Nothing at all. This irritated me intensely. Why? Because I don’t want the bosses of the companies I invest in to be fun-loving men of passion. Instead I’d like them to be rational and objective individuals with adult perspectives on their work.
And I don’t really want to see them on TV either. I prefer to think of them as sitting behind desks studying spreadsheets and having strategic visions.
That’s why I don’t think I would have ever considered investing in Japanese internet firm Livedoor, run by 33-year-old Takafumi Horie. He writes a daily blog, he signs autographs, he tries to buy baseball teams, he never says no to an interview, he publishes books, and he doesn’t even consider himself really Japanese — no, he is “a citizen of the world”.
He is the poster boy for the new Japan that American and European brokers and fund managers like to think they have been investing in. But last week Horie’s offices were raided by Japanese officials investigating allegations that Livedoor spread false information to boost a subsidiary’s share price and falsified its 2004 results to show a profit rather than a loss.
Although Livedoor denies the allegations, the shares have been in freefall ever since, and the fallout pushed the Nikkei index down by more than 6% in two days. This has made many investors nervous. Does it mean Japan’s latest bull market has come to an end? Is the 40% rise in the stock market last year just another false dawn? I don’t think so. What happened in Tokyo last week has told us that Livedoor is probably a rubbish company — and its problems led only indirectly to the wider fall in the Nikkei itself. It wasn’t that there was a sudden collapse of confidence; instead, the many day-traders using their Livedoor shares as collateral for other trades suddenly weren’t allowed to do so and had to liquidate other holdings in a hurry, something that hit the whole market.
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More importantly, all the bull points that were valid last year are still valid: the economy is still recovering, wages and employment are rising, property prices have bottomed and corporate profits are up, as are dividend payouts. So if you are invested in Japan, I’d stop worrying and stay invested — even at its low this week, the Nikkei was only back to the level it was at in mid-December and I imagine it will soon return to the level it was at last Friday.
If you need something to worry about, or a market to sell, there are plenty of other candidates.
At about the same time as the Livedoor story started to unfold, Intel and Yahoo announced disappointing results. While brokers dismissed these as company- specific problems, they were fast followed by disappointments from Apple and Ebay. So the problem is specific to Apple, Ebay, Yahoo and Intel? Which tech firms isn’t it specific to? Then I’d worry about the US trade deficit and the dollar, I’d worry about the US housing market and the American consumer as well as what might happen to the more export-orientated markets of Asia if those consumers start cutting back properly. Finally, I’d worry about the British housing market as unemployment continues to rise.
But I wouldn’t fuss about Japan. And I certainly wouldn’t worry about Horie. If his career is cut short, there’s no reason why he shouldn’t make it into the Celebrity Big Brother house this time next year.
Merryn Somerset Webb is a former stockbroker and now editor of Money Week. Her views are personal and investors should always seek professional advice