Today we have an exotic annual report to cover and lots of news after the snow has been cleared or melted here. The goods range from China to India, from Mexico to Sweden, from Qatar to Israel, from Myanmar to Japan, from Switzerland to Britain, plus lots of points in between.

China At Work

*Reporting today in RMB under IFRS standards, China Eastern Airlines, NYSE-CEA, missed on sales but beat on profits, and the stock rose over 4% this morning. Its sales in 2017 were down 3.5% from 2016 levels at RMB 102,475 billion, partly reversed by other China revenues, namely refunds of local taxes paid to municipalities for their facilities (like airports, I guess.) This boosted revenues to RMB 109,956 billion, up 5.2% on 2016.

Operating expenses were down 9% because of lower fuel costs but higher wages hit, so operating profit was down 30% y/y to RMB 9,431 mn. Then financial and currency hedge income chipped in to boost pre-tax profiss by 20% to RMB 8,131 mn. Taxes were lower proprotionately, a sign that some of the boost was not accepted by the fiscal authorities. Net income, the bottom line, was RMB 6,810 mn, or 44 Chinese cents/sh, up exactly 25%. The market treated the numbers as real. I am not a believer but I think the CEA stock has the ability to take off.

*Chinese lobbyists on behalf of Tianqi Lithium, a huge producer, met with Chilean stock market regulators to try to lift the ban on their buying the 33% of Soquimich. SQM is being auctioned off under Chinese anti-trust demands because the merger of ex- Agrium and ex- Potash risks creating a potash giant which can hurt Chinese farmers. Protectionism works differently for China across the Pacific than at home. Backing Chinese demands to be allowed to buy SQM are two big owners in Chile: Pampa Calichera and Potasios de Chile who have wrapped themselves in the mantle of shareholder rights. In fact PC and PdC are controlled by Julio Ponce, who used to run SQM, the ex-son-in-law of Augusto Pinochet, the Chilean dictator.

As shareholders of SQM we naturally want to be heard, but I am not willing to join up with the Clan Pinochet. Alas, the novice editor of, Carl Surran, applauded Ponce’s move to open up the board to more representatives.He calls the Ponce move a “corporate governance shake up”/.

I go back further than they do. I worked for the Senate Foreign Relations Committee when it examined the overthrow of Allende and the murder in Washington, DC of the dissident Chilean Ambassador (and innocent by-standers). Putin learned from the right and it appears that Xi does too.

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