Posts from Monday Oct 21 2013

The Closer

FURTHER FURTHER READING

- Brad DeLong on the “Commissars-Turned-Capitalists of Shanghai” Read more

“This bank will remain the Co-operative Bank”

That would be Euan Sutherland, chief executive of the Co-operative Group, announcing “we have been listening carefully” to bondholders (eventually). Anyway, Sutherland has three principles for the now bondholder-dominated recapitalisation of his group’s bank (still in negotiation)… Read more

The eejit market in AIB [update]

Behold…

 Read more

“Tapering is off the table”

Fresh from having made $1bn impeccably timing the putative US recovery in the first half of this year (and Japan, natch), Andrew Law of Caxton Associates – one of the world’s most successful macro traders – has now turned bearish, and in quite a big way.

Caxton, a hedge fund named after the printer (its now-retired founder Bruce Kovner is a billionaire bibliophile), believes the Fed will keep running its presses:

We have been expecting the US economy to reach escape velocity led by housing and corporate capital expenditure… but for whatever reason that just hasn’t happened…tapering is off the table for the foreseeable future.

Caxton is long across the US yield curve (the debt debacle has been a good buying opportunity, if nothing else). Mr Law has spoken extensively with us about his view on the global economy and the state of the hedge fund industry. Tree-based publishing issues mean those thoughts came in truncated form. Below are some extended excerpts from him. Read more

The Co-op mess, and bondholder ethics

The PRA works with the FCA and the FRC to improve the quality and usefulness of information disclosed on firms’ safety and soundness… Consistent with that, we will work with the FCA and the FRC to review the extent to which there is scope to extend bondholder influence over banks, with a view to bringing forward recommendations in due course…

Bank of England (and Prudential Regulation Authority) response to the Final Report of the Parliamentary Commission on Banking Standards

Alternatively… the PRA need look no further than the wreckage, on Monday, of the Co-operative Bank’s plan to deliver the £1.5bn recapitalisation they ordered.

Plan B (for Bondholder) has taken over. Read more

Abenomics might eat itself, a Pettis production

It may seem like an odd time to stress out about Japan running an overly aggressive current account surplus, which might in turn push Abenomics off the tracks, but since the fears over a deficit have been so well covered… Read more

Forecast suspicion du jour

Goldman Sachs have found a new way to show us that the European stock market is not cheap at all any more — although we’re not sure that was entirely their intention.

Indeed, their European strategists would have you buy the GSSTDMGR. That sounds like the plea for one last merger from a dying banker, but it means Goldman like companies which will grow as the European economy recovers. Read more

Markets Live: Monday, 21st October, 2013

Live markets commentary from FT.com 

The (early) Lunch Wrap

Good morning New York,

NEWS Read more

Further reading

Elsewhere on Monday,

- Herbalife’s India problem.

- Empty restaurants are underrated.

- “We don’t see any evidence that it is cheaper for us to trade.” Read more

The 6am London Cut

Markets: Sentiment was bright across Asian markets, which mostly extended relief rallies that began late last week on bets the US Federal Reserve would continue its monetary stimulus until December or beyond. (Financial TimesRead more