All posts by James Cannon

James Cannon

About James Cannon

James Cannon is an experienced hedge fund analyst. He has served on the advisory boards for various different Fortune 500 companies as well as serving as an adjunct professor of finance. James Cannon has written for a variety of Financial Magazines both on and off line. Contact James at james[at]businessdistrict.com

EY Appoints first Woman to Lead US Division

Kelly Grier, 48, was appointed to be chairman and managing partner of Ernst & Young LLP, an appointment which distinguishes her as the  firm’s first woman to lead the company in the United States.

Until her promotion Ms. Grier served as the central US regional managing partner for EY. She will replace Steve Howe, the current chairman, on July 1, 2018. When Grier takes over it will make her the third female head at the Big Four accounting firms. Deloitte and KPMG have both had women at the helm since 2015, Cathy Engelbert and Lynne Doughtie, respectively. Only PwC is led by a man, Tim Ryan.

“Kelly was the best choice to lead us forward,” Mr. Howe said in an interview. “We’re very proud of our focus on diversity and inclusion.”

Ms. Grier has been at EY since 1990, and was promoted to US regional managing partner in 2015. She was the company’s vice chair of talent for the Americas and was also a managing partner at EY’s office in Chicago. She has also worked in Switzerland and Germany.

EY, and other major accounting firms, are international umbrella organizations. They have separate member companies in each different country where they have operations. Ms. Grier will lead the US firm, plus serve as the managing partner of EY’s Americas region. EY’s global chairman and CEO is and will remain Mark Weinberger.

“Kelly has demonstrated uncompromised integrity and an ability to manage high-performing teams, while delivering exceptional results for EY clients,” Mr. Weinberger stated.

US Initiates Largest US-South Korean Aerial Drill in History

US stealth fighters arrived in South Korea to launch what is being billed as the “largest US-South Korean aerial drill in history,” set to begin on Monday. The drill, dubbed “Vigilant Ace” aggravated the already explosive nature of the US-North Korean non-relationship, prompting a message from North Korean foreign ministry verging on the hysterical, which said that the US has “nuclear war mania” and that President Donald Trump is “begging for nuclear war.”

The weekend saw several announcements issued from North Korea. The dictatorship’s foreign ministry read a statement on state television that said that the US president and his administration are “begging for nuclear war” by engaging in what is an “extremely dangerous nuclear gamble,” according to CNN.

The foreign ministry also said that if nuclear war did emerge on the Korean peninsula and the rest of the world, that the US would be “fully responsible” because of its “reckless nuclear war mania.”

Later North Korean state TV said in a commentary that the joint US-South Korea joint air exercises are a “dangerous provocation” which will “push the region “to the brink of a nuclear war,” also reported by CNN.

HR McMaster, the White House national security advisor, agrees that tension in the region are rising, and the chances for a nuclear war are also growing.

“I think it’s increasing every day, which means that we are in a race, really, we are in a race to be able to solve this problem,” McMaster said in a conference in California.

McMaster added that he believes North Korea is the “greatest immediate threat to the United States” at the moment.

Its All About Trust at Essex Financial

Earning customer trust and keeping that trust is the most important commodity a financial company offers its clients. Although sorely challenged recently, Essex Financial Services, a Connecticut-based subsidiary of Essex Savings Bank, pulled through their crisis in the best possible way.

The trouble began when the founder of the firm, John Rafal, was accused of obtaining a large account by means of an illegal referral fee.  He then tried to cover up the payment, but was unsuccessful, and a government investigation ensued. Some of the firm’s top advisors left, and some customers. A strong, positive reaction was needed for the company to regain the confidence of its clients and the US Securities and Exchange Commission.

Into the fray entered Charles R. “Chuck” Cumello, Jr. Already part of Essex Financial, he was promoted to the office of chief executive and president, while Rafal, at first, remained on as vice chairman. Eventually, under pressure from the SEC, Rafal was fired and then banned from the securities industry.

“We handled it the way we should,” Cumello said in an interview this month at Essex Financial. “At the end of the day, this is a trust business; there is a right way and a wrong way. … We navigated some rough waters, but we did what we had to do.”

Essex Financial paid a fine for the unethical actions of Rafal. But to regain the trust from the firm’s clients Cumello insisted that the firm assert an uncompromising requirement of utter transparency.

One colleague, John Patrick, president and CEO of Farmington Bank, which has a marketing partnership with Essex Financial, had the following praise for Cumello:

“Chuck kept me abreast of everything,” Patrick said. “He’s done a terrific job considering the (situation) that he inherited.”

Trump Brings Business Back from China

Courtesy of Iecs.

Several companies announced business deals worth $250 billion between the United States and China in conjunction with President Donald Trump’s recent Asia tour.

One of the more prominent deals was forged with Boeing. The aerospace giant forged a deal worth $37 billion in sales of planes to the communist behemoth. It was not made clear if this deal is part of a previous announcement from Boeing to sell hundreds of jets to yet unrevealed buyers.

General Electric was also able to forge three separate deals in China valued at a total of $3.5 billion. In addition, Qualcomm was in discussions with Xiaomi, Oppo and Vivo to purchase about $12 billion worth of semiconductors. Ford Motor Company will be investing $756 million in a joint venture with its Chinese partner Anhui Zotye Automobil to manufacture electric cars. This deal was already announced in August this year.
Some of the deals announced on Thursday have been in negotiations for a while, while other deals are only in the early stages, and the outcomes are far from assured.

Other deals in the works with China and US business include:

• A $83.7 billion investment by the China Energy Investment Corporation Limited in several shale gas and chemical manufacturing projects in West Virginia.
• Chinese state-run oil producer Sinopec has agreed to help develop Alaska’s liquefied natural gas sector. The deal, worth about $43 billion, is between Sinopec, the Bank of China and the China Investment Corp. It is estimated that about 12,000 jobs will be created during the construction of project.
• Chinese importers agreed to buy $5 billion worth of soybeans from US producers during 2018.
• Chinese e-commerce company JD.com said it will purchase $2 billion in food and agriculture products over the coming three years from the US, including $1.2 billion in Montana beef and Smithfield Foods pork.

China’s Poly Group Ready to Grow in the USA

Giant conglomerate, China Poly Group Corp, announced that it is continuing to look for trade and investment opportunities in the US, hopeful that the two countries will successfully overcome their differences over trade through talks and consultation.

The Poly Group is focused on investments in the US residential market and the cultural sector.

Chairman of the Group, Xu Niansha, said that investments in the US are an integral component of the company’s business strategy. His words were prompted by the high-profile visit of the US President Donald Trump, with a delegation of top US business executives to China.

Xu added that the president’s visit will allow the two countries to strengthen their commitment to each other and help to resolve any misunderstandings between the countries.

“China and US trade cooperation is essential for bilateral relations and hence mutually beneficial. We hope the two countries will continue on a path of cooperation considering China and the US are now each other’s major trading partner,” Xi said.