RSS feedBanking off the FOMC
The obvious place to start when discussing the impact of Wednesday’s FOMC meeting on US banks is with the downward pressure on net interest margins that will result from the extended period of low rates.
US Markets Live transcript 27 Jan 2012
Markets Live chat transcript for the chat ending at 16:04 on 27 Jan 2012. Participants in this chat were: Cardiff Garcia Joseph Cotterill, FT CGHello! CGHello! JCHola
Reminder: US Markets Live at 10am New York time, 3pm London
Breaking down the US Q4 GDP numbers, the latest in the Greece PSI negotiations, and we’ll have coverage of P&G, Caterpillar, and some other companies announcing earnings from earlier in the week. And we suspect the Rabble will have some lingering thoughts about the FOMC meeting on Wednesday.
It’s bonus season, so what’s the meaning of life?
Around exam time at university, the conversation always seemed to fluctuate between points of revision, questions that might be asked, and what the meaning of life actually is. “Exams aren’t a test of your real ability,”
Q4 real GDP increased 2.8%
Accelerating recovery or a winter head fake? Who knows, but the advance estimate for Q4 real GDP growth was 2.8 per cent after third quarter growth of 1.7 per cent. Consensus expectations were for 3 per cent growth:
HMT, the Bank of England, and ELA
The Government agrees that a limited statutory power of direction for the Chancellor over the Bank in a time of financial crisis would be helpful in clarifying lines of responsibility and accountability…
Markets Live transcript 27 Jan 2012
Markets Live chat transcript for the chat ending at 12:13 on 27 Jan 2012. Participants in this chat were: Paul Murphy Bryce Elder/FT PMMorning PMWelcome to Markets Live on time almost
How to read CDS prices, featuring Portugal
When a sovereign or corporate becomes sufficiently distressed, a flip can happen in the way the credit default swaps are quoted. According to Markit, this is happening with Portugal now, with the CDS moving from being quoted in conventional spread to upfront.
Awaiting the MBS settlement fail fee
It’s been a while since FT Alphaville looked at settlement fails, but the following chart from RBC Capital Markets did catch our eye this week:
As RBC notes, there’s a new settlement failure fee coming into force in the US for MBS securities on February 1,
Further reading
Elsewhere on Friday,
- The high yield ETF is really, really popular.
- The bubble in central banking.
- Why people become investment bankers.
- Is the natural gas rebound sustainable?
- Now this is a jolly.
Pink picks
Comment, analysis, and other offerings from Friday’s FT,
Philip Stephens: Europe rests on Monti’s shoulders
Italy is back. Germany’s Angela Merkel sits at the top of Europe’s power list.
Snap news
Breaking pre-market news on Friday,
– BP claims it has ‘stepped up’ regarding Deepwater – statement
– “Strong momentum” at the London Stock Exchange – statement
– Abbeycrest suspended, “pending clarification of the group’s financial position.”
Further further reading
For the commute home,
- Romney’s self-deportation policy would (have) be(en) very effective… (about 30 years ago).
- Davos is ignoring Occupy, and not just cause the good skiing is distracting.
SocGen: hedgies short euro against dollar “like never before”
A chart from SocGen’s latest Hedge Fund Watch showing that as of last week, hedge funds were short the Euro against the dollar “like never before”…
Make of it what you will — obviously their positions have fluctuated dramatically in the last couple of years (along with the exchange rate itself).
Portugal, back in the frame
Felix and Arianna want to move Davos to Patmos, but what about the Azores?
Have a look at the yields on the Portuguese 3-year…
… the widest flavour of paper at the short end of Portugal’s inverted curve,
Bilaterally — yours?
The FT’s James Mackintosh recently pointed out an interesting provision in the loan agreement Greece has with its bilateral official creditors – its fellow eurozone states.
They are entitled to require Greece to pay the whole loan back immediately if the country defaults on private bondholders.
US MMFs versus the Eurozone, Part 2
In the first installment of US money market funds versus the eurozone, the funds were seen fleeing the continent as quickly as possible, leaving all sorts of funding chaos in their wake.
In part two,
Powerfrau
Bild, the German tabloid, covers all the angles. Here is a (slightly odd — we don’t think it’s sarcastic…) debt crisis panegyric to German chancellor Angela Merkel:
(“She’s the German housewife who will see the work gets done before she pays”)
(H/T Raluca3000)
Though we wonder how that squares with Bild’s recent acquisition of holdings in Greece’s €14.5bn March 2012 bond.
The ‘QE-exit’ inflation paradox
RBC Capital Markets takes an interesting take on the Fed’s newly released Fed Funds projections.
First the projections, which look like this:
As the note under the chart declares, each circle represents an individual FOMC member’s judgment of where Fed Fund rates should be at the end of the specified year.
Markets Live transcript 26 Jan 2012
Markets Live chat transcript for the chat ending at 12:10 on 26 Jan 2012. Participants in this chat were: Bryce Elder/FT Paul Murphy BEGood morning BEAnd welcome to Markets Live
BTA-k to the drawing board
Remember that fractious Kazakh bank restructuring?
…BTA bank’s shareholders didn’t vote for it. Though the bank says it’ll carry on talks with creditors regardless.
Related link:
BTA: Can’t
Further reading
Elsewhere on Thursday,
- The internet Web: French.
- Fed take, I: ’Ever heard of the phrase “data overload?”’
- Fed take, II: was Ben showing his frustration?
- …And why the Fed did not pledge to keep rates low.
Pink picks
Comment, analysis, and other offerings from Thursday’s FT,
Alan Greenspan: Meddle with the market at your peril
Whatever the imperfections of free-market capitalism, no regime that has been tried as a replacement,
Snap news
Breaking pre-market news on Thursday,
- Easyjet sees first half loss of £140m-£160m — statement
- Banco Sabadell profits down 39 per cent to €232m, €1bn of provisions — statement
- Nintendo profit drops 61 per cent,
Further further reading
For the commute home,
- Expect another year of living dangerously, writes Martin Wolf.
- Is the next Karl Marx a management consultant?
- Geithner doesn’t think he’ll be around for another term.
US Markets Live transcript 25 Jan 2012
Markets Live chat transcript for the chat ending at 20:28 on 25 Jan 2012. Participants in this chat were: Cardiff Garcia Joseph Cotterill, FT Claire Jones FT CGHello! CGGonna be race to see whether ML starts working before the presser actually begins
It’s official: Fed’s 2 per cent inflation target
Full long-range FOMC statement belowm and click here for the Fed’s economic projections charts and tables…
Following careful deliberations at its recent meetings, the Federal Open Market Committee (FOMC) has reached broad agreement on the following principles regarding its longer-run goals and monetary policy strategy.
Late-2014 and a problem of flexibility
The S&P 500 has gradually climbed from 1310 at the time of the FOMC statement to about 1322 at pixel time, and at one point 5-year Treasury yields fell to an all-time low of about 0.76 per cent. They’re now at 0.78 per cent.