12-10-2011, 09:05 AM
(12-10-2011, 12:58 AM)d.o.g. Wrote: [ -> ]IMHO David Webb was justified in criticizing the Rusal offering as it was clear that HKEx was bending/amending its own rules.
As for the issue of Manchester United trying to use a structure that would have left the Glazers in control, it is a free market. I agree with Chen Show Mao's view that if you don't like it, don't buy it. Nobody forced you to invest.
Regarding the furore over unequal voting rights, people seem to forget that SPH has a dual-class share structure too. There are ordinary shares, held by regular shareholders, and there are management shares, held by various entities such as Great Eastern, OCBC, NTUC Income, SingTel, DBS, UOB, NUS and F&N.
The management shares outstanding are equal to only 1% of the ordinary shares in issue, but they have 200x voting power when it comes to "any resolution relating to the appointment or dismissal of a director or any member of the staff of the Company". In other words, the holders of the management shares wield unlimited power since they can appoint or dismiss anyone at the company, from the cleaning lady all the way up to the chairman of the board.
Clearly, the holders of ordinary shares have no say at all over the affairs of the company. The ordinary shares are effectively non-voting shares; you can vote, but it's meaningless since you will always be outvoted on the really important matters. Yet, there are plenty of people who own ordinary shares in SPH. Either they are all completely deluded about their voting rights, or they don't care about their lack of voting power.
As to who can own management shares, that is stated in the Newspaper and Printing Presses Act. I will leave interested readers to enlighten themselves at the Attorney-General's Chambers:
http://statutes.agc.gov.sg/
Big Toe Wrote:Do we want Sub-prime loans being offered to the investing public?
Seriously, do we really want that?
Whether we want it or not, we already have it.
1. Babcock and Brown Global Investments (now Global Investments) was a fund whose investments included sub-prime loans. It listed without any objections from SGX or MAS. Investors took severe losses during the 2008-2009 crisis, and it still trades at less than 20% of its IPO price today. I wrote on Wallstraits about BBGI when it went IPO and pointed out the awful things it owned. Didn't seem to stop people from buying it and losing money.
2. The Lehman Minibonds were far worse than sub-prime loans. Investors who bought them did not become sub-prime lenders, they became sub-prime insurers. Needless to say the losses suffered were horrendous. MAS was happy to let the financial institutions sell them, and when the Minibonds blew up the punishment was that the financial institutions couldn't sell these things for 6 months, which was no punishment at all since the bad PR meant nobody could move these things anyway.
The reality right now is that we have a disclosure based regime, which essentially means you can do anything you want, within the law, as long as you disclose it. Whether it is ethical or not is not the concern of the authorities, they are only concerned with legal matters, not moral matters.
Investors have to learn to think for themselves and not depend on the government to spoonfeed them. Kind of like how children have to be allowed to fall down and fail sometimes, otherwise they will never learn to get up and fend for themselves.
Hi Dog,
Don't be mistaken or even discouraged about your "super" educational articles from time to time. Just remember there are none so blind who cannot see. For me there are none so stupid who don't want to learn. For people like us(no financial education at all), we are ever thankful for people like you, giving priceless "financial education'. It's up to us to interpret information correctly and act accordingly.
i was "lucky" enough to read public articles about very hot "CDO" "guaranteed" structured products at that time sold by our banks; and thank GOD i gave them a wide berth.
And it's true, many times i am tempted to invest in something push by bank's RM, products which i can't understand fully.
Now, i won't touch/buy anything with the word "guaranteed" unless i understand fully what guaranteed means. Never presume.
You see i know i am an ignorant and i consider very fortunate to be able to blog here learning from knowledgeable people like you.
Cheers!
(And thanks to people like you).
Caveat Emptor is always applicable no matter what comes after.