Posts from Friday Jul 20 2012

The Weekender

This week on FT Alphaville,

– More on Spain’s bail-in and the ECB’s U-turn, courtesy of Joseph… Read more

More on M-pesa and e-money

We wrote about Kenya’s M-pesa mobile money model on Wednesday, which we think is a really innovative and encouraging development in the world of money supply.

The point we were trying to make at the time is that there are some interesting parallels between Safaricom’s role in the M-pesa e-money market and the role of central banks in conventional money markets. Read more

IOER, negative rates, and Ben

The ECB’s recent decision to lower its deposit rate to zero raised speculation in the market that the FOMC might be considering the reduction or elimination of the 0.25 per cent interest the Fed pays on excess reserves.

Bernanke himself hadn’t mentioned the idea lately prior to his testimony before Congress this week, and it hasn’t come up in FOMC minutes since last September’s meeting. Yet the market continues to price in the possibility of a cut, as Barclays analysts noted this morning: Read more

More emails, a wholly unregulated Libor

This seems wholly inadequate

 Read more

About that tumbling euro

The euro is tanking (again) and just hit a 2-year low of $1.2143 at pixel time. A drop of over 1 per cent:

 Read more

“Finland will not hang itself to the euro at any cost…”

… and we are prepared for all scenarios,” said Finnish finance minister Jutta Urpilainen earlier in the month.

‘ALL SCENARIOS’, you say? Read more

Unwinding with an invisibility cloak

JPMorgan is continuing to be coy about the management of its Chief Investment Office’s doomed synthetic credit portfolio. The positions lost $4.4bn in the second quarter, bringing the year-to-date loss to $5.8bn. It’s understandable that they don’t want to share more granular details — doing so would put them at a disadvantage in trying to manage the whole thing down.

We know the financial instruments in the portfolio themselves were nothing special. It’s that the whole portfolio of them became too complex and illiquid, in part due to their enormous size. Read more

Markets Live transcript 20 Jul 2012

Live markets commentary from 

The (early) Lunch Wrap

Good morning, New York…


Upsides to a tumbling euro?

The single currency is at its lowest level in 9-years when measured in trade-weighted terms and has fallen 15 per cent since its recent peak in October 2009.

 Read more

Further reading

Elsewhere on Friday,

Spain’s bailout is more garden variety than you think. Read more

The 6am Cut London

Fears of a global food crisis rose as corn and soyabean prices reached record highs on Thursday. Corn and soyabean futures hit $8.055 and $17.115 per bushel, respectively, and some traders believe corn will reach $9 by early August (Financial Times). Moderate droughts in Illinois, Nebraska and Iowa were upgraded to severe in the past week. (Reuters).

A battle for control of Asia Pacific Breweries, maker of Tiger beer, has erupted after Dutch brewer Heineken made a S$5.1bn ($4bn) offer to buy out its joint venture partner in the brewery, Singapore-listed Fraser and Neave (Financial Times). The move could thwart an attempt by billionaire Charoen Sirivadhanabhakdi,  one of Thailand’s richest men, to build his influence in APB (Bloomberg). Read more