Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
Support MFO
Donate through PayPal
White House Weighs Limits On U.S. Portfolio Flows Into China: Text & Video Presentation
I don't know if it's illegal or not (think war opponents) but if the President can do this on his own individual whim, it's scary. Until I thought about war enemies, my knee jerk reaction was "he can't do that".
CNBC-West is trumpeting this story Sunday night. And Asian markets are weaker on the news. Note: They not only propose to delist Chinese stocks on the exchange, they would also prohibit government pension funds from owning Chinese stocks.
Sounds to me like an attempt to scare investors away from China (and Asia in general) and thereby push the U.S. stock market even higher. Sure to hit a political storm if they try it. Suspect they won’t actually pull the stunt. Should they, other than rocking global equity markets near term, I doubt it would impact long range valuations or investors’ (global) returns over coming years.
Can’t help noting that T. Rowe is about to roll out a China fund. In the past they’ve gotten some flack from conservative pols who viewed them as liberal politically. Can’t recall the exact context or issue. One of their better fixed income managers, Mary Miller joined the Obama administration as an Undersecretary of Treasury in 2012.
I think this is the incident that I was referencing. Certainly, it does not identify TRP as pro-Republican or pro-Democrat. Sorry if I gave that impression:
In 2003 Republican Senator Michael Oxley tried to pressure mutual fund firms boards of directors into voting for a Republican to head the ICI, the trade association representing fund companies. T. Rowe Price found itself on the “wrong” side of the fence in that political dust-up, supporting the than Democratic leadership of the ICI.
Some relevant excerpts from the linked article:
“At issue are allegations that the committee's chairman, Ohio Republican Michael Oxley, has threatened to investigate the mutual fund industry unless the ICI brings aboard a Republican to succeed its president when he retires. ... The fracas blew into the open Feb. 15 when The Washington Post, citing unnamed sources, claimed in a story that Mr. Oxley and some staff members were pressuring the ICI to hire a prominent Republican. ”
“The push, the paper claimed, was part of a broader campaign by Republicans to place party loyalists in top jobs at corporate lobbying offices and trade associations. Citing six unnamed sources, both Republican and Democratic, the Post reported that certain members of Mr. Oxley's staff suggested the congressional probe ‘might ease up if the mutual fund trade group complies with their wishes.’ “
“At the heart of the fracas is the fact that ICI president Matthew Fink and his likely successor, executive vice president Julie Domenick, are both Democrats.House Republican leaders have been trying in recent years to get more Washington professional and trade associations to hire Republicans as leaders, a campaign that has been dubbed the ‘K Street Project.’ “
“Meanwhile, the fracas has caused some roiling within the ICI. At a mid-February board meeting, representatives from The Vanguard Group in Malvern, Pa., T. Rowe Price Associates Inc. in Baltimore and Capital Management and Research Co. in Los Angeles expressed support for the organization's leadership.” -
Where’s the link?@Ted has provided one that works better than mine did. See Ted’s follow-up post to access this Investment News article from March 10, 2003.
Comments
RepublicanI mean Trump party.Sounds to me like an attempt to scare investors away from China (and Asia in general) and thereby push the U.S. stock market even higher. Sure to hit a political storm if they try it. Suspect they won’t actually pull the stunt. Should they, other than rocking global equity markets near term, I doubt it would impact long range valuations or investors’ (global) returns over coming years.
Can’t help noting that T. Rowe is about to roll out a China fund. In the past they’ve gotten some flack from conservative pols who viewed them as liberal politically. Can’t recall the exact context or issue. One of their better fixed income managers, Mary Miller joined the Obama administration as an Undersecretary of Treasury in 2012.
https://opensecrets.org/orgs/summary.php?id=D000030253&cycle=2016
In 2003 Republican Senator Michael Oxley tried to pressure mutual fund firms boards of directors into voting for a Republican to head the ICI, the trade association representing fund companies. T. Rowe Price found itself on the “wrong” side of the fence in that political dust-up, supporting the than Democratic leadership of the ICI.
Some relevant excerpts from the linked article:
“At issue are allegations that the committee's chairman, Ohio Republican Michael Oxley, has threatened to investigate the mutual fund industry unless the ICI brings aboard a Republican to succeed its president when he retires. ... The fracas blew into the open Feb. 15 when The Washington Post, citing unnamed sources, claimed in a story that Mr. Oxley and some staff members were pressuring the ICI to hire a prominent Republican. ”
“The push, the paper claimed, was part of a broader campaign by Republicans to place party loyalists in top jobs at corporate lobbying offices and trade associations. Citing six unnamed sources, both Republican and Democratic, the Post reported that certain members of Mr. Oxley's staff suggested the congressional probe ‘might ease up if the mutual fund trade group complies with their wishes.’ “
“At the heart of the fracas is the fact that ICI president Matthew Fink and his likely successor, executive vice president Julie Domenick, are both Democrats.House Republican leaders have been trying in recent years to get more Washington professional and trade associations to hire Republicans as leaders, a campaign that has been dubbed the ‘K Street Project.’ “
“Meanwhile, the fracas has caused some roiling within the ICI. At a mid-February board meeting, representatives from The Vanguard Group in Malvern, Pa., T. Rowe Price Associates Inc. in Baltimore and Capital Management and Research Co. in Los Angeles expressed support for the organization's leadership.”
-
Where’s the link? @Ted has provided one that works better than mine did. See Ted’s follow-up post to access this Investment News article from March 10, 2003.
Regards,
Ted
https://www.google.com/search?sxsrf=ACYBGNSPKy_-nfBEmSyH5oyCr9gyUBS4bg:1569853776690&source=hp&ei=UBGSXaudJ77K0PEPztmIyAc&q=ICI+caught+up+in+GOP+ethics+flap&oq=ICI+caught+up+in+GOP+ethics+flap&gs_l=psy-ab.3..33i160l2.3300.3300..5143...0.0..0.135.135.0j1......0....2j1..gws-wiz.YdA7WVNObZc&ved=0ahUKEwirhdOF4fjkAhU-JTQIHc4sAnkQ4dUDCAc&uact=5