What? Companies dictating listings?
The stock exchange has finally done it, proved absolutely that it has become a branch of the civil service and expects to run itself that way.
It has a proper civil service type schedule, you see, of when companies should go public after saying they would like to. But some of these companies have now upset the schedule by taking the view that market conditions are not appropriate at the moment.
Can't have that. What is the world coming to when an agreed schedule is upset without official permission? It would never be tolerated in the civil service and should not be tolerated here.
Does the market not know who is boss around here? Time to rap some knuckles with a stiff memo.
And that is what the exchange has done.
It has told listing sponsors that there is a backlog of listing applications to the Trivial Pursuits Board (GEM) and some people are not handing in their paperwork on time. Unless they smarten up their listings may not be approved - 'Priority will be given to those applicants who have adhered to their original schedule'.
To drive the point home, we then have 'sources' complaining that there is a great deal of work involved in the approval process (there would be with civil servants running it) and 'if a lot of applicants revise their hearing schedules it will mess up the whole process'.
Oh dearie me, a messy market and bureaucrats who have never dirtied their hands in one can't imagine how that would happen.
Move aside, King Canute, we have an entire tribe here that thinks it can command the tide to stay out.
When its members start to see the water lap over their feet they may just wish to look at the tidal chart your correspondent has provided them in this column.
It shows you a 12-month running average of the number of new listings on the exchange every month over the past 10 years and it tells you they are directly correlated to the performance of the Hang Seng Index with about a three-month lag.
If only you had known. With this chart you would have bought in early 1991, sold at the end of 1993, bought again in mid-1995, sold in mid-1997, returned to the fray in late 1998 and been a billionaire.
But apparently it is not possible to drum it into a bureaucrat's head that in this business you can only hit the market when the market is hot and when the market is cold you simply cannot make it swallow stock, particularly when it is the sort of frivolous stuff peddled on the Trivial Pursuits Board.
We had a six-month window in which the market was happy to play trivial pursuits and that window is now shut. To mix the metaphor again, if you try to stuff a new-issue pipeline with new issues when the tap on the other end is closed you will only get a plugged pipeline. Stiffly worded memos will never open it.
Say what you like about the old lot that used to run the exchange, they at least understood this basic fact of life. They made sure that new issues went through the pipeline at a fast clip when it was open and they stood by when it was closed and waited until it was open again.
You won't find many stockbrokers who think they can jump to the civil service and run it just like that, but overpay a civil servant and you have an instant self-proclaimed expert in stockbroking.
Get it into your head, Mr Kwong. You don't set this schedule. The market does.
Graphic: mon17gbz
