Posts from Monday Nov 12 2012

The Closer


FT markets round-up: “Investors started the week in timid mood as worries about the looming Washington’s budget negotiations and a meeting in Europe to discuss a bailout programme to Greece weighed on sentiment. The FTSE All-World equity index fell 0.1 per cent after the FTSE Eurofirst 300 closed 0.3 per cent lower. The dollar index was also little changed as the US government bond markets were closed for Veterans’ Day, resulting in thinner trading volumes than usual. On Wall Street, the S&P 500 ended fractionally higher after see-sawing throughout most of the day. A batch of M&A moves, including Sherwin-Williams’ offer to buy Comex for $2.3bn, including debt, helped support the index.” (Financial TimesRead more

“Fiscal cliff” was smart branding until it was stupid; and other stuff

“Under current law, on January 1, 2013, there’s going to be a massive fiscal cliff of large spending cuts and tax increases.”

— Ben Bernanke, first usage of “fiscal cliff”, 29 Feb 2012 (Hat tip Kevin Drum)

 Read more

The growth of M&A litigation

You know the script here. X company announces that it is acquiring Y; a few days later news of a class action law suit ticks across the wires, typically alleging the directors have failed in their fiduciary duties in some manner; thereafter, silence…

Research by Robert Daines and Olga Koumrian at Cornerstone suggests that such litigation has become the norm since the onset of the financial crisis. Read more

So Popular it just can’t stop buying itself

Spain’s Popular bank has got backing for a €2.5bn rights issue. But here’s the thing we think deserves a touch more attention — in the run up to the rights issue, Popular once again ramped up its holdings of its own shares, from 0.588 per cent in July to 3.979 per cent on the second of November (data here). We still find this odd…

 Read more

Introducing the ‘youth sacrifice ratio’

Not the kind of youth sacrifice once practiced by the Aztecs, the Inca, and the Carthaginians in order please distant, fickle gods if course. We’ve moved on a bit since then.

Then again, it’s still the younger generation that generally draws the short straw in a crisis… Read more

Jefferies-Leucadia: the beef

All right, a presentation.

 Read more

Case studies in low UK taxes: from lattes to water pipes

Corporations appearing to not pay their fair share of tax in the UK is a running theme. Starbucks, Google, Amazon, and now water companies, are all having their turn in the limelight. Let’s have a brief tour around each.

Firstly, sorry to be the bearer of bad news — but it turns out that you aren’t paying enough for your extra hot single-shot caramel skinny latte (as per a Starbucks press release, emphasis ours): Read more

Markets Live: Monday, 12th November, 2012

Live markets commentary from 

The (early) Lunch Wrap

US to become world’s biggest oil producer || Greek push to avert €5bn default || Don’t fear the fiscal cliff, says Murray || Japan’s economy shrinks 3.5 per cent || US retailers target diverted goods || Starbucks, Amazon and Google face UK parliamentary committee on tax || Markets update Read more

Further reading

Elsewhere on Monday,

– Democrats, hubris and the fiscal cliff.

– GiGi wants to rule the world. World says: how about no?

– The growing Brics corruption threatRead more

The 6am London Cut

Obama on deficit reduction: “The White House plans an aggressive public campaign to build support for its approach to reduce the deficit through tax increases and spending cuts, a sharp contrast to its private talks with Republicans that faltered last year. President Barack Obama will meet with labor leaders Tuesday and a number of chief executives on Wednesday, in an effort to solidify backing for his proposals.” (Wall Street Journal)

Republicans signaling readiness to compromise: “A senior Republican senator voiced confidence on Sunday that U.S. lawmakers would forge a deal on the year-end “fiscal cliff,” while a top aide to President Barack Obama signaled a willingness to compromise over raising tax rates on the rich.” (ReutersRead more