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Tuesday, November 26, 2013

Japan's Real Estate Bubble is Back in 2014


I agree when taxi drivers start talking about investments with customers in the cab there is a bubble brewing. Right now in Tokyo, the initial steps are now beginning again. It is deja vu all over again. Now, about 5 times your annual income around 30M yen or US$300K, is the current sweet spot in metro centers. The overview is simple for the Japanese retail investor; since Lehman you tried FX online, followed by commodities like oil or coal, then gold for a while, and recently Japanese equities. With a consumer tax increase now slated for April 2014, it seems like now is the time to buy new real estate units. 

All over Tokyo, and other urban areas in Japan new condo construction is rampant with billboards everywhere showing new units for sale. These are not big units; 25-75 square meters, but they are new and well designed. As parents get older a big decision is being made; If we have an empty nest, is a single home really worth keeping? Perhaps it is time to sell the land underneath and buy a condo before the new tax kicks in? This may not make sense to other real estate markets overseas, but in Tokyo, Yokohama, Osaka, Kobe, Kyoto or Nagoya, it certainly does.

In Japan there is a depreciation driver with tax incentives that helps many locals, and the single house. Often wood built, it is soon worth nothing in accounting terms after 25+ years but the land still has worth. Last weekend, new projects in Tokyo to help build earthquake firewalls was complained about by many on some investigative talks show. It is now building price pressure due to the Olympic building boom that is driving new rail and expressways links already. As a result the city is changing fast and hopefully within 7 short years.

For non-residents not familiar, central Tokyo, still has single homes. You would not expect to see them in New York's Manhattan, or London's West End, terrace homes rule there, but not in Tokyo. In fact, that is what billionaire's live in. Many billionaires live in single home buildings. Abenomics; from a price-low December 2012, land prices in central Tokyo, (Hiroo or Azabu) are up as much as 44% on specific lots in less than a year. The average price today is still very low compared to the bubble peak prices of 1991, often no more than 30% of its former peak, so plenty of room to grow from a purchase today. The math is not complex, just do the numbers. Japan's farmers are old, office workers are young, and they work in big cities. The Japanese nation's population is shrinking, especially the countryside, 
but not its cities. 

There are NO nationality restrictions on ownership for these homes. Cash is all you need, unlike in other parts of Asia. There is NO real estate restriction based on an owner's passport, anybody can buy anything legally in Japan. Many Asian investors have clued in and are now buying land from older homes, putting up parking lots in the interim or a higher yielding convenience store, then waiting for the full bubble fever prices to return. With so many new maps with zones of specific lots to investigate (or avoid) from recent Olympic plans, a fascinating maze of profits (or problems) awaits the on the ground investor. To sell in future for 30-50% more in 3-5 years or less can be pretty compelling. The good old 10% return a year retail investor rule is back. So maybe retail investors have it right, again!



For more Buy-Side and Sell-Side roles in Asia-Pacific, contact our TMJ Partners Japan & Asia Finance team.


Tokyo                                                            Tokyo
       Mark Pink                                              Shinichi Nagasawa
Direct + 81 3 3505 3891                               Direct  +81 3 3505 3891
Email pinkmark@tmjpartners.com            Email nagasawa@tmjpartners.com

Monday, November 18, 2013

Job Update Tokyo: Long-Short Prop Trader in Japan


Back by popular demand; the Job Description Infographic.

Do you have what it takes to be a Long-Short Prop Trader in Japan?

Contact us at resume@tmjpartners.com if you think you do.

Wednesday, November 13, 2013

Japan's Retail Securities Rebound in Equities in 2014

To my surprise last week during a meeting with the president of a Japanese securities firm in Tokyo, I heard news of strong profits in Japan. After asking about how good profits are in 2013 compared to last year 2012, I actually heard the follwoing phrase, "It is not a question of any percentage better than last year, it is multiples better! If things continue like this, 2013 may be the best result we have had in 20 years since the bubble!" I have heard about some firms benefiting from the "Abenomics" rebound, but I had no idea it meant full multiples of improved results for certain firms already.

I then had to ask why results were so good and his response made sense to me; "Generally, our retail clients have been growing as a percentage of active trading, but they have changed what they trade. Last year many retail clients were trading FX, but the Yen crosses have not been very volatile or predictable this year. Gold has been in a down trend for a while, and is difficult to short, JGB rates are not moving up in the short term, so that really only leaves 2 asset classes left; Japanese equities and residential real estate."

I also had the opportunity to ask a few more questions to gain additional insight:

Q. How do you see equity markets in 2014 and what are your hiring plans? 
A. To be honest, there are NO headcount limits on retail sales people at our firm. If there are motivated equity sales people with basic or in-pocket retail clients, we would like to hire as many as we can in 2014. 
Q. In addition to equity sales what else is active? 
A. Real estate. We are actively looking for deal makers who can connect buyers and sellers of land and residential buildings especially in central Tokyo.

Moreover according to this president, overseas real estate investors from Asia into Japan are now growing. There has been a clear trend to buy larger older homes with gardens of 1000-2000+ square meters or more (1/4-1/2 an acre). Occasionally there are even 2 older properties side by side, and investors construct convenience stores on the property instead of parking lots. As the Abenomics story grows, an exit by 2020 around the Tokyo Olympics can take place, and a full condo building can then be built on the spot if the location is central and close to a train station. If we can find real estate staff who speak Mandarin, then that is the sweet spot. There is big flow in that direction. It is not a well covered market though, and few real estate professionals have those language abilities to do those kinds of deals. 

The retail sales momentum is clearly now on and Bloomberg touched on it last week with a great story. It is a clear snapshot of a Nomura Securities retail sales person closing like the good old bubble days, can we be in store for more bubble days again?

See full Bloomberg story here.

To find your next Retail Sales career look here.


For more Buy-Side and Sell-Side roles in Asia-Pacific, contact our TMJ Partners Japan & Asia Finance team.


Tokyo                                                              Tokyo
         Mark Pink                                                 Shinichi Nagasawa

Friday, November 8, 2013

Friday Feature Movie Review : "Jobs"


If Steve Jobs were alive he would not allow it to show in its current form. I would imagine his comment would be "fix it! It is too dry, not sexy enough, poorly paced and does not even have the Xerox scene, so fix it!". I must say that this seems about right.


To be clear this is a business movie and a drama, not a thriller. If you are big fan of the founder of Apple you will enjoy the movie. It is the non-believers who will be disappointed. I recognized many scenes and liked the visual feel for the 1970s that the movie brings to his early years. As many things in the movie his adoption is not given enough balance but that aside from that the acting is really good. In my view it is the story or screenplay that could use some tweaking. The visual flashbacks to India, the calligraphy courses he took at Reed College, and his drift toward design were all well done, though many others scenes were not included and needed to be. If you knew the overall story nothing would be new to you, however how and why he changed were not really explained well, and may have lost many of the audience. If there was a director's cut in a longer, full-3 hour version this would have been better. Too much seemed to be crammed into just 2 hours and sadly there was to much ground to cover. The look and feel of all of the key characters has comparison photos at the end and any casting pro would give high marks to the matches made. Ashton Kutchner really had his manner and walk down pat, but the lines were never consistent in quality.


If you are an easy sell for a business movie on Apple then you will enjoy yourself. However, if you hope to see a great movie that is about Apple, the tech image icon of our times and be enthralled by its founder's story, make another choice.


For more Buy-Side and Sell-Side roles in Asia-Pacific, contact our TMJ Partners Japan & Asia Finance team.


Tokyo                                                              Tokyo
         Mark Pink                                                Shinichi Nagasawa

Tuesday, November 5, 2013

14 Japanese Casino Locations Now in Play!

Last weekend a number of Japanese magazines and TV shows were talking about the soon to be passed casino law in Japan. As many as 14 clear locations across Japan are now being short listed. And to my surprise a number of solid arguments; pro & con have been discussed. 

It is not an easy, "no brainer", allowing a Macau or Singapore casino boom to repeat within a short amount of time. Korea walked down the same path 10 years ago, failed, and nobody generally asks "why"? Japan is asking why and how to find the right balance with the obvious merits and demerits of casinos. 

Among the 14 casino locations being discussed, Okinawa and the four main islands will all get some of them, and two seem worth looking at in more detail; Tokyo will certainly get a casino, and it will most likely be in the new Olympic village site called Odaiba, within Tokyo bay. 

There are already large condo developments currently being built and gaining consumer attention, with some reports confirming 3 times more condo model home visits now than before the Olympics were announced, as well near Nagasaki, a Dutch village concept called "Huis Ten Bosch" has a large parking space with a casino design already for investment once the new law is passed. The US$25M dollar building is expected to bring in more than US$250M in revenue within its first year! Huis Ten Bosch launched in 1992 and went bankrupt in 2003. It was a financial disaster that was bought 3 years ago by a Japanese travel firm HIS in 2010. At the time HIS shareholders questioned if the move would really bring any return. Hindsight is always 20-20 but if a casino plan was being lobbied for in the background then this shows a very different and VERY lucrative investment profile. 

Some of the basic facts being used to persuade the Japanese market mainly compare Singapore with Korea. Before Singapore opened its Marina Bay Sands casino and later Sentosa's Integrated Resort, around 9.7 millions visitors spent US$1200 per visit. Just 4 years later 2013 is looking at a forecast of 11.2 million visitors with each spending around US$1800 per visit, some 50% more. This is the positive path Japan wants to follow and repeat. The trick is with visitors versus locals. Korea tried to expand its casino footprint as well, but had rules that encouraged local Koreans to gamble 10 years ago, not overseas visitors. Sadly, a pawn shop town of lives lost to gambling sprouted around the casinos. The tax revenue never really justified enough numbers for "the common good" within the country. 

This is the balance Japan is currently trying to determine. Which overseas visitor focus is enough to encourage solid tourist dollars from Asia? How much local gambling should there be with its possible demerits, deserve counseling or help for those "unlucky at the table" who live in Japan?

There is no easy answer and with 14 possible locations now in play, many rule variants and combinations can come out. The next few months will see more and more information released to the public, while the momentum is clear, casinos are on track for Japan's future by 2014.


For more Buy-Side and Sell-Side roles in Asia-Pacific, contact our TMJ Partners Japan & Asia Finance team.


Tokyo                                                              Tokyo
        Mark Pink                                                Shinichi Nagasawa

Tuesday, September 24, 2013

BlackBerry's Takeover by Fairfax (Prem's Parts Value Play)



Prem Watsa, CEO of Fairfax Financial is not dumb money. Billionaires rarely are when they are self made. What then really is the motivation for the takeover of BlackBerry and why now? Prem has been a shareholder for some time and already owns almost 10% of the firm. Why is the consortium wanting to take it over non-exclusive at this point? Fairfax Financial Holdings (FFH) has a current market cap of US$9BN today and is up 1% after the deal was announced. The acquisition target BlackBerry is also up 1%, that does not often happen in the market. Is this another confirmation case of the wisdom of crowds at play? 

Who is Prem Watsa anyway and is he a flash in the pan? No would be a clear answer. Born in India in1950, he joined his brother in Toronto, Canada in 1972, and has not looked back. Like Warren Buffet, he is a disciple of the classic investor Benjamin Graham, who wrote "the Intelligent Investor".  He started his career in 1974, with many of the people that he still works with today. Warren Buffet has worked with Charlie Munger, for a very long time. Long term executives know each other, respect each other and find the long-term professional career balance as a team are rare. Not loosing key executives and not having to change the executive team at Fairfax or it predecessor is a solid management strength. That kind of HR proof pays dividends too, and does so long term.

As explained, it could be the break up value of the various parts. Patents are now at a premium so if they could be sold separately, what would they sell for? Once private, the rest of the BlackBerry brand may be much cheaper.  It may also be worthwhile for a smaller player wanting to get into the space like Bloomberg terminal systems itself. Perhaps the financial information service is waiting for the patents to be sold before making a bid for the handset business on its own. During the recent Apple iPhone for the 5C/5S press conference recently, fingerprint reading on a mobile device received attention. This is already a technology in use by Bloomberg terminal users, so it may be a logical next step. For the right price, post any patent sale, it could indeed make the final price very attractive. Security is of vital importance to many financial users and if the device is good enough for the President of the USA, it may be safe enough with a fingerprint security system for less powerful executives in the financial world. 


For more Buy-Side and Sell-Side roles in Asia-Pacific, contact our TMJ Partners Japan & Asia Finance team.


Tokyo                                                              Tokyo
       Mark Pink                                               Shinichi Nagasawa

Thursday, September 12, 2013

東京オリンピック2020 (現地の声)

2020年の東京オリンピックの開催が決まった。安堵の相場上昇が始まった。今週と来週の始めは、多くの投資家の"株式を追いかけ"にともなう利益が見込まれるため、経験豊富な投資家は利益を確定している。野村、 MUFJ 、大和やその他の証券会社の動きはアクティブである​​。各証券会社は既に価格上昇が見込まれる主な株式詳細レポートをクライアントに送っていた。このブログではこの件に関する詳細には触れない。代わりに、東京及びその他の地域で実際に起こっていることを紹介しよう。

先週の日曜日に東京を歩いていると、多くの小売店で、 2020円の特別なランチセットを提供された。それは、通常の2倍のランチ価格だ。これは(A2人のための特別なランチ、または(B)高級ランチである。寿司屋、アイスクリームパーラー、コーヒーショップ、クレープショップなどで見受けられた。また秋葉原の小売業者は、3500円の扇風機を2020円に値下げし提供していた。

消費者の小売部門では、この新しい"特別価格·ポイント"の恩恵を受けることができるかもしれない。これは、売上高に新たなプッシュをもたらす可能性がある。これは、日本の小売売上高の減少を予測してきた多くの人々を驚かせるかもしれない。トレンドが終わる時、経験豊富な投資家はすでに準備が出来ている。

日曜日、日本のテレビは、一日中、オリンピック開催のニュースだった。小さなケーブルニュースサービスから国営放送NHKまで、東京開催ニュースで一日中覆われていた。日本全国で午前520分の様々なビデオシーンが何回も再生された。多くの市民は、開催決定の瞬間をライブで祝うために早朝から集まっていた。その後の話先の2020円スペシャルで話したとおりである。2020円スペシャルのような現象によって小売店の売上高は本当に驚く数字になるかもしれない。

多くのニュースは日本、主に東京における新たなオフィスの拡大に伴う不動産価格の上昇を取り上げた。他の多くのニュースではオリンピック契約にかかる建設ブームに焦点を当てている。他に何が見落としているだろうか?答えは、国際化+スポーツ&健康の新しいブームの波である。

大量の英語レッスンが、若い世代に求められるであろう。彼らは、新たな観光客の波に対する英語でのサービスの必要に迫られるが、これは一晩では達成できない。ホテル、レストラン、小売店、サービススタッフは英語の学習を開始するであろう。この現象が大きくなればECC 、イーオン、 GABA 、ココ、ベルリッツ(ベネッセグループ)を含む "英会話"として知られる会話学校の多くは、スモールキャップスペースでのIPO可能性もある。





For more Buy-Side and Sell-Side roles in Asia-Pacific, contact our TMJ Partners Japan & Asia Finance team.


Tokyo                                                                 Tokyo
             Mark Pink                                                   Shinichi Nagasawa

Monday, September 9, 2013

Tokyo 2020: The REAL TRADES (Under Construction)


The Tokyo Olympic bid for 2020 is clear and the first relief rally in is now play. The early days of this week and next week will see many investors "chasing stocks" that will benefit, but the smart money will be selling the winners on the news to the maximize P/L in a price exit. Nomura, MUFJ, Daiwa and others have all sent out research on the major stocks that had a winning bid priced in. This blog post will not explain this but instead explain the local story right here on the ground in Tokyo and other parts of Japan.

If you walked around Tokyo yesterday a number of retail firms were offering special lunch sets for 2020 yen. That is twice the usual lunch price, so it is either A) a special for 2 people, or B) a luxury high end offering. This was observed at sushi restaurants, ice cream parlors, coffee, juice and crepe establishments. One retailer in Akihabara offered summer fans (for cooling) on sale for just 2020 yen, down from the retail price of 3500 yen. 

The consumer sector in many retail areas may be able to benefit from this new "special price point". It could bring a new bump in sales traffic that may surprise many who have been expecting retail sales declines. Trends end and the smart money gets ready for it early.

If you were anywhere near a TV in Japan yesterday, all day long, from the national broadcaster NHK to small cable news services, the Tokyo bid was covered all day. In all parts of Japan at 5:20am local time, various video scenes were replayed over and over. This was not just Tokyo, but across Japan. Many citizens woke early in the morning to celebrate. The follow up story was the price specials at 2020 yen. As the first wave learn a second wave will follow, retail sales may really surprise.

Many stories have covered the real estate increases from new offices expanding in Japan, mostly in Tokyo. Many other stories have also focused on the construction boom from the Olympic contracts. What else is being overlooked? The answer is a new wave of internationalization plus sports & health. 

The amount of English lessons that will be pursued by a new generation will to need to service a wave of visitors that cannot be achieved overnight. Hotels, restaurants, and retail service staff will all start learning more English, conversation schools also known as "eikaiwa" including ECC, Aeon, GABA, CoCo, and Berlitz (Benesse group) may all be possible IPO plays in the small cap space if things mushroom.

Many news stories yesterday focused on the prestige of being a torch carrier for the Olympic flame. The Japanese do not prepare lightly, and many joggers mentioned that a big motivation for them was to run hard and get a chance to hold the flame. Mizuno and a variety of other sports retailers will all benefit from the health and fitness boom that could be on the way in the years to come. 



For more Buy-Side and Sell-Side roles in Asia-Pacific, contact our TMJ Partners Japan & Asia Finance team.

Tokyo                                                              Tokyo
          Mark Pink                                                       Shinichi Nagasawa

Wednesday, September 4, 2013

Asia Currency Crisis Part 2 CIIT Markets


Yesterday on Bloomberg Douglas E. Cote of ING US Investment Management stated emerging markets will change. In fact, we may be in the middle of a second Asian currency crisis as indeed Thailand has many more reserves compared to the first currency crisis during 1997/1998, but they still may not be enough to stave off the crisis. The percentage impact of these reserves in relation to the economic growth of emerging markets may not have kept pace in proper ratio.

The players in the current crisis may be different from 1997, but the Asia market impact is still the same. CIIT (China, India, Indonesia, Thailand) currency markets seem to be taking the brunt of the difficulty from any US Federal Reserve tapering but will this spread to other currencies in other emerging markets, and will first world economies follow?  India's currency restrictions on the Rupee are certainly not helping the current situation.

Are these emerging markets the first wave of a short term impact, and will other markets follow? If Australia is nothing more than a proxy from China, is that a logical expectation? 

Douglas certainly gives the FX observer in Asia. There is much lot to consider in this excellent Bloomberg interview. 

Click here for the full interview, as it is certainly worth a 4 minute look.


For more Buy-Side and Sell-Side roles in Asia-Pacific, contact our TMJ Partners Japan & Asia Finance team.


Tokyo                                                              Tokyo
       Mark Pink                                               Shinichi Nagasawa

Monday, September 2, 2013

NEWS UPDATE Bloomberg's Takeover Bid for BlackBerry, the Business Mobile Marriage


Morgan Stanley needs to find a balance on how to give its core staff more BYOD (Bring Your Own Digital) choice or just stick with BlackBerry in the future - They are not alone, and yet if major CTOs at banks in Canada, like Royal Bank of Canada or Bank of Montreal are already in final stages of the Z10/Q10 upgrade, is it truly that risky? After all, well-run conservative institutions often run smoothly on purpose.

A major US bank with 100,000 staff in a testing program (perhaps even JPM who are doing the sale) may not have to wait long if the upgrades happen smoothly with other major financial firms. Regardless the timing of any upgrade, sale or the delay of a possible sale, does have corporate client implications for BlackBerry and its core financial client base. 

Timing is everything, and BB users want the latest version to work more efficiently. 

Does Bloomberg have a scheduled timing plan that could be influencing various investment banks who would want a consolidated offering? The faster a sale by RBC or JPM to a new firm, hopefully to Bloomberg, the better for all, Morgan Stanley included. The financial clients are waiting.

To read the full article click here.


For more Buy-Side and Sell-Side roles in Asia-Pacific, contact our TMJ Partners Japan & Asia Finance team.


Tokyo                                                              Tokyo
       Mark Pink                                                 Shinichi Nagasawa

Wednesday, August 28, 2013

Bloomberg's Takeover Bid for BlackBerry, the Business Mobile Marriage



Now that JPMorgan and RBC have been hired as investment banking advisers to actively find a sale for BlackBerry, when will a Bloomberg bid or talks about it finally be released?


Emerging markets in Asia and the business community are now re-signing with BlackBerry after the Z10/Q10 release gained solid traction. Bloomberg has a solid core of 300,000 direct-terminal users worldwide, with over 900,000 when including shared access. Bloomberg also has a magazine readership with Businessweek worldwide in a variety of languages that will serve as a core consumer base for Bloomberg.


Since the release of the Z10 with its fast OS and full size smartphone look, smart phone users finally have a new larger screen to upgrade. The Q10 has the same faster OS but with the traditional keyboard that long-term loyal BlackBerry users AKA "CrackBerry" users like the president of the United States, Barack Obama prefer. This may not move the needle within traditional US markets, but if growth can be found in fast growing markets and slowly regain the business user in North America and Europe that could be the best way forward for BlackBerry.


Few outside of finance know but Bloomberg has been encouraging financial third parties to create special APPs; mainly for BlackBerry users that would smoothly integrate Bloomberg financial data at a corporate level for various banks and securities firms. The Android wave of growth has been strong and BYOD (Bring Your Own Device) has even started within financial firms, but no major mobile virus has spread yet. This BlackBerry security advantage will be another reason for Bloomberg to takeover BlackBerry and ensure a secure mobile future for the most secure business platform.


Long before Facebook, Bloomberg was already the oldest Social Media platform making BlackBerry a logical extension.


Lets hope JPMorgan or RBC will announce the talks once they begin as it seems to be the most logical takeover bid for both sides.


For more Buy-Side and Sell-Side roles in Asia-Pacific, contact our TMJ Partners Japan & Asia Finance team.


Tokyo                                                              Tokyo
      Mark Pink                                            Shinichi Nagasawa

Wednesday, August 7, 2013

What Does It Take To Be An Equity Sales Trader In Japan

Another innovative, fun and fresh way to communicate your job description.

Interested in learning more?  Contact us at resume@tmjpartners.com to learn more.


































For more Buy-Side and Sell-Side roles in Asia-Pacific, contact our TMJ Partners Japan & Asia Finance team.



Tokyo                                                           Tokyo
        Mark Pink                                             Shinichi Nagasawa 

Monday, August 5, 2013

Massive Inflow into Japan, Often from China Redemptions


Last week was July 31st, the last chance for many long only and hedge fund portfolio managers to justify returns on capital before a redemption decision.  Most investors have a 30-45 day notice cycle if they want to take their money back before the end of a quarter. If investors see a better return on capital from October 1st, that means in many cases they have to redeem between August 15 - 30. In fact, investors are looking to massively move China dedicated capital into Japan.

If you are running a portfolio as a hedge fund prop trader or a long only fund manager, these dates are important as they determine your income. No major money to run means no major bonus to look forward to.  Some poor performers always get nervous around redemption time. It is the season for excuses.  The industry knows the rules, and if you are a "beta jockey" riding a positive wave, your luck will end, and so will your capital base.  Only "Alpha PMs" win long term in this game.  Winning performers gain the most capital when returns have to be counted and allocated.

This year has been one of change: last December 2012 was a warning short for Japanese markets - a new prime minister, one of many, was actually going to change things for the better. If you heard that message early you rode a huge wave of positive beta first and booked positive alpha later.  Many Pan-Asia PMs that we speak to have debated how long Japan will have legs and if a China collapse will take place.  If you thought Japan would be a little pop you were wrong.  If you thought China would collapse you were wrong again.  The winners in the mix have seen China as dead money this year and moved capital allocations into Japan. Then these true "Alpha Players" of the market today picked shorts over the last three months and booked more profits for Japan.

At TMJ Partners, we listen to the Alpha players everyday, and contrast their opinions with the beta jockeys soon to be forgotten. Our professional market observations & insight let our financial clients know where to be before their rivals, and stay profitable. When it comes to client focus it is always win/win.


For more Buy-Side and Sell-Side roles in Asia-Pacific, contact our TMJ Partners Japan & Asia Finance team.



Tokyo                                                              Tokyo
    Mark Pink                                              Shinichi Nagasawa

Monday, July 22, 2013

Japan's Election, New Casinos, TPP & JGB Debt



The recent election in Japan on July 21 gives Prime Minister Abe control of both houses in the Japanese parliament. What English language media are not talking about is what it means for new casinos in Japan, and the ability to tax them and pay off Japanese Government Bond Debt. The plan for Japanese casinos will spread across the country connected to airports as the big whale gamblers are expected to be Asian tourists, especially mainland Chinese visitors.

Overseas investors have constantly complained of poor ability of future tax payers to pay for this debt. However, none of these investors seem to be aware of the coming casinos to Japan. These will not be private and therefore not run by the yakuza, or other overseas gangsters. They will pay into the government coffers and may even reduce national tax rates over time. The most likely central Tokyo location is scheduled to be in Odaiba; already in close vicinity to many hotels, and close to Tokyo's Haneda airport. An opening date of the first Japanese Casino is on July 1st, 2015. Due to pre-planning already in place, this is a reasonable soft target.

The Trans Pacific Partnership moves will now gain traction. It will bring more trade and travel to the region, and will certainly be boosted by new casinos in Japan. More visas to Japan are about to be boosted by Chinese tourist groups. This not a surprise to anyone walking around Ginza on any given day. Any observer can now see who is paying for the luxury goods in Japan' luxury stores. It is no longer local Japanese, but Chinese tourists. They feel comfortable buying luxury brands that are never fake, and occasionally even special editions unique to Japan. This all adds more appeal to the traveling tourist from Asia. Ginza stores are the perfect excuse to spend your Japanese Casino winnings in future years.

In the coming weeks and months, more details about these new Japanese casinos will spread in the English media. The connection and financial insight coming from this election into this new trend will impact retail sales, hotel bookings, restaurant reservations and short term travel. All future P/L will change in Japan. 

At TMJ Partners, we know finance, and we try and be in the right place at the time. With our professional market insight, we let our financial clients know where to be before their rivals.


For more Buy-Side and Sell-Side roles in Asia-Pacific, contact our TMJ Partners Japan & Asia Finance team.


Tokyo                                                              Tokyo
       Mark Pink                                               Shinichi Nagasawa
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Email pinkmark@tmjpartners.com                 Email nagasawa@tmjpartners.com

Wednesday, July 17, 2013

The Top 20 Global Banks are Increasingly Chinese, not American


Recently Fortune Magazine US released a list of the top 500 corporations. Within this list are the top 20 global banks based on revenue. Overall China claims four of them including ICBC (Industrial & Commercial Bank of China) the largest of them all, topping the global list with US$133.6BN in revenue. This makes ICBC more than twice the size of Deutsche Bank.
In fact four of the top ten banks on the list are Chinese, and only one is a Japanese bank - How the world has changed in just five years after Lehman Brothers collapsed. It is indeed a "brave new world", as James Bond 007 said in Skyfall, and I would tend to agree. Was it so long ago that Japan dominated the global-landscape of bank names with domestic firms virtually unknown in the global area? It is hard to now believe that in 1993 Dai-ichi Kangyo Bank was the largest bank in the world (ranked by assets), although few outside of Japan would have recognized the name. 
The players have indeed changed with only four of the top twenty on the list now being US firms. How can that be? Only four US banks is equal to China. Is that possible in 2013? What will the same list be like in another five years? Some financial analysts we deal with focus on financial sectors and some clients claim there is a ticking "time bomb of Chinese defaulting debt", but only time will tell. 
Others claim that Japan's bank Mitsubishi UFJ Financial Group, may fall from the list when the JGB debt explodes. Kyle Bass, a well known and vocal hedge fund managers says "this is in the cards", again time will tell. Some financial analysts we deal with are laser focused on financial sectors and know which case may be true and what may be a false skew. It is always about knowing which professionals have the best insight. At Experis Finance we know the right professionals and due to our global network we sharpen that edge every day.
Source - Fortune Magazine
From Here is the City
Fortune magazine has just released its Global 500 list of the world's largest corporations (as per 2012 revenues).
He's the top 20 banks (Global 500 ranking in brackets):
1(29). Industrial & Commercial Bank of China - $133.6bn revenues
2(41). BNP Paribas - $123.0bn
3(50). China Construction Bank - $113.3bn
4(55). JPMorgan Chase - $108.1bn
5(58). Banco Santander - $106.0bn
6(60). HSBC - $105.2bn
7(61). Societe Generale - $105.0bn
8(64). Agricultural Bank of China - $103.4bn
9(66). Bank of America - $100.0bn
10(70). Bank of China - $98.4bn
11(73). Credit Agricole - $95.1bn
12(78). Wells Fargo - $91.2bn
13(79). Citigroup - $90.7bn
14(85). Lloyds Banking Group - $86.8bn
15(116) Banco Do Brasil - $72.0bn
16(130). Deutsche Bank - $67.4bn
17(163). Mitsubishi UFJ Financial Group - $57.3bn
18(168). Banco Bradesco - $55.9bn
19(177). Barclays - $54.6bn
20(180). Landesbank Baden-Wurttemberg - $53.8bn
Source - Fortune magazine


For more Buy-Side and Sell-Side roles in Asia-Pacific, contact our TMJ Partners Japan & Asia Finance team.


Tokyo                                                              Tokyo
      Mark Pink                                             Shinichi Nagasawa