The (early) Lunch Wrap

Good morning New York,

FT ALPHAVILLE Read more

The Closer

FURTHER FURTHER READING

- Diane Coyle on how to teach economics to undergradsRead more

GS on its recommended Treasury short: cut your losses, time to get out

By Camilla Hall and Stephen Foley

The Treasury market melt-up earlier today does not mean that everyone who believed higher rates are coming have stopped believing. Some investors just wanted to cut their losses, not willing to wait any longer. Read more

The (early) Lunch Wrap

UK unemployment falls to near 6-year low of 6% || Aldermore scraps IPO as listing markets sour || BG Group poaches Statoil’s chief executive || Amazon launches same-day delivery service in the UK || UniCredit turning to private equity to enable loan detox regime || Cameron signals inheritance tax cut | Markets Read more

The 6am London Cut

Markets: “Asian stocks fell, with the regional benchmark index heading for a six-month low, extending a rout in global equities after the Standard & Poor’s 500 Index capped its biggest three-day loss since 2011.” (BloombergRead more

The 6am London Cut

Markets: Asian markets were in the red as concerns about a eurozone slowdown and the effect on equities once the US central bank concludes its monetary stimulus this month continued to bite. As investors retreated from risk the US dollar dropped, the price of oil fell and demand rose for haven assets such as gold and the Japanese yen. Japanese markets were closed for a public holiday. (FT’s Global Markets OverviewRead more

Draghi flips Keynes

From the opening to Mario Draghi’s speech at the Brookings Institution on Thursday:

As I was preparing these comments, I happened to re-read John Maynard Keynes’ open letter to President Franklin D. Roosevelt, published in the New York Times in December 1933. In it, Keynes tells President Roosevelt that the administration is engaged simultaneously in recovery and reform, and identifies a tension between the two. He worries especially about the risk that over-hasty reform impedes recovery. Read more

The Closer

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- Pimco shows that star investors are not really solo artists. Read more

London 6am Cut

Rio turned down Glencore merger idea: “Rio Tinto said Glencore put forward the idea of a potential merger of the two companies to create the world’s largest miner and commodities trader, before Rio’s board rejected the idea. Glencore approached Rio in July regarding a potential tie-up but Rio’s board concluded unanimously that a “combination was not in the best interests of Rio Tinto’s shareholders”.” (Financial Times)

Brussels targets Amazon’s Luxembourg tax deal: “Brussels is confronting Luxembourg over an unorthodox Amazon tax deal, alleging it allowed the online retail giant to reap potentially illegal state subsidies for its European operations for almost a decade. The European Commission is poised to launch a formal in-depth probe into its serious concerns over improper state aid, dragging Amazon into a multi-pronged clampdown on sweetheart tax deals that has already ensnared Apple in Ireland and Starbucks in the Netherlands.” (Financial TimesRead more

The Closer

FURTHER FURTHER READING

- Income inequality and income-class consumption patterns. Read more

GlenTinto – fact or fiction

You’ve seen the story.

Now here’s some reaction. Read more

One hundred years ago (Manhattan real estate edition)

Compare (2014):

Hilton Worldwide Holdings Inc. (“Hilton Worldwide”) today announced it has entered into an agreement with Anbang Insurance Group Co. Ltd. (“Anbang”), under which Anbang has agreed to purchase the Waldorf Astoria New York for $1.95 billion. As part of this long-term strategic partnership, Anbang will grant Hilton Worldwide a management agreement to continue to operate the property for the next 100 years, and the hotel will undergo a major renovation to restore the property to its historic grandeur… Read more

Secrets and Libors

The Bank of England is going from twiddling bank capital to also twiddling mortgages themselves to try and stop risk in the UK’s housing market.

That’s big and part of an international trend among central banks. Interestingly, the Financial Policy Committee on Thursday sought direct powers to cap loan to value or debt to income ratios, versus leaving them to the PRA. Read more

Rocket, missing boosters

That’s a stock price of Rocket Internet GmbH — down 3 per cent at pixel time, but which had been down as much as 12.5 per cent as it started trading in Frankfurt on Thursday. Certainly no first-day pop.

Maybe the message is getting through? Read more

The Closer

FURTHER FURTHER READING

- Robot historians and the heroic idea. Read more

The EU versus Apple & Ireland

In the light of the foregoing considerations, the Commission’s preliminary view is that the tax ruling of 1990 (effectively agreed in 1991) and of 2007 in favour of the Apple group constitute State aid according to Article 107(1) TFEU. The Commission has doubts about the compatibility of such State aid with the internal market. The Commission has therefore decided to initiate the procedure laid down in Article 108(2) TFEU with respect to the measures in question.

Click for the full document laying out the case.

 Read more

Pimco deGrossed

They say that to lose one figurehead may be regarded as a misfortune; to lose both looks like carelessness. Read more

The Closer

FURTHER FURTHER READING

- Bringing back US productivity growthRead more

The Closer

FURTHER FURTHER READING

- How China’s central bank worksRead more

The (early) Lunch Wrap

Good morning New York,

FT ALPHAVILLE Read more

The Closer

FURTHER FURTHER READING

- There’s more than one kind of credibility.  Read more

Tesco: Every little helped?

A £250m profit overstatement will do that to you… Read more

The Closer

FURTHER FURTHER READING

- The disruption myth. Read more

Video: Calpers and hedge funds, the end of the affair

Joseph and Dan discuss the decision by the largest US public pension fund to ditch hedge funds, on the set of mastermind.*

 Read more

The Closer

FURTHER FURTHER READING

- The best solution for homelessness: give homes to the homeless. Read more

The (early) Lunch Wrap

Good morning New York,

ALPHAVILLE Read more

Markets Live Special — Donovan of UBS joins to discuss the Scottish vote

Tuesday at 11am.

Click here.

Paul Donovan, global economist at UBS, will join Bryce and Murphy for our regular Markets Live session. Extracts from his latest note on the Scottish independence vote below… Read more

The 6am London Cut

Survey bleg: The 6am Cut, Lunch Wrap and Closer emails will soon be relaunched in enhanced form. We want to ensure we’re providing only the most useful data, news and views — taking this short 2 minute survey would help us do that.

Markets: “Asian stocks stumbled to their lowest in five weeks on Monday after a batch of weak data out of China raised the spectre of a sharp slowdown in the world’s second-biggest economy. The Australian dollar, considered a liquid proxy for China plays, also took a hammering and slumped to a six-month low… Data released on Saturday showed China’s factory output grew at the weakest pace in nearly six years in August, while growth in other key sectors also cooled. “This confirms a slowdown in growth momentum in Q3 following the Q2 rebound,” analysts at Barclays wrote in a note to clients, adding they have cut their 2014 growth forecast for China to 7.2 percent from 7.4 percent.” (ReutersRead more

The 6am London Cut

Markets: Asian bourses were mixed following the release of data showing that Chinese credit grew in August, while US investors continued to fret over the likelihood of the Federal Reserve boosting interest rates. Aggregate financing – a measure of credit in China that includes bank loans and lightly-regulated trust products funded by retail investors – was Rmb957.4bn ($156bn) in August. That was up from Rmb273bn in July, hinting that Beijing is allowing banks to lend more freely amid a property market downturn — trust lending fell by Rmb51.5bn, after also falling by Rmb15.8bn in July.. (FT’s Global Markets OverviewRead more

Known unknowns in the Scottish referendum polls

The latest from the crew at Credit Suisse:

The chart below shows the spread between the “Yes” and “No” vote in various polls since the start of the year. The narrowing of the gap has been sudden, and looks to have been a consequence of both “No” voters switching to “Yes” and the hitherto large pool of undecided voters starting to drift towards the “Yes” camp. Although that trend is not clear across all polls, two major national polling organizations – YouGov and TNS – have picked it up. And, perhaps more critically, all the opinion polls are now showing a tight race. … Read more