Money and Finance
Link to: Coal-fired growth
- Links
Apollo Asia Fund: the manager's report for 4Q2014 (LINK) Amidst all these distractions, I omitted to post a link to GMO's 3Q report, with another compelling exposition from Jeremy Grantham on what I consider the key issue of our time. While acknowledging...
- Mckinsey Report: Resource Revolution: Meeting The World’s Energy, Materials, Food, And Water Needs
Published in November of last year. It looks similar to the things that Jeremy Grantham discussed in his Q2 letter. Resource prices are rising and becoming more volatile. Without a resource revolution, we all face the prospect of damage to global growth,...
- Not A Normal Cycle: Apollo Asia Fund: The Manager's Report For 3q2011
The outlook, however, seems much trickier now. Too many western economies, having hurled taxpayers' money indiscriminately at the banks without allowing normal bankruptcies and restructuring, have catapulted themselves into a debt trap from which...
- World In Upheaval: Apollo Asia Fund: The Manager's Report For 1q2011
Activity during the quarter was light: we added modestly to three holdings, trimmed four, and completely sold out of one very small stake. Our additions were mainly in Japan; our sales mainly in Southeast Asia. In the short term this has done nothing...
- Limits To Growth: Apollo Asia Fund - The Manager's Report For 1q2010
Our concern is over future earnings, given the precarious state of the global economy and doubtful prospects for Asia's exports. Since none of the major problems exposed by the crisis has been addressed, and panic responses have created new ones,...
Money and Finance
Coal-fired growth: Apollo Asia Fund: the manager's report for 2Q2014
Link to: Coal-fired growth
Many economic forecasters in Asia continue to extrapolate the trends of the recent past, failing to recognise the past contribution of resource windfalls which are dwindling, vanished, or overtaken by domestic consumption. Some of these trends are clearly unsustainable. If coal usage in Malaysia were to rise at its present rate for another 16 years, it would have risen 109 times since the start of the fund, and the consequences for the environment are important to contemplate. In practice it seems likely that coal will continue to increase as a proportion of the Southeast Asian energy mix; growth in energy use will moderate as costs rise and some subsidies are withdrawn; and GDP growth will be less than before.
Moreover, a higher proportion of economic activity will relate to resource extraction and the costs of environmental change (from water procurement through flood mitigation to health impacts). Anecdotally, we have also noticed a number of cases of forced investment in replacement systems due to individual unobtainable parts, without any of the productivity benefits experienced at the time of the original expenditure. Maintenance and replacement expenditure, along with debt service, may thus consume a rising percentage of income. Exports, the traditional growth driver, have faltered since the global financial crisis erupted in 2008. In several countries it now seems appropriate to focus on companies supplying the goods and services that will be prioritised if disposable income is squeezed.
- Links
Apollo Asia Fund: the manager's report for 4Q2014 (LINK) Amidst all these distractions, I omitted to post a link to GMO's 3Q report, with another compelling exposition from Jeremy Grantham on what I consider the key issue of our time. While acknowledging...
- Mckinsey Report: Resource Revolution: Meeting The World’s Energy, Materials, Food, And Water Needs
Published in November of last year. It looks similar to the things that Jeremy Grantham discussed in his Q2 letter. Resource prices are rising and becoming more volatile. Without a resource revolution, we all face the prospect of damage to global growth,...
- Not A Normal Cycle: Apollo Asia Fund: The Manager's Report For 3q2011
The outlook, however, seems much trickier now. Too many western economies, having hurled taxpayers' money indiscriminately at the banks without allowing normal bankruptcies and restructuring, have catapulted themselves into a debt trap from which...
- World In Upheaval: Apollo Asia Fund: The Manager's Report For 1q2011
Activity during the quarter was light: we added modestly to three holdings, trimmed four, and completely sold out of one very small stake. Our additions were mainly in Japan; our sales mainly in Southeast Asia. In the short term this has done nothing...
- Limits To Growth: Apollo Asia Fund - The Manager's Report For 1q2010
Our concern is over future earnings, given the precarious state of the global economy and doubtful prospects for Asia's exports. Since none of the major problems exposed by the crisis has been addressed, and panic responses have created new ones,...