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Archive for the China Category

Great book on building a business in China…

Up till now i read over 10 business books about China. If I need to single out one that i recommend the most, it will probably be… Mr China by Tim Clissold. If you are aiming to set up a new venture in China you should probably be aware that China is ranked #89 as the best place to do business globally.

If you want to get a glimpse of the reasons why it is ranked so LOW? Mr China will probably provide the best answers..

China will become the #2 Economy in the world this year and will become much bigger than the US economy in the next 20 years.. Doing business in China is a MUST for global companies, and this book can lay out some of the obstacles..

How ever it fails to provide good solutions for the many obstacles mentioned in the book.. I hope to offer some positive Tips in the near future..

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4 top Chinese Recipes

After coming back to Israel from Meijob I felt to cook Chinese food. I recalled my 8 months back memories where Lika, our Office Manager in Meijob and her sweet mother helped us prepare top Chinese cuisines. I asked Lika for sending me Chinese recipes. I will try to cook some Chinese food during the weekend. Here are some exciting Chinese recipes:

yu xiang qie zi

1)  Gong bao ji ding

  • Chicken slice (ji rou)
  • Chili pepper (Gan la jiao)
  • Peanuts (Hua sheng)
  • Sichuan pepper (Hua jiao)
  • Bean oil (Da dou you), Cai zi you (Corn oil)
  • Salt (Yen)
  • Sugar (Tang)
  • Vinegar (Cu)
  • Cooking wine (Liao jiu)
  • Monosodium glutamate (Wei jing)
  • Essence of chicken (Ji jing)
  • Leek (Cong)
  • Ginger (Jiang)
  • Garlic (Suan)
  • Egg (Ji dan)
  • Sauce (Jiang you)
  • Potato starch (Hong shu fen)
  • Bean sauce (Dou ban jiang)

sichuan flavor kung pao chicken

Preparation:

  1. Wash the sliced Chicken, cut it into diced pieces, place it into clean bowl, add 1 spoon chicken essence, salt (little), 1 spoon potato starch, egg white of one egg (egg-yolk can be used to cook Wan zi), you can also pour 1 to 2 spoon of water instead of egg white. Mix them up.
  2. Preparation of seasoning: Take a bowl and pour 1 spoon sauce in it, add 2 spoon sugar, 3 to 4 spoon of vinegar, add 1 spoon cooking wine, 1 spoon monosodium glutamate, 1 spoon potato starch, 2 to 3 spoon water, mix them up in a bowl and taste its sample (sugar and vinegar are optional and depends on your preference).
  3. Cut a half leek into pieces with size same as chicken dice, ginger (10 pieces), garlic (10 pieces), cut each piece as big as a nail, cut chili pepper into segments and wash them together with Sichuan pepper and drain off the water.

Cooking:
Heat the empty wok to make sure it is dry. You can put your hand above the wok to feel the working heat of it. Add 2 gram oil into the wok and wait till you feel the oil is hot enough. Pour half of the hot oil into a dry bowl (the oil in the bowl can be used to cook later). Pour 1 gram cool oil into the wok, and instantly put the chicken dice into the wok to fry it (this way can be used to cook every kind of meat to prevent it from sticking the wok). Take out diced chicken pieces in a bowl after it changes its color.

Add the oil in the wok that you took out in the beginning and put some bean sauce in it, along with some Sichuan pepper and Chili pepper. Continue frying this mixture by adding ginger and garlic pieces. Add the diced Chicken and leek segment into the wok. Fry it. Now pour the seasoning you prepared in the beginning into the wok by keeping the flame on. Fry it 3-4 times, then add peanuts in the wok, mix them up thoroughly. Turn off the flame; serve it on a dish plate. It’s ready to eat.

Key point: Please follow the order, Peanuts should be added into the wok at the last step.

2)  Lao hu cai

  • Green peppers (Qing jiao)
  • Leek (Cong)
  • Coriander (Xiang cai)
  • Sesame oil (Zhi ma you, Xiang you – two types of sesame oil)
  • Salt (Yen)
  • Vinegar (Cu)
  • Sugar (Tang)

Preparation:

  1. Slice the leek into segments, and then into thread
  2. Cut the Green peppers into thread and remember to remove the seeds inside it.
  3. Cut coriander into 1 inch long segment.

Cooking:
Put leek threads and green pepper threads into a bowl. Add 2 spoons of salt in it. Mix them up and put the bowl aside for 10 minutes. Wash the leek and pepper after 10minutes and let the water drip off from it. Add the coriander segments in the bowl, some monosodium glutamate, 1 to 2 spoons of vinegar, sugar (optional), and half spoon of sesame oil. Mix them up.

Key point: Sugar added in little quantity is enough or else the dish will taste too sweet. Sugar is optional and it tastes fine without it.

3)  Qiang Huang Gua

  • Cucumber (Huang Gua)
  • Dry chili pepper (Gan Hong La Jiao)
  • Sugar (Tang)
  • Vinegar (Cu)
  • Salt (Salt)
  • Monosodium glutamate – MSG (Wei Jing)
  • Bean Oil (Da Dou You)

Preparation:
Slice a cucumber and add the pieces in the bowl. Add salt, sugar, vinegar, MSG in the bowl and mix them up thoroughly and evenly; Chop dry chili peppers into small pieces and keep it aside for later use.

Cooking:
Heat the wok and pour oil in it. Heat the oil uniformly and as soon as it gets heated up add the standby dry chili peppers in the wok. Swing the wok to fry the chili pepper well. Pour the oil with fried peppers into the bowl which has cucumbers in it. Mix the ingredients of the bowl using chopsticks. Cover the bowl with a lid and let the cucumber boil inside it as the hot oil effect. After this process of 3-5 minutes the dish is ready to serve.

4)  Ban Tu Dou Si

  • Potato (Tu Dou)
  • Mashed Garlic (Suan Ni)
  • Sugar
  • Vinegar
  • Chopped dry chili pepper pieces
  • Salt
  • MSG
  • Bean Oil

Preparation:
Cut the potato into threads and put them in a bowl. Rinse the potato threads well, to remove the starch. Immerse the potato threads in the clean water for later use. Immersing potatoes under water would make the potato crisp when eaten.

Cooking:
Heat one braiser of water and after it gets boiled add potato threads in it. Take potatoes out from the pot, and please note that the boiling water should come over the potato threads. Don’t cook for too long as the potato will turn out to be soft rather than crisp. Don’t cook it for a short time as the potato will remain raw inside. Take them out in a bowl when the potatoes are very little raw from inside.

Wait for potatoes to get cooled down. Add mashed garlic, salt, MSG, sugar, vinegar in the bowl and mix them. Heat a pan, add some oil to it. Swing the pan to heat the oil uniformly. Add dry chili peppers to the pan and fry them with frying spoon. Pour the oil along with the pepper into the bowl which has potato in it. Mix all the ingredients of the bowl using chopsticks. Cover the bowl with a lid and let the potato threads boil inside it as the hot oil effect. Wait for 3-5 minutes. The dish is ready to serve.

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Great post about Teva

Great interview of Shlomo Yanai CEO of Teva about the big drug manufacturers going into the generic market. Here is the original interview. In the next month i plan to write to more articles about Teva, one that will cover the big drug companies globably and the other about Teva’s potential to penetrate the Chinese market

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The world biggest bubble

The economist inteligence unit just wrote in its July Global Economic – update:

“The US real GDP forecast for 2010 from 1% to 1.4%, but has downgraded its US 2010 forecast from growth of 1.4% to 0.8%. It says that in view of the likely continued weakness of domestic demand, a renewed weakening is likely in 2011 when stimulus measures start to fade. It is forecasting that the US budget deficit will be close to 15% of GDP in the next two years.

Chinese growth for 2009 has been revised upwards to 7.8% (from 6.8% previously), but again, the EIU forecasts Chinese growth to ease slightly in 2010, to 7.4%, again as the impact of the stimulus wanes. It says China’s export picture remains subdued.”

One thing that i remember from Macro economics is that the only force driving inflation is deficit. 15% is a hugh deficit! I would expect inflation levels in the US to reach 5%-10% within the next 5 years. This will drive interest up to 5%-10% compared to 0% today and will result in the USD devaluating vs most major currencies. Long term bonds yields can jump from 3% today to 10% within 5 years. Buyers of these bonds today can suffer from the capital loss of 50% on 10 year US bonds. in addition, if we take into account the currency devaluation that i predict, these investors can lose up to 70-80% of their initial investment – if we will measure it in RMB or Euro.

THIS IS PROBABLY THE BIGGEST BUBBLE IN TODAY’S GLOBAL ECONOMY.

How can we make money from this as individuals?

1. Buy TBT index fund which actually short US treasury bonds.

2. Avoid USD investment and hedge the currency risk if we do invest in USD assets (like the great opportunity of real estate in the US).

How can we protect our business as managers and entrepreneurs?

We should hedge the RMB appreciation risk (I estimate that USD/RMB will be at 4.00 in 5 years) by doing annual forward deals in the major banks.

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China Dreams July 2009

Last Saturday I did one of the things that I don’t like very much – sorting out my paper files. We return in 10 days to Israel and the moving company will arrive tomorrow. To my great surprise I actually enjoyed the process and it was not the chore I thought it would be. I found myself reading documents that were written 3 years ago about business plans and ideas that went through my mind at the time and checking back on them with 20/20 hindsight was quite exciting. It reminded me of browsing pictures from my youth, or from my 7 month trip to South America. We’ve spent 4 years in Beijing. The experience has been amazing and I’ve enjoyed almost every minute of my “China” experience. It’s hard to describe how many different new things we have experienced here. We have learned Chinese. Even after 4 years it still remains the toughest language for me in the whole planet. We have started up 2 internet companies that together employ over 30 employees. All are very devoted and form a strong family like culture. In both websites combined – over 40 million unique visitors have visited so far.  I can’t grasp this number – 40 Million! I got so used to this number that I forget to stop for a second, breath and look at the achievement. I managed to sing “Lan Lian Hua” in Chinese several times. We have raised over 2 Million dollars from investors and generated many long lasting friendships.

Change in priorities

We arrived in China as a couple and we return to Israel as a family with 2 children. I can’t describe the intensity of our love for them. The part I miss the most is sharing the joy of raising them with my family in Israel, particularly our son’s grandparents. It’s hard to believe that after 4 years in China, I have nothing bad to say about China. I love this country. I enjoyed living here and I admire the way this country is managed. It is clear to me that China’s role in the global economy will become even stronger as we move forward. The progress I have made in my personal career here in China is huge. I feel that every year in China was equal to 7 years in any other country (very similar to a dog’s year). The intensity and the speed of change and development is so much greater than Israel. Most of the circumstances show me that China is and will continue to be the future. But something in my gut and my heart, something that I can’t describe in words, directs me back to my family in Israel. 

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                                                                                                                                                                                                                                                                                                                      Special Thanks:

The 1st, is to my wife Irit, who has supported me during the ups and downs. Without her I wouldn’t have gotten past first base. The 2nd is to my 2nd “wife”, Guy.  Guy has been my Yin and my Yang over the last 4 years and helped me balance myself and Meijob. The 3rd goes to our lead investor and member of the board Arik, a true angel, if ever there was one. To the Meijob family: Philip – for following our vision and values with such devotion, your management capability and the passion you have for people and your desire for them to achieve their personal best. You are one of the best managers I’ve had the pleasure to work with; Evelyn – for the biggest heart I ever met; Lika – that I would have taken in a suitcase with me to Israel; Jackie – One of the best developers and devoted employees I’ve ever come across; Gil – for the great initiatives, charisma and management capabilities; Hongyin – for making Meijob’s development procedure robust and organized; Saprina – for leading the marketing with great results; Helix – for mastering the SEO and PPC while leading Meijob to new traffic records;  Vivian – for the distance she made in 3 years in her career at Meijob;  Alon – for the great improvement in our Employer site design; Eric for the attention to details that makes our site strong and healthy; Fei Shuang ge – for the great development of our Employer site and matching algorithm; Angela – for taking over Susan’s responsibility with enthusiasm; Mei for the love she projects to her environment; Rui – for running the daily operations of the office and last but not least – Andy for taking over the IT operations, developing our office, as well as our website’s IT environment and a tremendous ability to solve any problem that presents itself. I want to thank you all and let you know that I carry you in my heart, no matter where I am, you will always be with me and you will always be a part of me. Having co-Founded Meijob with Guy Rotberg, I will continue to influence and challenge the strategic direction of the business in my role as a Director of the Board in the hope of making our dreams come true.

My love to you all, Barak

 

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Beijing Blue Zoo

Today we will take Amit to see Beijing Blue Zoo

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Top 10 Chinese stocks – who is the most attractive?

The following post compares the top 10 chinese stocks in terms of market cap.

Baidu is by far the stock with the highest P/E – I would strongly recommend to avoid investing in Baidu in the current stock levels.

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RMB is the new king?

In this post about “Thoughts on the RMB as a Reserve Currency” published on seeking alpha there are a lot of things that support my previous post on seeking alpha dated December 07 2008, “Will We Reach 4 RMB Per U.S. Dollar?

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Old Media Is Losing the Advertising Budget Battle

In this clear post in seeking alpha Andy Beal writes about the expected death of traditional media compared to new media. I will have a presentation about the topic on 14th of july in Kampinsky hotel in one of the events of the israeli chamber of commerce is arranging. Here you can find a link to the presentation.

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3 reason why not to invest in US treasury bonds

1. Low yield – 10 year yields are only 2.85 percent. The risk of this bonds are interest increase that can create immidiate capital loss. For an example and increase within the next 3 years from 2.85% to 7% can create a capital loss of over 40%.

2. Unfavorable trend for the USD vs major other currencies – This was already covered by me in this article in seeking alpha

3. US debt to China is rising and it makes sense that China will start to search for other alternatives. Read China’s prime minister quote from yesterday…

I will remain cautios about American economy and especially American bonds in the near future. It is very low return and much higher risk than people precieve…

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