RSS feedA timely confirmation of risky behaviour
ECB papers are rarely the most riveting of reads but sometimes one crops up which is more attention-grabbing than usual…
This particular case, a paper by Biais, Heider and Hoerova, may be of interest as it at first glance appears to confirms what many already suspect — that hedging,
Hungary — “the Commission remains preoccupied…”
Making an extraordinary story of bailout conditionality even more extraordinary…
The European Commission warned the Hungarian government on Wednesday that it’s ready to go to the European Court of Justice to argue that a new constitution violates EU law.
And now for the bullish case on Chinese property
Just so as we are not accused of being gloomsterish on China, here is the latest from JPMorgan’s Jing Ulrich.
While risks of external shocks abound, she sees a more nuanced response from the central government than in 2008-09.
Is China secretly consuming more, or not?
The Barclays Capital note we discussed earlier this week, postulating that China had already begun to see a critical increase in its household consumption-to-GDP ratio, has generated a few questions over email.
[Credit event auctions] Mechanics
Since 2009 credit event auctions that determine credit default swap payouts have been hardwired into the operations of the market. Previously, auctions were arranged on a more ad hoc, voluntary basis.
Markets Live transcript 11 Jan 2012
Markets Live chat transcript for the chat ending at 12:06 on 11 Jan 2012. Participants in this chat were: Paul Murphy Bryce Elder/FT User7680760 PMMorning PMHello BEYes,
Consob is watching
RTRS-ITALY MARKET WATCHDOG CONSOB CHECKING BLACKROCK STATEMENTS ON UNICREDIT STAKE-CONSOB SOURCES
MILAN (Dow Jones)–U.S. asset management company BlackRock Inc. (BLK) Wednesday said it still holds a 3.09% stake in UniCredit SpA (UCG.MI),
Markets Live at 11am — Shopping special!
Tech permitting, we should have an esteemed guest on Markets Live on Wednesday: Mr Tony Shiret of RBS.
Shiret ranks as probably the best retail analyst in the country, so get your questions ready…
Pandit’s big idea
FT Alphaville has intercepted a recent phone call between banks and their regulators!!!
Regulators: “We’re going to revise the capital adequacy framework and increase transparency in the reporting of risk on bank balance sheets.”
Das transmission
Just to warm you up for Thursday’s European Central Bank policy meeting…
Though not many are expecting a rate change, Societe Generale’s Kit Juckes points out that the German two-year bond yield is close to going lower than Japan’s:
Further reading
Elsewhere on Wednesday,
- Davos job title cloud!!
- Asking for a base salary raise?
- Now, sell the nice hedgie your Greek bonds.
- What we know about Iran’s nuclear activities.
- Maybe it’s time to move office…
Pink picks
Comment, analysis and more from Wednesday’s FT,
Martin Wolf: Hopes in emerging countries
Between 2007 and 2012, the Chinese economy will expand by close to 60 per cent, writes Wolf. Emerging Asia as a whole will grow by almost 50 per cent.
Snap news
Breaking pre-market news on Wednesday,
– J Sainsbury record breaking Xmas, etc – statement
– Greggs’ excellent Xmas trading, etc – statement
– Supergroup’s solid Xmas, etc – statement
– BAA whinge – statement
– Amec’s National Grid contract – statement
– SABMiller partially refinances Fosters acquisition – statement
– Other corporate: Michael Page,
Further further reading
For the commute home,
- Corporate bond floodgates open wide.
- A slideshow (a good one, though) of America at work.
- The SEC pushes for more disclosure of US banks’ exposure to Europe.
- ECB loans stabilize market,
Fiscal flailing, continued
Goldman Sachs has updated this chart, which shows the projected impact of fiscal policy on GDP growth, to reflect its latest assumptions (see the previous version here):
The dotted line that dips through 2012 is what would happen if,
Brussels in sane competition ruling shock
An eye-catching story from the FT”s Alex Barker and Jeremy Grant on Tuesday…
Europe set to block DB-NYSE tie-up
European competition officials have recommended blocking the tie-up between Deutsche Börse and NYSE Euronext,
Some finporn
Forgive our tired cynicism, but how or why is this a ranking the world’s “richest” hedge funds? (Via Bloomberg Markets)
Top of the pops is Tiger Global, managed by Chase Coleman and Feroz Dewan,
A fistful of ______
Iranian FX management — still as bonkers as ever:
TEHRAN, Jan 10 (Reuters) – Iran’s currency has slid 20 percent against the dollar in the last week despite central bank intervention, and Iranians concerned about the economy said on Tuesday attempts to send text messages using the word “dollar”
America, healing? Not in Bob’s world
When you start talking about US growth in 2012, it’s hard to stop. The huge November consumer credit increase being a case in point. Plus a long slew of comfy data on auto sales, jobs…
So if you’re looking for a snappy corrective — here’s a précis of the opposite view,
German negative yields as harbinger of deflation
Mohammed El-Erian has penned a few thoughts about Germany’s negative yielding bubill auction and indentifies — quite rightly — that there are major risks associated with this precedent.
Ultimately,
Return of the large caps
Between 2000 and 2010, European large caps underperformed mid caps by 28% and lagged small caps by 47%.
And yet, the equity strategists at Morgan Stanley recommend investing in large caps in 2012. The decade of underperformance has been reversing.
To ring-fence the ECB in Greece… or not
There was a nice line in the FT’s latest story on Greece’s debt restructuring:
Questions are also being raised about the ECB’s estimated €45bn of Greek sovereign holdings. Collective action clauses are likely to be introduced into Greek bonds by the PSI deal,
Markets Live transcript 10 Jan 2012
Markets Live chat transcript for the chat ending at 12:03 on 10 Jan 2012. Participants in this chat were: Paul Murphy Bryce Elder/FT 11:00AM PMHello PMWelcome again to PML
Buiter on odds of German vs Greek euro exits
Next up in the eurozone drama - Citi chief economist Willem Buiter, with colleague Ebrahim Rahbari, have contributed their 2012 outlook on the European crisis.
They believe the ECB is likely to come to the rescue.
The iPay phenomenon
A British academic, Ian Tonks of Bath university, suffered a vicious TED attack this week regarding this post — a summary of Tonks’ research into links between bankers’ bonuses and the financial crisis.
Unlisted in euroland
Remember this?
First, the Eurosystem has abolished the eligibility requirement (Sections 6.2.1.5 and 6.2.1.6) that debt instruments issued by credit institutions, other than covered bank bonds, are only eligible if they are admitted to trading on a regulated market.
Our multi-speed world…
Quick observational snap from BarCap’s Global Macro Daily:
A tale of three economic blocks
Recent economic data imply that the US is experiencing a solid economic recovery, China a soft landing and the euro area a mild recession.
Further reading
Elsewhere on Tuesday,
- The analyst herd is practically marching in single file.
- And private investors are behaving like baboons in a warehouse full of plastic bananas.
- While economists seem to be affected by some kind of mysterious gas,
Pink picks
Comment, analysis and other offerings from Tuesday’s FT,
Gideon Rachman: Why I’m feeling strangely Austrian
The old is dying and the new cannot be born: in the interregnum a great variety of morbid symptoms will appear.” That statement from the Prison Notebooks of the Italian communist Antonio Gramsci was a favourite of student Marxists when I was at university in the 1980s.
Snap news
Breaking pre-market news on Tuesday,
– Food helps Marks & Spencer over Xmas – statement
– Sports Direct opines on Blacks Leisure administration – statement
– Gulf Keystone on Kurdistan licenses – statement
– Cairn Energy details $3.5bn cash return to shareholders – statement
– Corporate: Arbuthnot Banking,