KL - beauty and fall of the city

I would say that the worst part of KL is the feeling it might give you. On first look booming. New and new buildings build. But than u sit in Uber and you talk to IT guy, that did lost its job 3 months ago. Than another one. Then some accountant. And all of them talk about period of 3-5 months. U sense be carefull is on table. Than u give deposit to 5* hotel and they try to cheat you. KL is changing. KL is challenging. Get friends, get motivated people around you. And prepare to rest, as many things will happen.

Hong Kong - banking and economy 2016-05

Hong Kong economy is visibly worse than before. Difference is seen on a street. Hong Kong island, part of HK that used to be the most luxurious part did remind me of Brazil. Streets are empty, dirty, pollution in the air, much less people, closed and anandoned shops covered by wood. On same places only few shining neons.

Banking is different. I did sense it used to be more strict. More privilege.

HKneese say, that they became 2nd type city of China! That mean that the most luxurious please in Asia is now second rank in China. And I agree.

Singapore - what do u need money for

In this short article I would like to explain the idea of the need of the money in the company and the way you shall be asking for it. Ocasionally it might be used vice versa, but it doesnt break the main principle.

1. I need money for anything I store, I keep to sell within one year or do not really touch before I sell it. It is considered as a short term asset, or opposite to liability. As a liability is a foreign debt I did no pay yet due to the payment terms you may also consider short term asset to be an foreign asset I hold as I did not sell iz yet.

For this purpose we seek a working capital financing. Or working investment. It is an amount of money company needs to cover its short term assets before they are sold.

Do not seek for a investment financing or IPO for such an purpose. Why?
a) the risk is calculated diffetently in the financing institution
b) money are much more short term
c) usually it is not comnected with the growth of your company to new locations

2. Company needs money to open new branch, reconstruct current building, buy a new technology that will be used in production, cell phones for the managemenet, cars....

Than seek for the investment financing, IPO, ....

This money is for much longer period and the current and projected profit is the main principle to provide the cash. Profit is meant the cash flow generated from profit. Usually it is an accounting profit together with interest expenses other than once connected with working capital plus depreciation, as it is a non cash flow operation in Profit and Loss statemenet. If there are extraordinary items happening theese items shall be withdrwawn too.

What is the main objective of this simple article?

Currently I mezlt investors that were pushing our company to isse shares and go IPO or even sell a part of company for our working capital. That is really an expensive solution, as working capital is just an issue of deffered payment for the asset I hold for certain time on stock and the time I need to pay for such a stock. Very expensive way of financinf of company would thetefore investment financing be.

Financial rating - retail portfolio

Financial rating, the probability of not being able to pay the downpayment on a selected date. Downpayment could be defined as an interest only (the main stress factor) and within 90 days overdue (as a main stress factor 2, than all debt has to be taken as a failed one).

Later it could be focused on a different factors. You may even mitigate the risk by taking deposit on an account in amount of 90 days downpayment. Or second debtor as a guarantor on the first debt. Or agreement with employer that a salary will go firstly on your account. You can also use other facility to decrease your facity risk - credit card to pay the interest client owes. Another mitigant is the acceptance of liquid downpayment, but not in cashm Such examples could be airline miles, electricity downpayment, accepting foreign currency, short term rent of the part of the property, additional work being done at home, phone bills...

Some of this solutions could not be useful in a real life, some could. Important is to keep the loan "alive" and push a solution. Many time "dead" loans are able to be colected one or two years after as the financial situation changed. It could be a secondary problem causing the loan downpayment not performing.

Why shall we focus on such a distress loans? this loans are usually niche on a market. Place where risk could be managed easily, as the assessment process was done properly, misfit could be 1 month or percentally small. Than the balance sheet, write off is better or smaller and income on such a loans is higher, as we can charge additional fees.

Europe banking

Current lending in Europe (central Europe) is in a status of low interest rates, lower wages for the employees (bankers) and primary forcus on the return of the bank on equity. As the price of the equity is qrowing (higher stock prices) we shall be looking on the double pressure, if not tripple pressure.
1. higher stock prices of the banks thus pushing the returns to go up too (profit/equity ratio)
2. very low lending rates thus low spread for banks
3. negative deposit rates that could not be reflected to real deposits (or the depositing clients will run out of bank balances).

Therefore banks need to think, need to optimize, need to lower the costs. Instead of providing more money to economy we can see lower investments than expected. We may blame Basel II and Basel III not allowing banks to loan SME projects, but investing in properties. And property prices grow and grow.

Than we have a central banks problem. Like the one in Hungary, where Central banks did setup some type of the "Save the children fund" for only purpose to print money to this fund and than pump them to political parties pockets and managements pockets.

PayPal - limits and wrong approach

Notes:
PayPal is a well known brand for sending money overseas. They are in money remittance system (XOOM). Expansion to developing countries. Payments by cell phones, relying on traditional banks. Showman vision as a CEO. 90% of transactions to put on internet. Facebook payments. Most secure payment system. 235 Billion transactions a year. Launched in 1999. Filipino workers in HK. Paydiant to ATM do secure. Innovating trough acquisition. Max Levcin as a co founder. Dan Schulman CEO. Separate from eBay. 169 million customers for PayPal wallet. Credit card/debit card. 4 billion transactions. Facebook messenger payment platform. 70.000 people around the world. Alibaba, Google to purchase PayPal. 25 trillion dollars as whole market. 6.6 billion USD on accounts to invest. OneTouch payment improvement. 10.000 costumer resperentatives.

PayPal, Qatar airways, Bloomberg