Comment, analysis and other offerings from Thursday’s FT,
Jean-Claude Trichet: Macroeconomic policy is essential to stability
The financial market turmoil has been keeping the world on tenterhooks for more than a year now. After a long period of stability, 2007 marked a turning point, with the start of turbulence in financial markets that will be remembered for a long time. Central banks, supervisory authorities and governments worldwide have responded and continue to respond decisively to the emerging vulnerabilities and materialisation of risks, so as to restore stability and conditions conducive to growth as soon as possible.
Editorial Comment: Trigger Unhappy
Perseverance pays off. For the past four years – the whole time it has been in force – British business has been complaining about a pensions rule that companies say obstructs corporate activity. On Wednesday, the UK government began consulting about it. Ministers may believe that they can relax the rule without damaging the protection it provides, but beyond Whitehall such sunny optimism looks ill-founded.
Short View: Comparing analyst expectations
One reason cited for the extreme volatility on Wall Street of late is a lack of clarity for US companies’ future earnings. “How can investors value a stock if they don’t have the foggiest what the ‘e’ in p/e will be?” is a common refrain. Data from Thomson Reuters supports this “confusion hypothesis”. Now that most companies have reported their third-quarter results we can see how analysts’ expectations for earnings compared with the actual outcome.
Comment: ‘Boring’ Canada’s financial tips for world
James Flaherty, Canada’s finance minister, writes:The financial crisis that began 14 months ago in the US has intensified and spread around the world, threatening to roll back economic progress that has been made over the past two decades. Governments have been responding in a co-ordinated fashion and will continue this work in the lead-up to the summit of the Group of 20 leading economies.
David Pilling: Unadulterated version of China’s growth
Chinese statistics and Chinese milk packaging have something in common. Do not believe what you read on the label. Just as state-owned companies allowed suppliers to boost the supposed protein content of infant milk powder with melamine, an industrial plastic, so state-controlled statisticians have sometimes doctored official figures to suit the Communist party’s needs.
John Gapper: Detroit tries to fool them again
Having exhausted the search for “rich Arabs” who could prop up his company, having tired of calls for “laissez-faire for ever and other assorted bullshit” and having decided that “bankruptcy would be catastrophic”, the chief executive flew to Washington to beg.
Jonathan Guthrie: Coldly efficient predators of loan market
The police and trading standards officers raided the £1.2m mansion just before 8am, parking across the drive. The suspected loan shark, who has a reputation for beating up defaulters, might have done a runner. But he was unfazed, affable even. He discussed his interior decor with the arresting officers crowding into his house before they took him away.
Lex on the Tarp recast
Farewell, Tarp, we hardly knew ye. The $700bn troubled asset relief programme will now not buy up home loans or mortgage-backed paper – except, perhaps, in a focused fashion. Instead, the authorities are again changing tack, broadening the scope of their hastily constructed capital purchase scheme, targeting consumer credit by the ungumming of securitisation markets and aiming to reduce home foreclosures.
Robert Shrimsley – That G20 crisis meeting in full
Minutes from the G20 emergency meeting on tackling the global financial crisis
Present: Er, the G20 leaders.
Not present: Barack Obama.