Elon Musk’s start-up devoted to meshing brains with computers was on Friday closer to its dream, having gotten a monkey to play the video game Pong using only its mind. Musk has long contended that merging minds with machines is vital if people are going to avoid being outpaced by artificial intelligence. A video posted on YouTube by the entrepreneur’s Neuralink Corp start-up showed a macaque named Pager playing Pong by essentially using thought to move paddles that bounce digital balls back and forth onscreen. “To control his paddle, Pager simply thinks about moving his hand up or down,” a voice narrating the video said. “As you can see, Pager is amazingly good at MindPong.” Neuralink devices were implanted on two sides of Pager’s brain to sense neuron activity, then the monkey played the game a few minutes using a joystick to let software figure out the signals associated with hand movements. Pager’s reward was banana smoothly served through a straw when he successfully batted the digital ball from one paddle to the other, according to the demonstration. After a few minutes, the “decoder” program figured out what neuron signals to look for and the joystick was no longer needed to play the game. “A monkey is literally playing a video game telepathically using a brain chip!!” Musk wrote on Twitter. The decoder could be calibrated to enable a person to guide a cursor on a computer screen, potentially letting them type e-mails, text messages or browse the Internet just by thinking, a blog post at neuralink.com said. “Our first goal is to give people with paralysis their digital freedom back,” the Neuralink team said in the post. Members of the team last year shared a “wish list” that ranged from technology returning mobility to the paralyzed and sight to the blind, to enabling telepathy and the uploading of memories
Several hundred people have already booked their tickets and begun training for a spectacular voyage: a few minutes, or perhaps days, in the weightlessness of space. The mainly wealthy first-time space travelers are preparing to take part in one of several private missions which are preparing to launch. The era of space tourism is on the horizon 60 years after Soviet cosmonaut Yuri Gagarin became the first person in space. Two companies, Virgin Galactic and Blue Origin LLC, are building spacecraft capable of sending private clients on suborbital flights to the edge of space lasting several minutes. Glenn King is the director of spaceflight training at the National Aerospace Training and Research Center, a private company based in Pennsylvania that has already trained nearly 400 future Virgin Galactic passengers for their trips. “The oldest person I trained was 88 years old,” King said. The training program lasts two days — a morning of classroom instruction and tests in a centrifuge. This involves putting the trainee in a single-seat cockpit at the end of an 8m-long arm and spinning them around to simulate gravitational force, or G force. A medical team is on hand at all times. NASA’s training for shuttle crew members lasted two years, but the duration has been drastically reduced by the commercial space industry because of the “numbers of people that want to get up in space,” King said. “We can’t take two years to train these people. We’ve got to get this down to a matter of days to get these people up,” he said. “These people aren’t crews, just strictly passengers,” King said. “For a passenger, there isn’t a lot of work for you to do other than just relax, endure the G forces of launch or re-entry, and then once you’re orbital, enjoy the view out the window.” King said the pass rate for
NO SURPRISE: Many investors are expecting inflation to increase, but as the Fed has said it would allow inflation to overshoot its target, stocks were not affected much
The S&P 500 and the Dow on Friday rose to close at record highs, posting a third straight weekly increase partly on a lift from growth stocks, with a late-day rally building gains ahead of the quarterly earnings season next week. Growth names have found their footing over the past two weeks after being outperformed by value stocks for most of the year. A pullback in the 10-year US Treasury yield from a 14-month high hit late last month encouraged buying in growth. Data showed US producer prices increased more than expected last month, bringing the largest annual gain in nine-and-a-half years. Many investors now expect higher inflation as COVID-19 vaccine rollouts help the US economy rebound from lockdowns, yet stocks showed little concern as the US Federal Reserve has maintained that it would allow inflation to overshoot its target. “This is why all week long [US Chairman Jerome Powell] was jawboning, he made sure everyone understood they were expecting a spike and they are ready for it; it wasn’t a surprise,” said Ken Polcari, managing partner at Kace Capital Advisors in Jupiter, Florida. “Which is why the market is not backing off, because he succeeded in jawboning the anxiety and stopped people from getting really panicked about it,” Polcari said. The Dow Jones Industrial Average rose 297.03 points, or 0.89 percent, to 33,800.6, the S&P 500 gained 31.63 points, or 0.77 percent, to 4,128.8 and the NASDAQ Composite added 70.88 points, or 0.51 percent, to 13,900.19. For the week, the Dow advanced 1.95 percent, the S&P rose 2.71 percent and the NASDAQ climbed 3.12 percent. The banks launch first-quarter earnings season next week, with Goldman Sachs Group Inc, JPMorgan Chase & Co and Wells Fargo & Co scheduled to report on Wednesday. Analysts expect profits for S&P 500 firms to jump 25 percent from a year earlier,
European stocks on Friday were subdued, but marked their longest weekly winning streak since November 2019 as hopes of a rapid recovery in economic growth offset doubts over the eurozone’s COVID-19 vaccination program. The pan-European STOXX 600 index was up 0.08 percent at 437.23 and posted a weekly increase of 1.16 percent after hitting an all-time high at the open, while the UK’s blue-chip FTSE 100 slipped 0.38 percent to 6,915.75, but rose 2.65 percent from a week earlier. Global sentiment was underpinned by the US Federal Reserve’s pledge to keep its super-easy policy in place, even as data showed the world’s largest economy kicking into higher gear. London equities have outperformed this week, with the domestically focused FTSE mid-cap index notching a record high as the UK gradually emerges from a strict winter COVID-19 lockdown. “While the UK and US have done relatively well on the vaccination roll-out, continental Europe has lagged, but they will sort it out later this year,” BCA Research Inc chief strategist Dhaval Joshi said. “You’ll see an early rebound in UK and US economies from Q2 onwards. In continental Europe, it will be later this year rather than Q2.” European stocks hit a series of all-time highs this week, despite setbacks on the vaccination front after European regulators found a potential link between AstraZeneca’s COVID-19 vaccine and reports of rare brain blood clots. “The year has been without a major correction so far, and with equity inflows continuing to hit new multi-year highs the sense of ‘irrational exuberance’ is building once again,” IG Group PLC chief market analyst Chris Beauchamp said. “Some measure of caution would seem to be the prudent approach until a more comprehensive conclusion can be drawn,” Beauchamp said. Investors are to shift their focus to the US earnings season next week, with profits at S&P 500 companies
Brazil is on track to harvest record amounts of soy, corn and other grains this year, fueled by newly booming demand for commodities, particularly from China. Farmers in the world’s No. 1 soy producer and No. 3 corn producer have been harvesting at a record pace, capitalizing on prices that have leaped to multi-year highs on world markets after plunging because of the COVID-19 pandemic last year. The South American giant got off to a slow start because of a drought last season in key grain-belt states, but now has a bumper crop coming in thanks to superb weather. “Grain production in Brazil continues at the record pace we have seen through the 2020-21 harvest season, with growth of 16.8 million tonnes, or 6.5 percent, over the last harvest,” the government’s agricultural supply agency Companhia Nacional de Abastecimento said on Thursday. Brazilian grain farmers expanded their total crop land this year by 68.5 million hectares , a 3.9 percent increase, it said. The soy harvest is forecast to come in at an all-time high of 135.5 million tonnes, 8.6 percent more than last year’s crop, which was itself a record. Corn is also on track for a record, with a forecast harvest of 109 million tonnes, up 6.2 percent. The huge crop has farmers working full-steam in places such as Salto do Jacui, which sits at the heart of farm country in the southern state of Rio Grande do Sul, Brazil’s third-biggest grain producing state. Working side-by-side, combines have been plying the golden fields, cropping the sea of soybeans under a bright blue sky. “We’re very happy with the results of this year’s harvest,” farmer Adroaldo Rossato said. “Thanks to great weather we had excellent productivity, and prices are also very high, way above previous years,” he said on a break from harvesting. Much of Brazil’s crop is set to head
The US dollar on Friday edged higher against a basket of currencies, paring some of the week’s losses, as a stronger-than-expected rise in US and Chinese inflation gauges drove up bond yields. The US dollar index was 0.13 percent higher at 92.18. “We’re seeing a consolidation in the broad US dollar today after a week of losses as inflation data from China and the US sparks the US treasury curve back into life,” said Simon Harvey, a currency analyst at broker Monex Europe. Data on Friday showed that US producer prices increased more than expected last month, resulting in the largest annual gain in nine-and-a-half years, fitting in with expectations for higher inflation as the US economy reopens amid an improved public health environment and massive government funding. Inflation is expected to heat up this year, driven by pent-up demand, and as the weak readings last spring drop out of the calculation. Prices tumbled early in the COVID-19 pandemic amid mandatory closures of non-essential businesses across many states to slow the first wave of COVID-19 infections. Most economists and US Federal Reserve officials believe higher inflation will be transitory because of labor market slack. Earlier on Friday, data showed that China’s factory gate prices last month beat analyst expectations and rose at their fastest annual pace since July 2018, the latest sign that a recovery in the world’s second-largest economy is gathering momentum. The US dollar was also helped by data showing a second straight monthly drop in industrial production in Germany, further boosting the likelihood of Europe’s biggest economy having contracted in the first quarter. Still, the US dollar’s rally this year appears to have run out of steam. Despite Friday’s gains, the US dollar index finished the week down 0.89 percent, its worst weekly showing this year. “I guess this may only be a pause with the
Shares on Friday fell in most Asian markets after China reported a bigger-than-expected rise in prices that could prompt authorities to act to cool inflation. Japan’s benchmark Nikkei 225 index rebounded after falling the day before, but shares declined in Taiwan, Hong Kong, Shanghai, Sydney and Seoul. On Thursday, stocks closed moderately higher on Wall Street, lifted by gains in large technology companies that benefit from lower bond yields, but an increase in jobless claims dented some of the buying enthusiasm. China reported that consumer prices rose last month due largely to a jump in fuel prices, while producer prices climbed at the fastest pace in more than four years. China’s consumer price index rose 0.4 percent last month compared with minus-0.2 percent in February, as fuel prices jumped nearly 12 percent from a year earlier. Prices paid by manufacturers rose 4.4 percent from a year earlier. Inflation reflects rising demand as China’s economy leads the globel recovery from the COVID-19 pandemic. Worries that stronger growth might spur inflation that regulators in many major economies would then move to cool, partly by raising interest rates, have been hanging over markets for the past several months. China’s central bank already has ordered lenders to slow the pace of credit growth to counter rising risks. Added to that, a fresh round of US sanctions, this time against seven Chinese supercomputer makers, has revived concern over trade friction between the two largest economies, Oanda Corp senior market analyst for Asia-Pacific Jeffrey Halley said. “Asian markets are once again adopting a more cautious posture today. Geopolitics is never far from the surface, even if it is often lost in the global recovery noise,” Halley said in a report. Taiwan’s TAIEX ended down 72.34 points, or 0.43 percent, at 16,854.1, but rose 1.71 percent from a week earlier.
Oil posted its worst week in three amid concerns that rising global COVID-19 cases are slowing the economic recovery. West Texas Intermediate for May delivery on Friday dropped 0.47 percent to US$59.32 a barrel, and ended the week down 3.47 percent, its biggest weekly loss since the middle of last month. Brent Crude for May delivery fell 0.4 percent to US$62.95, declining 2.94 percent from a week earlier. OUTPUT INCREASE With the OPEC and its allies planning to start raising output, markets are now focused on whether the demand recovery will be enough to absorb growing supplies. While consumption is climbing in India and the US, rising COVID-19 cases and the possibility of stricter travel limits in Europe are muddying the forecast and putting pressure on crude. Oil on Monday plunged after the UK said it might delay global travel beyond May 17. “The COVID situation has really not had a strong recovery in Europe and across many emerging markets, and that’s really weighed down the demand outlook for oil,” Oanda Corp senior market analyst Edward Moya said. US DOLLAR A stronger US dollar also weighed on oil on Friday, reducing the appeal of commodities priced in the currency. A higher-than-expected rise in US producer prices last month stoked inflation concerns. “If we get some hotter inflation readings, that could send [US] Treasury yields higher again,” negatively impacting oil, Moya said. Saudi Arabia said it remains confident that OPEC+ made the right decision to increase production over the next three months, and there are signs of better days ahead for demand that could soak up the additional barrels. CALCULATING DEMAND India’s oil-products demand last month rose to the highest since late 2019, while Germany reiterated support for a short, strict lockdown in the country. In the US, traffic is roaring back in some cities, an indication of better demand this summer. Making
NO SIGN OF SLOWING: A statistics official said that shortages of components and shipping delays have prompted firms to build up inventories and increase prices
Exports last month soared 27.1 percent year-on-year to a record US$35.89 billion, as inventory demand for all product categories gained unprecedented traction amid component shortages and shipping delays, the Ministry of Finance said yesterday. The growth momentum might extend into this quarter, buoyed by expectations of a global economic recovery, although the COVID-19 pandemic continues to pose uncertainty, the ministry said. “Component shortages and shipping delays have prompted companies to build up and vie for tech and non-tech products, and push up their selling prices,” Department of Statistics Director-General Beatrice Tsai (蔡美娜) told a news conference in Taipei. The phenomenon is supported by economic improvement around the world following vaccine rollouts, Tsai said, adding that exports this month might also increase by a double-digit percentage point to more than US$30 billion. Shipments of electronics surged 24.5 percent to US$13.45 billion, led by a 24.5 percent increase in semiconductors, a 45.2 percent jump in capacitors and a 35 percent gain in LEDs, the ministry said in its monthly report. Local suppliers of chips and passive components have indicated plans to increase selling prices, as demand shows no signs of abating, it said. Exports of information and communications devices rose 38.9 percent to a record US$92 billion, thanks to avid demand for personal computers, accessories and related products, such as routers, switches and data storage devices, it said. Tsai dismissed concern over double-booking, saying that order visibility is clear through next year for manufacturers of notebook computers, chips and machinery equipment. The boom extended to non-tech sectors, as exports of plastic products and electrical machinery swelled 39 percent and 29.3 percent respectively to US$2.59 billion and US$2.46 billion, both the highest in history, Tsai said, adding that shipments of textile and mineral products swung into positive territory. Imports, a gauge of capacity expansion plans among local firms, spiked 38.4 percent to
SUPPLY CONSTRAINTS: The firm is close to finalizing contract negotiations for the second quarter, its president said, adding that prices would rise month by month
DRAM chipmaker Nanya Technology Corp (南亞科技) yesterday posted its best quarterly profit in three quarters as work-from-home and remote schooling trends helped improve demand for Chromebooks and other consumer electronics. The chipmaker said that it expects the growth momentum to extend into this quarter, as the global economic outlook has improved amid increasing COVID-19 vaccinations. Recovering demand for servers is adding to the already resilient sales of notebook computers, mobile phones, TVs and networking devices, it said. “We are close to finalizing contract negotiations for the second quarter,” Nanya president Lee Pei-ing (李培瑛) told a media briefing. “Prices are going up month by month in the second quarter.” That bodes well for the chipmaker to report a better financial performance this quarter than last quarter, which was itself a significant improvement, Lee said. Demand is strong in almost every segment, led by consumer electronics, so memorychip supply will become scarce this quarter, he said. The supply constraints might last through the end of this year, hinging on COVID-19 vaccination rates and how a US-China trade spat develops, with “overbooking” and a supply crunch of key components crucial to supply-demand dynamics, he said. There might be a crunch in TV supply chains similar to what occurred with a shortage of automotive chips, Lee said. On the supply side, the increase of new DRAM manufacturing capacity is quite slow, as major global chipmakers are cautious about capital expenditure in the first half of this year, even though supply chain inventories are running low, Lee said. Supply of less-advanced DDR3 DRAM has become tight lately, as some chipmakers have allocated capacity for image sensors and power management chips, he said. That boosted DDR3 DRAM prices, he said. DDR3 DRAM, which is mostly used in consumer electronics, accounts for 30 to 40 percent of Nanya’s total capacity, he added. The company expects shipments to remain flat
Taiwan’s three listed freight forwarders yesterday reported annual growth in first-quarter revenue as freight rates remain high amid rising demand. T3EX Global Holdings Corp (台驊國際投資控股) reported the largest increase, 133.16 percent to NT$5.89 billion (US$207.13 million), ahead of Dimerco Express Corp’s (中菲行) 66.4 percent growth to NT$6.89 billion and Soonest Express Co’s (捷迅) 35.69 percent expansion to NT$1.06 billion, data from the companies showed. T3EX’s revenue generated from sea freight business advanced 208 percent from a year earlier to a record NT$3.86 billion in the first quarter, the company said. Sea freight business contributed 65 percent of the firm’s total revenue last quarter, up from 52 percent last year, it said. The growth came as sea freight rates were buoyed by a shortage of containers and workers, unsolved congestion at ports and stronger-than-expected demand for freight transport, T3EX said in a statement. The Shanghai Containerized Freight Index, which reflects spot freight rates on major routes that Shanghai is on, was above 2,500 points from January to last month, compared with the same period last year when it ranged from 900 to 1,000 points. ‘ADVANTAGE’ “When it is more difficult to book cargo space due to demand exceeding supply, we have an advantage over peers with smaller business scale, as we have a better connection with shippers,” T3EX said. The air cargo forwarding business grew 57 percent to NT$1.3 billion in the first quarter, the company said. It contributed 22 percent to the company’s total revenue, compared with 33 percent last year, as air cargo rates began to fall in February, it said. The Baltic Exchange Air Freight Index showed that rates from Hong Kong to North America fell to US$5.48 per kilogram on average last month, down from US$6.43 per kilogram in January, while rates from Hong Kong to Europe fell from US$4.28 per kilogram to US$4.05 per kilogram. AIR RATES Air
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday reported a third straight quarter of record sales, underscoring its lead as the world’s No. 1 maker of advanced chips, which are in short supply. Taiwan’s largest company said that first-quarter revenue climbed 16.7 percent to NT$362.41 billion (US$12.74 billion), compared with the average NT$360.5 billion of analysts’ estimates. TSMC in the middle of January said that its revenue for the three-month period was expected to range from US$12.7 billion to US$13 billion after the estimate was converted into a range of NT$354.97 billion to NT$363.35, based on the average exchange rate of NT$27.95 at the time. The strong showing in the first quarter came after TSMC smashed its records by posting NT$129.13 billion in sales last month, up 21.2 percent from a month earlier and 13.7 percent from a year earlier. TSMC has kept its fabs running at “over 100 percent utilization” over the past year, chief executive officer C.C. Wei (魏哲家) told clients in a letter recently. The company — already planning capital spending of as much as US$28 billion this year — plans to invest US$100 billion over the next three years to expand its capacity, he said. “TSMC is investing aggressively to capture the structural and fundamental increase in underlying demand driven by long-term growth megatrends from 5G and high-performance computing,” Citigroup Inc analyst Roland Shu (徐振志) wrote in a note. The spending target implies that TSMC’s revenue could reach as much as US$95.1 billion in 2024 and the firm “is on the march to be the largest semiconductor company by revenue in 2024-2025,” Shu said. TSMC has scheduled an investors’ conference on Thursday next week to detail its first-quarter results and give guidance for the second quarter, as well as for the whole of this year. Analysts said that the company’s sales growth momentum would continue with
Elevator supplier Golden Friends Corp (崇友實業) yesterday posted NT$330.48 million (US$11.62 million) in revenue for last month, a 38.7 percent rise from a month earlier, amid continued recovery in the local property market, although the figure fell 15.15 percent from a year earlier. Revenue in the first quarter totaled NT$1.03 billion, a 3.66 percent increase from a year earlier, Golden Friends data showed. Replacement of old elevators rose 16.35 percent, accounting for 24.69 percent of overall installments, or 500 elevators, in the January-to-March period, the Taipei-based company said in a statement. Its maintenance and repair business serviced 37,100 elevators and escalators in the quarter, an increase of 4 percent from a year earlier as government agencies and companies become more aware that elevators play an important part in building safety, it said. Golden Friends is upbeat about its business going forward, even though developers might turn cautious following a spate of unfavorable policies to cool the property market, as real demand for housing and office space remains, the company said. Firms shifting manufacturing facilities home from China would also lend support to its business, it said. Contracts on hand so far this year have spiked 18.05 percent from the same time a year earlier, laying a healthy foundation for business in the short to medium term, Golden Friends said. It intends to boost its market share by spending more to improve the ease and convenience of elevator rides, helped by the latest technologies, it said. Last month, Golden Friends proposed a cash dividend of NT$3 per share based on its net income of NT$726 million last year, or earnings per share of NT$4.1.
Sales of insurance policies online dived 37.3 percent year-on-year to NT$2.49 billion (US$87.57 million) last year, as people lost interest in interest-sensitive annuities amid falling returns and bought fewer travel insurance policies due to border controls, the Financial Supervisory Commission (FSC) said on Tuesday. The number of travel insurance policies sold online plummeted 68 percent annually to 156,683, the lowest in three years, while first-year premiums (FYP) generated from such policies dropped 72 percent year-on-year to NT$35 million last year, commission data showed. The number of interest-sensitive annuities sold online plunged 76 percent to 4,232, while the FYPs they generated fell 67 percent to NT$767 million, the data showed. Interest-sensitive annuities were not as popular because many life insurers cut their declared interest rates amid a global rate cut cycle, Insurance Bureau Director Tsai Huo-yen (蔡火炎) said. Declared interest rates decide the distributions a policyholder gains. By comparison, accident insurance products, including car and scooter insurance policies, had mild growth in the number of policies sold online and the FYPs they generated, as demand for such products was not affected by the COVID-19 pandemic, Tsai said.
Taipei Deputy Mayor Tsai Ping-kun, second row center, Taipei Department of Information and Tourism Commissioner Liu Yi-ting, second row left, and performers yesterday pose for a photograph at the Taipei City Government booth on the first day of the Taipei International Spring Travel Fair at the Taipei World Trade Center’s Exhibition Hall 1. The four-day event, which offers tour packages, as well as bargain hotel and restaurant vouchers, runs until Monday.
RICH V POOR: Officials said the COVID-19 pandemic offers a vehicle to accelerate investment in green projects and ‘limit the long-term threat from climate change’
Policymakers must continue to spend money to shore up the global economy and ensure that no one is left behind, the IMF said on Thursday, warning that the recovery from the COVID-19 pandemic is not yet over. Without that aid, and additional financing from the IMF and the World Bank, developing nations and poor people in many countries could struggle to rebound from the downturn, the IMF said at the conclusion of its spring meeting. Continued support is needed to “mitigate and heal economic scars,” IMF managing director Kristalina Georgieva told reporters. “We want to make sure everybody has a fair shot to a better life.” That means accelerating access to vaccines and taking advantage of the opportunity presented by the pandemic to invest in green technology, which can create good paying jobs and address climate change, she said. US Secretary of the Treasury Janet Yellen joined the call, urging “significant” new spending to ensure a solid rebound. While the economic outlook has “improved significantly,” especially due to substantial government support, “the job is not yet done, given high uncertainty and the risk of permanent scarring,” Yellen said. “I urge major economies to not just avoid removing support too early, but to strive to provide significant amounts of new fiscal support to secure a robust recovery,” she said. The IMF now projects global growth of 6 percent this year after a 3.3 percent contraction last year, and credited the US$16 trillion in global public spending during the pandemic with keeping the worst peacetime recession in a century from being three times as severe. However, Georgieva warned about a “dangerous divergence” in low-income countries’ prospects compared with rich nations, which could worsen if advanced economies such as the US raise interest rates sooner than expected. She praised the IMF members who agreed to allow the fund to issue US$650 billion
SIZE ISSUE: Jerome Powell said that many Americans would struggle to find new jobs because some industries would likely be smaller than before the pandemic
The US economy, boosted by quickening vaccinations and signs of rapid hiring, is headed toward a strong recovery, US Federal Reserve Chair Jerome Powell said on Thursday. However, he warned that not all people would immediately benefit. “There are a number of factors that are coming together to support a brighter outlook for the US economy,” Powell said during the virtual spring meetings of the IMF and the World Bank. Those factors are putting the nation “on track to allow a full reopening of the economy fairly soon,” he said. Still, Powell said that many Americans who are out of work would struggle to find new jobs because some industries would likely be smaller than they were before the COVID-19 pandemic. In other cases, employers are seeking to use technology instead of workers where possible, he said. “It’s important to remember we’re not going back to the same economy,” Powell said. “This will be a different economy.” Powell spoke along with other world economic leaders during the meetings of the two global lending agencies. WTO Director-General Ngozi Oknojo-Iweala said that an unequal distribution of vaccines could threaten the global economic recovery. Just 0.1 percent of vaccines have gone to low-income countries, she said. “If we don’t do something to change the pace at which the poorer countries are getting access to vaccines, it will take a long time to get to herd immunity for the world,” Oknojo-Iweala said. That, in turn, could threaten those nations already vaccinated by spreading new variants that could push up case counts and reverse economic progress in wealthier countries. Powell also endorsed the idea of more government investment in the US, although he said that he was not referring to any particular legislation. US President Joe Biden earlier this week proposed a US$2.3 trillion infrastructure investment package.
Toshiba Corp’s board yesterday issued a statement in the wake of CVC Capital Partners’ offer to take the Japanese conglomerate private, warning that the proposal is preliminary and might not lead to a transaction. CVC’s offer is not legally binding and many details still need to be worked out, Toshiba Corp board Osamu Nagayama chairman said. Any deal also requires extensive regulatory reviews and CVC would have to organize a consortium to line up financing, Nagayama said. “We expect that such financing process would require a substantial amount of time and involve complexity for consideration,” he said. Directors would conduct a “careful review of the initial proposal when it is further clarified in the future,” he said. Toshiba’s shares slid 5.4 percent in trading yesterday. The board also said that the CVC proposal was “completely unsolicited and not initiated by Toshiba.” The company this week said that CVC made an offer to buy out its public shareholders. The preliminary proposal is for ￥5,000 per share or about ￥2.28 trillion (US$20.7 billion), Bloomberg News reported. An acquisition by a foreign buyer might prove difficult because the company has been considered an icon of Japan and several of its businesses have deep strategic importance for the country. Its nuclear unit, for example, is involved in decommissioning the wrecked Fukushima Dai-ichi nuclear power plant. Toshiba is also the largest shareholder in memorychip maker Kioxia Holdings Corp. Given the sensitivity around Toshiba’s bushiness, Japanese government approval would be required for the deal, Japanese Chief Cabinet Secretary Katsunobu Kato said. Separately, Toshiba this week reappointed its chairman, Satoshi Tsunakawa, as an executive officer to have him deal with its largest shareholder, Effissimo Capital Management, people familiar with the matter said. The board approved the decision during a meeting on Wednesday, said the people, asking not to be identified because the matter is private. The move gives Tsunakawa a more central
The Chinese government on Thursday told smaller, local financial institutions to step up risk management and avoid “excessive” growth, stepping up a campaign to clamp down on a build-up in debt as the economy stabilizes. At a meeting of the Chinese Financial Stability and Development Committee, Chinese Vice Premier Liu He (劉鶴) called for “zero tolerance” on illicit activities, telling regulators to improve supervision of shareholders and owners of financial institutions, risk concentration, connected transactions and data authenticity, an official statement said. With the COVID-19 pandemic largely contained and the economy rebounding, policymakers are shifting their focus to deleveraging, a long-standing goal shelved during a trade dispute with the US and further delayed by the pandemic. Last year’s stimulus pushed debt to almost 280 percent of annual economic output, with banks alone doling out a record 19.6 trillion yuan (US$3 trillion) in cheap credit. “The committee meeting signals that China will conduct a systematic review of local financial institutions, especially the ones related to local governments, to resolve risks,” said Cao Heping (曹和平), a professor of economics at Peking University. The People’s Bank of China has also told the nation’s major lenders to curtail loan growth for the rest of this year after a surge in the first two months stoked bubble risks, people familiar with the matter have said. At a meeting with the central bank on March 22, banks were told to keep new advances this year at roughly the same level as last year. Over the past three years, the banking regulator has zeroed in on the nation’s about 4,000 small city and rural banks, which are struggling with bad loans and poor corporate governance. These institutions have amassed one-quarter of total banking assets by the end of last year and their lending growth — fueled by interbank borrowing and shadow financing — has often
RSS