The Valentine's Day summit between Xi Jinping and Barack Obama could make for uncomfortable viewing. China's likely next president is due to meet the US leader in Washington - as his predecessor did ten years ago. Only this time the stakes are higher. Obama, facing a November election, is under pressure to talk tough. Xi is under pressure to stay cool, while appeasing hardliners back home.

He said, Xi said

Business Standard

Glencore&rsquo;s tie-up with Xstrata may not harm competition. But, that won&rsquo;t stop regulators from trying to wrap it up in red tape for several months. As the miners head into a $90-billion all-share merger, competition watchdogs from China to South Africa, Australia and Europe, will get a chance to probe companies&rsquo; business and impose conditions on a union.

Watch the watchdogs

Twin political flameouts in China deserve investors&rsquo; attention. The tribulations of Bo Xilai and Henry Tang teach a valuable lesson about the political risk premium.

In the red

Is the tide turning for Hong Kong&rsquo;s tycoons? It may feel like it for Raymond and Thomas Kwok, two property moguls arrested by the city&rsquo;s corruption watchdog on March 29 over suspected bribery. But the billionaires can relax: Hong Kong remains a low-risk haven for the one per cent, and those who invest in them.

The ticking Kwok

Li Ka-shing is taking the Chinese approach to succession. After years of leaving investors guessing, Hong Kong&rsquo;s richest man named his eldest son, Victor, as heir to his business empire. That should prevent a power scramble, and assures him a loyal follower who shares his values. The newcomer will even be surrounded by a coterie of long-time Li acolytes. It&rsquo;s not dissimilar to the leadership transition happening in Beijing.

Family planning

China&rsquo;s property chickens are coming home to roost. Last week&rsquo;s economic data shows that a year of falling prices is finally changing developers&rsquo; speculative behaviour.

Tonne of bricks

Temasek is turning into a financial chimera. Where that mythical beast was part lion, goat and serpent, the Singaporean fund combines aspects of a hedge fund, private equity house and investment bank. That combination sounds good for returns, though it might not sit well with Temasek&rsquo;s political ties.

Multi-tasking Temasek

HSBC has received a first-quarter fillip. The UK-based emerging markets bank reported a 33 per cent increase in pre-tax profit in the first three months, compared with the period to the end of December. Strip out accounting funnies arising from the increased value of HSBC&rsquo;s own debt and the figure more than doubled. This brings chief executive Stuart Gulliver tantalisingly close to the targets he set last year.

Spring break

An escaped Chinese dissident takes refuge in the US embassy. It&rsquo;s a diplomatic crisis, but needn&rsquo;t become an economic one. Washington values rights, but it also needs a stable and cooperative China.

Don't fight over rights

Could Temasek&rsquo;s tinkering put Standard Chartered in play? The Singaporean fund&rsquo;s recent reshuffle of its bank assets has revived talk about its 18 per cent stake in the UK-based emerging markets lender. Now might be a good time to find a new owner.

Standard practices

China's present condition can't be summed up in a few tenths of a percentage point. True, judged by the headlines, GDP growth of 8.1 per cent in the first quarter of 2012 was a miss. Economists polled by Reuters expected 8.3 per cent. Investors shouldn't overthink it: growth is the least of China's three big worries.

Weakness in numbers

The resignations of Nomura&rsquo;s two top executives may close the chapter on the Japanese firm&rsquo;s plan to become a global player in investment banking. Departing Chief Executive Kenichi Watanabe and Chief Operating Officer Takumi Shibata led the opportunistic swoop on bankrupt Lehman Brothers in 2008. They are leaving mainly due to an unrelated insider trading scandal. But Lehman isn&rsquo;t working, and the pair&rsquo;s replacements have a chance for a dignified unwind.

Banking seppuku

China breaks the rules. The United States loses its edge. As for Britain, it barely registers at all. It&rsquo;s easy to see the Olympic Games as a metaphor for economic rivalry. Fortunately, the real world is different, and can be much more harmonious &ndash; if everyone basically plays fair.

Blame Games

Standard Chartered&rsquo;s true sanctions crisis could be over culture, not cash. The bank has hit back at the claim by a US regulator that it hid $250 billion worth of trades for Iranian clients in order to dodge US sanctions between 2001 and 2010. The denial is robust, but the case still raises worrying questions about how StanChart approached regulatory requirements. Given the limited changes in the bank&rsquo;s top team, these will be harder to brush off.

Of probes and probity

Do a favour, get a favour. That&rsquo;s how China works, and banking is no different. In keeping with the country&rsquo;s &ldquo;guanxi&rdquo; system of personal relations, Citi, UBS and Goldman Sachs all helped out troubled financial firms in the past and received privileges for it later. Rivals have not been so fortunate, however. And there&rsquo;s the risk that one favour leads to demands for more.

Gifts that keep giving

So much for China&rsquo;s rebalancing. President Hu Jintao has extolled the merits of infrastructure investment at an Asia-Pacific summit, even as the government approved some 1 trillion yuan of local projects, from subways to sewers. The goal of consumption rather than investment driving economic expansion has been put on hold. For now, that&rsquo;s as it should be.

Rebalancing can wait

China&rsquo;s growth is slowing, and president-in-waiting Xi Jinping hasn&rsquo;t been seen in public for two weeks. China-watchers are discussing little else. The former issue matters greatly to the world, while the latter is fascinating, but basically unimportant.

Xi's not there

Standard Chartered needs a governance booster. The UK-based bank is under attack from a New York financial regulator over trades for Iranian clients that could see the bank landed with a huge fine, or worse. A stronger board wouldn&rsquo;t have prevented the assault, but it might help the bank recover more quickly.

Top-down defence

What price a quiet life? Standard Chartered says $340 million. That&rsquo;s how much the UK bank paid to call off an assault from New York&rsquo;s Department of Financial Services, which had accused it of sanctions-busting trades.

Unsettling question

China&rsquo;s hurried murder conviction for politician&rsquo;s wife Gu Kailai and Russia&rsquo;s imprisonment of punk protesters Pussy Riot were both slightly farcical and deeply symbolic. The guilty verdicts were the same, but investors are likely to draw different conclusions.

You be the judge

Nearly forty years after China and Japan officially pronounced their relationship &ldquo;normal&rdquo;, it seems anything but. An old grudge over disputed islands has produced foolish rhetoric from Tokyo, anti-Japan riots in Chinese cities, and even an attack on the Japanese ambassador&rsquo;s car. Yet, the bad blood doesn&rsquo;t change the potential for closer Sino-Japanese ties.

John Foley