Posts from Monday Nov 26 2012

A mere three weeks later, a Greek debt deal [updated]

A deal, a late-night press conference, an inevitable fudging of the numbers. You know the rules.

Eurogroup officials will hold a press conference on Monday night at 11pm CET – or at least, that’s the time given in this link… Read more

Amazon borrows cheap money because, we guess, money is cheap to borrow (and easy to spend)

From the FT’s Barney Jopson and Vivianne Rodrigues:

Amazon was set to issue a bond for the first time in more than a decade on Monday, taking advantage of rock-bottom borrowing costs as it continues an investment drive that is withering its profits.

 Read more

The Closer


FT markets round-up: “Global stocks started the week on a downbeat note following a string of gains in the past couple of sessions as worries over a looming fiscal cliff in the US, and lingering debt woes in the eurozone weighed on investors’ sentiment. The mood was cautious, with copper steady at $3.53 a pound as the euro fell 0.1 per cent to $1.2965. The dollar index was little changed, while Treasuries attracted buyers, pushing 10-year yields down 3 basis points to 1.66 per cent. Gold also edged lower, falling $1 to $1,748 an ounce. High quality global journalism requires investment. The FTSE All-World equity index retreated by 0.1 per cent after Asia was broadly firmer. The FTSE Eurofirst 300 closed 0.5 per cent lower as Wall Street’s S&P 500 fell 0.2 per cent to close at 1,404 points.” (Financial TimesRead more

Marginal tax rates and that thing that’s happening at the end of the year

We’re trying not to get too caught up in the play-by-play of the negotiations between the President and Congress about the [rhymes with, um, driscoll spliff], thinking it better to wait until we start getting more definitive news. We recommend the NYT’s Debt Reckoning site to those who want frequently updated coverage.

But we recently came across a series of useful and well-constructed charts from Credit Suisse, and we wanted to highlight a couple of them: Read more

Five seven five / Is unsustainable, so / Haircut to seven

One of the following is an autumnal haiku composed on Twitter by Herman van Rompuy, President of the European Council. But which is it?

The night has fallen
The bare branches can be seen
Even more lonely Read more

Schapiro steps down

After nearly four years in office, SEC Chairman Mary L. Schapiro today announced that she will step down on Dec. 14, 2012.

A big announcement today from the SEC. Read more

Old Canucklehead to Old Lady – a Mark Carney intro

We say old – he’s only 47. But what kind of “quality guvnor” (George Osborne’s words) will Mark Carney be at the Bank of England?

Well, one thing pops out from the Bank of Canada press release announcing Carney’s move across the Atlantic: “The Governor will remain Chair of the Financial Stability Board.” Emphasis ours. Read more

Meet the new BofE governor

Rather unexpectedly, Mark Carney gets the job.

 Read more

Cut out and keep, charting Greek OSI edition

Hat-tip to the FT’s Brussels blog

Click t0 enlarge — a Eurogroup chart guide on how to cut Greece’s official debt levels (a buyback boondoggle included): Read more

Eurogroup meets for third go at kicking can down the road

The Eurogroup meets on Monday for the third time in as many weeks to discuss Greece’s finances. Maybe third time’s the charm?

The focus remains on getting an agreement on the country’s medium-term debt sustainability. The reason for that is two-fold. First, it’s necessary to appease the IMF given its insistence on a haircut (which is politically very difficult for many of the member countries). Second, with the German elections taking place next September, it’s seen as best for all concerned to agree some sort of solution that will allow the question of Greece’s longer-term sustainability to be ignored until late 2013. Read more

Expect to hear a lot more about asset encumbrance, say SocGen

Asset encumbrance ratios are becoming a fashionable metric when it comes to assessing the health of banks.

On that note, Société Générale’s cross-asset research group provides a nice little break-down on Monday. While SocGen don’t believe that asset encumbrance is a major problem for any bank yet, they do recognise that the issue is becoming important on account of banks’ recourse to secured funding, and one likely to be picked up on by ratings agencies soon. Read more

Markets Live: Monday, 26th November, 2012

Live markets commentary from 

The (early) Lunch Wrap

Victory for Catalan separatists || UBS fined for Adoboli failings || The latest on Argentina vs holdouts || Investors urge Jenkins to split Barclays, while Qatar Holdings sells its shares in the bank || Black Friday moves to interwebs || EU banking union urged || Goldman not so keen on underwriting banks in Spain & Italy || Tim Geithner in fiscal cliff negotiation role || European stocks await outcome of Greece talks Read more

China’s ubiquitous ghost cities

One of the tentative signs of improvement in China’s economy in the past few months has been the apparent reduction in inventory of residential apartments.

Real estate investment was responsible for about 13 per cent of China’s GDP last year, and is a key destination for financially-repressed Chinese household savings, so it’s an important sector. Read more

UBS fined £29.7m for significant failings in Adoboli case

Definitely a turn-around for the books in the Kweku Adoboli case.

From the FSA on Monday, emphasis FT Alphaville’s (and the whole release really is worth a read): Read more

Catalans maybe like this independence idea

Catalonia’s regional election on Sunday delivered a big victory for the separatist movement — but a more fragmented one than had been expected. Four separatist parties won 87 of the regional parliament’s 135 seats. The ruling CiU party didn’t do so well, losing 12 seats to hold 50. This was much lower than polls had suggested, and follows a battle between supporters and opponents of independence that has become increasingly bitter, as the allegations against Artur Mas last week illustrated.

As the FT’s Miles Johnson reports, the vote brings the prospect of a stronger push for Catalan independence. Regardless of the CiU’s own performance, the surge in support for smaller separatist parties raises the big question of what this means for heavily-indebted Catalonia, and for Spanish prime minister Mariano Rajoy. Read more

Further reading

Elsewhere on Monday,

– Hugh Hendry on the ‘death spiral of mercantilism‘ and more.

– The austerity sadness goes on.

– Depression severity assessment, in a single questionRead more

The 6am Cut London

Asian shares up, yen down || Catalans show strong support for independence || Barclays shareholders want investment bank axed || Argentina to appeal bond ruling today || Asmussen dismisses official haircuts || New BoJ members sought more expansionary statement || ‘Old fashioned’ commercial bankers in demand Read more