January, 2009
Oil speculator debate resurfaces
It was the hot topic of last summer (when oil prices were racing to record highs), but the debate over whether speculators are really to blame for oil’s volatily has somewhat fallen off the agenda since the price of crude came crashing down.
Lloyds Banking Group – a defence
Lloyds Banking Group has flown out of the starting blocks on Wednesday morning, showing a clean pair of heels to the rest of the UK banks.
Its near 30 per cent advance is in large part due to bullish note from house broker Citigroup,
The strange world of Japan’s CDS market
Ever wonder why one of the world’s largest economies, with one of the world’s largest pools of funds, is but a mere blip in the vast world of credit default swaps? As is starkly illustrated in Wednesday’s FT:
Mistresses of the universe
Are you or someone you love dating a banker? If so, we are here to support you through these difficult times. Dating A Banker Anonymous (DABA) is a safe place where women can come together – free from the scrutiny of feminists- and share their tearful tales of how the mortgage meltdown has affected their relationships.
Damn those 419 scammers are good!
… says the author of the eponymous Cassandra Does Tokyo.
Following is a taste of the latest such 419 email to plop into her inbox, ostensibly from ‘United States Lottery Director’, or one Timothy Geithner:
Further reading
Elsewhere on Wednesday:
- What John Thain, Jon Bon Jovi, Justin Timberlake and Barbara Streisand have in common
- So what exactly makes a bank ‘too big to fail’?
- Another Geithner ethics compromise (‘let-them-eat-cake’ edition)
- Marking the market to market
- Mike Mayo’s alternative options to nationalisation
- Learning from failure:
It’s Davos
The annual gathering that is the Davos World Economic Forum gets underway in the small Swiss Alpine resort on Wednesday 28th January. For those of you keen to follow the goings on over the next three days,
Pink picks
Comment, analysis and other offerings from Wednesday’s FT,
Martin Wolf wonders why dealing with the huge debt overhang is so hard
How much debt is too much? Nobody knows. But the governments of highly indebted high-income economies – such as the US and UK – think they know the answer:
Snap news
Breaking pre-market news on Wednesday,
- Standard Life reports stable regulatory surplus, but global fall in sales – statement
- VT Group to sell £380m stake in BAE joint venture – statement
- Brewin Dolphin sees slight dall in income – statement
- SSL announces 9.99% share offering – statement
- Corporate results:
Santander makes offer to Madoff victims
Santander, the Spanish bank whose clients lost €2.33bn in the alleged fraud by US broker Bernard Madoff, on Tuesday became the first institution to offer to repay the victims in an attempt to stave off lawsuits.
Citi forced to cancel jet order
The US financial sector’s new political masters on Tuesday forced Citigroup to scrap the purchase of a $50m executive jet that was seen as a misuse of money at a time when the bank is reliant on public support.
Thain called to testify on Merrill bonuses
John Thain was issued a subpoena on Tuesday to testify about Merrill Lynch’s decision to accelerate the payment of nearly $4bn in employee bonuses last month – just days before the closing of its sale to Bank of America.
Nomura considers asset sales
Nomura admitted Tuesday it is considering selling off businesses to raise capital after the Japanese bank suffered a record quarterly loss as it struggled to digest its acquisition of parts of Lehman Brothers .
Mizuho eyes Citi Japan units
Mizuho Financial Group, Japan’s second-largest bank, said it may consider buying Citigroup’s local brokerage and asset-management units, reports Bloomberg. Yasuhiro Sato, who will become CEO of Mizuho’s corporate banking unit on April 1,
3i faces creditor coup at VNU
Britain’s oldest private equity group is facing a possible creditor takeover at VNU Business Media Europe, the Dutch group it bought at the peak of the buyout boom, reports The Times. 3i, which will present its interim management statement Wednesday,
Germany set for record deficit
Germany is set to record its largest post-war deficit this year, Angela Merkel, chancellor, said Tuesday after an emergency meeting of her cabinet approved the government’s €50bn fiscal stimulus and amended the 2009 federal budget.
US house prices stay in freefall
Home prices in big US cities fell at a record 18.2% in the year to November as the stricken housing market showed no signs of bottoming out. The drop followed an 18% annual decline in October, itself a record,
Canada to unveil stimulus package
Canada’s minority Conservative government was set to unveil a sweeping stimulus package of tax cuts and new spending initiatives late Tuesday, pushing the federal budget into deficit for the first time since 1996.
Tokyo in rescue plan for companies
The Japanese government stepped up its efforts to combat the credit crisis on Tuesday by setting aside Y1,500bn ($16.9bn) in public funds to encourage banks to buy shares in cash-strapped companies. The plan,
Dow reverses dividend pledge
Dow Chemical on Tuesday said it was considering breaking one of the longest streaks in US corporate history of consistent dividends by making its first cut since 1912. In a reversal of its pledge not to cut its $1.6bn-a-year dividend,
Moody’s could cut GE rating
Moody’s Investors Service said Tuesday it was reviewing General Electric’s triple-A credit ratings, which could lead to a downgrade, and its shares fell as much as 5% in extended trade, reports Reuters.
Iceland’s Straumur ponders UK switch
Straumur-Burdaras, Iceland’s largest remaining listed bank, is considering shifting its stock exchange listing and legal domicile to London in a move to distance itself from Iceland’s financial crisis that led to nationalisation of the country’s three largest banks last autumn,
RBS ‘rebuffed’ investor calls
The directors of Royal Bank of Scotland rebuffed demands from its biggest investors for its chairman and chief executive to quit after an emergency £12bn fundraising last year, the head of UK’s biggest investment group told MPs on Tuesday.
Friends to demerge F&C holding
Trevor Matthews, chief executive of UK life assurer Friends Provident, said there were no “substantial” talks on selling Friends’ majority holding in asset manager F&C and Friends would press ahead with demerging the stake.
Corning cuts 3,500 jobs
Corning, the US glassmaker, on Tuesday said it would cut 3,500 jobs, or 13% of its workforce, as its fourth- quarter profits plunged on slumping demand for television and computer monitors. Net income declined 65% to $249m yoy,
Vulture funds home in on UK
Vulture funds believe British companies will offer the best investment opportunity in Europe this year, as the UK faces a sharper slowdown than its neighbours, a survey has found. A poll of 100 such funds,
US arrests fund manager Nadel
Florida hedge fund manager Arthur Nadel, who went missing two weeks ago, turned himself in on Tuesday and was ordered held on securities and wire fraud charges until a bail hearing on Friday, reports Reuters.
Overnight markets: Mixed
Asian stocks mostly retreated from Tuesday’s surge, led down by Japan, after companies from Nomura to Fuji Fire & Marine Insurance said earnings are suffering amid the global recession. Chinese markets remained closed for the lunar new year holiday.
Another knock for GE as Moody’s warns on rating
Following in S&P’s footsteps, Moody’s on Tuesday warned that GE is at risk of losing its triple-A rating.
Here’s the statement, emphasis FT Alphaville’s:
Jan 27 – Moody’s Investors Service placed the long-term ratings of General Electric Company (Aaa senior unsecured) and General Electric Capital Corporation (GECC;