US And China Millennials Do Not Mark The End Of European Luxury

UBS | Following our recent launch report on European luxury we have undertaken an analysis of US and Chinese millennial (18-34 years) spending together with UBS Evidence Lab based on our survey of 2,109 consumers. We conclude that millennials will not mark the end to luxury consumption that some fear.


Redefining The China Dream

Caixin | Lijia Zhang burst onto the international literary scene in 2008 with a memoir about her rebellious journey from disillusioned factory worker who spearheaded a walkout in support of the Tiananmen Square demonstrators in 1989 to becoming a writer and journalist. Her first book, Socialism is Great! A Worker’s Memoir of the New China, published by Atlas & Co., describes how she dreamed of escaping the stultifying routine of factory life, while reading Jane Eyre hidden within the folds of The People’s Daily. The book has since been translated into seven languages.


‘One belt, one road’ and how China aims to lead trade between Asia and Europe

Iris Mir | China aims to recover the ancient Silk Road to create an unprecedented trade link between Asia and Europe. Least developed Chinese provinces would also benefit largely from the ‘one belt, one road’ project as Beijing will need to invest greatly in infrastructure and high-speed railways. Local governments see the project as a golden opportunity to revive stagnating growth.

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China: Winners and losers of faster reforms in 2015

ZURICH | UBS analysts | We expect reforms to accelerate in 2015. As the government moves toward systematic “rule by law” and the property downturn persists, more space will open up and pressure increase for economic reforms to accelerate. We see three themes for China’s reforms this year: growth support, risk containment and rebalancing. In other words, reforms that can unlock new sources of growth and bolster domestic demand, reduce economic and financial risks, or diminish/remove structural imbalances should advance most.

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Hu-Gang Tong puts China on path to strong capital market

SHANGHAI | By Qi Bing via Caixin | The smooth opening of the Hu-Gang Tong, the Shanghai-Hong Kong bourse linkage, marked the entrance of the Chinese capital market to a new era and was a major global event. It follows on progress China has made in opening up its markets after joining the World Trade Organization, and will hopefully greatly boost the country’s economic and social reforms in the years to come.

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In-depth: China desperate at cooling down the property bubble

Iris Mir | China’s real state market is cooling down. Rampant investment in the past few years has caused lingering oversupply and a drop in investment prices. Property developers suffer a very risky lack of liquidity and limited access to credit that prevents them from being able to repay previous loans. China’s real state sector represents a 15% of the national GDP; and it plays a crucial role in other sectors. The government is very keen on lending all the necessary support to maintain the speculative frenzy. But analysts believe that recent measures will not solve the structural problems of the housing market.

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Retail traditions hit a wall at Wal-Mart China

BEIJING | By Li Xuena via Caixin | Zhong Shidan started climbing the Wal-Mart career ladder 18 years ago after she joined the U.S. retail giant’s Shenzhen outlet as a shop assistant. Today, Zhong holds a high-level operations department position and oversees the company’s more than 80,000 employees in China. She goes by the English name Grace and works hard to reflect well on Wal-Mart as an executive who is persistent, smart and focused.

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The new ‘growth package’ from the EU

By Peter Lundgreen via Caixin | Last week, China’s biggest export destination, the European Union established a new growth package. The desired size of a new investment fund is 315 billion euros, and it will be called the European Fund for Strategic Investments (EFSI). During a period of three years, new investments financed by the fund are expected to lift annual GDP growth in the EU by 0.7 percentage points. The calculations from the EU show that the package can create between 1 million and 1.3 million new jobs.

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A hundred-year stagnation? For who?

By Alberto Forchielli via Caixin | The creation of the Asian Infrastructure Investment Bank (AIIB) is a necessary objective. Anyone who travels in the Far East finds confirmation of the desperate lack of efficient networks. With the exception of Japan and other developed economies, countries see their ambitions reduced by chronic underdevelopment. How can we forcefully industrialize agrarian countries if the goods produced are not transported on paved roads, via trucks, for eventual export?

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PBoC delivered asymmetric rate cuts, what’s next?

By Jian Chang (Barclays) | The PBoC announced after the market close on Friday it was lowering the benchmark interest rates, effective 22 November 2014. The cut will be asymmetric, with the 1y lending rate down by 40bp to 5.6% and the 1y deposit rate down by 25bp to 2.75% (Figures 1 and 2). Meanwhile, the central bank further advanced its interest rate liberalization agenda. Banks can offer deposit rates at 20% above the benchmark rate, up from 10% currently (the upward flexibility was first introduced in June 2012, also along with a 25bp cut in the deposit rate). The bank also removed the benchmark guidance for the 5y savings rate.