Some Economic News

Mighty Toyota hits Speed Bump

I was shocked when I read that Toyota reported a loss in North America.

Toyota is the most-studied car maker in any MBA program. The Japanese firm is known for its lean production. Toyota is the second largest car maker in the world, behind Detroit’s General Motors. However, Toyota enjoys a far better profit margin.

Even so, the Japanese car maker could not escape the economic downturn. It reported an operating loss of 34.6 billion yen in North America. Globally, Toyota’s second-quarter net income fell 69%.

When the mighty Toyota is reporting loss, you know how bad the economy is.

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Singapore’s Casino Faces Uncertainty

Las Vegas Sands, which is building a casino in Singapore, is facing a cash shortage problem.

Singapore has an “interventionist economy”. The economy of the island republic is largely driven by the government. The two casinos under development, one by Las Vegas Sands and the other one by Malaysia’s Genting, were brainchild of Singapore’s government.

In the last few years, the government wanted to woo wealthy foreigners to migrate to the Lion City. To this end, it has built many luxury homes, such as those in Sentosa Cove. Lee Hsieng Loong’s administration is naïve to think that if they build the houses, foreigners will come. It has failed to realize that, in the 21^st century, Shanghai has replaced Singapore to become the magnet for expatriates.

Now, with the world economy heading towards recession, the casino by Las Vegas Sands is in jeopardy. I am not optimistic with the market for luxury homes too.