Monthly Archives: August 2016

What will happen with vietnams language divide

The increased presence of southern dialects on Vietnamese state television may be a sign that true unification is happening between the country’s politically dominant north and the economically stronger south.

After a war between the north and south from the early 1960s until 1975, the language adopted as standard became that of the north, the winner, which is primarily used in Hanoi. Since then, state-run Vietnam Television(VTV) had been dominated by announcers from the northern region.

In 2013, however, the first announcer from the south appeared on a nationwide VTV news program. There are now three announcers who speak southern dialects on TV today. Their accents are distinctive from northern intonations, especially when pronouncing words with the letter “z,” “y” or “r.”

In the current environment, it can be common for both professional TV anchors and ordinary Vietnamese to continue speaking their local dialects and refrain from adopting the standard language.

The north-south divide seems to exist even among younger generations who did not experience the war. A 32-year-old company employee in Hanoi said she is proud of the language spoken in her hometown of Ho Chi Minh City, the former capital of South Vietnam, previously known as Saigon, and does not feel the need to adapt her language.

Many people once thought that Nguyen Tan Dung, the former prime minister from the southern province of Ca Mau, might become the first secretary-general of Vietnam’s Communist Party — the country’s supreme leader — to hail from the south. But overcoming the north’s dominance proved too difficult, and he eventually stepped down.

Ho Chi Minh City is the economic capital of Vietnam, and most major companies, such as Vietnam Dairy Products (Vinamilk) and VietJet Air, are based in the south. Despite the south’s economic dominance, though, the north’s political establishment continues to control the country — a situation that rankles southerners. Even the city’s secretary, Dinh La Thang, is from the north.

For a country sometimes described, ironically, as two countries under one system, a small change at its state broadcaster may be a big step toward the unification of north and south.

U.S. military jet engines will be received in China

On Thursday, a woman named Wenxia Man was convicted in a Florida court of conspiring to evade U.S. export laws by illegally acquiring and sending fighter jet engines and drones to China, according to the U.S. Department of Justice.

Prosecutors said Man was working with an associate in China to buy and export engines made by Pratt & Whitney and General Electric (GE), which are found in a range of top U.S. military aircraft, including the F-35 Joint Strike Fighter, the F-22 and the F-16 fighter jets. She was also found to have tried to export a General Atomics drone, and technical data for the different hardware items.

During the investigation, Man referred to her associate as a spy “who worked on behalf of the Chinese military to copy items obtained from other countries and stated that he was particularly interested in stealth technology,” the Department of Justice said.

The conviction of Man is the latest development in an ongoing saga of corporate espionage between the U.S. and China. Experts say spying has played a role in China’s strategy to modernize the country in recent decades. The illicit acquisition of technology has helped China accelerate the process, bypassing problems that would otherwise require years of research and development to resolve, according to analysts.

But Beijing has repeatedly denied that it engages in corporate espionage.

Boosting jet engine capabilities has long been a priority for China as it seeks to increase its military clout. The most recent five-year development plan for the country identifies domestic development and production of engines and planes as a major goal.

But it’s a difficult area to master, forcing China to rely heavily on importing technology. Over the last four years, engines accounted for 30% of all its imports, according to the Stockholm International Peace Research Institute.

Even the C919, a commercial airliner that China is developing in the hope of rivaling Boeing, is using engines made by a U.S. and French joint venture.

The Department of Justice statement didn’t provide details on Man’s background. The Sun Sentinel in Florida reported that she was born in China but is a naturalized U.S. citizen. She will be sentenced in August and could spend up to 20 years in jail.

Hers is the latest in a series of corporate espionage cases in the U.S. that have been linked to China. They have swept across numerous industries from agriculture to aviation. Alleged targets have included a solar panel manufacturer, aluminum and steel producers, and a company that designs nuclear power plants.

In March, a Chinese man pleaded guilty to cyber spying on Boeing and other U.S. firms by hacking into their networks to pilfer sensitive information to send to China.

China’s Ministry of Foreign Affairs didn’t respond to faxed questions Friday, which is a public holiday in the country.

How about prediction of America’s Earnings

Wall Street is bracing for the earnings recession to hit the one-year mark this earnings season, which kicks off next week when Alcoa (AA) and JPMorgan Chase (JPM) reveal results.

The timing of the profit downturn is somewhat unusual because it’s taken place in the face of an American economy that continues to grow, albeit slowly. But the one-two punch of cheap oil and strong U.S. dollar have been powerful enough forces to drown out that steady growth.

“The depth and breadth of the current earnings slump is quite rare outside of an economic recession,” Paul Eitelman, investment strategist at Russell Investments, wrote in a recent report.

The good news is that profits could resume growing later this year.

The market has stalled out ever since the profit recession began in the third quarter of last year. When earnings shrink, stocks suddenly look more expensive. Even Federal Reserve chief Janet Yellen recently warned that the market is trading at historically high valuations.

Just look at how the S&P 500 is trading at 17.1 times forward earnings estimates — near the loftiest levels of the past seven years, according to S&P Global Market Intelligence.

The upcoming earnings season may only worsen those valuation concerns. Second-quarter profits from S&P 500 companies are expected to decline by 5%, the fourth-straight quarterly drop, according to S&P.

The most pain will be felt in the energy sector, which is expected to suffer an incredible 81% plunge in profits due to lower oil prices. Even diversified oil giants Chevron (CVX) and ExxonMobil (XOM) are on track to suffer big profit slumps.

More bottom-line trouble is brewing in the financial sector as banks grapple with extremely low interest rates that depress earnings. Citigroup (C), JPMorgan and Wells Fargo (WFC) are all expected to disclose profit declines when they hit the earnings stage next week.

The U.S. dollar remains another sore spot, especially for multinationals like Pizza Hut owner Yum! Brands (YUM), which reports results on July 13. A strong dollar makes U.S. goods sold abroad more expensive and hurts revenue when it’s translated back to dollars.

Thankfully, American consumers continue to open their wallets, due in part to lower gasoline prices. Consumer discretionary stocks are poised to log a healthy profit gain of nearly 10% this earnings season. Big expected winners include Amazon (AMZN, Tech30), which analysts believe will reveal an incredible six-fold increase second-quarter profits.

“It’s a very good sign for our economy. The consumer is hanging in there,” said Lindsey Bell, a senior analyst at S&P Global Market Intelligence.

America’s profit recession could finally end in the second half of this year, thanks to higher oil prices and a tamer U.S. dollar. S&P 500 profits are expected to grow 2% in the third quarter, 8% in the fourth and then by double-digits in 2017, according to S&P.

But Wall Street will be paying close attention to make sure CEOs are still expecting a rebound later this year, especially given the Brexit turmoil in Europe.

The other crucial thing to look for is confidence that the long-awaited revenue rebound is materializing after what is expected to be a sixth-straight quarterly decline.

In the past, Corporate America has masked anemic sales by cutting costs and buying back stock, but there isn’t much room for those moves at this point in the economic cycle.

“We’ve run out of financial tricks and now we’re waiting for real economic growth to show up,” said Brad McMillan, chief investment officer for Commonwealth Financial Network.