Spring 2003 - The Hong Kong Association of Northern California

Transcription

Welcoming New Members, New Year
Merrill Lynch Guru Proposes Portfolio Strategy
by Lesley Hu
Chris Hyzy Looks at Investment Opportunities for the Next Five Years
Hong Kong Association
of Northern California
2003 Officers
by Gary Carr
President Tommy Wu
and Lesley Hu
honoring Gary Carr
Editor for the
Monitor.
T
he Art Deco environment of the City Club of San Francisco helped set the
theme of The Old and The New for the Association’s annual Open House on
February 11. The event welcomed both new and returning HKANC members
to the new Year of the Ram.
Tan enumerated the many programs available to members. The Distinguished
Speaker Luncheons have featured high-level private and public sector guests
such as John S. Chen, CEO of Sybase, Inc.; Dr. Robert T. Parry, President and
CEO of the Federal Reserve Bank of San Francisco, and Laura Tyson, former
Chief Economic Advisor to President Clinton and past Dean of the Haas School
of Business at U.C. Berkeley. Other luncheons, she continued, have hosted top
Hong Kong SAR government officials, including The Honorable Tung Chee Hwa,
Chief Executive, and Antony Leung, Financial Secretary.
Touching on the importance of good programming, Tan noted guest speakers,
panel discussions and social events. She also informed members about the
newly instituted scholarship program, which last year funded $2,000 scholarships
to 20 students at UC Berkeley and San Francisco State.
Tan honored the Past Presidents in attendance and introduced the HKANC’s
newest President, Thomas Wu, Chairman of the Board, CEO and President of
United Commercial Bank.
However, Hyzy reported that a “slow-motion recovery” has
finally begun, and that the landscape should look much
sunnier in 2004. But for now, 2003 is not a time for taking
on too much risk.
President Tommy Wu
and Vice President
Heidi Tan welcome
new Corporate
Members.
Looking below the ice
“A number of important developments are already occurring
deep down below the ice,” Hyzy said. Among them are the
slight improvements in manufacturing and pricing power,
along with rising cash-flow yields.
with California. HKANC will benefit from the increase in trade.” He commented
on how delighted he was with the turn out of 140 members and affiliates.
Wu introduced the newest Corporate and Individual Members to join in 2003,
and presented each new member with a lucky red envelope and a HKANC pin.
Wu concluded with the promise that, “we’ll make sure you’ll enjoy being a
member of the Association.”
To culminate the event, Lesley Hu honored Gary Carr of PKF Consulting, for his
generous contributions and clear, insightful writing for HKANC’s newsletter, The
Monitor. Carr has served as writer, reporter, and editor of The Monitor for the
past three years. Accepting his
engraved silver tray, Carr said, “I feel
honored to be a part of the
Association, and I hope all of you
enjoyed reading The Monitor as much
as I enjoyed writing for it.”
The evening ended with the
distribution of lucky red envelopes filled
with lotto numbers to all members and
their guests as a way to celebrate The
Year of the Ram.
In his first official address to the members, Wu forecasted that “we should be
expecting more trade between Hong Kong and the United States, especially
2003 Corporate Members
Air China Cargo
APEX Maritime Co., Inc.
Bank of America
Bank of the Orient
Besphil & Co. (US) Ltd.
BoldFocus
C.M. Capital Corp.
Cathay Pacific Airways Ltd.
Central Financial Management
Chef Chu’s Distinctive Cuisine of China
ChinaVest, Inc.
Citigroup Private Bank
Cobra Solutions
Deloitte & Touche LLP
Derrick T. Wu Architect
Direction 21
First Republic Bank
Golden Gateway Associates
HCV Pacific Partners LLC
Heller Ehrman White & McAuliffe
Holiday Inn Financial District
Hong Kong Economic & Trade Office
Hong Kong Tourism Board
Hong Kong Trade Development Council
HSBC Bank USA
Insurance Associates of Northern California
Intergraph, Inc.
International Sources
James Ho
Merrill Lynch International
D
uring the Ice Age, a lot was happening under the ice
that came back to haunt us or help us after the ice
disappeared,” declared Chris Hyzy, Head of Global
Investment Policy for Merrill Lynch Global Investment
Strategy. As the first presenter in HKANC’s 2003
Distinguished Speakers Series, Hyzy appeared at the March
5 Association luncheon held at the Banker’s Club in San
Francisco.
Hyzy claimed that we are now in the midst of a global “Ice
Age” of investment, with most investors seemingly frozen in
place. He finds the temper of the current economic times
to be an anomaly. Looking back over the past eight
recessions we’ve experienced, starting with the one in 195354, the 2001-02 recession is the only one where, a year
later, everything is still sluggish. The customary melting and
loosening up has taken a longer than usual time to get
started.
Members and guests were able to
circulate amongst fellow members,
new Corporate and Individual
Members, and the 2003 Board of
Directors and Officers of HKANC.
In the short welcoming program, Heidi
Tan, newly elected Vice President and
Membership Committee Chair,
highlighted the history of HKANC. She
explained that, over its 20 years, the
Association has worked diligently to create programs that benefit and intrigue
the membership. She recognized Immediate Past President Tony Chan for his
vision in founding the Association two decades ago.
“
Montclair Hills, Inc.
Morrison & Foerster LLP
MTC Trading Company
New Horizon Enterprises, Ltd.
OOCL (USA) Inc.
Pacific Century CyberWorks
Pacific Interstate Financial Corp
PKF Consulting
PricewaterhouseCoopers LLP
Reliance Technical Services
Renaissance Parc 55 Hotel
Rochester Wong & Shepard
Ropers, Majeski, Kohn & Bentley
Sandhill Property Co.
Stanford Hotels Corporation
Strategic Planning Associates
Tai Seng Video Marketing
The Zeka Group, Inc.
Tiempo Interiors Inc.
Time Advertising
Tomer & Shen Orthodontic Group
United Airlines
United Commercial Bank
Wang Hutner Design
Waterfront Container Leasing Co. Inc.
Wells Fargo
Wells Fargo HSBC Trade Bank
Whitney Cressman Limited
Worldco Company, Ltd.
He broke the world down into regions and sectors, reporting
that, regionally, high quality, structural shifts are visible, with
wide variations in expected performance:
Intrigued guests get investor tips.
impact as it did on the economy in 1980, when it reached
the equivalent of $100 a barrel in 2002 adjusted dollars.
“But remember,” he cautioned, “every $10 increase in the
price of oil will knock 0.5% from the U.S. GDP.”
Balance sheet repair
Hyzy presented some medium-term trends to watch, the
theme for which is “balance sheet repair,” as businesses
are suddenly getting religious. The bursting of the
technology, credit, and overall market bubble has led to
massive movements in balance sheet restructuring, some
of whose implications include:
• A struggling asset deflationary environment and less
impact by the Federal Reserve.
• Lower credit card demand, even in a low-rate
environment.
• Massive consolidation as leaders grab for market
share.
• New growth industries take longer to be born.
• Previous market leadership group loses that status.
• UK – Outperform (dividend yield theme)
• Emerging Markets – Outperform (China driving
demand in N. Asia)
• U.S. – Neutral (good relative valuations, high absolute
valuations)
• Eurozone – Underperform (weakest growth outside
of Japan)
• Japan – Underperform (on again/off again reform, 0%
growth)
Looking at global sectors, he found no pricing power present
across a variety of industries:
• Outperformers – Staples, Energy, Utilities
• Neutral – General Industrials, Telecoms, Basic
Industries, Media
• Underperformers –
Technology, Cyclical
Goods, Financials
One might only speculate on
the effects of a second Gulf
War, but Hyzy did say that any
oil price impact would not be
as large as the last “oil shock.”
Oil, he said, would have to jump
to $60 a barrel to have the same
Speaker Chris Hyzy.
• Stock, bond, and cash returns remain volatile and likely
to be below normal. Benefits of asset allocation for
every risk profile remain critical.
• And, finally – the bright light in demand will continue
to be China!
Looking at U.S. market returns by decade, Hyzy presented
what he termed “sobering stuff.” U.S. equities have averaged
close to 18% returns in the last two full decades. It is not
illogical, he said, to expect below-average returns in the
current decade. To prevent a decade worse than the 1930s,
equity returns in the U.S. will have to average 6.5% for the
next seven years.
Currently, ROI is still lower than in the 1980s. Although
oversupply is still having an impact, Hyzy feels we are on
the mend. “Our call,” he said, “is for 2004-05 to begin the
recovery.”
Implications for Investors:
Hyzy closed with a list of “Investment Implications during
the Ice Age.”
• Be well diversified across ALL core asset classes and
some non-core and within each class.
• Be disciplined regarding downside risk.
• Active vs. passive management
• Alternative strategies are needed to outperform the
markets (AIs, FX, High Yield, etc.)
• Market timing is impossible. Procrastination is just
as bad.
• Dollar cost averaging with a consistent road map
is optimal.
In the Q and A session that followed, Hyzy was asked to
comment on the strategies of Warren Buffet.
“Buffet looks for companies that, he feels, have repaired
their balance sheets. He buys companies, not equities,”
Hyzy explained, “and he has the money to be wrong.”
Based on Hyzy’s presentation, one would assume that
investors in this current Ice Age would do well to tread very
carefully. Unless they have the money to be wrong.
President
Mr. Thomas Wu
President & CEO
Vice President
Ms. Heidi Tan
President
Secretary
Mr. Chi-Hung Chan
Partner
Treasurer
Mr. Thomas Broderick
Partner
Honorary Director Ms. Annie Tang
Director
Hong Kong Economic and
Trade Office
Executive Director Ms. Lesley Hu (Outgoing)
Ms. Susanna Kwan (Incoming)
Board of Directors Page:
Mr. Anthony Chan
General Partner
Mr. Michael Lee
Advisor
GrandOak Consulting
Mr. Lawrence Chan
President & CEO
Mr. Edmond Lok
Managing Director
Mr. Joe Cheung
International Sales Manager
United Airlines
Ms. Ruth Ma
Director
Central Financial
Management.
Montgomery Golf Corp.
Mr. Norman Eckersley
Bank of the Orient
Mr. Henry Gaw
Senior Vice President
C.M. Capital Corp.
Mr. Dennis Wu
Managing Partner,
Chinese Severice Group
Deloitte and Touché LLP
Mr. Hutchins Hung
SVP & Mgr. - US Asia Banking Center
Bank of America
Mr. Patrick Quek
President & CEO
PKF Consulting
Mr. Terry Kanat
District Sales Manager
Mr. Gary Schroeder
HSBC Bank USA
Mr. James Kwok
Principal
Dr. David Shen
Partner
Tomer & Shen Orthoworks
Mr. Benjamin Lam
First Vice President, Investments
Mr. L. Leland Whitney
Managing Principal
M O N I T O R
Spring 2003
The Hong Kong Association of Northern California
Annual Event Lives Up to Its Promise
Gala Party Highlighted with an Encore by
the Lettermen at the Ritz-Carlton
by Gary Carr
W
hen The Lettermen returned to headline the HKANC Annual Event on
January 11, it was like old friends coming back for a reunion. The popular
vocal trio, with nine Gold Albums to their credit, is a special favorite of the
Association and their performance in the Grand Ballroom at San Francisco’s
Ritz-Carlton Hotel showed why.
A capacity crowd of 460 packed the ballroom, anticipating a great show
from The Lettermen, who had won the hearts of their audience at the Annual
Event two years earlier. Event co-chairs Tony Chan, Ellen Chan and Heidi Tan
played all the right cards in bringing The Lettermen back. Their efforts paid
off, as the trio of Donovan Tea, Darren Dowler, and leader Tony Butala put
on a very tight, and at the same time, warm show featuring songs from
Broadway. In their hands, tunes seemingly so opposite in character as “Hey,
Look Me Over” and “If I Loved You” came out boisterously alive or enchantingly
haunting, proving these men know how to tackle a song.
Long-time fans, some of whom remembered the group from when it started
in 1961, were treated to a medley of Lettermen favorites as the
group donned letter sweaters to
Diamond Sponsor Bank of America with The Lettermen.
sing their first hit single, “The Way You Look Tonight,” along with “Theme
from Summer Place,” and “When I Fall in Love.”
Besides their musicianship, which extends to their choice of an excellent
backup group of keyboards, guitar, and drums, The Lettermen are savvy
entertainers and genuinely like their audience. Tony Butala admitted that he’s
sung “Maria” in every show for the past 43 years, then found a real Maria in
the audience and sang the song to her, backed up by some gently wry
comedy from Darren and Donovan. In addition, the fact that the trio took
the time to learn songs in Cantonese brought a wave of appreciative
applause.
Tony Chan was hustled to the stage to join the trio as the “Fourth
Letterman,” singing lead with them on “The Way You Look Tonight.”
Having broken the ice for audience involvement, The Lettermen gave
a gentleman at a far table his five minutes of fame by encouraging him
to sing “I Left My Heart in San Francisco.” The episode was handled
with warmth and a spirit of fun, and the accountant from “an
unmentioned utility company whose name is three initials” probably
went home a hero.
If you’re around The Lettermen offstage, you find them and their
crew to be pretty easygoing people who just happen to be talented
performers as well. Their lives have many of the same twists and
turns that the rest of us experience, except for being on the road for
150 shows each year. At lunch, Tony Butala talked not of music, but of
football and wine.
The Hong Kong Association
41 Sutter Street, #1748
San Francisco, CA 94104
Tel: (415) 398-4506 Fax: (415) 392-2964
website: www.hkanc.com
e-mail: [email protected]
Creative and Production: Time Advertising
Presenting THE LETTERMEN.
(Cont. on page 2)
(Cont. from page 1)
“When we’re traveling together or relaxing before a show, football is a
good topic, a nice break from talking about the business all the time,”
Butala said.
“The Dalmatian Coast, it’s beautiful,” he says. “And perfect for wine, because
it’s got the sea to the west, just like California.”
Butala is involved with a winery in Croatia, as well. His eyes go wide as he
explains how oenologists have traced the zinfandel grape
back to vine stocks that originated on the Dalmatian
Coast. His dissertation continues - a descendant of this
grape is currently responsible for a Croatian wine bottled
as Plavac Malia.
Tony grew up in Sharon, Pennsylvania, not far from Pittsburgh, and is
a lifelong Steelers fan. Donovan Tea lives in Nashville and follows the
Titans. Later that night, when Tony mentioned the Steelers’ loss that
afternoon to Nashville, it probably had something to do with losing a
bet to Tea.
Letterman Darren Dowler lives in Playa del Rey, California, “five minutes
from LAX.” He has a sound studio in his home. “I’m so close to the
airport that it took me three weeks of work to soundproof the studio,
instead of the three days I’d figured on.” He went on to detail the
number of layers of wood and soundproofing he had to use, sounding
as much like Bob Vila as a talented singer-impressionist.
Ladies of the Annual Event: (left to right) Executive Director Lesley Hu,
Co-chairs Heidi Tan and Ellen Chan.
Butala’s smile is wide and intense. He could sell you
a bottle of this wine as easily as he sells a song.
Lunch is over. The band leaves for a sound check. The
Lettermen excuse themselves, and already their game
faces are starting to show. Things look very promising.
Darren is about to start taking lessons in the art of ancient Japanese
swordsmanship.
Donovan Tea lives in Nashville because he is also a songwriter.
He has a number of non-Lettermen songs to his credit and has been
with the group for 19 years. His wife is a professional photographer,
and he is about to become a father for the first time.
The lucky number is...(left to right) Wendy Quek, past president Tony Chan,
Howard Hu, and Chek Tan.
Corporate Member Volunteers: (left to right)
Co-Chair Ellen Chan, Lesley Hu,
Shirley Kwok and Therese Hu
prepare for the event.
The event committee worked out even the tiniest of
details, from approving all the graphics to designing the
special dessert, a Chinese take-out box made out of
chocolate and filled with berries and chocolate mousse.
Even the chopsticks were chocolate.
Oversized posters decorated the reception area, each
devoted to the sponsors and giving special thanks to
past and present Directors of HKANC. In all, more
than 35 businesses and dozens of volunteers
contributed to the production of the Annual Event. In
addition, 15 airline, hotel, cruise line, andrestaurant
companies contributed raffle prizes, ranging from
round trips to Hong Kong to weekends in San
Francisco. Special thanks went to Terry Kanat of
Cathay Pacific Airways and Joe Cheung of United
Airlines for assisting insoliciting the airline packages.
Tony Chan was effusive in extending sincere thanks in his opening remarks to
the major sponsors of the event, including Diamond Sponsor Bank of America
and Platinum Sponsors Citigroup Private Bank, Hong Kong Economic and
Trade Office, United Commercial Bank, and Wells Fargo. [What Tony did not
mention was that another note of thanks should go to his wife Ellen and
himself. Their longstanding personal friendship with The Lettermen was
instrumental in securing the group’s appearance.]
The Annual Event succeeded because so many people made
promises – and kept them. The Lettermen helped HKANC carry out
this theme. As soon as they hit the stage, The Lettermen sang a
musical promise – “We’ve Got Magic to Do.” An appreciative audience
saw that promise fulfilled, not just in the show itself, but in the way
the whole of HKANC did magic that night.
In his opening remarks, outgoing President Tony Chan
promised a stellar evening, and thanked co-chairs Heidi
and Ellen, along with Executive Director Lesley Hu, for
their tireless, 11-month effort in putting the program
together.
“The school is right near my house,” he said. “I saw them practicing
and thought, ‘I’ve got to try that’.”
Tony Butala now lives in Manitowoc, Wisconsin, but also owns a
house and vineyards in Napa. He thinks he’ll retire there one day. He
is passionate about wine, particularly the wines of his country of
ancestry, Croatia.
A Letter From Our President, Tommy S. Wu
To All HKANC Members
New President Tommy Wu, new Vice President Heidi Tan and HKETO Director
Annie Tang enjoying a moment with corporate members, Chek Tan & Director Patrick Quek.
Dear All
Membe
rs,
A s Ho n
g Kong
emerges
gate way
as the fi
for busi
nancial
nesses fr
hub of th
Rim to
o
m Ameri
e Pearl R
capitaliz
c
iver Delt
a
tr
e
anscend
on the b
Trade O
a Region
ing into
usiness o
rganizati
of South
C
p
h
p
ina. Cali
o
r tunitie
on in th
ern Chin
fornia is
s betwee
e near fu
a, it has
T h e Ho
n
strategic
tu
th
become
r
e
e
.
United
n g Ko n g
a
lly w ell
ev en mo
S
ta
A
te
p
ss
s
ositione
ociation
and the
re impo
in the re
d with it
r tant as
Mainlan
of North
gional a
s pr oxim
the
d especia
nd glob
ern Cali
and inte
ity to th
a
fo
ll
l
y
e
rn
conomie
when C
ia
r esting
w
e Pacific
il
l
th
h
s
in
o
e
p
re
f
a
ro
th
fo
e
nters in
grams th
e 21st C
re conti
collabora
to the W
nue to fo
entur y.
r oughou
tiv e exp
orld
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cus on in
t the y e
erience
a
a
ls
c
r,
o
w
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ts
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ll of us.
gether to
of busin
ess stud
focus on
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str ength
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Thoma
our ties
in Asia
sS
thr ough
P r e s i d e . Wu
Ho n g K
nt
ong,
Jackson Cheung sings
his heart out in San Francisco.
Corporate members Sue Hutner and Maria Wang
pose with the Lettermen.
460 guests packed the Ballroom at the
Ritz-Carlton
UPCOMING EVENTS
Panel Discussion
“Hong Kong And Its Neighbors:
what now??? WHAT NEXT???”
May 27, 2003
5:30pm to 7:30pm
Distinguished Speakers Luncheon Featuring
Hong Kong Forum
Mr. Eddie Wang
October 28-29th
Regional President For The West Coast of HSBC Bank USA
Hong Kong Convention and Exhibition Center
June 12, 2003
11:30pm to 2:00pm
Hong Kong
Renaissance Parc 55 Hotel, San Francisco
Hong Kong Economic and Trade Office
Second Annual Scholarship Fundraising
Annual Event
130 Montgomery Street, San Francisco
Golf Tournament
January 10th, 2004
September 22, 2003
Westin St. Francis Hotel, San Francisco
The Peninsula Golf & Country Club, San Mateo
(Cont. from page 1)
Butala said.
as Plavac Malia.
bet to Tea.
swordsmanship.
together.
ancestry, Croatia.
Dear All
Membe
rs,
A s Ho n
g Kong
emerges
gate way
as the fi
for busi
nancial
nesses fr
hub of th
Rim to
o
m Ameri
e Pearl R
capitaliz
c
iver Delt
a
tr
e
anscend
on the b
Trade O
a Region
ing into
usiness o
rganizati
of South
C
p
h
p
ina. Cali
o
r tunitie
on in th
ern Chin
fornia is
s betwee
e near fu
a, it has
T h e Ho
n
strategic
tu
th
become
r
e
e
.
United
n g Ko n g
a
lly w ell
ev en mo
S
ta
A
te
p
ss
s
ositione
ociation
and the
re impo
in the re
d with it
r tant as
Mainlan
of North
gional a
s pr oxim
the
d especia
nd glob
ern Cali
and inte
ity to th
a
fo
ll
l
y
e
rn
conomie
when C
ia
r esting
w
e Pacific
il
l
th
h
s
in
o
e
p
re
f
a
ro
th
fo
e
nters in
grams th
e 21st C
re conti
collabora
to the W
nue to fo
entur y.
r oughou
tiv e exp
orld
We will
cus on in
t the y e
erience
a
a
ls
c
r,
o
w
r
easing th
both ind
continu
ith fello
2003 pro
e
w
e
e
w
p
u
H
e
it
n
n
o
h
d
d
n g Ko n g
erstandin
our earn
ently an
mises to
est effor
associate
d jointl
g of H o
be anoth
speaker
y, with
n g Ko n g
t to spon
s in the
er ex citin
s for th
o
’s role
th
B
sor a vari
a
e
y
g
r
A
o
y
e
e
rg
re
a
p
a
r
a
.
o
ety of hig
n
for our
Mr. Ed
p
iz
u
a
ti
la
o
r
n
d ie W a n
s to sha
members
d is t in g
h
q
u
ality
r e our c
u is h e d
g, Head
. Ou r P
just to n
omrade
speaker
rogram
of HSB
ame a fe
sh
C
s
C
ip
o
lu
Bank, U
mmittee
and
ncheon
w. With
Associati
S A in J u
is for eve
s . So m
the supp
on will
ne and
r workin
e of th
or t of th
a
D
ls
e
g
o
r
. Sung W
schedu
hard to
offer r ou
e Ho n g
Kong Fo
le d s p e
calenda
ndtable
. Sohn,
Kong E
rum, wh
r high c
akers f
discussio
conomic
C h ie f E
ich is sp
28th an
aliber
or the
c
n
o
o
&
meeting
nsored b
n o m is t
T
d 29th.
r
y ear w
a
d
e
o
s
O
y
f
w
ff
T
W
T
it
il l f e a t
ic
h
h
h
e
e
e
e
ll
visiting
Ho n g K
a
other pro
s
n
do hav e
F
d
a
ure
r
o
g
ther Ho
o Bank
H ong K
ong Tra
grams to
a strong
n g Ko n
in N o v e
o n g G ov
d e De v e
understa
look ou
g
m
like the
g
lo
e
o
b
rn
p
v
e
t
m
e
r,
ment an
nding o
for will
rnmenta
ent Cou
Annual
f the Ho
d busine
be the p
l agencie
ncil will
G olf To
ng Kon
anel dis
ss leaders
Golf To
s, the
once ag
urname
g
c
u
urname
.
a
a
ss
n
T
n
in
ions wit
d China
t on Sep
he Annu
take pla
nt is to
h distin
tember
business
a l Ho n g
ce in H
from Ch
raise fun
guished
22nd an
o n g Ko n
envir on
ina, Ho
ds to su
b
d
u
m
g on O c
th
si
e
ng Kong
e grand
ness lead
n
p
t;
p
o
a
n
r
tober
t
d
the Asso
affair e d
a host o
ers in th
and the
The Boa
’honneu
ciation’s
f quality
United
e B ay A
rd and I
r,
States o
re
n
fu
th
e
a
w
n
e Annua
who
draising
ly found
thank y
f Chine
l E ve n t
2003 wil
and soc
ed Scho
ou for y
se decen
in Janua
ial ev en
larship F
l be ano
our sup
t.
r
ts
y
ther suc
u
2
p
n
0
or t and
d benefi
04. The
cessful y
by work
ting stu
goal of th
Cordiall
ear for a
in
d
e
g
e
n
to
ts
y,
ll of us.
gether to
of busin
ess stud
focus on
ies
str ength
e
ning of
Thoma
our ties
in Asia
sS
thr ough
P r e s i d e . Wu
Ho n g K
nt
ong,
Ritz-Carlton
UPCOMING EVENTS
Panel Discussion
May 27, 2003
5:30pm to 7:30pm
Hong Kong Forum
Mr. Eddie Wang
October 28-29th
June 12, 2003
11:30pm to 2:00pm
Hong Kong
Annual Event
Golf Tournament
January 10th, 2004
September 22, 2003
(Cont. from page 1)
Butala said.
as Plavac Malia.
bet to Tea.
swordsmanship.
together.
ancestry, Croatia.
Dear All
Membe
rs,
A s Ho n
g Kong
emerges
gate way
as the fi
for busi
nancial
nesses fr
hub of th
Rim to
o
m Ameri
e Pearl R
capitaliz
c
iver Delt
a
tr
e
anscend
on the b
Trade O
a Region
ing into
usiness o
rganizati
of South
C
p
h
p
ina. Cali
o
r tunitie
on in th
ern Chin
fornia is
s betwee
e near fu
a, it has
T h e Ho
n
strategic
tu
th
become
r
e
e
.
United
n g Ko n g
a
lly w ell
ev en mo
S
ta
A
te
p
ss
s
ositione
ociation
and the
re impo
in the re
d with it
r tant as
Mainlan
of North
gional a
s pr oxim
the
d especia
nd glob
ern Cali
and inte
ity to th
a
fo
ll
l
y
e
rn
conomie
when C
ia
r esting
w
e Pacific
il
l
th
h
s
in
o
e
p
re
f
a
ro
th
fo
e
nters in
grams th
e 21st C
re conti
collabora
to the W
nue to fo
entur y.
r oughou
tiv e exp
orld
We will
cus on in
t the y e
erience
a
a
ls
c
r,
o
w
r
easing th
both ind
continu
ith fello
2003 pro
e
w
e
e
w
p
u
H
e
it
n
n
o
h
d
d
n g Ko n g
erstandin
our earn
ently an
mises to
est effor
associate
d jointl
g of H o
be anoth
speaker
y, with
n g Ko n g
t to spon
s in the
er ex citin
s for th
o
’s role
th
B
sor a vari
a
e
y
g
r
A
o
y
e
e
rg
re
a
p
a
r
a
.
o
ety of hig
n
for our
Mr. Ed
p
iz
u
a
ti
la
o
r
n
d ie W a n
s to sha
members
d is t in g
h
q
u
ality
r e our c
u is h e d
g, Head
. Ou r P
just to n
omrade
speaker
rogram
of HSB
ame a fe
sh
C
s
C
ip
o
lu
Bank, U
mmittee
and
ncheon
w. With
Associati
S A in J u
is for eve
s . So m
the supp
on will
ne and
r workin
e of th
or t of th
a
D
ls
e
g
o
r
. Sung W
schedu
hard to
offer r ou
e Ho n g
Kong Fo
le d s p e
calenda
ndtable
. Sohn,
Kong E
rum, wh
r high c
akers f
discussio
conomic
C h ie f E
ich is sp
28th an
aliber
or the
c
n
o
o
&
meeting
nsored b
n o m is t
T
d 29th.
r
y ear w
a
d
e
o
s
O
y
f
w
ff
T
W
T
it
il l f e a t
ic
h
h
h
e
e
e
e
ll
visiting
Ho n g K
a
other pro
s
n
do hav e
F
d
a
ure
r
o
g
ther Ho
o Bank
H ong K
ong Tra
grams to
a strong
n g Ko n
in N o v e
o n g G ov
d e De v e
understa
look ou
g
m
like the
g
lo
e
o
b
rn
p
v
e
t
m
e
r,
ment an
nding o
for will
rnmenta
ent Cou
Annual
f the Ho
d busine
be the p
l agencie
ncil will
G olf To
ng Kon
anel dis
ss leaders
Golf To
s, the
once ag
urname
g
c
u
urname
.
a
a
ss
n
T
n
in
ions wit
d China
t on Sep
he Annu
take pla
nt is to
h distin
tember
business
a l Ho n g
ce in H
from Ch
raise fun
guished
22nd an
o n g Ko n
envir on
ina, Ho
ds to su
b
d
u
m
g on O c
th
si
e
ng Kong
e grand
ness lead
n
p
t;
p
o
a
n
r
tober
t
d
the Asso
affair e d
a host o
ers in th
and the
The Boa
’honneu
ciation’s
f quality
United
e B ay A
rd and I
r,
States o
re
n
fu
th
e
a
w
n
e Annua
who
draising
ly found
thank y
f Chine
l E ve n t
2003 wil
and soc
ed Scho
ou for y
se decen
in Janua
ial ev en
larship F
l be ano
our sup
t.
r
ts
y
ther suc
u
2
p
n
0
or t and
d benefi
04. The
cessful y
by work
ting stu
goal of th
Cordiall
ear for a
in
d
e
g
e
n
to
ts
y,
ll of us.
gether to
of busin
ess stud
focus on
ies
str ength
e
ning of
Thoma
our ties
in Asia
sS
thr ough
P r e s i d e . Wu
Ho n g K
nt
ong,
Ritz-Carlton
UPCOMING EVENTS
Panel Discussion
May 27, 2003
5:30pm to 7:30pm
Hong Kong Forum
Mr. Eddie Wang
October 28-29th
June 12, 2003
11:30pm to 2:00pm
Hong Kong
Annual Event
Golf Tournament
January 10th, 2004
September 22, 2003
Merrill Lynch Gu
by Lesley Hu
Chris Hyzy Looks at Inve
by Gary Carr
President Tommy Wu
and Lesley Hu
honoring Gary Carr
Editor for the
Monitor.
T
However, Hyzy reported that a “slow-motio
finally begun, and that the landscape sho
sunnier in 2004. But for now, 2003 is not a
on too much risk.
President Tommy Wu
and Vice President
Heidi Tan welcome
new Corporate
Members.
“A number of important developments are a
deep down below the ice,” Hyzy said. Amo
slight improvements in manufacturing and
Year of the Ram.
Air China Cargo
Bank of America
Bank of the Orient
BoldFocus
C.M. Capital Corp.
Cobra Solutions
Direction 21
First Republic Bank
HSBC Bank USA
Intergraph, Inc.
James Ho
D
uring the Ice Age, a lot was happenin
that came back to haunt us or help u
disappeared,” declared Chris Hyzy, H
Investment Policy for Merrill Lynch Glob
Strategy. As the first presenter in H
Distinguished Speakers Series, Hyzy appear
5 Association luncheon held at the Banke
Francisco.
Hyzy claimed that we are now in the midst
Age” of investment, with most investors see
place. He finds the temper of the current e
to be an anomaly. Looking back over
recessions we’ve experienced, starting with t
54, the 2001-02 recession is the only one
later, everything is still sluggish. The custom
loosening up has taken a longer than us
started.
“
MTC Trading Company
OOCL (USA) Inc.
PKF Consulting
Time Advertising
U. S. Land International Holdings, Inc.
United Airlines
Wang Hutner Design
Wells Fargo
He broke the world down into regions and se
that, regionally, high quality, structural shifts
• UK – Outperform (dividend yield them
• Emerging Markets – Outperform
demand in N. Asia)
• U.S. – Neutral (good relative valuation
valuations)
• Eurozone – Underperform (weakest
of Japan)
• Japan – Underperform (on again/off a
growth)
Looking at global sectors, he found no pricing
• Outperformers – Staples, Energy, Uti
• Neutral – General Industrials, Te
Industries, Media
• Underpe
Technol
Goods, Fin
One might on
the effects of
War, but Hyzy
oil price impac
as large as the
Oil, he said, wou
to $60 a barrel to
Sp
Merrill Lynch Guru Proposes Portfolio Strategy
by Lesley Hu
Chris Hyzy Looks at Investment Opportunities for the Next Five Years
Hong Kong Association
2003 Officers
by Gary Carr
President Tommy Wu
and Lesley Hu
honoring Gary Carr
Editor for the
Monitor.
T
However, Hyzy reported that a “slow-motion recovery” has
finally begun, and that the landscape should look much
sunnier in 2004. But for now, 2003 is not a time for taking
on too much risk.
President Tommy Wu
and Vice President
Heidi Tan welcome
new Corporate
Members.
“A number of important developments are already occurring
deep down below the ice,” Hyzy said. Among them are the
slight improvements in manufacturing and pricing power,
Year of the Ram.
Air China Cargo
Bank of America
Bank of the Orient
BoldFocus
C.M. Capital Corp.
ChinaVest, Inc.
Cobra Solutions
Direction 21
First Republic Bank
HSBC Bank USA
Intergraph, Inc.
James Ho
D
uring the Ice Age, a lot was happening under the ice
that came back to haunt us or help us after the ice
disappeared,” declared Chris Hyzy, Head of Global
Investment Policy for Merrill Lynch Global Investment
Strategy. As the first presenter in HKANC’s 2003
Distinguished Speakers Series, Hyzy appeared at the March
5 Association luncheon held at the Banker’s Club in San
Francisco.
Hyzy claimed that we are now in the midst of a global “Ice
Age” of investment, with most investors seemingly frozen in
place. He finds the temper of the current economic times
to be an anomaly. Looking back over the past eight
recessions we’ve experienced, starting with the one in 195354, the 2001-02 recession is the only one where, a year
later, everything is still sluggish. The customary melting and
loosening up has taken a longer than usual time to get
started.
“
MTC Trading Company
OOCL (USA) Inc.
PKF Consulting
Time Advertising
United Airlines
Wang Hutner Design
Wells Fargo
He broke the world down into regions and sectors, reporting
that, regionally, high quality, structural shifts are visible, with
Intrigued guests get investor tips.
impact as it did on the economy in 1980, when it reached
the equivalent of $100 a barrel in 2002 adjusted dollars.
“But remember,” he cautioned, “every $10 increase in the
price of oil will knock 0.5% from the U.S. GDP.”
Balance sheet repair
Hyzy presented some medium-term trends to watch, the
theme for which is “balance sheet repair,” as businesses
are suddenly getting religious. The bursting of the
technology, credit, and overall market bubble has led to
massive movements in balance sheet restructuring, some
of whose implications include:
• A struggling asset deflationary environment and less
impact by the Federal Reserve.
• Lower credit card demand, even in a low-rate
environment.
• Massive consolidation as leaders grab for market
share.
• New growth industries take longer to be born.
• Previous market leadership group loses that status.
• UK – Outperform (dividend yield theme)
• Emerging Markets – Outperform (China driving
demand in N. Asia)
• U.S. – Neutral (good relative valuations, high absolute
valuations)
• Eurozone – Underperform (weakest growth outside
of Japan)
• Japan – Underperform (on again/off again reform, 0%
growth)
Looking at global sectors, he found no pricing power present
• Outperformers – Staples, Energy, Utilities
• Neutral – General Industrials, Telecoms, Basic
Industries, Media
• Underperformers –
Technology, Cyclical
Goods, Financials
One might only speculate on
the effects of a second Gulf
War, but Hyzy did say that any
oil price impact would not be
as large as the last “oil shock.”
Oil, he said, would have to jump
to $60 a barrel to have the same
Speaker Chris Hyzy.
• Stock, bond, and cash returns remain volatile and likely
to be below normal. Benefits of asset allocation for
every risk profile remain critical.
• And, finally – the bright light in demand will continue
to be China!
Looking at U.S. market returns by decade, Hyzy presented
what he termed “sobering stuff.” U.S. equities have averaged
close to 18% returns in the last two full decades. It is not
illogical, he said, to expect below-average returns in the
current decade. To prevent a decade worse than the 1930s,
equity returns in the U.S. will have to average 6.5% for the
next seven years.
Currently, ROI is still lower than in the 1980s. Although
oversupply is still having an impact, Hyzy feels we are on
the mend. “Our call,” he said, “is for 2004-05 to begin the
recovery.”
Implications for Investors:
Hyzy closed with a list of “Investment Implications during
the Ice Age.”
• Be well diversified across ALL core asset classes and
some non-core and within each class.
• Be disciplined regarding downside risk.
• Active vs. passive management
• Alternative strategies are needed to outperform the
markets (AIs, FX, High Yield, etc.)
• Market timing is impossible. Procrastination is just
as bad.
• Dollar cost averaging with a consistent road map
is optimal.
In the Q and A session that followed, Hyzy was asked to
comment on the strategies of Warren Buffet.
“Buffet looks for companies that, he feels, have repaired
their balance sheets. He buys companies, not equities,”
Hyzy explained, “and he has the money to be wrong.”
Based on Hyzy’s presentation, one would assume that
investors in this current Ice Age would do well to tread very
carefully. Unless they have the money to be wrong.
President
Mr. Thomas Wu
President & CEO
Vice President
Ms. Heidi Tan
President
Secretary
Mr. Chi-Hung Chan
Partner
Treasurer
Mr. Thomas Broderick
Partner
Honorary Director Ms. Annie Tang
Director
Hong Kong Economic and
Trade Office
Executive Director Ms. Lesley Hu (Outgoing)
Ms. Susanna Kwan (Incoming)
Board of Directors Page:
Mr. Anthony Chan
General Partner
Mr. Michael Lee
Advisor
GrandOak Consulting
Mr. Lawrence Chan
President & CEO
Mr. Edmond Lok
Managing Director
Mr. Joe Cheung
International Sales Manager
United Airlines
Ms. Ruth Ma
Director
Central Financial
Management.
Montgomery Golf Corp.
Mr. Norman Eckersley
Bank of the Orient
Mr. Henry Gaw
C.M. Capital Corp.
Mr. Dennis Wu
Managing Partner,
Chinese Severice Group
Deloitte and Touché LLP
Mr. Hutchins Hung
SVP & Mgr. - US Asia Banking Center
Bank of America
Mr. Patrick Quek
President & CEO
PKF Consulting
Mr. Terry Kanat
District Sales Manager
Mr. Gary Schroeder
HSBC Bank USA
Mr. James Kwok
Principal
Dr. David Shen
Partner
Tomer & Shen Orthoworks
Mr. Benjamin Lam
First Vice President, Investments
Mr. L. Leland Whitney
Managing Principal
M O N I T O R
Spring 2003
The Hong Kong Association of Northern California
Annual Event Lives Up to Its Promise
Gala Party Highlighted with an Encore by
the Lettermen at the Ritz-Carlton
by Gary Carr
W
hen The Lettermen returned to headline the HKANC Annual Event on
January 11, it was like old friends coming back for a reunion. The popular
vocal trio, with nine Gold Albums to their credit, is a special favorite of the
Association and their performance in the Grand Ballroom at San Francisco’s
Ritz-Carlton Hotel showed why.
A capacity crowd of 460 packed the ballroom, anticipating a great show
from The Lettermen, who had won the hearts of their audience at the Annual
Event two years earlier. Event co-chairs Tony Chan, Ellen Chan and Heidi Tan
played all the right cards in bringing The Lettermen back. Their efforts paid
off, as the trio of Donovan Tea, Darren Dowler, and leader Tony Butala put
on a very tight, and at the same time, warm show featuring songs from
Broadway. In their hands, tunes seemingly so opposite in character as “Hey,
Look Me Over” and “If I Loved You” came out boisterously alive or enchantingly
haunting, proving these men know how to tackle a song.
Long-time fans, some of whom remembered the group from when it started
in 1961, were treated to a medley of Lettermen favorites as the
group donned letter sweaters to
Diamond Sponsor Bank of America with The Lettermen.
sing their first hit single, “The Way You Look Tonight,” along with “Theme
from Summer Place,” and “When I Fall in Love.”
Besides their musicianship, which extends to their choice of an excellent
backup group of keyboards, guitar, and drums, The Lettermen are savvy
entertainers and genuinely like their audience. Tony Butala admitted that he’s
sung “Maria” in every show for the past 43 years, then found a real Maria in
the audience and sang the song to her, backed up by some gently wry
comedy from Darren and Donovan. In addition, the fact that the trio took
the time to learn songs in Cantonese brought a wave of appreciative
applause.
Tony Chan was hustled to the stage to join the trio as the “Fourth
Letterman,” singing lead with them on “The Way You Look Tonight.”
Having broken the ice for audience involvement, The Lettermen gave
a gentleman at a far table his five minutes of fame by encouraging him
to sing “I Left My Heart in San Francisco.” The episode was handled
with warmth and a spirit of fun, and the accountant from “an
unmentioned utility company whose name is three initials” probably
went home a hero.
If you’re around The Lettermen offstage, you find them and their
crew to be pretty easygoing people who just happen to be talented
performers as well. Their lives have many of the same twists and
turns that the rest of us experience, except for being on the road for
150 shows each year. At lunch, Tony Butala talked not of music, but of
football and wine.
The Hong Kong Association
41 Sutter Street, #1748
San Francisco, CA 94104
Tel: (415) 398-4506 Fax: (415) 392-2964
website: www.hkanc.com
e-mail: [email protected]
Creative and Production: Time Advertising
Presenting THE LETTERMEN.
(Cont. on page 2)

Spring 2003 - The Hong Kong Association of Northern California

Transcription

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