline ($/gal.) NYMEX 2.1855 0.0203 0.94 2.3329 1.8222 Pakistan rupee 116.224 0.0086 85.500 0.0117 Lebanon pound 2039.70 0.0004903 1500.50 0.0006665
Natural gas ($/mmBtu) NYMEX 3.985 0.003 0.08 11.750 3.853 Philippines peso 59.574 0.0168 43.825 0.0228 Saudi Arabia riyal 5.0972 0.1962 3.7498 0.2667
Brent crude ($/bbl.) ICE-EU 87.05 0.52 0.60 134.00 57.36 Singapore dollar 1.7719 0.5644 1.3035 0.7672 South Africa rand 9.4963 0.1053 6.9859 0.1431
Gas oil ($/ton) ICE-EU 744.75 -1.00 -0.13 782.25 592.50 South Korea won 1543.34 0.0006479 1135.35 0.0008808 United Arab dirham 4.9926 0.2003 3.6728 0.2723
Taiwan dollar 41.199 0.02427 30.308 0.03300
Source: Thomson Reuters; WSJ Market Data Group SDR -f 0.8730 1.1455 0.6422 1.5571
WSJ.com Thailand baht 40.679 0.02458 29.925 0.03342

a-floating rate b-commercial rate c-government rate c-commercial rate d-Russian Central Bank rate f-Special Drawing Rights
Follow the markets throughout the day with updated stock quotes, news and commentary at WSJ.com from the International Monetary Fund ; based on exchange rates for U.S., British and Japanese currencies.
Also, receive email alerts that summarize the day’s trading in Europe and Asia. To sign up, go to WSJ.com/Email Note: Based on trading among banks in amounts of $1 million and more, as quoted by Thomson Reuters.

Major stock market indexes Stock indexes from around the world, grouped by region. Shown in local-currency terms.
Price-to- PREVIOUS SESSION PERFORMANCE Price-to- PREVIOUS SESSION PERFORMANCE
earnings ratio* Region/Country Index Close Net change Percentage change Yr.-to-date 52-wk. earnings ratio* Region/Country Index Close Net change Percentage change Yr.-to-date 52-wk.
18 ASIA-PACIFIC DJ Asia-Pacific 135.93 -0.50 -0.37% 10.5% 11.6% 27 Euro Zone Euro Stoxx 275.18 2.26 0.83% 0.1% 1.0%
... Australia SPX/ASX 200 4688.04 -4.69 -0.10 -3.7 -1.4 14 Euro Stoxx 50 2846.69 24.26 0.86 -4.0 -2.6
... China CBN 600 28332.93 345.84 1.24% -2.5 -3.3 21 Denmark OMX Copenhagen 405.73 2.42 0.60 28.5 27.7
15 Hong Kong Hang Seng 24027.18 -195.40 -0.81 9.9 4.7 14 Finland OMX Helsinki 7329.60 62.72 0.86 13.5 14.7
20 India Sensex 20309.69 152.80 0.76 16.3 19.2 13 France CAC-40 3864.24 33.12 0.86 -1.8 ...
... Indonesia Jakarta Composite 3656.462 -9.384 -0.26 44.3 48.1 14 Germany DAX 6790.17 55.56 0.82 14.0 17.0
... Japan Nikkei Stock Average 9827.51 102.70 1.06 -6.8 0.4 12 Italy FTSE MIB 20993.27 163.44 0.78 -9.7 -11.1
... Topix 851.56 4.58 0.54 -6.2 -1.0 9 Netherlands AEX 345.53 2.33 0.68 3.0 7.3
... Malaysia Kuala Lumpur Composite 1501.56 1.75 0.12 18.0 17.5 ... Russia RTSI 1609.43 -1.54 -0.10% 12.8 8.6
... New Zealand NZSX-50 3328.227 17.643 0.53 3.0 4.9 9 Spain IBEX 35 10349.7 122.9 1.20 -13.3 -13.7
8 Pakistan KSE 100 10909.65 35.63 0.33 16.2 17.3 14 Switzerland SMI 6562.15 56.86 0.87 0.2 2.2
13 Philippines Manila Composite 4139.32 62.64 1.54 35.6 37.5 ... Turkey ISE National 100 69998.07 444.99 0.64 32.5 43.5
... Singapore Straits Times 3236.80 -15.20 -0.47 11.7 16.3 12 U.K. FTSE 100 5820.41 23.54 0.41 7.5 8.1
11 South Korea Kospi 1913.81 0.69 0.04 13.7 20.2 17 AMERICAS DJ Americas 323.97 0.39 0.12 9.3 10.1
14 Taiwan Weighted 8240.65 -75.40 -0.91 0.6 5.7 ... Brazil Bovespa 70367.15 Closed 2.6 5.6
10 Thailand SET 1029.14 10.28 1.01 40.1 45.6 ... Argentina Merval 3254.43 38.95 1.21 40.2 42.1
23 EUROPE Stoxx Europe 600 272.13 1.95 0.72 7.5 8.3 17 Mexico IPC 36057.39 Closed 12.3 16.3
14 Stoxx Europe 50 2600.86 18.25 0.71 0.9 2.2
Thomson Reuters is the primary data provider for several statistical tables in The Wall Street Journal, including foreign
*P/E ratios use trailing 12-months, as-reported earnings stock quotations, futures and futures options prices, and foreign exchange tables. Reuters real-time data feeds are used
European and Americas index data are as of 12:00 p.m. ET. Sources: Thomson Reuters; WSJ Market Data Group to calculate various Dow Jones Indexes.

Dow Jones Indexes


Price-to- Price-to- PERFORMANCE
MSCI indexes
PERFORMANCE
Dividend earnings Net Year- Three-yr., Dividend earnings Net Year- Three-yr.,
yield* ratio* Dows Jones Index Last change Daily to-date 52-wk. annualized yield* ratio* Dows Jones Index Last change Daily to-date 52-wk. annualized Developed and emerging-market regional and country indexes
2.15% 16 Global TSM 2510.07 0.17 0.01% 8.3% 8.1% -6.9% 0.03% 8 Shenzhen -c 452.84 8.38 1.89% 8.7% 9.8% -1.0% from MSCI Barra as of November. 15, 2010
1.94 16 Global DOW 2033.48 -0.24 -0.01 2.5 2.6 -9.5 1.81 17 U.S. TSM 12467.93 19.93 0.16 9.5 10.6 -5.1 Price-to- LOCAL-CURRENCY
2.22 14 Global Titans 50 172.19 -0.33 -0.19 -0.8 -1.5 -10.2 4.42 15 Global Select Div -d 212.16 -0.90 -0.42 5.1 2.8 -9.4 Dividend earnings PERFORMANCE
2.35 18 Asia/Pacific TSM 1347.20 -5.15 -0.38 10.8 11.9 -6.1 5.24 11 Asia/Pacific Select Div -d 296.12 1.00 0.34 10.3 6.3 -10.6 yield ratio Morgan Stanley Index Last Daily YTD 52-wk.
2.42 18 Asia/Pacific ex-Japan TSM 3516.75 -20.55 -0.58 14.3 15.3 -4.3 3.67 7 Hong Kong Select Div -d 220.02 -2.48 -1.12 17.4 18.4 0.9 2.40% 16 ALL COUNTRY (AC) WORLD* 319.70 1.04% 6.8% 13.1%
2.57 16 Europe TSM 2742.64 4.10 0.15 2.4 -1.0 -11.3 3.95 15 U.S. Select Dividend -d 346.57 1.16 0.33 9.8 11.6 -9.1 2.50 16 World (Developed Markets) 1,236.35 0.95 5.8 11.8
1.97 13 Emerging Markets TSM 4743.81 -22.17 -0.47 17.0 16.3 -3.9 1.46 19 Islamic Market 2122.66 -1.47 -0.07 7.5 8.6 -3.7
1.70 27 World Small Cap 218.62 1.25 15.0 22.8
2.76 15 Asian Titans 50 138.27 -0.21 -0.15 3.0 3.3 -8.1 1.89 15 Islamic Market 100 2164.70 0.60 0.03 2.0 2.9 -5.6
1.42 13 BRIC 50 647.89 -4.04 -0.62 8.4 5.0 -5.8 2.23 14 Islamic China/HK Titans 30 1712.42 -11.23 -0.65 15.2 13.5 -6.1 2.50 16 Kokusai (World ex-Japan) 1,227.31 0.95 5.8 12.5
1.42 13 CBN China 600 -c 28332.93 345.84 1.24 -2.5 -3.3 -9.6 1.31 17 Sustainability Korea 1369.36 -1.75 -0.13 13.6 16.6 -5.2 3.00 16 EAFE 1,631.09 0.56 3.2 6.4
0.03 8 China Offshore 50 4451.25 -68.84 -1.52 9.2 3.2 -7.8 3.21 20 Brookfield Infrastructure 2265.98 -7.01 -0.31 11.8 16.8 -2.7 2.10 14 Emerging Markets (EM) 1,121.17 1.58 13.3 22.6
0.03 8 Shanghai -c 380.44 4.83 1.29 -1.9 -2.5 -9.1 DJ-UBS Commodity -p 147.80 -5.94 -3.86 6.2 12.2 -6.7
2.60 16 AC ASIA PACIFIC EX-JAPAN 468.45 1.98 12.5 19.4
*Fundamentals are based on data in U.S. dollar. Footnotes: c-in local currency. d-dividends reinvested. p-previous day. Note: All data as of 11:30 a.m. ET. Source: DowJones Indexes 2.30 14 AC Far East ex-Japan 516.84 1.98 14.9 22.2
2.10 17 Japan 530.98 -1.14 -6.6 -4.2
Cross rates U.S.-dollar and euro foreign-exchange rates in global trading 2.10 15 China 70.51 -2.63 8.8 12.0
US$ A$ £ C$ YUAN EURO HK$ RUPEE RUPIAH YEN NZ$ WON RINGGIT PH. PESO S$ S FRANC TW$ BAHT 1.00 24 China A (China Domestic) 3,235.66 -6.04 -4.3 4.4
U.S. 1.012 0.622 1.008 6.644 0.736 7.753 45.175 8967.81 82.975 1.289 1135.34 3.139 43.825 1.303 0.985 30.308 29.925
Australia 0.988 0.615 0.996 6.562 0.727 7.658 44.622 8857.95 81.959 1.273 1121.44 3.101 43.288 1.288 0.973 29.936 29.558 2.50 20 Hong Kong 12,595.25 -0.97 23.7 24.3
Britain 1.607 1.627 1.620 10.676 1.182 12.458 72.592 14410.37 133.333 2.072 1824.38 5.045 70.422 2.095 1.583 48.701 48.086
0.90 23 India 809.62 -1.91 14.5 27.2
Canada 0.992 1.004 0.617 6.592 0.730 7.692 44.821 8897.52 82.325 1.279 1126.45 3.115 43.481 1.293 0.978 30.070 29.690
China 0.1505 0.152 0.094 0.152 0.111 1.167 6.800 1349.81 12.489 0.194 170.89 0.473 6.596 0.196 0.148 4.562 4.504 1.30 10 Korea 536.41 0.33 11.6 20.0
Euro 1.359 1.376 0.846 1.370 9.031 10.538 61.409 12190.39 112.792 1.752 1543.33 4.268 59.574 1.772 1.339 41.199 40.679
Hong Kong 0.129 0.131 0.080 0.130 0.857 0.095 5.827 1156.75 10.703 0.166 146.45 0.405 5.653 0.168 0.127 3.909 3.860 2.10 18 Malaysia 552.72 -0.93 17.6 19.7
India 0.0221 0.0224 0.0138 0.0223 0.1471 0.0163 0.1716 198.51 1.8367 0.0285 25.13 0.0695 0.9701 0.0289 0.0218 0.6709 0.6624 2.80 16 Singapore 1,776.14 -1.84 9.3 20.7
Indonesia 0.0001 0.0001 0.0001 0.0001 0.0007 0.0001 0.0009 0.0050 0.0093 0.0001 0.13 0.0004 0.0049 0.0001 0.0001 0.0034 0.0033
Japan 0.012 0.012 0.008 0.012 0.080 0.009 0.093 0.544 108.08 0.016 13.68 0.038 0.528 0.016 0.012 0.365 0.361 3.50 15 Taiwan 294.86 -1.41 -0.4 10.5
New Zealand 0.776 0.785 0.483 0.782 5.154 0.571 6.014 35.042 6956.33 64.364 880.69 2.435 33.995 1.011 0.764 23.510 23.213
2.80 15 Thailand 407.40 -1.45 35.0 45.5
South Korea 0.0009 0.0009 0.0005 0.0009 0.0059 0.0006 0.0068 0.0398 7.90 0.0731 0.0011 0.0028 0.0386 0.0011 0.0009 0.0267 0.0264
Malaysia 0.319 0.322 0.198 0.321 2.116 0.234 2.469 14.389 2856.44 26.429 0.411 361.63 13.959 0.415 0.314 9.654 9.532 4.00 18 Australia 958.13 -0.76 -4.3 0.2
Philippines 0.023 0.023 0.014 0.023 0.152 0.017 0.177 1.031 204.63 1.893 0.029 25.91 0.072 0.030 0.022 0.692 0.683
Singapore 0.767 0.777 0.477 0.773 5.097 0.564 5.948 34.657 6879.79 63.656 0.989 871.00 2.409 33.621 0.756 23.251 22.957 5.60 16 New Zealand 83.72 -0.52 -4.0 -6.5
Switzerland 1.015 1.028 0.632 1.023 6.743 0.747 7.868 45.849 9101.60 84.213 1.308 1152.28 3.186 44.479 1.323 30.760 30.371 1.80 18 US BROAD MARKET 1,349.81 1.28 9.1 18.1
Taiwan 0.033 0.033 0.021 0.033 0.219 0.024 0.256 1.491 295.89 2.738 0.043 37.46 0.104 1.446 0.043 0.033 0.987
Thailand 0.033 0.034 0.021 0.034 0.222 0.025 0.259 1.510 299.68 2.773 0.043 37.94 0.105 1.464 0.044 0.033 1.013 3.20 15 EUROPE 93.71 -0.44 6.2 13.6
Source: Thomson Reuters via WSJ Market Data Group *Twenty-three developed and 26 emerging markets Source: MSCI Barra
32 THE WALL STREET JOURNAL. Tuesday, November 16, 2010

SCANNING THE GLOBE


Dow Jones Industrial Average P/E: 14 Nasdaq Composite Index P/E: 12* S&P 500 Index P/E: 18
LAST: 11237.50 s 44.92, or 0.40% LAST: 2521.93 s 3.72, or 0.15% LAST: 1203.00 s 3.79, or 0.32%
YEAR TO DATE: s 809.45, or 7.8% YEAR TO DATE: s 252.78, or 11.1% YEAR TO DATE: s 87.90, or 7.9%
OVER 52 WEEKS s 830.54, or 8.0% OVER 52 WEEKS s 324.08, or 14.7% OVER 52 WEEKS s 93.70, or 8.4%

High
12000 2650 1325
Close
Low
11500 2500 1250

11000 2350 1175

10500 2200 1100


t

50–day
moving average 10000 2050 1025

9500 1900 950


20 27 3 10 17 24 1 8 15 22 29 5 12 20 27 3 10 17 24 1 8 15 22 29 5 12 20 27 3 10 17 24 1 8 15 22 29 5 12
Sept. Oct. Nov. Sept. Oct. Nov. Sept. Oct. Nov.
*Price-to-earnings ratio for the Nasdaq 100 Note: Price-to-earnings ratios are for trailing 12 months Sources: WSJ Market Data Group; Birinyi Associates

DJIA component stocks U.S. stocks: most active... ADRs of Asian companies*
Volume, CHANGE Volume, CHANGE 52-WEEK Volume, CHANGE
Stock Symbol in millions Latest Points Percentage Stock Symbol in millions Latest Points Percentage High Low Stock Symbol in OOOs Latest Points Percentage
AT&T T 6.9 $28.86 0.40 1.41% Citigroup C 160.8 $4.37 0.08 1.75% $115.04 $38.47 Baidu ADS BIDU 3,315.7 $109.53 –1.11 –1.00%
Alcoa AA 9.1 13.56 0.07 0.52 FordMotor F 92.9 17.04 0.74 4.54 11.69 9.30 TaiwanSemi TSM 3,311.6 11.16 0.11 1.00
AmExpress AXP 2.4 43.22 0.52 1.22 SPDR S&P 500 SPY 67.3 120.95 0.75 0.63 92.62 58.38 BHPBilton ADS BHP 2,307.7 88.72 1.75 2.01
BankAm BAC 54.6 12.24 0.12 0.99 CiscoSys CSCO 58.5 20.08 –0.07 –0.35 53.16 29.90 CtripInt ADS CTRP 1,488.8 46.47 –1.46 –3.05
Boeing BA 4.5 63.66 0.57 0.90 BankAm BAC 54.6 12.24 0.12 0.99 34.60 13.40 TataMtrs ADS TTM 1,436.9 31.48 1.27 4.20
Caterpillar CAT 8.7 83.41 2.37 2.92 SPDR FnclSelSct XLF 30.5 15.17 0.23 1.54 18.78 7.53 SuntechPwr STP 1,174.9 8.71 0.24 2.86
Chevron CVX 3.0 85.78 0.34 0.40 PwrShrs QQQ QQQQ 28.1 52.64 0.13 0.25 7.71 4.45 Slcnwr ADS SPIL 741.5 5.17 0.02 0.39
CiscoSys CSCO 58.5 20.08 –0.07 –0.35 IsilonSystems ISLN 27.1 33.77 7.49 28.47 13.30 8.38 AU Optrncs AUO 577.1 9.68 –0.09 –0.92
CocaCola KO 3.7 62.97 0.05 0.08 Level3Comm LVLT 26.2 1.18 0.04 3.61 58.22 32.68 ICICI Bk ADS IBN 520.3 54.59 0.63 1.17
Disney DIS 5.7 37.39 –0.36 –0.95 iShrMSCIEmrgMkt EEM 24.1 46.84 0.43 0.93 5.74 4.48 MitsuUFJ ADS MTU 486.3 4.76 0.06 1.19
DuPont DD 1.9 46.72 0.20 0.43 Microsoft MSFT 22.6 26.32 0.05 0.21 15.68 10.34 ChinaUnicomHK CHU 485.1 13.99 –0.07 –0.50
ExxonMobil XOM 7.5 70.99 ... ... SiriusXM SIRI 21.8 1.42 ... ... 27.27 12.26 FocusMediaHldg FMCN 409.8 24.57 0.57 2.38
GenElec GE 16.4 16.38 0.13 0.77 Intel INTC 20.9 21.44 –0.09 –0.42 9.61 5.90 TeleNZ ADS NZT 401.0 8.59 0.14 1.66
HewlettPk HPQ 6.7 42.92 0.71 1.69 StrlFnlWA STSA 20.0 0.24 –0.26 –52.06 17.74 8.20 CityTelecm CTEL 379.2 15.46 1.02 7.06
HomeDpt HD 3.9 31.80 0.36 1.13 BucyrusInt BUCY 20.0 89.67 20.05 28.79 22.81 16.45 KT Crp ADS KT 341.6 22.04 0.24 1.10
Intel INTC 20.9 21.44 –0.09 –0.42 4.24 2.50 UtdMicro ADS UMC 328.8 3.06 0.05 1.50
IBM IBM 1.5 144.16 0.42 0.29 Biggest gainers... 40.45 25.85 SonyCp SNE 303.1 33.80 0.85 2.58
JPMorgChas JPM 13.6 40.53 0.92 2.32 21.59 13.13 LG DisplayADS LPL 289.3 17.09 0.20 1.18
JohnsJohns JNJ 5.6 64.16 0.49 0.77 BucyrusInt BUCY 19,954.8 $89.67 20.05 28.79% 19.14 14.58 SK Tele ADS SKM 278.3 18.80 0.06 0.32
KftFoods KFT 2.7 30.89 0.27 0.88 IsilonSystems ISLN 27,122.1 33.77 7.49 28.47 71.99 49.55 Infosys INFY 270.4 66.66 0.36 0.54
McDonalds MCD 1.2 79.22 0.37 0.47 HeartWareInt HTWR 547.3 90.00 17.74 24.55 54.70 44.36 ChinaMobile CHL 263.3 51.59 0.31 0.60
Merck MRK 5.7 34.91 0.20 0.56 MediaComm A MCCC 10,040.5 8.39 1.53 22.30 91.97 67.56 ToyotaMtr ADS TM 248.0 76.20 0.69 0.91
Microsoft MSFT 22.6 26.32 0.05 0.21 HenryBrosElec HBE 164.6 8.23 1.28 18.42 8.58 4.75 NmuraHldg NMR 187.8 5.55 0.09 1.65
Pfizer
ProctGamb
PFE
PG
13.8
4.9
16.89
64.70
0.04
0.37
0.24
0.58
...Biggest losers 25.38
43.66
17.36
26.16
ChunghwaTel
Netease.com
CHT
NTES
186.8 24.51 0.19
161.3 40.54 –0.69
0.78
–1.66
3M MMM 1.0 86.65 0.41 0.48 SoCTBcp SSE 49.0 $4.35 –1.85 –29.85% 18.20 10.43 KoreaElecPwr KEP 159.6 13.07 0.07 0.54
TravelersCos TRV 1.4 56.82 0.51 0.91 Hallwood HWG 33.6 20.69 –8.28 –28.58 40.25 22.96 DrRdyLab ADS RDY 147.2 39.30 –0.10 –0.25
UnitedTech UTX 1.4 75.25 0.37 0.49 RINO RINO 3,907.6 8.37 –2.64 –23.98 32.26 18.29 Yanzhou ADS YZC 146.3 29.85 –0.71 –2.32
Verizon VZ 5.1 32.89 0.33 1.02 Thoratec THOR 7,865.2 24.90 –6.05 –19.55 34.27 18.03 AluCpChina ACH 126.6 23.66 –0.14 –0.59
WalMart WMT 4.1 54.02 –0.11 –0.20 MakeMyTrip MMYT 1,389.3 32.40 –5.75 –15.07 81.00 57.04 ChinaLfIns ADS LFC 117.4 67.74 –0.24 –0.35
*Most active American depositary receipts tracked by Dow Jones
Source: WSJ Market Data Group

Global government bonds U.S. Treasury yield curve


Latest, month-ago and year-ago yields and spreads over or under U.S. Treasurys on benchmark two-year The curve shows the yield to maturity of current bills, notes and bonds; all data as of 3 p.m. ET.
and 10-year government bonds around the world. Data as of 11 a.m. ET
Country/ SPREAD OVER TREASURYS, in basis points YIELD TOTAL RETURN
Coupon Maturity, in years Yield Latest Previous Month ago Year ago Previous Month ago Year ago Yield to Modified Month Quarter Year
5% Ryan Index maturity duration to-date to-date to-date 12-month
4.750% Australia 2 5.110% 458.6 457.9 447.7 385.6 5.070% 4.847% 4.670%
4.500 10 5.410 256.3 264.3 251.5 218.7 5.370 5.080 5.613 30-year Treasury 4.270% 16.84 –2.88 % –7.62 % 11.73 % 8.09 %
5.000 Austria 2 1.219 69.5 76.3 65.7 7.0 1.254 1.027 0.884 4 10-year Treasury 2.754 8.73 –0.71 –1.32 13.09 10.03
3.900 10 2.986 13.9 23.8 23.7 21.7 2.965 2.802 3.643 One year ago 7 Year Treasury 1.979 6.49 –0.38 –0.01 13.44 11.25
s

3 Five-year Treasury 1.348 4.80 –0.74 –0.07 9.55 8.17


2.000 Belgium 2 1.301 77.7 84.7 68.3 24.2 1.338 1.053 1.056
Ryan Index 1.933 6.97 –0.93 –1.56 9.21 7.38
3.750 10 3.435 58.8 72.3 64.5 26.9 3.450 3.210 3.695
2 3 Year Treasury 0.743 2.97 –0.61 –0.13 4.85 4.22
1.500 Canada 2 1.625 110.1 108.6 106.8 57.1 1.577 1.438 1.385
Two-year Treasury 0.503 1.96 –0.28 –0.10 2.24 1.94
3.067
s

3.500 10 22.0 28.7 22.8 4.4 3.014 2.793 3.470 Friday


1 Year Treasury 0.254 0.94 –0.03 0.04 0.78 0.78
4.000 Denmark 2 1.219 69.5 78.0 69.0 145.9 1.271 1.060 2.273 1
Six-month Treasury 0.173 0.50 0.01 0.03 0.25 0.27
4.000 10 2.702 -14.5 -6.0 -8.5 26.9 2.667 2.480 3.695 Ryan Cash Index-a 0.167 0.44 ... 0.03 0.33 0.35
0.750 France 2 1.143 61.9 66.7 55.9 45.6 1.158 0.929 1.270 0
Three-month bill 0.132 0.25 0.01 0.03 0.18 0.21
2.500 10 2.992 14.5 23.9 13.4 19.3 2.966 2.699 3.619 1 3 6 1 2 3 5 710 30
month(s) years One-month bill 0.112 0.07 0.01 0.02 0.11 0.12
1.000 Germany 2 1.044 52.0 55.6 43.8 38.0 1.047 0.808 1.194
maturity
2.250 10 2.562 -28.5 -20.7 -20.7 -6.4 2.520 2.358 3.362 a-Performance of a cash investment Source: Ryan ALM
0.500 Hong Kong 2 0.615 9.1 -1.9 21.3 -27.8 0.472 0.583 0.536
2.530 10 2.530 -31.7 -30.7 -40.1 -111.9 2.420 2.164 2.307
2.000
4.000
Italy 2
10
2.252
4.082
172.8
123.5
182.5
139.9
128.6
115.3
64.2
66.4
2.316
4.126
1.656
3.718
1.456
4.090
Key money rates
0.100 Japan 2 0.155 -36.9 -34.1 -24.0 -56.4 0.150 0.130 0.250 Latest 52 wks ago Latest 52 wks ago Offer Bid

0.800 10 1.075 -177.2 -172.6 -168.5 -208.3 1.001 0.880 1.343 Prime rates Euro Libor Eurodollars
5.000 Netherlands 2 1.072 54.8 57.3 47.5 7.4 1.064 0.845 0.888 U.S. 3.25% 3.25% One month 0.80750% 0.39500% One month 0.3500% 0.2500%
3.500 10 2.783 -6.4 3.7 2.9 15.2 2.764 2.594 3.578 Canada 3.00 2.25 Three month 0.99125 0.67125 Three month 0.5500 0.4500
1.475 1.23250 0.7500
5.000 Portugal 2 4.446 392.2 444.7 304.2 33.4 4.938 3.412 1.148 Japan 1.475 Six month 0.97875 Six month 0.6000
Britain 0.50 0.50 One year 1.51125 1.21250 One year 1.0500 0.8500
4.800 10 6.836 398.9 427.8 324.3 39.4 7.005 5.808 3.820
ECB 1.00 1.00 Hibor
2.750 Spain 2 2.370 184.6 194.0 152.8 53.5 2.431 1.898 1.349
Switzerland 0.58 0.53 One month 0.16929 0.10036% Latest 52 wks ago
4.850 10 4.514 166.7 184.4 142.2 43.5 4.571 3.987 3.861
Australia 4.75 3.50 Three month 0.24750 0.14929 U.S. discount 0.75% 0.50%
4.000 Switzerland 2 0.518 -0.6 1.0 15.5 -35.3 0.501 0.525 0.461
Hong Kong 5.25 5.25 Six month 0.34857 0.35929 Fed-funds target 0.25 0.25
2.000 10 1.557 -129.0 -118.3 -106.2 -143.8 1.544 1.503 1.988 One year 0.67786 0.63929 Call money 2.00 2.00
5.000 U.K. 2 0.798 27.4 30.8 29.7 53.7 0.799 0.667 1.351 Libor Asian dollars
4.750 10 3.262 41.5 46.8 38.4 37.3 3.195 2.949 3.799 One month 0.25344% 0.23750% One month 0.2671% 0.24% Overnight repurchase rates
0.375 U.S. 2 0.524 ... ... ... ... 0.491 0.370 0.814 Three month 0.28438 0.27125 Three month 0.3040 0.2783 U.S. 0.36% 0.10%
2.625 10 2.847 ... ... ... ... 2.727 2.565 3.426 Six month 0.44250 0.51781 Six month 0.4620 0.5288 U.K. (BBA) 0.560 0.477
Source: Thomson Reuters One year 0.76481 1.08813 One year 0.7730 1.0950 Euro zone 0.73 0.34

Sources: WSJ Market Data Group; Reuters


Tuesday, November 16, 2010 THE WALL STREET JOURNAL. 33

MARKETS

Goldman hits Asian finance firms set for M&A


snag on payback
Continued from page 19
Billions more will be raised from Financial Finance: Others:
the rights issues launched in the 23.8% 31.7%
last few weeks by Bank of China payday Computers & Total
Ltd. and China Construction Share of electronics: net revenue:
7.3%
Effort to repay Berkshire is delayed by Fed Bank Corp.
“Now that the Chinese banks
investment-bank
revenue in Asia Oil & gas:
$11.6 billion Holding companies:
4.0%
have largely completed their capital Pacific by 6.7% Insurance: 4.1%
BY LIZ RAPPAPORT Berkshire at any time for $5.5 bil- raisings, we believe that they will industry,
Construction/building:
AND SERENA NG lion, subject to Fed approval, though become more active with respect to year to date Chemicals: 4.1%
4.7%
the move would trigger a charge of M&A as they expand their platforms Real estate/property:
Goldman Sachs Group Inc. has $1.6 billion. The infusion was an- and franchises within Asia to follow Utility & energy: Mining: 4.3%
Source: Dealogic 4.7% 4.6%
hit a delay in its efforts to win U.S. nounced in September 2008. their clients around the region,”
government approval to pay back a Redeeming the shares would said Simon Yoo, co-head of financial
$5 billion investment from Warren save Goldman dividend payments of institutions group for Citigroup in tutions at Bank of America Merrill tively few people buy life insurance.
Buffett’s Berkshire Hathaway Inc. 10% a year on the investment. Asia Pacific. Lynch. “For the Japanese and Chi- “Insurance activity will likely
because the Federal Reserve first Berkshire would retain war- Chinese banks have said they nese institutions, this means seek- continue to be driven by listings,”
wants to hammer out guidelines on rants allowing the company to pur- want to expand beyond their bor- ing out growth opportunities in the said Marie-Soazic Geffroy Dernon-
bank-dividend increases, according chase as many as 43.5 million Gold- ders, and ICBC has stakes in South Asean markets.” (Asean, a reference court, a managing director at Mor-
to people familiar with the matter. man common shares at about $115 African and Indonesian banks. to the Association of Southeast gan Stanley. “There is strong inves-
Goldman formally sought per- apiece before Oct. 1, 2013. Goldman One geographic focus could be Asian Nations, comprises 10 South- tor appetite for the Asian insurance
mission from the Fed for the trans- shares were trading near that level Southeast Asia, where economies east Asian countries.) sector and with only about 15 listed
action in late October, shortly after at the time of the infusion but have are expanding rapidly and financial Insurers also have been busy players in a region which will drive
The Wall Street Journal reported since rebounded sharply. On Friday, markets are being liberalized. Ana- raising capital. In addition to AIA, insurance growth in the next de-
that the New York company was Goldman shares fell $1.88, or 1.1%, lysts often single out resource-rich other major insurers that have gone cade, there is room to expand the
considering the move, in part be- to $165.83 on the New York Stock Indonesia, with nearly 238 million public are Japan’s Dai-ichi Life In- investment alternatives.”
cause Goldman has emerged from Exchange. people, as an ideal expansion target surance Co. Ltd., which raised But with demand comes flush
the financial crisis with a comfort- In 2008 and 2009, Berkshire in- for Chinese banks. US$11.14 billion, and South Korean pricing. Asian life companies usually
able cushion to absorb losses. Berk- vested more than $21 billion in “The larger banks in Asia will insurer Samsung Life Insurance Co trade at higher multiples to embed-
shire’s cash investment also has cost Goldman, General Electric Co., continue to seek to expand their re- Ltd., which raised US$4.4 billion. In- ded value, a preferred valuation for
Goldman about $1 billion in divi- Swiss Reinsurance Co., Dow Chem- gional footprints,” said Michael Tan, vestors see potential for insurance the insurance industry, than their
dend payments so far. ical Co. and Wm. Wrigley Jr. Co. in head of Asian-Pacific financial insti- companies in a region where rela- Western counterparts.
The Fed must approve the trans- the form of preferred equity, bonds
action because it is Gold- or other capital instruments.
man’s banking supervisor. Many of the investments
Goldman officials hoped to had terms that guaranteed
win clearance quickly, but fat returns for Berkshire,
the request has been run by Mr. Buffett,
caught up in the wider whose reputation helped
process of setting a divi- boost investor confidence in
dend-increase policy for the companies when finan-
all U.S. banks overseen by cial markets were in turmoil
the Fed, said people famil- and capital was scarce.
iar with the matter. Earlier this month, Swiss
The Fed may be reluc- Re reached an agreement
tant to give Goldman a go- with Berkshire to redeem a
ahead to make adjust- Warren Buffett three billion Swiss franc
ments to its capital level ($3.06 billion) capital in-
before other banks get the same strument for roughly 3.9 billion
flexibility, the people said. francs. The Swiss Re instrument,
Federal Reserve Governor Daniel which paid Berkshire 12% annually,
Tarullo said Friday that he expects previously wasn’t expected to be re-
the Fed’s first approvals for banks deemed before March 2011. Berk-
to increase dividends will be issued shire had made the investment in
in next year’s first quarter. Banks March 2009, after Swiss Re reported
will need to show they can meet large losses from credit derivatives.
high capital hurdles before they can The Zurich-based insurer’s capi-
increase payouts to shareholders, he tal position is stronger now, and it
said. paid Berkshire no penalty charge
Before the financial crisis, banks “for bringing forward the repay-
typically had to just inform the Fed ment date,” Swiss Re said in a state-
of dividend adjustments. During the ment accompanying its latest finan-
crisis, banks slashed their dividends cial results.
and were required to seek permis- Since March 2009, the Swiss
sion from the Fed to raise the pay- franc has strengthened against the
outs again. The toughened stance U.S. dollar, juicing Berkshire’s re-
encouraged battered financial firms, turns; its original investment cost
many of which sharply reduced their about $2.7 billion.
dividends, to conserve more capital. GE also has indicated it intends
At the end of the third quarter, to redeem Berkshire’s $3 billion in-
Goldman had a healthy $75.66 bil- vestment, in the form of 10% pre-
lion of shareholder equity. The com- ferred shares, at some point in the
pany also has plenty of money to re- future.
pay Berkshire under the new Basel With interest rates and bond
III capital guidelines. yields at low levels, double-digit-
Goldman has the option to re- percentage annual returns will be
deem the preferred shares held by harder to come by for Berkshire.

CBA warns on profit margins


BY CYNTHIA KOONS gins are struggling under the weight
of high deposit and wholesale-fund-
SYDNEY—Commonwealth Bank ing costs.
of Australia said unaudited cash To win customers, Australian
earnings for the fiscal first quarter banks have been offering retail de-
to Sept. 30 were about 1.6 billion positors high savings rates. This
Australian dollars ($1.58 billion). comes at a time when wholesale-
The bank, which recently came funding costs also are higher. CBA
under fire by being the first to raise said its retail-bank margins are 15%
mortgage rates beyond the central below what they were at the start of
bank’s rate increase, said operating the global financial crisis.
conditions still are challenging, and CBA’s impairments were A$321
both business and consumer credit million in the quarter. The bank said
growth remain “muted.” the quality of some lending portfo-
CBA on Monday said profit mar- lios is gradually improving.
34 THE WALL STREET JOURNAL. Tuesday, November 16, 2010

HEARD ON THE STREET


Email: heard@wsj.com FINA NCIA L A NA LYSIS & COMMENTARY WSJ.com/Heard

Japan’s economic joy Subsidized boost


Japan's third-quarter GDP by
category: percentage-point growth
and percent of total
Patient AMP
gets help from
a French friend
has no staying power
Capital
expenditures: Inventory:
0.1 (11%) 0.1 (11%)
Household Patience looks like it’s going to
consumption: pay off for AMP.
0.7 (78%) A year after making its first bid
for AXA Asia Pacific Holdings, the
In Japan on Monday, good news factors, such as a summer heat wave ergy-saving electronics will be fully 3Q GDP: Australian wealth manager is back
was bad news. that bolstered sales of air condition- phased out in March. +0.9%* with a new offer. This time it can
The nation’s economic growth ers, and subsidies that cannibalized The payback is already becoming Net bid with more confidence: Its major
surged to 3.9% in the third quar- future demand. Net exports, a major evident. The capacity utilization rate exports:
rival for the asset, National Austra-
0
ter—on an annualized, price-ad- driver of Japan’s economy, contrib- for factories, which has been drop- lia Bank, has fallen by the wayside,
justed basis—surprising economists, uted nothing to growth. Spending on ping since June, fell below 70% in * Change from previous quarter; annualized rate thanks to Australia’s competition
who had expected less. services and other goods, for which September for the first time since of 3.9% regulator. And it will pay less for
Source: Japan Cabinet Office
Credit goes to a jump in con- Tokyo hasn’t provided incentives, December, according to Crédit Agri- the assets than when it bid a year
sumer spending. Household outlays fell. cole. companies last week shows them ago, while shifting much of the risk
accounted for almost all of this. The With base wages stagnant, con- Add in a stronger yen, slowing forecasting core machinery orders in this deal to France’s AXA SA.
purchases of products such as cars sumers still appear to be reluctant to exports and uncertainty over global to drop nearly 10% in the current When the deal is finalized, AXA
and flat-panel TV sets rose at their spend without some help. demand, and that doesn’t augur well quarter from the previous. It’s a APH will be split: AMP will own the
quickest pace in more than two de- So the question now is whether it for plant and equipment investment. measure that tends to lead capital Australia and New Zealand business
cades, an annualized rate of nearly means Japan will slide into a techni- This accounts for about 15% of GDP expenditure by six or nine months. at a cost of $4.1 billion, and AXA SA
53%. cal recession early next year. Subsi- and, although slowing, it has risen The joy in Japan’s latest eco- the Asian operations. The French
But there’s a hitch. The spending dies for fuel-efficient cars ended in for four consecutive quarters. nomic numbers will be fleeting. company’s desperation to gain full
was driven by a number of one-time early September, and those for en- But a Cabinet Office survey of — James Simms control of those—it currently owns
54% of AXA APH—is critical to
AMP’s probable success.

Time for BHP Billiton to think smaller


AMP is offering shares and cash
for AXA APH, but if AMP’s stock
falls, AXA SA will make up the dif-
ference, meaning AXA APH’s minor-
ity shareholders won’t lose out. In
BHP Billiton, once full of prom- But a change of direction isn’t a also grow by spending to further de- addition, AXA SA is going to under-
ises that it would use acquisitions to terrible proposition. Large mining- velop existing mines. The $10.8 bil- write a $590 million subordinated-
secure its position as a mining gi- industry acquisitions bring few syn- lion that BHP spent on project in- debt issue by AMP to fund the deal.
ant, is proving just too big to deal. ergies, and the only compelling ad- vestment last year was the lowest The net result is that even
The company’s $39 billion bid for vantage is that a buyer might bring figure since before Mr. Kloppers though AMP is set to pay less for
Potash Corp. of Saskatchawan, development capital to the table. took over in 2006. the AXA APH assets than it would
withdrawn by BHP on Monday, The lack of big deals hasn’t hurt have done under the terms of its bid
means three of the company’s major BHP’s results. Operating-profit mar- last December, the overall bid is
transactions have flopped. Canadian BHP is fast running out of gin stands at a robust 40.7%, and now equivalent to the offer made by
politicians blocked this one; the since Mr. Kloppers took the helm National Australia Bank earlier this
credit crisis brought down its 2007 top-tier targets like Potash dividends have nearly doubled. In year—which AXA APH’s minority
bid for Rio Tinto, and European reg- and Rio, and the regulatory fact, the one message that’s likely to shareholders had accepted.
ulators foiled a planned iron-ore be loud and clear at BHP’s investor AMP won’t face the same regula-
venture with Rio last month. climate is getting tougher. meeting Tuesday is the desire tory opposition to its deal as NAB.
It should now be evident that among shareholders for it to return Instead, at least in the wealth-man-
Chief Executive Marius Kloppers, more capital to investors in the agement sphere, this deal should en-
who took up his post in 2007 pledg- True, unlike other companies, form of dividends and buybacks. sure AMP is able to compete on
ing megadeals, is going to have to miners can’t readily renew their Longer term, investors will want level terms with Australia’s major
think up a new approach. BHP is stock—you either have the ore, or to see BHP renewing its asset base, banks. AMP expects the acquisition
Reuters

fast running out of top-tier targets you don’t—so asset acquisitions are but they might also be pleased to to add to its earnings in year two.
like Potash and Rio, and the regula- critical. But they needn’t be so hear that Mr. Kloppers is no longer Thank goodness for generous
BHP failed in a 2007 Rio takeover bid. tory climate is getting tougher. large, and mining companies can thinking so big. —David Fickling French friends. —Andrew Peaple

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Tuesday, November 16, 2010 THE WALL STREET JOURNAL. 35

MARKETS LINEUP

Moving the Asian index movers…


markets Nikkei Stock Average CBN 600 Hang Seng Sensex
At right, Japan’s benchmark stock index and
Japan 9827.51 China 28332.93 Hong Kong 24027.18 India 20309.69
the biggest movers among the larger Asian
stocks indexes and stocks Monday. Below s 1.06% or 102.70 s 1.24% or 345.83 t 0.81% or 195.42 s 0.76% or 152.79
each index are its most actively traded stocks.
The charts show the percentage change in The index’s gains were helped by better- The gain wiped out most of the loss posted Chinese financial and commodity firms were Shares in Satyam Computer Services fell
each index’s or stock’s value, rather than the than-expected gross-domestic-product data so far for November. Property firms and dragged down by concerns about possible ahead of its first-half results that were due
point change, for purposes of comparison. The
and a weaker yen. Dai-ichi Life Insurance banks were mostly higher. Gemdale and further tightening measures in China. Bank after the close. Unitech slid after fiscal sec-
rose after results topped guidance. ICBC rose. of China and Chalco shares dropped. ond-quarter earnings missed estimates.
index level or stock price is indicated on each
axis. All indexes and stocks are shown in local
currency terms. 15000 45000 30000 30000

12500 37500 25000 25000

10000 30000 20000 20000

7500 22500 15000 15000

5000 15000 10000 10000


N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O
WSJ.com N D J F M A M J J A S O
2010 2010 2010 2010

Follow the markets throughout the day, Volume Change Volume Change Volume Change Volume Change
with updated stock quotes, news and Stock in millions Close Net % Stock in millions Close Net % Stock in millions Close Net % Stock in millions Close Net %

commentary at WSJ.com. Mizuho Financial 337.23 127 unch. … Icbc 906.30 5.00 0.32 6.84 Icbc 420.92 6.49 unch. –1.82 Bharti Airtel-A 2.40 309.50 3.45 1.13
Mtshbsh Fin Grp 60.15 391 –1 –0.26 AgricBkofChina 296.37 2.75 0.03 1.10 CCB 268.15 7.34 –0.09 –1.21 Tata Steel-A 2.11 617.15 10.85 1.79
Also, receive emails that summarize 1.20
Hitachi 27.69 393 5 1.29 Zijin Mining 259.40 9.12 –0.40 –4.20 Bank Of China 217.09 4.49 –0.07 –1.54 Jaiprak Asso-A 128.05 -1.25 –0.97
the day’s trading in Europe and Asia. 1.19
Nomura Hldgs 27.52 460 3 0.66 United Network 183.14 5.24 –0.04 –0.76 ChinaPetroChem 111.38 7.50 –0.22 –2.85 Reliance Com-A 168.05 380.00 –1.12
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ResonaHldgs 27.49 463 –15 –3.14 Western Mining 158.65 20.50 –1.00 –4.65 PetroChina 79.11 10.06 –0.20 –1.95 Sbi New-A 1.05 3,164.15 133.75 4.41

Asian stocks in the news


Tokyo Electron State Bank of India Brambles TonenGenl Sekiyu AXA Asia Pacific Hldgs
Japan ¥5,070 India 3,164.15 rupee Australia A$6.88 Japan ¥799 Australia A$6.17
s 3.0% or ¥150 s 4.4% or 133.75 rupee s 5.4% or A$0.35 s 6.4% or ¥48 s 6.7% or A$0.39
Exporters’ shares were aided by a sharply Banking shares benefited from a lack of The firm agreed to buy IFCO Systems, saying The company raised its pretax profit forecast The firm said it is considering a new takeover
weaker yen. negative surprises in the October inflation it would be immediately accretive to earnings Friday. proposal from AMP and parent AXA.
numbers. per share.

In yen 10000 In rupee 5000 In Australian dollars 12.50 In yen 1500 In Australian dollars 10
8000 4000 10.00 1200 8

6000 3000 7.50 900 6

4000 2000 5.00 600 4

2000 1000 2.50 300 2


N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O
2010 2010 2010 2010 2010

Price-to-earnings ratio 14 Price-to-earnings ratio 17 Price-to-earnings ratio 19 Price-to-earnings ratio 10 Price-to-earnings ratio 20
Earnings per share, past four quarters 365.40 Earnings per share, past four quarters 182.77 Earnings per share, past four quarters 0.37 Earnings per share, past four quarters 81.40 Earnings per share, past four quarters 0.31
Dividend yield 2.0 Dividend yield 0.9 Dividend yield 1.8 Dividend yield 4.8 Dividend yield 1.5
PERCENTAGE CHANGE PERCENTAGE CHANGE PERCENTAGE CHANGE PERCENTAGE CHANGE PERCENTAGE CHANGE
Daily 1 wk. 52 wks Daily 1 wk. 52 wks Daily 1 wk. 52 wks Daily 1 wk. 52 wks Daily 1 wk. 52 wks
Technology 0.6% -1.0% 12.3% Banks -0.3% -3.1% 2.4% Indus Gds & Svcs -0.4% -2.6% 20.1% Oil & Gas -0.9% -4.3% 11.2% Insurance -0.7% -2.0% -2.9%
Tokyo Electron 3.0% 0.2% 3.9% State Bank of India 4.4% -7.6% 35.0% Brambles 5.4% 2.5% -2.3% TonenGenl Sekiyu 6.4% 7.7% 0.9% AXA Asia Pacific Hldgs 6.7% 11.2% 3.0%

Noble Grp Resona Hldgs China Shenhua Energy Incitec Pivot China Coal Energy
Singapore S$2.08 Japan ¥463 Hong Kong HK$34.65 Australia A$3.77 Hong Kong HK$13.18
t 2.8% or S$0.06 t 3.1% or ¥15 t 3.2% or HK$1.15 t 3.3% or A$0.13 t 4.1% or HK$0.56
Shares of the commodities trading firm have The bank’s first-half net profit declined 4.5% Commodities firms fell on concerns China may The fertilizer maker complained of a higher The company’s report Friday that its October
lost 5.5% over the past two trading days. from a year earlier. impose price controls on the resources sector. Australian dollar and strong local competition. output rose 23% from a year ago failed to
boost shares.

In Singapore dollars 3.75 In yen 1750 In Hong Kong dollars 70 In Australian dollars 7.50 In Hong Kong dollars 20
3.00 1400 56 6.00 16

2.25 1050 42 4.50 12

1.50 700 28 3.00 8

0.75 350 14 1.50 4


N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O
2010 2010 2010 2010 2010

Price-to-earnings ratio 22 Price-to-earnings ratio 4 Price-to-earnings ratio 18 Price-to-earnings ratio None Price-to-earnings ratio 17
Earnings per share, past four quarters 0.10 Earnings per share, past four quarters 111.10 Earnings per share, past four quarters 1.97 Earnings per share, past four quarters -0.10 Earnings per share, past four quarters 0.77
Dividend yield 2.4 Dividend yield 2.2 Dividend yield 1.7 Dividend yield 1.6 Dividend yield 1.3
PERCENTAGE CHANGE PERCENTAGE CHANGE PERCENTAGE CHANGE PERCENTAGE CHANGE PERCENTAGE CHANGE
Daily 1 wk. 52 wks Daily 1 wk. 52 wks Daily 1 wk. 52 wks Daily 1 wk. 52 wks Daily 1 wk. 52 wks
Indus Gds & Svcs -0.4% -2.6% 20.1% Banks -0.3% -3.1% 2.4% Basic Resources -0.8% -3.5% 13.8% Chemicals -1.0% -3.9% 25.8% Basic Resources -0.8% -3.5% 13.8%
Noble Grp -2.8% -2.3% 12.4% Resona Hldgs -3.1% -1.1% -53.2% China Shenhua Energy -3.2% -7.7% -12.4% Incitec Pivot -3.3% -2.8% 35.1% China Coal Energy -4.1% -8.2% -2.9%
36

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