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There have been several letters this year to the FTC urging it to investigate claims that Herbalife is a dastardly pryamid scheme, from consumer groups, congress people and others. Most have leant on the arguments made by short seller Bill Ackman, but today’s from MANA, a National Latina Organisation, has some of the strongest and most specific language we have seen.
Herbalife claims it is both a product company and a business opportunity, but clearly this is a deceptive claim since the majority of Herbalife distributors make little or no income. According to Herbalife’s own 2012 data, 88 percent of their participants received no payments from the company at all. Read more
The Italian government has not collapsed in a flurry of post-bunga bunga recrimination, at least not yet.
With the ECB standing ready, the debt markets are calm, and investors in the banks are feeling good about improvements in asset quality and the direction of earnings. Read more
Live markets commentary from FT.com
Verizon set for biggest-ever debt sale || Apple introduced two new handsets at the same time || Barclays faces $10bn damages claim from Saudi businessman || Private Swiss bank says it is under investigation in US || Tesco to dispose of Fresh & Easy chain || Intel unveils tiny quark chips for wearable devices || Europe’s plan for FTT tax hit a wall || Ivan Glasenberg shows the ‘Glencore way’ to cut Xstrata ‘fat’ || Uralkali billionaire in talks to sell stake || China’s broadest new credit measure doubles || Markets Read more
Last week we ran a guest post from Yukon Huang of the Carnegie Foundation, which argued that China’s high rate of investment to GDP (which exceeds levels ever reached by obvious comparisons such as Japan and South Korea) is a consequence of China’s economic rise, not a problem in itself.
The imbalance, says Huang, merely reflects the urbanisation-industrialisation process — income rises and output grows as newly-urbanised workers earn more, but the proportion of their income spent on consumption falls for a time. Read more
What you don’t hear very often (and we are as guilty of this as anyone) is that the Fed data of “corporate securities held by primary dealers” is tainted with some assets that don’t look very much like corporate bonds. Those would be private-label residential mortgage-backed securities (RMBS), commercial MBS (CMBS) and commercial paper (CP).
Barack Obama has asked Congress to delay a vote authorising a strike on Syria while the US and its allies pursue a diplomatic initiative with Russia at the UN to force Damascus to give up its chemical weapons. He gave no indication of how long he would wait for a diplomatic solution to be worked out, with negotiations possibly being drawn out for weeks if not months, besides the difficulties of securing and removing Syria’s chemical weapons. (Financial Times) Read more