All posts by yimianwu

Time to include Renminbi in SDR basket?

By Yimian Wu

Financial experts from Hong Kong said in Chicago Wednesday that November will be a good time to include the renminbi, or RMB,  the Chinese currency, in the International Monetary Fund’s special drawing rights basket.

The SDR is an international reserve asset created by the IMF in 1969 to supplement its member countries’ official reserves. The IMF reviews its SDR basket every five years and the next review will be in November.

In its 2000 review, the IMF did not include the RMB in its SDR basket because it was not “freely usable.” However, in a press release last March, IMF Managing Director Christine Lagarde said she was “impressed by the rapid internationalization of Renminbi in recent years” and the IMF welcomes and shares the Chinese government’s objective to have the RMB included in the SDR basket.

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Italy protects food with geographic names

By Yimian Wu

Italy’s Trade Agency on Tuesday kicked off a three-year plan of promoting authentic Italian foods and beverages and fighting “Italian sounding” products that are actually made in the U.S.

Speaking to the press at FMI Connect, a food and beverage trade show at McCormick Place in Chicago, Carlo Calenda, the Italian vice minister for Economic Development, said the plan will include a media campaign and retail promotion with a budget of 39 million euros ($44 million) a year,

“To produce something with a geographic indication in Italy, you not only need to state the geographic area, but also to respect a very precise standard of profession that cannot be replicated. This keeps the very special taste to the products,” said Calenda.

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Founder of 1871 envisions the future of Chicago

By Yimian Wu

The founder of the high-tech incubator 1871, philanthropist J.B. Pritzker, called for risk-taking and revolution to create Chicago’s “next big thing” at the annual luncheon of the Metropolitan Planning Council on Wednesday.

“It is the idea that we are willing to take risks that is going to get us the next wave or the next answer. You have to think in really big terms,” said Pritzker.

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Yum’s decision in China: To dump or not to dump

Updated June 3 with comment from OSI Group LLC

By Yimian Wu

Hedge funds such as Third Point and Corvex Management favor Yum! Brands Inc., for one thing: China. But activist investors propose divesting Yum’s China division, which generates half Yum’s revenue, as a giant franchisee that would pay big, steady royalty fees.

According to Bloomberg, the founder of activist hedge fund Corvex Management, Keith Meister, said at a recent Sohn Investment Conference in New York that spinning off Yum’s Chinese business could create additional value of $16 per share.

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Gross domestic product sagged in first quarter

By Yimian Wu

The U.S economy contracted 0.7 percent in the first quarter as the trade deficit widened and business investment fell, according to the second estimate of gross domestic product (GDP) by the Commerce Department.

The result was revised from the first estimate of an increase of 0.2 percent released last month, but it was better than expected. According to Bloomberg, the median forecast of 84 economists expected a 0.9 percent drop.

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Community bank shares its recipe for success on its 40th anniversary

By Yimian Wu

How does a small, privately-owned community bank compete against the dominant banking giants?

Cultivating long-term personal relationships, developing niche products and embracing innovation such as a total interior redesign is how 40-year-old Countryside Bank survived a painful Recession-bred crisis and resumed profitable growth.

“Once when we were in Paris,” recalled Chicago customer Karen Fort, “we tried to use our debit cards and the machine wouldn’t take it. So Keith called the bank and they said ‘Hello, Mr. Fort! Sure.’ and they punched the numbers in the computer and they said, ‘Now try it again.’ In Paris, it worked.”

The Forts live across the street from Countryside Bank’s branch on Belmont Avenue on Chicago’s North Side. Keith said, “This is the only bank where when I walk in the door, the teller looks up and calls me by name.”

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Asset Managers eye Latin America’s middle class for growth

By Yimian Wu

Asset managers operating in Latin America hope to claim a bigger share of the growing mutual fund market, currently dominated by local banks, with more sophisticated equity products, said fund managers in the annual conference of the Chartered Financial Analyst (CFA) Society Chicago on Thursday.

Mutual funds operated by the local banks invest primarily in fixed income securities and local markets, conference participants said, so people in the emerging middle class are looking for alternative investments for their retirement funds.

There is significant room for growth in mutual funds in Latin America, said Lucas Ramirez, head of research at Sura Investment Management. According to him, although the region had only 2.5 percent of global assets under management in 2013, growth of managed assets in the past six years has been around 13 percent annually compared to a global average of around 6 percent.

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How Disneyland went wrong in Hong Kong

By Yimian Wu

Experts characterize China’s vast wave of “super consumers” as emerging middle class, aging customers and active e-commerce users.

As China is shifting from an investment-fueled economy to a consumption-driven economy, understanding consumer behavior is key to developing the right strategy to tap into the large consumer base, the experts said in a conference at Northwestern University’s Kellogg School of Management in Evanston on Saturday.

“It’s super consumers because there are 800 million consumers. They are changing the way China looks and feels,” explained Michael Zakkour, vice president at Tompkins International, a global business consulting firm.

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Groupon reports diminishing net loss, shares down

By Yimian Wu

Groupon Inc. announced its first quarter earnings with improving revenue, growing deals and users and a diminished net loss. Shares dropped 52 cents to $6.32.

In the quarter ended March 31, the Chicago-based online deals marketplace narrowed its net loss to $14.3 million, or 2 cents per diluted share, from a year-earlier loss of $38 million, or 6 cents per diluted share. Analysts estimated a net loss of 0.5 cent per share, according to Bloomberg.

Revenue increased 3 percent to $750.4 million from $728.4 million in the same quarter last year. Revenue in North America had the largest increase of 11.3 percent while revenue in the rest of the world dropped. The stronger dollar negatively impacted the revenue outside the country. Continue reading

Millennials want houses despite falling homeownership rate

By Yimian Wu

Despite the falling U.S homeownership rate and the rise of the sharing economy, owning a home is still part of the American dream for most Millennails, the 20- and 30- somethings.

A random sampling of college students in downtown Chicago shows a majority plan to purchase a home in the future. The primary reasons are family formation and “a place to call mine”.

The U.S. seasonally adjusted homeownership rate dropped to 63.8 percent in the first quarter, the lowest since 1989, according to the housing vacancies and homeownership report released by the Census Bureau last week. Continue reading