* * * * * * * * * T E R R I E 'S T A K E * * * * * * *
A weekly roundup of news & information from Terrie Lloyd.
General Edition Sunday, November 23, 2008 Issue No. 495
- What's new
- Candidate roundup/Vacancies
- Upcoming events
- News credits
SUBSCRIBE to, UNSUBSCRIBE from Terrie's Take at:
----------------- PBXL - CUT COSTS NOW! -------------------
Looking for ways to cut expenses in your existing operations
in Japan and around Asia?
If so, PBXL's CommDown program is perfect for you.
Focusing on telecom expense management, our shared savings
approach ensures that you DON'T PAY unless you save.
Contact us today for more information!
+++ WHAT'S NEW
The Japanese stock market is bouncing around like a yo-yo
and investors are getting dizzy. As many market bears have
been saying, it's starting to look like this is no ordinary
recession and perhaps it's time for us all to start
thinking further ahead about what else might happen.
Just to quickly review, on October 27th, just four weeks
ago, the Nikkei 225 Average dropped to its lowest point in
26 years, when it temporarily hit 7,141.27. Since then, the
Nikkei has been up as high as 9,521 two weeks ago, and down
to a new low of 7,406 last Friday -- although investors
recovered confidence later in the day and the Average ended
up at 7,910. With extremes like this, including 6.4% from
peak-to-trough in just one day, it is no wonder that most
people are sitting on the sidelines, waiting for the storm
to pass. But will it pass any time soon?
The seesawing action of the Nikkei isn't just happening in
Japan. If you overlay the Nikkei 225 chart on the Dow Jones
Industrials Average, you'll see that almost every move of
the DJI is tracked a day later by a similar but even more
pessimistic reaction in the Nikkei. Clearly Japanese
investors look to the USA for leadership and market
direction, and respond accordingly. There is a strong
belief that the U.S. is still the world's financial engine,
and what is bad for the U.S. can only be worse for Japan.
With this going on day after day, and with little change likely
until Barak Obama is sworn in and his new government has a
few weeks to settle the markets with new legislation and
programs, what is an investor to do? Is this a chance of a
lifetime to get into Japanese stocks cheaply? Or is it
better to keep your powder dry in case the markets slump
Further, if this recession develops into a global
depression, then what are some of the more extreme
possibilities in regards to Japan?
---------- Japanese Labor/Employment Law Seminar ----------
CCH Japan presents the "Topical issues of Japanese Labor/
Employment Law" seminar
Covered in the seminar are the following key topics:
Basic explanation working hours
- Regulations on working and rest hours
- Holidays and annual paid leave
- Discretionary working hour system
Overtime work allowance
- Failure to pay overtime work allowance
- Back payments of overtime
- Discussions with employment standards inspection offices
Date : Thursday, November 27, 2008 1:20PM - 5:00PM
Venue: Arcadia Ichigaya (5F, Hodaka)
(4-2-25 Kudan-kita Chiyoda-ku, Tel:03-3461-9921)
Fees: Terrie's Take Readers - JPY20,000 +Tax
(Regular price- JPY25,000 +Tax)
Number of Seats: 50, Language: English
Speaker Attorney from Anderson, Mori and Tomotsune LLP
We are not stock trading professionals, but being in
business requires us to steer our companies and teams
through the rocky shoals. Doing this requires a certain
awareness of global economics and market fundamentals.
These "fundamentals" are of course all about human
confidence, and in the current environment they have
almost nothing to do with actual financial results. If
people lose confidence, then the trust which is so
important for companies to trade with each other also
evaporates, and everyone sits on their own pile of cash
waiting for that trust to magically reappear again. We think
it will be a while before the thaw happens, and indeed,
there is likely to be further freezing first. After all,
some big Japanese companies are still out there buying up
assets as if there will be no recession.
We've been following the commentary on three of our
favorite websites to get a feel for where investors will turn
and what the likely direction of this downturn will be. The
three sites are The Daily Reckoning
(www.dailyreckoning.com), Seeking Alpha
(www.seekingalpha.com) and of course the Nikkei
(www.nni.nikkei.co.jp, subscription required). Over the
last few weeks, commentators and editors have been
opining that the smart money is picking "basic living"
industries to be in, since these businesses will still
continue to trade even if the downturn becomes a lot
worse. By "basic living" we mean food and toiletries
companies, and public utilities and transportation
In Japan at least, food and utilities will always be the
safest stocks, because it's not possible for the populace
flee to the countryside and grow their own vegetables.
Certainly Japan's biggest punters think this, and it is
probably no coincidence that Itochu, one of the largest and
most successful of Japan's trading companies, has just
announced an investment of US$700m to buy a 20% stake of
China's biggest food processing company Ting Hsin. Amongst
other things, Ting Hsin controls that country's biggest
instant noodles maker, Tingyi Holding. Whether Itochu is
just thinking about the China market (unlikely) or plans to
somehow migrate their investment back to the Japanese
market is unclear at this stage. However, what is clear is
that company is diversifying to supplement recession-
sensitive minerals with more immediately sellable food
and other consumables.
Apart from food and toiletries, other sectors that we
expect to grow as the recession bites harder are: tobacco,
alcohol, and perhaps surprisingly, home entertainment. We
choose this last sector because we feel that as people get
more depressed with their situation, they will look to
escape reality. And while being drunk can be fun for a
while, entertainment for the mind is much better value.
Internet and mobile phone websites and games are cheap to
use once you've made the initial investments, and in a
manner of speaking are the "utilities" of the mind.
Hook in, and you're addicted for life.
For this reason we'd be looking at some of the Internet
entertainment stocks where companies have proven money
making ability but which have been badly hit by the exodus
from what are perceived as risky investments. One company
which meets this criteria is Axel Mark, whose market
valuation has to just 0.68 of its price-to-book-value
ratio. Yes, this company will probably suffer further
near-term earnings falls, but as the recession takes hold
and people need more mental escape, this and other
businesses like it will come surging back on the basis of
Just a note on "book value". Many investor sites are now
talking about Japanese companies becoming interesting as
investments again, due to their share prices falling below
their book value. On the face of it, this is a compelling
argument to enter the markets and take a punt. But before
doing so, we encourage investors to remember that the
actual book value in Japanese companies isn't always what
you think it should be. We've seen witnessed first-hand
listed companies which have reported their subsidiaries (in
particular) at unrealistic valuations. No one challenges
the assumptions made, and only trying to sell off such
assets would reveal that their real value is but a
fraction of the reported asset value. So, our take is that
investors need to stay focused on future earnings as well
as the apparent cheapness of the stock.
Looking out further than the next year or so, one
interesting comment made on Seeking Alpha was that Barack
Obama's government would necessarily become protectionist,
as it sought to limit the hurt being done to wage earners
(voters). Protectionism is a bad direction for the global
flow of goods and services, and for U.S. economic health in
general, but since Obama was voted in as a man of the
people, we suspect that further into his term he will find
it difficult to move away from this expectation and will
need to bash the foreigners for taking U.S. jobs.
Thus, America is likely to start hitting China in
particular. Initially we guess the demands will be for a
revaluation of the Yuan, much as was done with the Japanese
through the Plaza Accord in the mid-80's, then move later
to punitive trade tariffs. The commentator on Seeking Alpha
made the point that this type of action will likely cause a
nationalistic reaction in China, and that they will seek to
punish U.S. corporations operating there, in turn. If this
happens, in a couple of years time we could wind up with
another cold war or at very least a trade war between the
West and China.
What would Japan's role be if this happened? Firstly, trade
protection actions against China might not necessarily
spill over onto Japanese companies, since the Japanese are
way ahead in transplanting factories, etc., into the U.S.
market and are now major employers. Therefore, so long so
long as none of the major Japanese auto firms makes the
mistake of shutting down U.S. plants in preference to
Japan-based ones, so as to preserve domestic employment,
they will be allowed to continue operating as best they
can. Indeed, if the U.S. auto industry gets government
handouts, the Obama government will want the Japanese to
stick around to make sure that they keep the U.S. firms
competitive and thus ensure the public of a chance of
getting its money back.
Looking further forward, though, it is inevitable that if
the U.S. slides into protectionism, then Japan will be
forced to stand by itself, or to pay a lot more for its
U.S. defense relationship. Given that the U.S. has been
giving Japan investment, military aid, and markets for
half a century, this would be an unfamiliar and unsettling
turn of events for the Japanese and could open the way to
a backlash against pro-U.S. feelings and thus a rise in
True, China, would be there to keep any military ambitions
in check, but domestically things may become more difficult
for non-Japanese. This would be particularly unfortunate,
because thanks to the aging of Japanese society, attitudes
to foreigners have been slowly changing, especially at
government level. There have been a number of hopeful
developments such as dual nationality for kids of
international marriages (and their parents), opening of
health and other sectors to foreign workers, and greater
opening of commerce and finance. These moves would likely
stop dead if there was a negative backlash.
Terrie's Take is proud to be a supporter of The Japan
Helpline. To get help 24 hours assistance with any problem,
any time, go to www.jhelp.com and click `help`.
Your support keeps The Japan Helpline going.
...The information janitors/
----------------- Web Hosting in Japan --------------------
With prices comparable to those available in the US, and a
full range of hosting services, there is no need to put up
with slow-downloading websites hosted overseas anymore.
With nearly 10 years experience in the Japanese market,
Tsukaeru.net provides great value for money to both the
Japanese and English speaking clients.
We provide low cost shared hosting accounts from just 210
yen per month,to fully managed complex hosting.
Customers moving from our competitors receive
up to JPY10,000 cashback on completion of migration.
- Nokia to launch MVNO
- Nikko Cordial employees offered early retirement
- School violence gets worse
- New voice extraction technology
- Uh-oh, ShinGinko belly flops even worse
-> Nokia to launch MVNO
The Yomiuri Shimbun has broken a story that Nokia, the
world's largest cellphone producer, will launch a Mobile
Virtual Network Operator (MVNO) business in Japan in 2009.
The company is apparently going to rent bandwidth and
infrastructure off DoCoMo. The company will sell its
handsets as part of the user solution, and they will
reportedly be starting with their high-end Vertu units.
***Ed: The problem for Nokia has been that their globalized
handsets are not what the Japanese want. The functionality
and shape are not particularly popular and Nokia has
gained a also-ran image in the market as a result.
Releasing the Virtu brand is a good idea, but what would be
better is if Nokia created something to properly compete
with the iPhone -- which the Japanese makers are surely
doing for their next generation of products. Ideally Nokia
should embrace Google's Android operating system, but Nokia
HQ said back in May that it doesn't have any interest in
the OS. Time for a change of heart?** (Source: TT
commentary from afp on google.com, Nov 21, 2008)
-> Nikko Cordial employees offered early retirement
The Nikkei is reporting that Citigroup-owned Nikko Cordial
has offered all employees over the age of 40 an early
retirement package of two year's salary. Nikko Cordial has
7,000 employees in Japan and apparently the offer is being
made until December 8th. ***Ed: This is a difficult choice
for those employees with kids and mortgages to support and
we imagine that only the best and most mobile of 40-year
olds will be taking up the offer. For those who elect to
stay, which going on Citi's experience where only 35% of
employees took up a similar offer upon the June closure of
the consumer finance business (as reported by
Bloomberg.com), there will be a series of difficult
negotiations and the surplus staff will probably take
another 2-3 years to release.** (Source: TT commentary from
bloomberg.com, Nov 21, 2008)
-> School violence gets worse
The Ministry of Education has released statistics that show
that student violence at school is increasing. Apparently
there were 53,000 reported incidents, an increase of 18%
over last year. Cases amongst younger children increased
dramatically, jumping 37% to 5,214 reports. Bullying was
the most common complaint, with 101,000 cases at Japan's
40,000 elementary, junior high, and senior high schools.
***Ed: Experts say that children are experiencing
increasing pressure to study and succeed -- however, this
has been a trait of Japanese education for a long time.
More likely, it is a function of the spread of technology
and access to information, and thus both children and their
parents are becoming more sophisticated and more willing
to complain. This is a good thing.** (Source: TT commentary
from reuters.com, Nov 21, 2008)
-> New voice extraction technology
Researchers from Waseda University and Oki Electric have
developed new technology which separates a particular
individual's voice from background noise and other
speakers. It's unclear as to how effective the new system
is over existing voice separation systems, however, the
team does say that they expect the new software/hardware
solution to appear in voice-operated remote controllers for
electronic devices such as TVs -- so it can't be too bad.
***Ed: If the new system does work as well as indicated,
then we imagine that industrial espionage will have a new
lease of life, as well!** (Source: TT commentary from
nikkei.co.jp, Nov 17, 2008)
-> Uh-oh, ShinGinko belly flops even worse
Tokyo governor Shintaro Ishihara should be falling on his
sword collection right now, as it has been revealed that
his love child, Tokyo government-sponsored bank ShinGinko,
has a ratio of bad loans to overall lending of an
unsustainable 17%! This is seven times higher than the
national bank average and to us is a clear indication that
something fishy has been going on. ***Ed: The bank says
it will still have a full fiscal year loss of JPY12.6bn, as
projected, but given that the recession is going to get worse,
we think this number will blow out dramatically.** (Source:
TT commentary from nikkei.co.jp, Nov 22, 2008)
NOTE: Broken links
Many online news sources remove their articles after just a
few days of posting them, thus breaking our links -- we
apologize for the inconvenience.
------------- Looking for English Magazines? --------------
Subscribe to your favorite English magazines today -- TIME,
Newsweek, National Geographic, Scientific American, People
and many more.
eigoTown.com is now offering subscriptions to English
magazines at great prices.
Credit cards and PayPal accepted.
+++ CANDIDATE ROUND UP/VACANCIES
=> LINC Japan Ltd., an affiliate of the LINC Media group,
is actively marketing the following positions for market
entry customers setting up in Japan, as well as other
employers of bilinguals.
** HIGHLIGHTED POSITION(S)
BiOS now has an opening for a junior level Helpdesk role in
a large global insurance company. As part of the level 1
support function of our client's helpdesk you will be
required to provide bilingual technical support to up to 60
users and fielding issues by both telephone and email, so
good communication skills are essential for this position.
In addition to this you will also be involved in
troubleshooting of OS and applications issues, as well as
expansion and renewal of existing internal systems.
The ideal candidate will have at least one years experience
in a similar position, and ideally this experience will
include supporting both Japanese and English speaking
users. In addition to this, you will be required to
demonstrate an overall good understanding and knowledge of
IT equipment in general, as well as some knowledge of
Windows Servers and PC Networks. An understanding of
supporting AV equipment would also be advantageous to your
Remuneration is JPY4m – JPY4.5m, based on your experience.
** POSITIONS VACANT
- Security Engineer in a telecoms company, JPYnegotiable
- Enterprise Systems Integration Engr, TV Co. JPY5m – JPY8m
- Account Manager, foreign Media Firm, JPY3m – JPY4m +comm.
- Tech. Support Manager, SW company, JPY8m – JPY10m
- IT Translators required! - JPYvarious
Interested individuals may e-mail resumes to:
** BiOS Job Mail
Every 2 weeks BiOS sends out a regular communication to its
job seeking candidates, called BiOS Job Mail. Every edition
carries a list of BiOS's current and most up-to-date
vacancies, with each entry featuring a short job
description and a direct link to the main entry on the BiOS
home page. Regardless of whether you are unemployed and
searching, thinking about a career change, or just curious
to know if there is something out there that might suit you
better, the BiOS Job Mail newsletter is an easy and
convenient way for you to stay informed. If you would like
to register for the BiOS Job Mail, or to find out more,
please email firstname.lastname@example.org.
Interested individuals may e-mail resumes to:
+++ UPCOMING EVENTS/ANNOUNCEMENTS
-------- BE THERE WHEN THE MUSICAL YEAR KICKS OFF! --------
Speaking at MIDEM / MidemNet 2009
* David Eun, VP Content Partnerships, Google Inc
* Jay Marciano, Pres., Madison Square Garden Entertainment
* J.Y. Park, Founder and President, JYP Entertainment
* Jim Balsillie, co-CEO, RIM/Blackberry
* Amit Kapur, COO, MySpace
* Dr Tero Ojanpera, EVP, Entertainment & Communities, Nokia
MidemNet: 17 - 18 January 2009 View MidemNet Programme
MIDEM, the world's music market: 18-21 January 2009.
9,000 key professionals from 90 countries
The earlier you register, the less you pay.
Register now at: www.midem.com
--------------- Entrepreneur Association of Tokyo ---------
Wednesday, December 3rd seminar
Speaker: Maria Mercedes M. Corrales, Rep. Director
CEO and COO of Starbucks Coffee Japan, Ltd.
Join EA-Tokyo's holiday seminar to hear Maria Mercedes
(Mercy) M. Corrales.
Mercy joined Starbucks Coffee Japan Ltd. in January 2006
and now oversees the operation of a company with approx.
800 coffee shops in Japan.
Prior to Starbucks, 'Mercy' worked for 31 years with Levi
Strauss, where she held a series of executive positions in
Southeast Asia, North Asia (including Greater China) and
South America. From 2001 through 2005, Mercy was President
and Representative Director of Levi Strauss Japan K.K. and
led the entity to a highly profitable and successful
business. Mercy has built a reputation for building
world-class teams, executing strong brand management, and
understanding at a deep level different cultures and
operating environments. Mercy was chosen as the Business
Stateswoman of 2008 by the Harvard Business School Club of
Japan. Please sign up early while seats are available.
Date/Time: Wednesday, December 3rd, 7:00 pm
Location: Shinsei Bank Head Office - 20th Floor
--------------- Tokyo PC Users Group Meeting --------------
Thurs. Dec. 4, 7:00 pm - "Why is Security Hard?"
Tokyo Union Church, in Omotesando
Matthew Dons, an active member of the international
security community, will look at the technological, social
and economic aspects of security with an aim to helping
attendees choose security products, configurations and
policies for everything from booking a holiday online to
implementing building access control systems. See
http://www.tokyopc.org for more details, including map.
---------- Metropolis and eigoTown.com Party --------------
November 29, 2008 - Join over 300 party animals.
8:00pm - 11:00pm @ Feria, Roppongi. Alcohol, food and
music! After 11pm, stay on as long as you want!
Check it Out: All-you-can drink
Show this email at the door to get in for 3,500 yen
Nearest stn: Roppongi
CORPORATE SPONSORS WELCOME
Events announcements are priced at JPY50,000 per week.
For more information, contact sales at japaninc.com
In this section we run comments and corrections submitted
by readers. We encourage you to spot our mistakes and
amplify our points, by email, to email@example.com.
*** No corrections this week.
SUBSCRIBERS: 11,138 as of November 23, 2008
(We purge our list regularly.
+++ ABOUT US
Written by: Terrie Lloyd (firstname.lastname@example.org)
HELP: E-mail Terrieemail@example.com
with the word 'help' in the subject or body (don't include
the quotes), and you will get back a message with
Send letters (Feedback, Inquiries & Information) to the
editor to firstname.lastname@example.org.
For more information on advertising in this newsletter,
Get Terrie's Take by giving your name and email address at
http://www.japaninc.com/newsletters/free_sign_up, or go
straight to Mailman at:
Copyright 2008 Japan Inc. Communications Inc.
------------ Japan Inc is worth every penny! --------------
J@pan Inc is Japan's only publicly sold English-language
business magazine. Authoritatively chronicling business
trends in Japan, each beautifully designed full-color issue
brings you in-depth analysis of business, people and
technology in the world's second largest economy. Don't
miss another issue! JPY8,000 for 1 year (12 issues)
JPY15,000 for 2 years (24 issues).
Visit www.japaninc.com/mgz_subscriptions to subscribe.
Terrie mailing list