China Dispatch: Honing my negotiating skills and some closing thoughts
Posted on October 30, 2009 at 2:38 pm
Our final city visit on this trip was to Hong Kong, which is beautifully situated on the coast and is very modern. The 10-year-old state-of-the-art airport sits on a man-made island about 30 minutes from downtown. Given its history of being longtime British colony, it is the most westernized Chinese city that we visited.
We arrived in the early evening — with enough time to get fitted for a suit that cost a quarter of the U.S. price — then headed over to Hong Kong Island to do some last-minute shopping in the street market. What a sight to see: thousands of people walking shoulder to shoulder down shop-lined streets buying everything from knock-off Rolexes to rubber chickens, all trying to negotiate the best deal they could. After being taken a few times, I became the hardest negotiator in the street — at least in my own mind.
I had to depart early the next day while the group had a last day of meetings. I feel very privileged to have been invited to travel to China with a first-class Tennessee delegation. I enjoyed getting to know the governor, the commissioners, their hard-working staff and, most of all, the Tennessee business leaders who all share a common interest in growing ties with China. I met many people, both American and Chinese, with whom I plan to explore opportunities.
China was different than I had anticipated. I had envisioned more of a third-world infrastructure that only had an upper and lower class, all ruled by the fist of Communism. Instead, I found a very robust ‘capitalist-like’ society backed by a government in pursuit of world power.
The country’s leaders have the strong taste for wealth and are making monumental strides in buying up the world’s natural resources and learning (some would call it stealing) everything they can to improve their citizens’ lives. Although, like us right now, I’m not sure they’ve figured out how to pay for it.
The Chinese have a rich history dating back thousands of years, during which they have seen just about everything. While they do have a judicial system, they seem to still turn a blind eye to human rights, the protection of intellectual property and true freedom of speech. I was warned to watch what I blogged, as they do monitor ‘reporter-like’ information. (For more on that, check out hotel Internet use disclaimer.) I didn’t want Bill Clinton to have to come fetch me.
The few businesspeople I spoke with who are doing business in China said that, while their costs are still very low, they are still only comfortable with transaction-based investments, i.e. outsourcing portions of their production to Chinese companies instead of fully investing in facilities there. Their fear is that their product patents will be stolen and their real estate taken.
It’s still a bit of the Wild West there. But then again, on the clock of Chinese’s long history, so was the U.S. only a few minutes ago.
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Cash for clunkers’ local boost
Posted on at 2:26 pm
Middle Tennessee’s factory sector saw a nice boost in activity during September, with hours worked at durable goods manufacturers jumping almost 20 percent.
Think Halloween is scary? Try getting a bunch of lawyers to move by December 15
Posted on at 2:08 pm
That’s what the Bass Berry team needs to do.
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Billions more for transportation?
Posted on at 1:53 pm
TRG analyst Kathryn Thompson says the latest political posturing over infrastructure spending could push the conversation to a more productive place.
What does this all mean? Perhaps the biggest roadblock to transportation reauthorization debate has been lack of guidance from the White House. Durbin’s unique political position (i.e., Senate majority whip & close ties to Illinois based President Obama) could help bring to light to the Obama administration that the transportation bill is, in fact, a politically worthy cause to address sooner rather than later. Overall, it is clear that the pressure is mounting, driven by state DOTs, industry, and rising unemployment.
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China Dispatch: Quick-thinking monks and private equity with its eye on the States
Posted on at 12:47 pm
Our third stop was Hangzhou, located about two hours west of Shanghai. Many people from Shanghai have second homes in Hangzhou, which is surrounded by mountains, has a large river running through it and a large, calm lake sitting in the middle of the city.
In the morning before meetings, Butch Eley, Rep. Craig Fitzhugh, Tom Cigarran, a few others and I took a bus to see Buddhist temple nestled in the hills just outside of town. The beautifully restored structure was one of the only temples not destroyed when Mao took power. We were told that, after being given a heads up that the Communists were on their way, the 1,000 monks who lived there hung large photographs of Mao on the walls of the temple. It convinced the revolutionary leader not to destroy it and the site is still home to several buildings containing Buddhist statues more than 30 feet tall.
From there, we drove to a tea plantation built into the hills of a steep canyon. It resembled a small Napa Valley winery. We stopped for a tasting and learned that many world leaders — including the No. 1 tea lover, Queen Elizabeth — had tasted tea there. We got a full education on growing tea plants, the drying process and then drinking it.
Unfortunately, it didn’t have any alcohol. But like wine, they have several different price levels, which we tried — and of course had to buy. The Chinese are great salespeople. We all just had to buy the tea which all of the dignitaries drank, known as the “Emperor’s Tea.” While it was good and cost the group over $2,000, I don’t think any of us plan to trade in our Starbucks coffee anytime soon. We were all glad that we took the trip. It was good to see the countryside and something other than skyscrapers piercing through smog.
Our day ended with several hours of meetings with the local city and provincial government, where Governor Bredesen signed another memorandum of understanding to work together on business opportunities. We heard from the CEO of the 700-bed hospital in which HCA’s Tommy Frist has invested more than $120 million.
We then had a reception with local business people where we talked about opportunities to do business in China and the U.S. Most were health care and energy companies, but I did speak with a young a woman, educated in the U.S., who was now with a private-equity firm looking to invest in the States. This was refreshing to hear, as most companies were still looking for Chinese investment.
Later that evening, a few of us went to a karaoke establishment. That’s the only way to describe it. It was in an office building, had marble-lined floors and walls with about 20 private, well-appointed rooms for groups to privately belt out their best “Rocky Mountain High.” While walking back to our hotel, I noticed a drunken squabble between a man and a very pregnant woman. I immediately ran over and pulled the two apart and they said a few things that I couldn’t understand. Some things are best left unsaid or uninterpreted.
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No green shoots for developers
Posted on at 12:12 pmMarty Heflin of M2H Group says the mood is just plain sour.
“Heaven in 2011?” I am not so sure. In conversations with fellow developers, lenders and investors primarily in the Southeast region, I am not hearing a lot of talk about “green shoots.” I am seeing a lot of downcast faces and concern. The central problem continues to be two-fold: a) the land sellers and asset holders that are distressed haven’t gotten the memo yet and b) the credit markets remain shut tighter than the back of a Swiss watch.
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Gun maker takes aim at TDOT
Posted on at 10:39 am
Ronnie Barrett says state officials told him they were on board with his plans to expand and add 300 jobs just off I-24 in Rutherford County — until they weren’t and left him with a building he can’t get to.
“TDOT was very in favor of it. They said, ‘Yes, we like it. It’s an old farm fence out there. I think it’s going to be easy just to move the fence,’” said Barrett. “Now we have the inability to be able to win certain government contracts because our building’s not big enough.”
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The nightmare of unknown risks
Posted on at 10:02 am
Directors surveyed by locally based Corporate Board Member say they aren’t gravely worried about their CEOs’ ability to handle the challenges now facing their companies. What has many more of them staying awake at night is the idea that they don’t know what the next set of challenges will look like.
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Local industrial property market ahead of nation’s
Posted on at 9:44 am
Data compiled by Colliers shows Nashville – along with regional competitors Louisville and Indianapolis – with an industrial real estate vacancy rate that is well below the national average. Memphis, Atlanta and Cincinnati, on the other hand, are struggling with double-digit numbers.
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This is how the housing inventory will be whittled down
Posted on at 9:14 am
Numbers from MTSU’s BERC show the value of Nashville-area building permits the past three months was only about a third of the volume from the boom years. Check out the raw numbers and other regional stats here.
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HIMSS absorbs Nashville medical biz
Posted on at 8:04 am
The Chicago-based Healthcare Information Management Systems Society, a nonprofit membership group, has acquired Nashville’s Medical Banking Project. Read about how the project will bring together health care IT and banking here.
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Browsing Pinnacle’s 10-Q
Posted on at 7:45 amWe had to go pretty deep to find some nuggets of info that weren’t covered in last week’s Q3 earnings release and conference call, but here’s what we found:
- Terry Turner and his crew are still looking to grab market share. They ramped up marketing and business development spending in the quarter to $512,000, a jump of more than a third from a year ago and up 13 percent from their first-half pace.
- A chunk of that cash is going to the trust department, which has grown its assets under management to $607 million from $537 million a year ago.
- Spending on foreclosed real estate fell by almost half during Q3. Is it a sign that the worst has passed or does it mean that Pinnacle, like other lenders, is strategically not foreclosing on troubled properties?
Check out the full filing here.
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Fed orders West Tenn. bank to shape up
Posted on at 7:33 amRegulators from the St. Louis Federal Reserve Bank last week formally ordered the leadership of West Tennessee Bancshares to shape up its oversight and risk management and boost its capital. West Tennessee is the parent of the Bank of Bartlett, which has seven offices and about $450 million in assets but lost $3.1 million in the first half of this year.
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Think it’s too late to have your say in the health reform debate?
Posted on at 7:23 amIt’s anticipated that the outcry we heard from the public in August will be nothing compared to November and early December. We’ll see.
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Mike Edwards takes one in the kisser
Posted on October 29, 2009 at 3:12 pm
Now in the River City, the former Nashville-area president for First Tennessee Bank has helped get the Memphis Grizzlies season off to a kickin’ start.
The ball bounced into the stands followed by Tayshaun Prince of the Detroit Pistons. Prince jumped over Edwards.
Well, nearly. One sneaker did not make it over.
HT: Josh Flory
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