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7/30/2019 Spex Issue 38
1/10
-China3.0
-GSTinMalaysia:Promotestaxationefficiency,burdensthepoor-Simplicityversuscomplexity(Part1)
TheFortnightInBrief(13 thMayto26thMay)
US:Willtheyorwontthey?
FederalReserveChairmanBernanketestifiedbeforelawmakerslastweek,
defendingthecentralbanksmonetarypolicyamidspeculationofwhetherits
assetpurchasingwillbetaperedfollowingfavorableemploymentjobsnumbersin
thepastmonths.10-yeartreasuryyieldsbrokeabove2%forthefirsttimesince
MarchastheChairmanwarnedthattapertalkcouldoccurinitsnextfew
meetingsiftheUSeconomyshowedsignsofasustainablerecovery,butstressedthatmonetarypolicywouldremainhighlyaccommodative.Newhomesales
reachingitssecond-highestinnearlyfiveyears,coupledwithgainsinhousing
market,autosandordersforU.S.durablegoodsisexpectedtolifttheeconomyin
thesecondhalfoftheyear.
AsiaPacific:PessimismFloodsChinasEconomy
PessimismcontinuestospreadaboutChinaseconomicprospectsasUBScutits
2013GDPforecastfrom8%to7.7%.ThismovefollowsinthestepsofGoldman
Sachs,JPMorgan,RoyalBankofScotland,theWorldBankandIMF.Acombination
offactors,includingwagegrowth,weakconsumptionandtepidexportsamongst
others,hascontributedtothepessimism.HSBCflashPMIforChinafellto49.6inMayfrom50.4inApril.Thisisthefirsttimetheindexhasfallenbelow50since
October2012andcouldputpressureontheChinesegovernmenttocuttaxesand
increasespendingtoreviveitseconomy.
EU:GermanytakesbilateralpathstotackleEUjobscrisis
Germanyisbankingonbilateraldealstofightrecordyouthunemploymentinthe
eurozone,agreeingtocooperatewithseveralcountriestobypasspan-European
bureaucracy.Youthunemploymenthasreachedarecord42percentinPortugal
and57percentinSpainasgovernmentsimplementausteritymeasures.Berlinis
also about to announce a joint plan with Paris to address unemployment,
followingadealannouncedwithSpainlastmonthtochannelmoneyfromprivateinvestorsintocredit-starvedsmallandmedium-sizedbusinesses.Policymakersin
Berlin are frustrated by a lack of urgency at the European Commission,
commentingthateffortstohelpsuchcompaniesareheldupbyEUstateaidrules
meanttopreventunfaircompetition.
INCOLLABORATION
WITH
PROUDLYSUPPORTEDBY
ISSUE 38
27 MAY 2013
SMU Political-EconomicExchange
ANSMUECONOMICSINTELLIGENCECLUBPRODUCTION
1645
1655
1665
1675
S&P500
302
304
306
308
310
312
STOXXEurope600
545
549
553
557
561
565
MSCIACAsiaEx.Japan
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Copyright 2012 SMU Economics Intelligence Club2
China3.0
ByAdamTan,SingaporeManagementUniversity
TheChinesecharacter(numbereight)hasalwaysbeenassociatedwithprosperityand
goodluckinChineseculture.However,eighthasincreasinglybeenagrowthfigureoutofreachfortheslowingChineseeconomy.Fundmanagersandanalystshadrecentlyadmitted
thatitisnowbecomingagrowthceilinginsteadofafloorforthenextdecade.Tepidrecovery
fromtheUnitedStatesandtheon-goingEurozonecrisisisnothelpingtheexport-oriented
Asiangianteither.So,whatcanChinadotokeeptheiradmirablegrowthenginegoingata
sustainablerate?Letsexplorethedifferentpossibleroutesavailabletothem.
StructuralReform
Overthepastyears,wordsofhardlanding1oftheChineseeconomyhavebeengoingaround
wheneverthemarketstartstoturnbearish.Someclaimthatthesearejustnoiseandareofnogenuineconcern.However,sincetheturnoftheyear,thenewlyselectedadministrationhas
acknowledgedtheneedforstructuralreformtopursuequalitygrowth.Thisledtomarket
speculationinsmallcapitalizationtechnologicalandservicessectorstockslistedinShenzhen
formingapossibleassetbubble.Thisspeculationismainlydrivenbytwofundamental
reasons:1)reductionoffixedcapitaltodrivegrowth,and2)shiftawayfromthelowvalue-
addexporttoservicesexportmodel.
Source:WorldBank Source:CEIC
Asseenonthechartontheleft,ChinaleadstheUnitedStatesandJapan(thelargestand3rd
largesteconomyintheworld)intermsoffixedcapitalasapercentageofGDPbymorethan
double.Thisisnotagoodsigngiventhatmosteconomicgrowthforthepastdecadewere
drivenbythecoastalprovincesandcities(Shanghai,Beijing,ZhejiangandGuangdong).
DeleveragingfromrelianceonfixedcapitaltowardsthelevelsoftheUnitedStatesandJapan
willbeapointtonoteforinterestedinvestorsinthelongrun.
30%
40%
50%
60%
70%
80%
90%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Services (%) of GDP
CN US JP
10%
15%
20%
25%
30%
35%
40%
45%
50%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Fixed Capital (%) of GDP
CN US JP
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Copyright 2012 SMU Economics Intelligence Club3
ThechartontherightshowsthecontributionoftheservicessectortowardsoverallGDP.This
chartprovidestheidealsolutionforChinaslackofalternativegrowthdrivers.Thelargegap
betweentheUnitedStates/JapanandChinasignifieshugegrowthpotentialasChina
eventuallymaturesintoafirstworldeconomy.However,caveattothisliesinhowmarginal
Chinasservicessectorhasgrown(39%to43%)overthepastdecadeandwhethertheywill
beabletoactuallyfulfillthispotential.Thekeydrivertoservicesgrowthwillbecorrelatedto
howquicklythemiddleclassdisposablehouseholdincomegrowthwillbe,whichbringsmeto
mysecondpoint:policyreform.
PolicyReform
Onemajorproblemfacedbyleadersofmanydevelopedcountriesthesedaysseemstocircle
aroundincomeequalityandtheirGiniCoefficient2.ThisproblemisnotuniquetoChinabutis
akeyissuethattheChineseleadersneedtoaddressbeforeitgetsblownoutofproportion.
ChinaslatestGiniCoefficientestimatein2012placedtheminoneofthetopthree(at47.4)
slightlybehindBrazilandMexico.Thisnumberworsensfromthepreviousestimateof42.5backin2005.Thismaybeastatisticalprooftothesayingthat80%oftheincomeismadeby
20%ofthepopulationasevidentlytheincomegaphaswidenedbetweenthetopandbottom
overtheyears.Theurgencytopushforwardtheimplementationofanationwideminimum
wagelawbefore2015shouldcommandthesamepriorityastheneedtotacklegraftand
corruptioninthecurrentadministration.Onlywhengainstrickledownfromthetopofthe
pyramidtothemiddleclass,willtheirdisposableincomeincreaseandhelpdrivegrowthin
theservicessector.
Source:WorldBank
55
48
47
41
40
36
Brazil
Mexico
China
USA
Russia
UK
Gini Coefficient
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Copyright 2012 SMU Economics Intelligence Club4
LongArduousJourneyAhead
Resistinghotmoney3inflowandtherealestatebubbleareotherchallengesin-progressfor
thecurrentadministration.However,settingthestagerightforthefuturebymakingthehard
decisionofimplementingstructuralandpolicyreformprudentlywillyieldgreatergrowthand
prosperity.QuotingthelateChairmanoftheCommunistPartyofChina,DengXiaoping,the
currentadministrationneedstocrosstheriverbyfeelingthestones.
Sources:
1.Bloomberg2.TheFinancialTimes3. Investopedia
1HardLanding
Aneconomicstatewhereintheeconomyisslowingdownsharplyoristippedinto
outrightrecessionafteraperiodofrapidgrowth,duetogovernmentattemptstoreinininflation.
2GiniCoeeficient
Ameasurementoftheincomedistributionofacountry'sresidentsrangingbetween0
and100.0signifiesperfectequalityand100signifiesperfectinequality.
3HotMoney
Flowoffundsfromonecountrytoanotherinordertoearnashort-termprofitoninterestratedifferencesorexchangerateshifts.Duetoitsfastmovingnature,itcan
potentiallycausemarketinstability.
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Copyright 2012 SMU Economics Intelligence Club5
GSTinMalaysia:Promotestaxationefficiency,burdens
thepoor
ByLeeGuojun,SingaporeManagementUniversity
WhenMalaysianMinisterinthePrimeMinister'sDepartment,DatukSeriIdrisJalasaidifthenewgoodsandservicestax(GST)weretobeimplementedat7%,itwouldincreasethe
MalaysiasrevenuebyRM27billion,ahugeuproarfromthepublicensued.However,justacrosstheCausewaySingaporeanshavebeenlivingwitha7%GSTsince2007;withsome
starkdifferencesbetweenthetwocountrysGSTschemes,ofcourse.
AccordingtotheMalaysiasMinistryofFinance,GSTisavalue-addedconsumptiontax
imposedongoodsandservicesateveryproductionanddistributionstage,includingthestagewheregoodsandservicesareimported.Thismeansthatimporters,manufacturers,retailers,
andfinallytheendconsumers,wouldbechargedacertainpercentageoftax.However,
businessesthatareregisteredunderGSTwouldbeabletoclaimaninputtaxcredit,whichis
ultimatelybornebytheendusers.Currently,MalaysiaadoptsaSalesandServicesTax(SST)wherethesalestaxisgenerallyfixedat10%dependingonthetypeofgoodssold,andaservicetaxrateof5%imposedonservicesinthefoodandbeverageindustry,healthand
professionalandconsultancyservices.
TherationalebehindtheMalaysiangovernment'splanstoimplementGSTintheeconomyis
toenhancethecapability,effectiveness,andtransparencyofthetaxadministrationand
managementinMalaysia.TheGSTwouldalsobemorecomprehensivethanthecurrentSSTbecauseitwouldofferlesstaxexemptions1thattheSST.AnotherreasonbehindtheGST
implementationistohelpthegovernmentreininitseverincreasingpublicdebt2.WhileMalaysia'sGDPgrowthhasbeenaveragingastrong7%overthepast5yearsdespitethe
globalfinancialcrisisof2008/2009,muchofithasbeenattributedtolargegovernment
spendingonmega-infrastructureprojects.Mostoftheseprojectshoweverareslowlybecomingwhiteelephants.AshortdrivethroughJohorandonewouldnoticethelarge
numberofpartiallyconstructedcommercialbuildingshavenotbeencompletedforseveral
years.Thelarge-scaleabandonmentofinfrastructureprojectshaveproducednearlyzeroreturnoninvestments,andhasleftMalaysiawithanevenlargerpublicdebtburden,asthe
countryedgesclosertowardstheparliamentaryimposed55%ofGDPdebtlimit3.
WhiletheGST'seffectivenessinreininginpublicdebtremainsahotlydebatedtopicin
Malaysia,imposinga7%onallgoodsandserviceswithimmediateeffectwoulddefinitelyharmconsumers,especiallythoseinthelowerincomebracketaslivingcostsarealready
alarminglyhigh.WhileitisimportanttonotethatimplementingtheGSTwouldalter
consumptionpatternsandthusencouragesavingsandinvestment,itmaynotbetruefor78%oftheMalaysianpopulationthatearninglessthanRM2,500permonth,saysthePeople's
JusticePartyTradeandInvestmentBureauChiefWongChen.Spendingondailynecessitiesconstitutesalargepercentageofincomeforthoseinthelowerincomebrackets,andtheGST
wouldleavelittleforthesehouseholdstosave.Introducinga7%"shock"increaseindaily
necessitiescouldpotentiallywipeoutsavingsforthelowerincomegroupsaltogether.
AlthoughthisauthoragreesthattheimplementationoftheGSThasitsbenefitsintermsof
improvingtheefficiencyoftaxadministrationandmanagementandalsoreducingMalaysia's
dependenceondirecttaxes,currentprogresswithintheMalaysiangovernmentleavesmore
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Copyright 2012 SMU Economics Intelligence Club6
questionsthananswers.ThereareimprovementsthatneedstobedonebeforetheGSTcanbe
rolledoutinMalaysia.OnesuchimprovementthattheMalaysiangovernmentshouldconsideristoexemptdailynecessitiessuchasfood,utilities,andaccommodationfromGSTfor3to5
years,ensuringthatthesavingsoflow-incomehouseholdsarenotadverselyaffectedinthe
shortrun.
SingaporecomesintomindwhenMalaysiansdebatetheimpactofGSTontheirconsumption
andsavingspattern.AstheMalaysianMinistryofFinancecontinuestocrunchnumbersinsearchoftheidealGSTrate(currentresearchhasconcludedthattheGSTrateshouldbe
between4-6%althoughitisunconfirmed),SingaporesversionofGSTofferssomethingtoponderon.OnewayisfortheMalaysiangovernmenttoslowlyadjusttheGSTrateto7%over
aperiodofatleasttenyears.SingaporeintroducedtheGSTin1994startingat3%,whichheld
onfornearly9yearsbeforebeingincreasedto4%,andsubsequentlytothecurrentrateof7%on1stJuly2007.ThisslowadjustmentoftheGSTratehasnotonlymadeiteasierfor
householdstocopewithhigherlivingcosts,buthasalsohelpedSingaporereduceitsreliance
ondirecttaxes,especiallycorporatetax.ThisschemeallowstheSingaporegovernmentmoreroomtocutdirecttaxrates,ensuringthatSingaporeremainscompetitiveinattracting
internationalcapitalandlabortogrowitseconomy.Besidescommittingtoanoincreaseintaxrateforanumberofyearsbeforereadjustment,offsetpackageswerealsoofferedto
householdstohelpallaytheshort-termshockofincreasedlivingcosts.
AlthoughtheGSTfacesstiffoppositionfromthepublicandparticularlyMalaysiasopposition
parties,thetaxifimplementedproperly,wouldserveasagreattoolinreininginMalaysia's
publicdebtandreduceitsrelianceonincomethroughdirecttaxes.WithitsASEANneighborssuchasSingaporeandVietnamundergoingeconomicreformtoaddresstheirdomestic
concerns,itishightimethatMalaysiagetsitsGSTimplementationright,inordertoremaincompetitiveintheregion.
Sources:
1.NewsStraitsTimes2.MinistryofFinanceMalaysia3.RoyalMalaysianCustomsDepartment4.FreeMalaysiaToday.com5.TheMalaysianInsider
1TaxExemptionTobefreefrom,ornotsubjectto,taxationbyregulatorsorgovernmententities.Ataxexemptentitycanbeexcusedfromasingleormultipletaxationlawsdueto
variousreasons.
2PublicDebt
Publicdebtisthedebtowedbyacentralgovernmentusuallyusedtofinanceagovernmentdeficit(adifferencebetweengovernmentreceiptsandspending).
3DebtLimitThemaximumdebtagovernmentisallowedtohold.
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Copyright 2012 SMU Economics Intelligence Club7
Simplicityversuscomplexity:Whatarethelimitsof
structuredfinancialproducts?(Part1)ByShaneAi,SingaporeManagementUniversity
TheParableoftheProdigalSontellsastoryofason,whosquandershisinheritance,onlytorealizehisfollyandreturnhometohisfatherswelcomingarms.Similarly,structured
products,onceheraldedasthepeakoffinancialinnovation,havesufferedtremendousbacklashinrecentyears.Tilltoday,opinionsbetweenregulators,issuersandinvestorson
theircredibilityremaindivided.Whileaddressingthelimitsofstructuredproducts1,perhaps
amorepertinentquestionwouldbe:Shouldtheybewelcomedbackatall?
Afamiliaritywiththeiroriginwillhelpintacklingthisissue.Investmentbanksbeganwithengineeringtheseproductsforinstitutions,whichwereessentiallyvanillainstruments2
wrappedintohighlycustomizedpayoffs.Thisprovedtobewin-winforbothclientsand
issuers,asfirmscouldissuecheaperdebtandbanksenjoyedhighermargins.
Anothersignificantdevelopmentdatesbackto2000,whenthedotcombubbleburst.
Heightenedriskaversionledtoretailinvestorswantingtoparticipateinhigherreturnswithouttherisk,soissuersofferedCapital-ProtectedNotestothepublic,amongothers.
Furtherfanningtheirproliferationweretechnologicaladvancesandfavorablemarketconditions.Inlinewithinvestorsinsatiabledesirestohavetheircakeandeatittoo,financial
engineerscreatedproductsthatoccupiedthemiddlegroundbetweentheimpossibletrinityof
return-seeking,premium-resistantandrisk-aversebehaviors.
Beforeexaminingthe2008crisisfallout,structuredfinanceshouldbeunderstoodonadeeper
level.Conventionalinnovationprovidesdirectutilitytoitsusers,withorwithoutcons.
Proponentsoffinancialinnovationhaveextendedthiscontentiontofinance,whichistoosimplisticatbest.Whilecertainformsoffinancialinnovationdoesmakeliveseasier(thinkATMs),itremainsunclearifeasiercreditconfersanyutilityatall.Toillustratethispoint,the
benefitsofowningawatcharecertain,butsecuritizationsimplyallowsforcredittobe
obtainedinnewerways.Whetherthisleadstooverallpositiveoutcomesdependsoneconomicagentsinvolved.
Pre-2007,severeincentivemisalignmentandunsoundriskassessmentplaguedtheentireUSmortgagesecuritization3chain.Whatisapparentnow,inhindsight,isthattheactionsof
economicagentscatalyzedthecrisis,nottheinnovationinitself.Theeconomicbenefitofsecuritizationisprimarilythedistributionofrisktoabroaderinvestorbase.Ironically,risk
concentrationoccurredinstead,asfinancialinstitutionswereeasilyabletoleveruptheirexposurestothisassetclass.Subsequently,whenthesoundnessofsubprimemortgageswasquestioned,aCDOfiresalewastriggered,resultinginwrite-offsonbankbalancesheetsanda
systemwithlittleliquidity.
Itissafetosaythatstructuredproductshavefoundtheirlimitsinthepotentialforabusein
securitization.Fundamentally,itisnavetoassumethattherewillbeaninexhaustiblesourceoffuturerevenuestreamstopawnlaMBS.Sincethecrisis,thestructuredcreditsectorhas
undergonesignificantdeleveragingandcurrentglobalCDOsoutstandingareat38%oftheir
2007levels.Tougherlendingstandardsandregulationshavealsoledtoissuerphobia,with2011newissuesfalling90%from2007.Hence,currentsystemicdamagepotentialfrom
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Copyright 2012 SMU Economics Intelligence Club8
securitizationhaslargelybeenstemmedanditisunlikelythatwewillseearepeatof2008
vis--visstructuredcredit.
Movingbeyondstructuredcredit,itiscrucialtoscrutinizethepost-2008structuredproduct
stigma.Afallacyofcomposition,thestructuralshortcomingsofUSstructuredcreditwereextendedtoallstructuredproducts.Viewingthemasoneencompassingassetclassis
erroneous.Besidesannuities(includingCDOs),structuredproductscomeinotherwrappers,
namelyinsuredCDs,notesandfunds.Issuerriskwasinconceivablepre-crisis,giventhecounterpartieswerefinancialtitans.ThisledtomassivepublicoutcriesinSingaporeand
HongKong,whereinvestorswerefuriousthattheirLehman-linkednoteswerenotfullyPrincipal-Protectedasbelieved.Also,structuredproductsoffernotjustprotection,but
variablelevelsofinvestorparticipationaswell.Thus,theflawedproductsandtheir
imperfectionscomprisemerelyasmallsubsetoftheentireproductuniverse.
Populistnotionshavealsodemonizedstructuredproductsbyclaimingthatfinancial
institutionsareusingtheproductstoreaphighmarginsatthepublicsexpense.Uponcloserinspection,thisprovestobeuntrue.Retailincomeonlyaccountedforone-thirdoftotal
incomefromstructuredproductpre-crisissales.Theimportanceofthissharehassincediminished,withthemajorityofproductclientsbeingprivatebanksandinstitutions.
Structuredproductshavebecomethesecond-favorite(2010:24%)amongalternative
investmentsforAsianHNWIs,furtherboostingthesignificanceofthisclientsegment.Next,regulatorypushes,likefurtherproductpricingtransparencyfromBaselIIIandDodd-Frank
andincertainjurisdictions,extremelystringentproductapprovalprocedures,haveledto
greatercostsandcompliancecomplexityforstructurersanddistributors,effectivelymakingretailsalesanimpracticality.Givenhowheavilydistributorswerepenalizedin2008,this
issueisveryprevalentinAsia,wherewhite-labelingdominatesstructuredretail.Combinethiswithhowglobalon-exchangevolumeshavedeclined30%from2011,anditisnotso
ironicthatactivityisdecliningdespitemoreregulation.Lastly,issuerreputationalriskis
extremelyrelevanttoday,giveneverincreasingscrutinybyregulatorsandthepublic.Puttingthisintoperspectiveishowretailnotestook4yearsbeforereappearinginSingaporepost-
Lehman,withonlyoneoffering.
Nextweek,Shanecontinueshisdiscussiononstructuredproductsandtheirviability
1StructuredProductsAstructuredproductisgenerallyapre-packagedinvestmentstrategybasedon
derivatives,suchasasinglesecurity,abasketofsecurities,options,indices,
commodities,debtissuanceand/orforeigncurrencies,andtoalesserextent,swaps.
2VanillaInstrumentsThemostbasicorstandardversionofafinancialinstrument,usuallyoptions,bonds,futuresandswaps.
3MortgageSecuritization
Theturningofamortgageintoasecurityorabondwhichrepresentsaclaimonthe
cashflowsfrommortgageloans.
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Copyright 2012 SMU Economics Intelligence Club9
Sources:
1.Europe'sUnemploymentProblemsWorsen,publishedbyWorldStreetJournal,byArtPatnaudeandWilliamHorobin
2.Capgemini.(2011).Asia-PacificWealthReport2011.Retrievedfromhttp://www.ml.com/media/114333.pdf
3.Mgge,D.(2009).Talesoftailsanddogs:Derivativesandfinancializationincontemporarycapitalism,ReviewofInternationalPoliticalEconomy,16:3,514-526
4. Johnson,S.(2009,April18).Financialinnovationforbeginners.Retrievedfromhttp://baselinescenario.com/2009/04/18/financial-innovation-for-beginners/
5.Zeisberger,C.(2007).Pervasivenessofstructuredproductstoomuchstructuretoolittlestrength?.Retrievedfrom
http://www.insead.edu.sg/asiafinance/documents/StructuredProducts_May07_JW.pdf
6.Enskog,D.(2012,October30).Structuredproductsadapttothenewmarketenvironment.Retrievedfromhttps://infocus.credit-
suisse.com/app/article/index.cfm?fuseaction=OpenArticle&aoid=371687&coid=118&lang
=EN
7.Moiseiwitsch,J.(2012,August20).Thedeclineandfallofstructuredproducts.Retrievedfromhttp://www.scmp.com/business/money/investment-
products/article/1018369/decline-and-fall-structured-products
8.Collins,H.(2012,November13).Structuredproductseurope:Investorsunawareofregulatoryimprovements,sayspeakers.Retrievedfromhttp://www.risk.net/structured-
products/news/2224515/structured-products-europe-investors-unaware-of-regulatory-
improvements-say-speakers
9.HKSFC.(2006).Stockinvestorsurvey.Retrievedfromhttp://www.sfc.hk/web/doc/EN/speeches/public/surveys/06/stock_investor_survey_060602.pdf
10. Chew,V.(2010).Lehmanbrothersminibondsaga.Retrievedfromhttp://infopedia.nl.sg/articles/SIP_1654_2010-03-19.html
11. Millers,V.(2012,November5).Structuredproductscouldleadthewayinnewnomenclaturestandards.Retrievedfromhttp://www.risk.net/structured-
products/news/2222494/structured-products-could-lead-the-way-in-new-nomenclature-
standards
12. SIFMA.(2012).Statistics.Retrievedfromhttp://www.sifma.org/research/statistics.aspx
13. Anderson,J.(2012,January).http://media.pimco.com/documents/featuredsolutionandersonpetersonstructuredcreditjan2012.pdf.Retrievedfrom
http://media.pimco.com/Documents/FeaturedSolutionAndersonPeterson
StructuredCreditJan2012.pdf
14. Bhat,S.(2009,November27).Takingstockofstructuredproducts.Retrievedfromhttp://business.asiaone.com/Business/My+Money/Building+Your+Nest+Egg/Investments
+And+Savings/Story/A1Story20091125-182276.html
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Copyright 2012 SMU Economics Intelligence Club10
TheS&P500isafree-floatcapitalization-weightedindexpublishedsince1957ofthepricesof500large-capcommonstocksactivelytradedin
theUnitedStates.IthasbeenwidelyregardedasagaugeforthelargecapUSequitiesmarket
TheMSCI Asiaex Japan Index is a freefloat-adjustedmarket capitalization indexconsisting of10developedand emergingmarketcountry
indices:China,HongKong,India,Indonesia,Korea,Malaysia,Philippines,Singapore,Taiwan,andThailand.
The STOXXEurope 600 Index is regardedasa benchmark for European equity markets. It represents large, mid and small capitalization
companiesacross18 countriesof theEuropean region:Austria,Belgium,Denmark, Finland,France,Germany,Greece, Iceland,Ireland,Italy,
Luxembourg,theNetherlands,Norway,Portugal,Spain,Sweden,SwitzerlandandtheUnitedKingdom.
Correspondents:
VeraSoh(VicePresident,Publication)
vera.soh.2011@economics.smu.edu.sg
SingaporeManagementUniversity
Singapore
NgJiaWei(VicePresident,Operations)
jiawei.ng.2012@economics.smu.edu.sg
SingaporeManagementUniversity
Singapore
SamuelOng(PublicationsDirector/Editor)
samuel.ong.2010@business.smu.edu.sg
SingaporeManagementUniversitySingapore
YingyuZeng(LiaisonOfficer)
yingyu.zeng.2010@economics.smu.edu.sg
SingaporeManagementUniversitySingapore
NgYongxiang(MarketingDeputy)
yx.ng.2011@accountancy.smu.edu.sgSingaporeManagementUniversity
Singapore
DarrenGohXianYong(Editor)
darren.goh.2010@business.smu.edu.sgSingaporeManagementUniversity
Singapore
AdamTan(Writer)
Undergraduate
LeeKongChianSchoolofBusiness
SingaporeManagementUniversity
adam.tan.2009@business.smu.edu.sg
ShaneAi(Writer)
Undergraduate
SchoolofEconomics
SingaporeManagementUniversity
changxun.ai.2010@economics.smu.edu.sg
LeeGuojun(Writer)
Undergraduate
SchoolofEconomics
SingaporeManagementUniversity
guojun.lee.2010@economics.smu.edu.sg
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