Jeffrey H. Schwartz, Chief Executive Officer of US based Prologis began his Q2 earnings commentary by saying “We’re doing our call from Tokyo this evening.” “…the rest of the world does look a whole lot better.” Mr. Schwartz went on to say “this year 90% of our investment is expected to be outside of the US, as we noted last call, where we can focus our capital on the highest risk adjusted returns, thus our current focus on Asia.” A full transcript of ProLogis’ commentary can be found at Seeking Alpha.
Mr. Schwartz might have been given pause by the headlines at FT.com: “Inflation brakes Asian construction”. The Financial Times went on to say:
Asian governments, faced with the highest inflation for a decade or more, are shelving billions of dollars worth of landmark infrastructure projects and shifting funds to more immediate economic assistance.
Given the threat presented by surging food and fuel prices, “the long-term projects go by the wayside in favour of short-term sops to keep people happy”, said Edward Teather, an economist at UBS in Singapore. “Clearly, inflation now affects everybody.”
July 31st, 2008 at 11:36 am
The rest of the world does look a whole lot better? I wonder if Mr. Schwartz reads the papers. The rest of the world does not look better. The FT made clear that there is a tension between macroeconomic spending and microeconomic need. And that tension is not just in Asia but globally.
July 31st, 2008 at 11:39 am
Investing or focusing capital abroad simply because you have a misdirected notion that elsewhere is doing better is doing our economy even more harm.