The (early) Lunch Wrap | FT Alphaville

The (early) Lunch Wrap

Good morning, New York…


Governor Zhou and China’s money creating machine: Everyone already knows China has the world’s largest stock of M2 money. But what the team at Standard Chartered thinks is more important in the Zhou era is China’s importance as a creator of new M2. Kate reviews their analysis.

China is, once more, a net buyer of US Treasuries: a move overlooked amid the higher-profile news that Chinese growth in Q1 decelerated by less than expected and the RMB was allowed to trade in a wider band. Cardiff’s insight into the recent reversal in this post, along with an illustrative chart.

Argentina’s takeover of oil group YPF: it’s not “expropriation”, it’s asserting one’s “hydrocarbon sovereignty”, which is in the “national public interest”. Get a sense our skepticism in this post.

Resurrecting late executives: there’s a company that says they do this, Kate reports. See the comment gallery for light relief, e.g. “Warren is going to run Berkshire 4eva” from Ehwotay.

Five years later… by now there’s a pretty decent dataset for the financial crisis. How has credit performed in terms of defaults and recovery rates? Deutsche Bank unleashes their 2012 Default Study, Lisa reviews.


Japan will provide $60bn worth of loans to the IMF, in an effort to contain the eurozone sovereign crisis. It is hoped that the country’s contribution will lead to further financial commitments from other countries. (Reuters)

Citigroup might not increase its payout to shareholders at all this year, Vikram Pandit, chief executive, has warned, even as the bank reported improved first-quarter earnings. (Financial Times)

The World Bank has chosen Jim Yong Kim as its next president, ending a bitter selection process that the US nominee’s main rival said was not decided on merit. (Financial Times)

The Senate has voted to block the “Buffett rule”, setting the stage for an ideological fight between Republicans and Democrats that will play out all the way to the presidential election in November. (Financial Times)

Madrid has threatened to seize budgetary control of wayward Spanish regions as early as May if they flout deficit limits, officials said – as investors took fright at the fragility of some eurozone economies. (Financial Times)

US regulators accused optionsXpress, an online futures broker, and five individuals of engaging in sham options transactions as part of a naked short selling scheme. (Financial Times)

Central bank reserve managers responsible for trillions of dollars of investments are shunning euro assets and questioning the currency’s haven status because of the region’s sovereign debt crisis, research has found. (Financial Times)

The US Supreme Court agreed to consider a case involving a graduate student who sold foreign books on Ebay to finance his education, with the decision potentially having far-reaching implications for the multibillion-dollar market for international goods resold in the US. (Financial Times)

Markets: Dithering at the start of the European session has given way to a more optimistic tone, though the apparent bullish undercurrent is being restricted by lingering worries over the eurozone’s fiscal condition (FT’s Global Market Overview). An auction of Spanish debt saw increased demand, and US index futures are up (Bloomberg).