Still worth to watch!

Overconfidence among experts

Almost all of us have tendency to be overconfident. It is funny to learn that even top experts in the world were saying the following statements!

“A severe depression like that of 1920 - 1921 is simply outside the range of possibility!”

Harvard Economic Society - Weekly Letter - 16 November 1929

“Don’t worry. They couldn’t hit an elephant at this dist…”

The last words of General J.B. Sedgwick - American Civil War, 1876

“This actor does not have the presidential look!”

A United Artists executive rejecting Ronald Reagan to play the role of the president in ‘The Best Man’

“Heavier-than-air flying machines are simply impossible! Radio has no future. X-rays will prove a hoax.”

Lord Kelvin - British mathematician and physicist, 1899

NEVER SAY NEVER, or how tomorrow’s technology caught out the experts!

“Drill into the ground to try to find oil? You’re crazy.”

Workers to railroad conductor Edwin Drake who drilled the first US oil field, 1859

“Television will not last. People will get tired of staring at a plywood box every night.”

Daryll Zanuck, 20^th Centruy Fox producer, 1946

“There is no reason anyone would want a computer in their home.”

Ken Olson, president of Digital Equipment Corp, 1977.

“Who the hell wants to hear actors talk?”

Warner Bros, 1927

“I think there is a world market for maybe five computers.”

Thomas Watson, chairman of the board of IBM, 1943

“The bomb will never go off. I speak as an expert in explosives.”

Admiral William Leahy, US Atomic Bomb Projects

“This telephone has too many shortcomings to be seriously considered as a means of communication.”

Western Union, 1876

Quote of the day

“The stock exchanges of the future will migrate away from the geographical bounds that the interest groups behind any potential European Stock Exchange seek to retain. Instead of a national view, a sector approach is emerging: for example, investors will not view the market in terms of, say, Germany, Sweden, or the UK. Instead, their view will be in terms of pharmaceuticals, IT or forest products.” Per. E. Larrsson, CEO, OM Group

Guess that when did he say so?

It is better to have a look rather than hearing hundred times

I was lucky enough to be a part of DSAM delegates last week to explore Japan’s experience and knowledge for differently abled children and adults. We had a one week busy visit in Tokyo and Yokohama and it was impossible to have this great opportunity without help of Mr.Nobushige Yamauchi (M.Ed) who is Managing Director of Learning Disabilities Association Kanagawa and Mr.Hiroyuki Oyaizu who is Director General of NISVA (Nippon Skilled Volunteers Association). On behalf of all members of DSAM, I would like to express my deepest gratitude to our Japanese friends. Even though it was a one-week trip, every single minute was precious for all of us. We were all energized by the Japanese professionals’ supportive actions and challenging discussions. As a developing country with limited resources, DSAM tries to position itself to have vision with passion for its long term successful operation in Mongolia. It was amazing experience to feel that not only Japanese people’s real actions and tight collaboration but also methods and methodologies how Japanese synergize education and business communities with mentally challenged people. This trip allowed us to meet Mr.Shuichi Ohno, Managing Director of Nippon Foundation which is the core sponsor of NISVA.  

Personally, I always believe that the love is the fundamental factor of the meaning of mankind’s life. However there are many different people in the world, we should have the same life principle to create what we call “perfect world”. Our life meant to be a pleasure for all of us unfortunately it has become a pressure for most of us. It is very sad to acknowledge that only 1% of world population owns 40% of the planet’s wealth and 50% of the world’s population lives on less than 2 dollars a day. I did not mention here about disabled people’s statistics. Therefore, if we cannot change this situation, then what is our responsibility as a human being? It seems that passion is one of the most important parts of human life which makes people to be the agent of change. It is an exceptional human nature to contribute their inputs to others’ societies. Moreover, I would say that respect is a treatment to be tranquilized. With respect, all we can create synergy among our society. I strongly felt all these positive energies last week throughout of the trip.

We have a very small and fragile boat which is called the earth but we are on the deep blue ocean so called the universe. Due to the rapid technological development and globalization, the weight and consumption of our boat has exceeded what it should be. We have two paddles so called an economy and a society. If we do not balance these 2 paddles, the boat will lose its direction where it meant to reach! But who is the captain to lead the boat crew? It can be said that the governments. The government consists of various minded politicians. Politicians are financially supported by big corporations, companies, and the public. Behind these organizations there are entrepreneurs and employees! Hence, it can be said that it is very difficult to create a pleasant community if there is lack of passionate people.

There is no doubt that you, me, and we all human being who are totally dependent on natural law but not really on social law. Every single person has a different feeling, different culture, different attitude, different behavior, and different value than others. Based on our different feelings, we all have different commitments to each other. This is our society. These are who we are! Quality of human beings in our society goes up from mass to niche group whereas the quantity of people who belonged into those certain groups is increasing from the niche to mass group. It cannot be said that these kinds of different groups exit because of people’s different IQ or basic skills. But it is because of just the love! I would argue that both developed and developing countries are being challenged by this issue nowadays.

Today human beings can do almost everything as they wish because of their knowledge, skills, and technology. But sometimes the only thing missing is love! Japan has all but the love has been positioned in combination with its unique culture as a bottom part of Japan society’s pyramid to maintain its sustainable development. To sum up, I would like to say that there is a Mongolian proverb saying that “It is better to have a look rather than hearing hundred times”. It was indeed a wonderful experience for us to bridge our “in house” knowledge with best Japanese practices in real life. 

CHAPTER VI

CHAPTER VI

CONCLUSIONS AND RECOMMENDATIONS

Интернэтээр сонин уншиж байгаад Монгол улс маань хахир хүйтэн, их цас, малчдын ба төрийн хувийн болон хувьсгалын бэлтгэл хангалтаас болоод 4 гаран сая малаа энэ өвөл алдаад буйг баталгаажуулж мэдэв. Бид нар бараг л жил болгон л энэ тухай мэдээ сонсдог болоод удаж байнам. Өнөөг хүртэл яагаад юу ч өөрчлөгдөхгүй, яагаад бид юуг нь ч өөрчилж чадахгүй байгаа хэрэг вэ. Өдгөөгөөс бараг 6 жилийн өмнө би зорьж байгаад энэхүү асуудлаар буюу “Mongolian animal husbandry sector and its future” гэсэн сэдвээр Австралид мастерийн дипломаа бичин хамгаалж байсан юм. Файлаа ухаж байгаад тухайн үед бичиж байсан дипломын ажлын сүүлийн бүлэг буюу дүгнэлт саналын хэсгийг блог дээрээ оруулмаар санагдав. Яг одоогийн нөхцөлд зудын эсрэг миний хийж чадах ганц зүйл юм даа харь орноос. Энэхүү ажлын literature review хэсгийг би нилээд дээр мөн блог дээрээ оруулж байсныг эндээс үншиж болно. Бас мичин жилийн зуд ба нарны идэвхжил хооронд харилцаа уялдаа бий эсэхийг судлах гэж додомдож байсныг эндээс мөн уншиж болно. Аль алинийг нь харьцуулаад харвал миний юу хэлэх гээд байгаа талаар жаахан ч гэсэн ойлголт авах болов уу.  

Conclusions

There are over a half million stakeholders in the Mongolian agricultural sector and livestock still plays a significant role in the Mongolian economy. But traditional nomadic livestock handling makes it dependent upon nature and it sees herders ‘natural prisoners’. Some of the major agricultural changes, which involve the land using system, technology revolution, an increase in intensification and commercialization, resulted in changes to the herders’ level of productivity and income.

A market economy encourages herders to be business-oriented; however, this system resulted in the rapid increase of the number of livestock and overgrazing. In other words, a market economy pushes herders to act environmentally unfriendly and not socially productive.

Mongolian herders and farmers should become a business-oriented operation and create an agribusiness in Mongolia. There is such potential in Mongolia but lack of business experience, equipment, and financial ability could fail or delay such a move.

The increasing number of livestock which resulted in degradation of pastureland, natural disaster, lack of business management, the land using system challenges nomadic Mongolian herders to change their traditional extensive farming technique to cope with a market system which Mongolia only introduced over the last fourteen years.

One of the ways to solve these problems is to move towards semi-intensive and intensive methods. This method requires herder to have better land management, advanced technology, and integrated agriculture. It is needless to say that herders will choose intensive farming methods only if it costs less than their traditional extensive style and risk.

If the land privatization policy works successfully in Mongolia, the land will be considered the real asset and herders will be able to make its value for them. Banking and financial services need herders to cope with a market economy.

Summing up, a market economy pushes Mongolian nomadic herders to focus on not size of the land but management of the land and not quantity of animals but quality of animals.

Recommendations for stakeholders

• The government needs to attempt to increase productivity (quality not quantity) of the animal husbandry sector through a host of programs, intensives, and incentives. The pasture management techniques need to be discussed. In other words, to develop animal husbandry as a modern intensive sector with consideration for its nomadic character and create modern procession industry for animal raw materials or invest substantial amounts of money in local animal raw material processing industries to protect the market from Chinese traders. It is suggested that Mongolians cannot copy foreign farming style directly because of the different lifestyle; harsh weather and some foreigners do not have a similar understanding of how a local resource works and what rules and norms others share 
• The government should maintain the viability of rural communities, not only to support the animal husbandry sector but also to alleviate and prevent further social problems in urban areas. The government should ensure consistent development of the infrastructure sectors and focus attention on projects designed at improving energy supply, development of roads, and railway and communication systems in rural area. Such moves will create efficient and cost-effective marketing and distribution channels to improve returns for animal husbandry participants and enhanced food security for the nation because providing roads for transporting livestock and improving water supplies could increase net output from the pastoral industry and the Mongolian economy would benefit from making these improvements
• Develop intensified cattle and sheep feeding and classify them as meat, milk, wool, and cashmere. Eventually, to integrate crop and livestock production to create a more efficient farming system and avoid total dependence on nature 
• To improve appropriate laboratory technology, such as testing and research facilities, for the development of modern herders and to establish an intensive animal husbandry system, adapted to the natural conditions and characteristics of Mongolia and to upgrade agricultural equipment and related materials as well as to develop biotechnology 
• To attract foreign investors into the Mongolian animal husbandry sector and to encourage foreign agricultural companies to license their technology to Mongolia 
• To develop financial institutions such as insurance companies, local banks, and market information centres and teach herders how to use them 
• To educate Mongolian herders about market economy, farming practice, and intensive farming systems

Mongolia to Establish “National Champions”

Mongolia is seeking to create three national holding companies. Prime Minister Batbold Sukhbaatar has made a number of important policy statements in his recent meetings in Ulaanbaatar with mining industry executives, representatives of the securities market as well as in his interview with the Wall Street Journal. The Mongolian government intends to establish three major state-owned holding companies (which we would call “national champions”) and raise significant amounts of capital by offering their shares in international and domestic stock markets.  Raising billion of dollars through IPOs would allow the mineral-rich nation to finance major mining, energy and infrastructure projects. These three envisioned national holding companies are:

·         Mongol Erdes (Mongolian Minerals) to consolidate mining assets;

·         Mongol Erchim (Mongolian Power) to combine power assets;

·         Mongol Ded Butets (Mongolian Infrastructure) to include various infrastructure projects.

Will Mongol Erdes become crown jewel of Mongolia Inc? Mongol Erdes, the national mining holding company might be established under already existing Erdenes MGL LLC, a 100% state-owned entity. On behalf of the government, Erdenes MGL perhaps through Mongol Erdes may to own stakes in other 14 strategic deposits, including a massive Tavan Talgoi coking coal mine.  Mongol Erdes may possibly emerge as Mongolia’s largest and most valuable company, catapulting into a must-own stock (like Gazprom in Russia) while its planned local listing would be a huge boost for the Mongolia Stock Exchange attracting strong interest both domestic and global investors. 

MSE may be partially sold to major stock exchanges. Prime Minister S. Batbold stated that the government would consider selling 20-30% stake in the Mongolia Stock Exchange (MSE) to one of the major exchanges operating in London, New York, Toronto, Tokyo, Hong Kong or Singapore in a bid to introduce advance operational knowhow and technologies and extensively revamp currently under-resourced domestic bourse.

The Mongolian people to own shares in strategic deposits. The Prime Minister said that the Mongolian people will have the opportunity to participate in growth and upside from development of strategic deposits once the mining company is listed on domestic stock exchange. We believe distribution of shares to Mongolian public (“people’s IPO”) is more effective solution which allows the Mongolians to benefit from mineral wealth in the long term compared earlier proposed inflation-triggering cash handouts.

It seems that public rate highly the Prime Minister’s vision and initiatives in developing the national economy, local capital markets and effectively managing resource wealth; however, it looks like Russian business ecosystem to me. If these initiatives are successfully implemented, these “national champions” would be the main engines of industrialization and economic growth in the coming decade and as public listed companies are poised become one of best investment opportunities in Mongolia.

$700 Billion US Bailout Plan

"It's not based on any particular data point, we just wanted to choose a really large number." — a Treasury Department spokeswoman explaining how the $700 billion number was chosen for the initial bailout, quoted on Forbes.com Sept. 23, 2009.

Well, no comment on this statement from my side. So “funny”!

Online survey please!

The objective of this survey is to know non-Japanese people’s online purchasing behavior in Japan. We are working on the project for Obata brewery to optimize its electronic marketing performance. Please provide us your preferences by filling in THIS online questionnaire. It takes only a minute. Doomo arigato gozaimasu!

E-Marketing-ийн хичээлийн сүүлийн даалгавар нь Японы Нийгата мужийн алдартай сакэнүүдийн нэг болох Обата саке үйлдвэрийн цахим маркетингийн төлөвлөгөөг хийж гүйцэтгэх захиралд нь тайлагнах учиртай байгаа юм. Үүний тулд маш богино хугацаанд Японд буй гадаад улсын иргэдийн талаар товч мэдээлэл цуглуулах шаардлагатай болов. Та бүхэн Японд түр хугацаагаар байгаа эсвэл аялаж байгаа гэж өөрсдийгөө төсөөлөөд ЭНЭХҮҮ судалгааг бөглөж тусалбал ихэд баярлана.  

The world in 2009

“ITU Telecom World 2009” international forum was held in Geneva a week ago and opened by the UN Secretary-General. ITU means International Telecommunication Union and they released this report titled “The World in 2009: ICT Facts and Figures”.

This report provides very insightful information and important statistics to us. For example: “Mobile cellular has been the most rapidly adopted technology in history. Today it is the most popular and widespread personal technology on the planet, with an estimated 4.6 billion subscriptions globally by the end of 2009 which means 67 people in per 100 inhabitants. Moreover, in 2009, over a quarter of the world’s population-or 1.9 billion people have access to a computer at home. Therefore, ITU announced its latest ICT Development Index. Sweden ranked 1^st in Europe and South Korea ranked 1^st in Asia and Pacific.”

Here is also a very interesting report titled “Confronting the crisis: Its impact on the ICT industry”. I firmly believe that all those ICT development will eventually wipe out the worldwide digital divide.

ACI MONGOLIA news

The Financial Markets Association

Analyst: Danzandagva.D

E-mail: info@fma.mn

Web: http://www.fma.mn

Altai center, Peace Avenue, Sukhbaatar district, POB-1386, Ulaanbaatar 15160, Mongolia

03 July, 09: Banks are bearish on USDMNT long term, but bullish for the shorter run…

2009-Jul-03

USDMNT	1 month	3 months	6 months	1 year
Mean	1,461	1,507	1,536	1,382
Median	1,460	1,493	1,518	1,413
Max	1,488	1,590	1,680	1,480
Min	1,440	1,435	1,400	1,250

A monthly survey from ACI Mongolia among analysts of the banks concluded that analysts were generally bearish on USDMNT in 1-year horizon, but were expecting the pair to go higher in the shorter period.

Following the steep fall from its highs of the region of 1700-1800, the pair was range bound for the past few months in 1420-1440 zones.

About Monthly USDMNT forecasting

ACI Mongolia’s monthly USDMNT forecasting data is collected from individual analysts of banks within 5th of every month and then distributed to public. “Analysts” refers to treasurers, dealers, traders and specialized analysts working within Treasury departments of Mongolian banks.

About ACI Mongolia

ACI Mongolia, The Financial Markets Association was established as Mongolian Financial Markets Association (formerly known as FMA or MFMA) in late 2004 upon market initiative. ACI Mongolia is now the largest professional, non-profit organization promoting best market practices in different financial markets, contributing public education and helping to improve regulatory framework. With its broad base of about 100 members, ACI Mongolia has became an affiliated national association of ACI, The Financial Markets Association, the world’s largest financial markets association based in Paris, in early 2009. ACI has its affiliated national associations in 62 countries and about 13,000 professional members working in various international financial markets.

Other Activities

• Since 2007 ACI Mongolia has been the holder of UBIBOR (Ulaanbaatar interbank offered rate), the money market benchmark rate, along with Thomson Reuters plc. As of May 2009, 15 Mongolian commercial banks were contributing to UBIBOR at 11.30 hours of each business day. The UBIBOR index is then distributed through Thomson Reuters’s extensive global information network to thousands of information platforms.
• CSI (Consumer Sentiment Index) is the first of “leading” economic indicators in Mongolia. The index is published quarterly upon surveying 500 consumers representing different sectors. A 24 question questionnaire is divided into 5 sub categories, namely a. Change in consumption behavior and the sentiment b. Inflation c. Unemployment d. Sentiment towards financial sector e. Sentiment towards state policies and agendas.
• Based on its recently established CFOCLUB, ACI Mongolia is planning to introduce Business Sentiment Index (BSI) in August of 2009. CFOCLUB is a networking platform for financial executives, financiers, CFO’s, treasurers, academia, and other professionals. The club intends to raise professional awareness of financial managers.
• ACI Mongolia publishes a full financial page (known as pink page) each day on the largest daily newspaper Unuudur.
• ACI Mongolia organizes educational trainings and seminars for public, financial institutions. ACI Mongolia also organizes free of charge seminars for journalists to promote business and finance journalism in Mongolia.
• ACI Mongolia and Education TV are currently broadcasting weekly financial education program to increase public knowledge with regard to finance and economy.

© ACI Mongolia, The Financial Markets Association, 2009. All rights reserved.