Gluskin Sheff’s David Rosenberg hit out at Jim Paulsen of Wells Capital Managment in his Monday missive. Why?
Here’s an extract from Paulsen’s latest monthly newsletter:
We believe the recession has ended,
Robert Khuzami, the SEC’s resident bulldog and chief of enforcement, had a warning for participants in the derivatives market on Monday.
As Bloomberg reported:
“The days of insider-trading scrutiny being focused almost solely on the equity markets are now gone,”
Gavan Nolan of Markit wrote this CDS report
European credit indices rallied today, matching a strong performance in the equity markets and recovering some ground from last week. The Markit iTraxx Europe index closed at 84bp,
One point to JP Morgan, which predicted not a week ago that Fitch was likely to cut Mexico’s credit rating. On Monday, the rating agency did just that, lowering the country’s foreign currency issuer default rating by one notch to BBB.
The Daily Mail moaning about the effects of contango in the oil markets last week got us thinking about how the same market dynamic might translate to UK house prices.
Could it be, as we cheekily suggested,
The perfect riposte to Monday’s equity market rally has arrived: the latest Global Strategy Weekly from Soc Gen’s Albert Edwards.
And while the headline rather gives things away, here are some selected highlights for all the bears out there.
Standard & Poor’s freshly published comparison of global banks’ risk-adjusted capital (RAC) adequacy made for gripping reading on a chilly Monday morning in New York.
The report contains 22 pages of data,
Last Friday, what many in the energy market had long suspected might happen, happened.
Valero, the largest independent refiner in the US, was forced to close another 200,000-plus barrel-per-day refinery — this time,
Fresh news from the 3rd Seminar on Banking Services and Export in Tehran: Iran gained $5bn by reducing the portion of dollars in its oil currency basket, according to Mahmoud Bahman, head of Iran’s central bank.
We were struck by the following quote in Monday’s NY Times story about the wave of debt repayments facing the US government:
“The government is on teaser rates,” said Robert Bixby, executive director of the Concord Coalition,
Last week, the spread between Greek bonds and German bunds widened to its widest since April after the Greek central bank warned domestic lenders they would have to wean themselves of ECB liquidity measures.
On FT Alphaville on Monday morning,
- Then and now, Heritage Oil edition.
- The return of widening sovereign credit spreads.
- The Emerging Europe debt dog.
- A Chinese vampire squid in Further reading.
While the search for yield is setting most emerging markets ablaze in terms of institutional money flow, there is one EM area that appears noticeably excluded from the flow party: Emerging Europe.
As Bloomberg noted on Monday,
Markets live chat transcript for the chat ending at 12:17 on 23 Nov 2009. Participants in this chat were: Neil Hume, FT (NH) Miles Johnson, FT (MJ) NH:hello there NH:It’s 11.03am
The ECB signalled on Friday that it would soon start retracting some of the liquidity provisions it put in place last year, in a bid to stop some of its lower-rated members from using them for financing investments in their own local government bonds - something that had helped keep European sovereign spreads tight.
What a difference a week makes.
Heritage Oil interim management statement, Tuesday, November 17:
Discussions with Genel are continuing with the terms of the merger nearing formal agreement. Both sides remain committed to completing the proposed transaction.
Elsewhere on Monday,
- China, the vampire squid of commodities?
- Saturday Night Live does Obama’s trip to China.
- Carlyle Group goes clean.
- Janet Tavakoli rescinds her apology and calls for more regulation of Goldman Sachs.
Comment, analysis and other offerings from Monday’s FT,
Wolfgang Munchau: Van Rompuy is the right man for the job
It is so easy to get exasperated with the European Union — its lack of ambition,
Breaking pre-market news on Monday,
- Heritage Oil-Genel merger terminated, Heritage issues letter of intent to sell its Ugandan assets to Eni for $1.3bn - statement.
- Lloyds Banking Group says it has accepted offers to exchange £8.8bn of non-US securities - statement.
Foreign companies could be sued more easily in US courts under legislation working through Congress. The Investor Protection Act, approved by the House financial services committee this month, contains a provision to make it easier for investors to sue public companies in the US even if they are based abroad and listed on overseas exchanges.
Cadbury is expecting a “white knight” bid from Hershey if the US confectioner can arrange the financing for a takeover offer. The British firm, fending off an approach from Kraft, sees commercial logic in an alternative deal with Hershey,
Reliance Industries, India’s biggest listed company, plans to offer $10bn for a controlling stake in LyondellBasell, the bankrupt Dutch-based petrochemical giant, in what would be one of the largest overseas acquisitions by an Indian group. The scale of the bid – and its all-cash nature – would seem to highlight the growing confidence of Indian companies on the global stage,
Bank of America may appoint an interim chief executive, or even delay the retirement of Ken Lewis, if the bank cannot settle on a candidate by November 26, Bloomberg reports. At least four external candidates have rebuffed approaches,
Spain’s BBVA is set to exercise an option to increase its stake in China Citic Bank from 10 per cent to 15 per cent, cementing its position as one of the leading European investors in mainland Chinese banking.
The volume of activity in sovereign credit default swaps linked to the US, UK and Japan have doubled in the past year because of concerns about their public finances. CDS volumes for Italy, which has one of the highest debt burdens of the developed economies,
Microsoft has discussed a plan with News Corp to “de-index” the media company’s news websites from Google. The Financial Times has learnt that Microsoft, which owns the rival Bing search engine, has also approached other big online publishers to persuade them to remove their sites from Google’s search engine.
Demands for higher capital at financial companies and a growing risk of national protectionism will act as a drag on the real economy, warns John Tiner, former head of the Financial Services Authority.
US unemployment is likely to rise from its current level of 10.2 per cent to peak at about 10.5 per cent and may not start to come down until the summer of next year, according to Charles Evans, president of the Federal Reserve Bank of Chicago.
Lloyds Banking Group is considering developing a new stockbroking business with Evolution, the independent brokerage in which it already holds a 10 per cent stake, the Times reported.
Asian markets (Mon - Japan closed)
04:00 GMT
Nikkei 225 (Friday) down 119.88 (-1.26%) 9,429.59
Topix (Friday) down 7.20 (-0.86%) at 830.51
Hang Seng (Monday) up 118 (0.53%) at 22,613
US markets
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