Thursday, June 30, 2005
These large financial institutions enjoy informational economies of scale. These large corporations, due to their size, will have difficulties in controlling operation of branch offices. Due to the financial strength of these multinational large financial corporations the amount of money they manage will sometime exceed the money supply of a small economy which will affect the stability of the financial system globally.
These large corporations will also have sufficient bargaining power that may influence policy of World Bank, Asian Development Bank, IMF and the like. Poor and developing countries in many cases were forced to open up their market to international corporations before they are granted loans to help the economy and fight poverty.
Financial superpower also in some cases involves in politics and influence government polices which in many countries promote corruptions and expropriation of the general public (depositors or investors). Some of these large corporations, in order to gain political influence, have also involved in “black money” politics and lobbying using their financial strength.
(a) Globalization can bring about economics of scale for manufacturers with competitive markets, gains from international division of labour and brings new producers onto world markets.
(b) Globalization of finance suffers a principal/agent problem in that agent incentives are based on performance measures observable by their principal. This has promoted hedge funds and arbitrage at colossal volumes which has led to the collapse of Barings and LTCM etc.
Wednesday, June 29, 2005
Examples are tax heaven and the use of paper entities to evade liability. Profits are moved between accounting books from one country to another to avoid disclosure and escape tax. The arbitrage operation between jurisdictions require large financial corporations to create subsidiaries under their control in different countries which discourage average investors to fully understand the complicated accounts behind them.
Tuesday, June 28, 2005
Monday, June 27, 2005
world. Subsidies and government protections, if not removed, will scare away foreign investments due to unfair competition. This will also generate disputes with China trading partners after joining WTO.
Furthermore there are opportunities for conglomerates to expropriate the state during the transition to private ownership therefore in the long-term this could lead to corruption. Political units will arbitrage between themselves for personal benefits or for their cronies who hold managerial positions. Such corruption is a high cost to the state.
Saturday, June 25, 2005
whole town, a small city) who have been well looked after by the provincial governments. If the "change" is not smooth social and political unrest will affect central government leadership.
Friday, June 24, 2005
Thursday, June 23, 2005
Wednesday, June 22, 2005
Tuesday, June 21, 2005
Monday, June 20, 2005
Saturday, June 18, 2005
Friday, June 17, 2005
(i) With crossholding between B and C that will reduce transparency, hence higher information asymmetry. If the Manager of the pyramid is also the controlling shareholder then he can also reduce his risk of personal portfolio for diversifying across B and C while retaining overall control of these companies.(ii) For the pyramid structure one other aspect is to make sure Manager of these companies will also be under control by the company A.With crossholding between key companies at lower level of the pyramid under A's control this would ensure that decision made by these subsidiaries will not deviate from A's direction by a Manager in one particular subsidiary. Deviation from the A's corporate directive is only possible when many Managers of subsidiaries are acting in concert.
If the controlling shareholder in A has personal interests in B and C that pyramid structure is likely built for reason (i) If the crossholding between B and C are by way of company shares then it is likely that it is for reason (ii) Another way could be by examining dividend payout and the ownership/control ratio. However in the stock market there are many other factors that may affect dividend trend.
Wednesday, June 15, 2005
Tuesday, June 14, 2005
Monday, June 13, 2005
Friday, June 10, 2005
Thursday, June 9, 2005
Art Kleiner is also a business book authors who wrote "Who Really Matters – The Core Group" and "The Age of Heretics". Kleiner quoted Harvard Business School professor Morten Hansen saying that Collins' study aimed at Managers and best methods of academic research was followed. In fact Collins himself said he wasn't aimed at Manager at the beginning. It was the Chimps (Collins' research associates) who championed the inclusion of the Level 5 Leadership concept. Kleiner pointed out in this article that Collins' study led to a series of questions about virtue and when the 11 companies were singled out for in-depth analysis the key factors were found one of them being the Level 5 Leadership. Indeed Collins' methodology was uncommon. He didn't pick companies with continuous growth such as Coca-Cola, GE, Intel or even Microsoft. This possibly has made Collins' book stood out because most management books used stories surrounding glamorous companies like those mentioned above or charismatic leaders working for these companies to attract readers. Collins picked companies that took off suddenly after many years of flatten performance then 15 years of accelerated growth. One can tell the meaning of this from the choice of the verb "catapult" in Collin's 2001 article. In the description by Kleiner on how Collins managed to write his book "Good to Great" you will know Collins was doing what Nick Sagar did on "The Crew". Collins was determined to climb that rock (research and write the book) his way by having no faulty appointment and rejected punditry financing scheme of taking consulting jobs. $750,000 of Collins' own money was spent in the research and writing of his book "Good to Great" and while collaborating with Professor Porras the Collins couple lived in a small Palo Alto cottage on an annual income of $33,000. Kleiner also called Collins a perfectionist. The 7 key factors found by the Chimps were
- First Who….Then What
- The Stockdale Paradox
- A Culture of Discipline
- Technology Accelerators
- The Flywheel
- The Hedgehog Concept
- The Level 5 Leaders
Collins refused to get a Ph.D and he made no secret of his contempt for the specialization (he called them, the "churches") of management theory. Ironically the churches like Collins' idea as you can tell from the number of results you may get by putting "fallure + church" as your search texts in a Google search. Few churches and Christianity groups have quoted Collins' climbing experience as metaphor of life in their webpage.A few is listed below:
Wednesday, June 8, 2005
Tuesday, June 7, 2005
It's so warm that I get reply from a human.
I use firefox and my blog is one of the home pages that I would open. Every morning I start firefox at round 9:30am Hong Kong time. During the last 2 weeks perhaps I have only 1 day with my blog successfully opened.
Almost everytime I tried status.blogger.com but it disappointedly failed. At the time of this writing both my blog and your status page can't be read.
Interestingly in the last few days I have asked my sister in Malaysia to view my blog, it was OK in most days.
I think you may have a technical problem somewhere that your internet load balancing has put Hong Kong in low priority during your US night time. It's understandable that Blogger has scheduled shutdown and maintenance during those hours.
I have read newsgroups and others and found that I'm not the only one feeling this frustration. Blogger must put this right quick.
Monday, June 6, 2005
The concept behind each of these lessons was further elaborated with climbing experience and a real life example in his book.
Fallure, an invented jargon for climber may be, is a bit of wordplay derived from a decision that rock climbers make if they know they cannot complete the route they have chosen for a climb. They allow themselves to fall, knowing that the bolts attached to the side of the rock face through which their climbing ropes are threaded will break their fall. In fallure, a climber still fails to get up the route, but he or she pushes to the ultimate limit. Fallure means a climber made a commitment to make the ascent, despite the odds. See more at Leadership.
Saturday, June 4, 2005
Collins used the story of Nick Sagar to demonstrate the attitude of "never give up". Climbing (the kind of sport or endeavor is not relevant) is not really about climbing but a metaphor for life. Reaching the top/goal or not did not matter but the lesson learnt in the process is far more important for life long learning. The Sagar's goal to conquer "The Crew" has also another meaning which is that once you set your target there are necessary sacrifices, i.e. in the case of Sagar, he lived on small sponsorship and had to give up his quest when the money failed to come through.
Collins is an avid climber himself. He used his lessons learnt in climbing to map into other aspects of life, e.g. business, management, leadership etc. He summarized what he learnt into these 5 key lessons in life.
- Climb to fallure, not failure: Succeed without reaching the top
- Climb in the future: Frame your mind
- Separate probability from consequence: Know the true risks
- Form the Partner's Pact: First Who, Then What
- Don't confuse luck and competence: How to not let success kill you