Sunday, October 31, 2010
Last week was unproductive, but it is over and I am starting a new week. Koor is selling Makhteshim to the Chinese. I saw it coming since I was in Ecuador: Makhteshim was being out-competed by cheaper Chinese products. So the time has come to move production to China and focus on marketing and research. Makhteshim has been tortured to death by the Ministry of Environment and the "Green" activists, that now will have to search for another enemy. Currently, about 20% of Makhteshim's production cost is environmentally dictated. Apparently the Chinese are ready to pay a good premium on TASE price. On the good news, I already sold most of my holdings.
I am definitely for the Chinese. They are making all the world wealthier. For example, I have an IBM laptop that I bought six or seven years ago for about 3,000 dollars. A better one if now offered by Lenovo for 500 dollars. Excellent Chinese shirts are sold for 5 dollars. I bought Chinese frozen fish for a quarter of the Argentine fish (but I didnt like it).
What is my agenda for this coming week? The Israeli gas and oil sector has fever and I am not in it. I am sleeping too well, I should take more risks.
Update: The agreement with the Chinese says that they will keep the factories in Israel till 2017. In other words, they are emptying the company and moving the operation to China. Sad. I did once some work related to Makhteshim and it was a good company. It had grown to be the largest of the world in generic pesticides. We are losing it.