Posts from Friday Jun 8 2012

Spain could request bank bailout this weekend

While we were watching the football, our colleagues Peter Spiegel and Victor Mallet reported earlier this afternoon:

Spain could request bailout aid for its struggling banks as early as Saturday, making Madrid the fourth member of the currency bloc to need a rescue from EU authorities since the outbreak of the sovereign debt crisis. Read more

The economics of EURO 2012

No, we’re not talking about stuff like this…

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A little perspective

It has come to FT Alphaville’s attention that the NYMag is admirably trying to completely prepare the latest crop of would-be bankers for their summer sojourn as interns.

For those in NYC, there is advice on where to live. For those who haven’t clocked that working at a bank involves dressing up in a suit and not having a ridiculous haircut, there’s advice on what to wear and appearance. Finally, there’s advice on what to do, and what most definitely not to do, inside and outside the work environment. Read more

The other fiscal cliff issu(-ance)

Most of the fear of what might happen if the US goes over the proverbial fiscal cliff has concentrated on the size of the economic drag it would produce.

But as you might have guessed for a blog that has long worried about the effects of a decline in safe assets on trust in financial intermediation, shadow banking liquidity, collateral shortfalls in money markets, etc… we also think it’s important to look at what it would mean for the corresponding decline in US Treasury issuance. Read more

On the (marginal) advantages of the Greek bank jog

We’ve all been griping about the “bank jog” that has been eating away at the Greek banks’ deposit base — €70bn or so of deposits flying out of the country’s banks seems to be a bad news no brainer.

But what if the scale of the flight has a counter-intuitive positive side? (Although “ever so slightly less negative side” would probably be a better description.) Read more

A snip at £2.49…

That’s from iTunes. Get the Kindle version here: Read more

An eye-catching spike in Nokia…

Well, it caught our eye.

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Battlefield Internet: A Saga of the Year 2012

Dr Thies Lindenthal, a researcher in virtual real estate at the Massachusetts Institute of Technology, submits the following post to FT Alphaville.

The piecemeal roll out of new virtual space is unfair, risky and detrimental to the user-acceptance of new space on the internet.
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A quick note on Fitch’s downgrade of Spain (updated)

UPDATE: The below is an accidental exaggeration and ignores the role of the fourth rating agency, DBRS, which Joseph recently posted about. For a collateral hike to take place DBRS would have to reduce its rating on Spain to BBBH/BBB. It is currently at A (high) with a negative outlook having been downgraded in May.

As JPMorgan’s Flows & Liquidity said in May: Read more

Markets Live transcript 8 Jun 2012

Live markets commentary from 

The (early) Lunch Wrap

Good morning New York…


When the eurozone sneezes, does the US catch a cold?

If this chart of exports is anything to go by, it’s hard to see how the US would become unwell:

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The end of artificial scarcity

With so much doom and gloom about, we’d like to take you on a trip through the looking glass to a world where the future is bright, not bleak. Optimistic, not pessimistic. Hopeful, not dismal.

And we mean that in the context of today’s data. Not in some parallel-universe that doesn’t exist. Read more

Further reading

Elsewhere on Friday,

– Why do trade negotiations take so long? Read more

The 6am Cut London

Japan’s current account surplus for April was smaller than expected, reports Bloomberg, at 334bn yen compared to economists’ median estimates of 441bn. However the country revised its Q1 GDP growth rate up to 4.7% in annualised terms, from 4.1% previously, reports the WSJ. The main reason was capital spending which declined at a much slower rate.

Concern is growing that China’s stimulus measures will ultimately harm the economy, says the FT, after Thursday’s interest rate cut announcement from the PBoC. Read more

Overnight markets: Down

Asian shares edged lower on Friday, with disappointment over Ben Bernanke’s lack of clues on whether a US easing was in the offer outweighing any positive effect from China rate cuts, says Reuters. The MSCI Asia ex-Japan index fell 0.2%, after rising 1.7% to a one-week high in the previous session. The dollar firmed against major currencies, while the euro eased 0.1% to $1.2558, moving further away from a two-week high of $1.2626 hit on Thursday.

Asian markets
Nikkei 225 down -159.78 (-1.85%) at 8,480
Topix down -12.36 (-1.69%) at 718.39
Hang Seng down -172.08 (-0.92%) at 18,506 Read more