Posts from Tuesday Jul 3 2012

The Closer


US stocks shrugged off the economy and Brent crude hit $101 a barrel again. The S&P 500 rose 0.62 per cent to 1,374.02, led by energy stocks — and posting its best three-day stretch since December (Reuters). Read more

‘I ain’t dead’ — US bank holding companies

Click for Goldman’s ‘living will ‘ for regulators, listing how it would try to resolve by selling parts of its business under bankruptcy:

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ECB collateral shift du jour

It relates to government-guaranteed bank bonds. In plain English — this appears to be tightening banks’ future use of them as collateral but with exceptions for some banks.

From Tuesday’s decisionRead more

Flooring the ESM

Assuming there are no voting hiccups in getting the ESM to buy sovereign bonds on the secondary market…

Some arguments that bailout fund’s limited size means it will eventually hit a floor which will ultimately make bond market liquidity worse. Read more

What Google searches tell us about China

Back in 2009 Standard Chartered’s Wei Li and Stephen Green figured out that while the great Chinese firewall may be capable of restricting access to undesirable internet content on the mainland, it can’t stop people from searching for said undesirable content.

While Google has suffered some setbacks in China, the analysts believe the search engine is still responsible for some 12-13 per cent of mainland searches. Read more

“Mr Tucker stated… that it did not always need to be the case that we appeared as high as we have recently.”

From Barclays’ written submission to the Treasury Select Committee. Click for better legibility.

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DTCC to the rescue! (With a benchmark)

Libor has, in many ways, already been disowned by the industry. But now the discussion of its inadequacies has entered the mainstream, thanks to the fines recently levied on Barclays for manipulating the rate, and its drawing unwelcome attention to the fact that it’s still used to determine payments on hundreds of trillions of financial products.

Some of the holders of said products are not happy, and have filed class action suits to show it. Clap your hands. Read more

Cajas or Landesbanken?

Click through the pic to the full IMF report on country x to find out. (p. 17)

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And with an inflexion of the eyebrows, Bob was gone

The City of London is old, its institutions built over centuries.

FT Alphaville has done some googling fieldwork and we have channeled the spirit of the City to give you this background on Bank of England Governor Mervyn King’s thinking since Barclays’ fines for manipulating Libor were revealed. Read more

The base money confusion

FT Alphaville had an interesting email exchange with Peter Stella this past week, snippets of which we would like to share (with Stella’s permission).

Stella is currently the director of Stellar Consulting, an organisation that provides macroeconomic policy advice and research to central banks, governments, and private clients. He was formerly the head of the Central Banking and Monetary and Foreign Exchange Operations Divisions at the International Monetary Fund. He has co-authored a number of papers on the topics of money supply, collateral and risk-free assets. Read more

Learning by imagining (nightmare Eurexit scenarios)

FT Alphaville didn’t enter the Wolfson economics competition, in part because our pizza drawing skills don’t pass muster, but Nomura’s Jens Nordvig and Nick Firoozye did. Their entry landed them one of the five finalist spots (more about those here).

Ahead of the announcement of the winner on Thursday, the pair have published a rather interesting and disturbing list of what they learned in the process of eurozone breakup solutionising. It won’t please anyone who’s been arguing that a break-up might not be such a big deal. Here’s a tl;dr version of their list of grim learnings: Read more

A note on the COFER data

If there was ever an expression of the fight facing the Bank of Japan in a risk-off world if it wishes to keep the yen down, then the IMF’s latest round of Currency Composition of Official Foreign Exchange Reserves (COFER) data out last week is it.

The COFER data remains the best snapshot of what is going on in one of the most important elements of the FX market. Admittedly China is annoyingly missing from the allocated reserve data, but with 55 per cent of reserves are reported, it remains an indicative dataset. Read more

Ireland’s ‘triumphant’ return to the markets

Ireland is heading back to the debt markets. It plans to recommence Treasury Bill auctions on Thursday 5 July 2012 by offering “€500 million of Treasury Bills with a three-month maturity in its first such auction since September 2010”:

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Markets Live transcript 3 Jul 2012

Live markets commentary from 

Introducing Bob’s natural successor…

David Roberts

He spent roughly his whole career at Barclays, joining in 1983 and working his way up to be first chief executive of Personal Financial Services at the bank and then head of Business Banking. He lost out to Bob Diamond in the race to be group ceo when the previous incumbent, John Varley, opted for early retirement. Read more

The (early) Lunch Wrap

Good morning, New York…

FT ALPHAVILLE – Bye, bye Bob Special Read more

Barclays, PB*


First, a tip for Bob Diamond’s successor as chief executive at Barclays: Don’t threaten the Bank of England. It will get you deported. Read more

Further reading

Elsewhere on Tuesday,

– Money makes people less humaneRead more

No flowers

3 July 2012

Barclays PLC and Barclays Bank PLC (Barclays) Read more

The 6am Cut London

Diamond threatens to drag in BoE: Pressure on Barclays CEO Bob Diamond remains after the bank’s chairman, Marcus Agius, resigned on Monday (Reuters). Diamond has sought to alleviate some of the pressure by “threatening to reveal potentially embarrassing details about Barclays’ dealings with regulators if he comes under fire at a parliamentary hearing on Wednesday”, according to people close to Diamond. (Financial Times)

Microsoft has taken a $6.2bn writedown on its internet business, underscoring the failure of the company’s push into the internet advertising market. The charge mainly relates to the $6.3bn acquisition in 2007 of AQuantive, which was then a leader in automated online ad sales and placement. Google acquired DoubleClick the same year and has since led the field. (Financial TimesRead more

Smells like Bob contrition

Step 1. Make exemplary use of the passive voice in communications to the Treasury Select Committee and staff.

Step 2. Wait for someone else to fall on his swordRead more