Shaw Capital Management: South Korea’s Economy

South Korea’s output is continuing to accelerate, and the government needs

to exit from its accommodative economic policies earlier than anticipated.

The HSBC Korea’s purchasing managers’ index (PMI) rose from 55.6 in

January to 58.2 in February — the highest since December 2007. New orders

are coming in, and there are rising backlogs of unfulfilled orders.

Shaw Capital Management: South Korea’s Economy - Employment too is rising suggesting that the current pace of growth will

be sustained for the next several months. Inflation paced a little with

consumer prices up 3.1% in January from a year earlier. But inflation in

Korea is likely to remain stable for some months.

The central bank is expected to tighten its monetary policy by starting to

raise interest rates from the current record low of 2% in the later part of

the second quarter as the government retains its focus on job creation and

growth.

Shaw Capital Management: South Korea’s Economy - Exports expanded 31% year on year, better than Reuters’ forecast of 22.7%.

South Korea posted a much larger-than-expected trade surplus of $2.33

billion in February as ship deliveries boosted exports, while imports fell as

holidays reduced crude oil and natural gas demand.

The government expects a monthly trade surplus of more than $1 billion

from March as demand improves. The current-account surplus is most

likely to dwindle to around $17 billion this year from $42.7 billion in 2009

as imports rise. A new Bank of Korea governor, widely expected to be a

more pro-government figure, will not rush to raise rates after taking office

in April.

Exports grew 31% from a year earlier to $33.27 billion, faster than the

expected rise of 21%, while imports climbed 36.9% to $30.94 billion, exceeding

a forecast of an expansion of 34.0%.

South Korea, which is heading the G20 group of leading economies wants

to leave an imprint of its presidency.

Shaw Capital Management: South Korea’s Economy - It is trying to introduce a system of international currency swaps which it

hopes will reduce global imbalances by lessening the need for countries to

accumulate reserves, seen as one of the causes of last year’s financial and

economic crisis.

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Taiwan’s Economy: by Shaw Capital Management Korea

With gross domestic product clocking 10.2% growth from a year ago in the

fourth quarter, and 4.2% from the previous quarter, Taiwan returned to

pre-financial crisis growth levels. In spite of the strong recovery in the

second half of the year, Taiwan’s economy still shrank by 1.9% in 2009.

The government expects GDP to grow 4.7% this year, an upward revision

from its previous forecast of 4.4% growth. With rising new orders Taiwan’s

economy has entered a sustained expansion cycle.

Taiwan’s exports rose 75.8% in January to US$21.75 billion from US$12.37

billion a year earlier and imports in January more than doubled to US$19.25

billion from US$8.97 billion a year earlier.

Taiwan had a trade surplus of US$2.49 billion in Jnanuary, bigger than the

government forecast of a US$1.93 billion surplus. The island had a trade

surplus of US$1.65 billion in December.

Taiwan will lower investment barriers for its technology companies to do

business in China. This sector is the latest to benefit from tighter economic

ties between the mainland and the island.

Shaw Capital Management – New Economy - Although we have seen an explosive decade of growth and cycle in the economy, the bombs have been filtered out leaving the economy poised for steady and certain growth. Smart money is now wise to the problems the past few years, lessons have been learned, and the best investments are now at hand.

We have seen extraordinary growth in technology, but at the same time a buffering and selection process in industry. Although the infrastructure is stable for the moment, there are new technologies emerging, which would otherwise have been lost in the chaotic trends of recent times. This settling of the infrastructure will allow these new technologies to become visible more easily, but fast response time is critical.

Poised for Growth. Based on the stabilized infrastructure and upswing and recovery in the economy, business is poised for an explosive period of growth as smart money now focuses in on those business models and innovations designed for success. These select companies are key to your financial growth and your future wealth.

But how to determine which companies are the movers. Short term trends only show day to day trading and market momentum. These are important indicators to a markets early acceptance of a company. The real key is having industry knowledge, and understanding how a company fits into the evolving New Economy over time.

What is required is a group of professionals working together sharing, discussing, and evaluating those market trends and the companies which will be filling the needs of industry over time. Through careful research the Shaw Capital Asset Management Korea staff of investment professionals document and compare the relative strengths of the hottest new companies and affiliates. Staff origins and histories are reviewed. Only those companies with the strongest and most consistent foundations are considered.

From those companies with strong foundations of support, the technology and product offerings are then compared in search of the stellar products which address industry needs for a stable fit into the economy, but also do so in a fashion which goes beyond just "filling a gap" in the market. In other words, a strong company and equally strong and visionary products.

This type of dedication and selection is what allows us to be a driving force behind the evolution of the New Economy.