January, 2009
BNP Paribas sees €1.4bn Q4 loss
BNP Paribas said it would make a pre-tax loss of €1.4bn in the last three months of 2008 but would report a net profit of €3bn for the whole year. Shares in France’s biggest bank closed 17% higher at €25 on relief that the result,
Rohm & Haas sues Dow Chemical
Dow Chemical’s planned $15bn takeover of Rohm and Haas, its US rival, was in jeopardy after the group said Monday it lacked funds to close the deal, triggering an immediate lawsuit from its target. Rohm and Haas,
Cattles gives up on banking licence
Cattles, the troubled UK subprime lender, on Monday abandoned plans to gain a deposit-taking licence as it became clear that its application to the FSA watchdog would be unsuccessful. The shares, already weakened by the group’s difficulties,
Citi to proceed with private jet order
Citigroup, which has received $45bn in US federal aid, is going through with plans to buy a $50m jet, but a US senator called the deal absurd and wants the Obama administration to block it, reports Reuters.
Greenberg recruits ex-AIG executives
Maurice “Hank” Greenberg’s CV Starr said Monday it had formed a joint venture with a Bermuda insurer that is ramping up its business after recruiting some of AIG’s top talent, reports Reuters. The venture will reunite Greenberg,
Fuld ‘sold’ mansion to wife for $100
The controversial former chief executive of Lehman Brothers transferred ownership of a $14m Florida mansion to his wife for $100 in a possible attempt to move assets beyond the reach of infuriated investors of the collapsed bank,
Overnight markets: Up
Asian stocks rallied from a seven- week low on Tuesday (although Hong Kong, China and Taiwan remained closed for the lunar new year), led by banks and mining companies, as borrowing costs declined and US and Australian data provided some good news amid deepening gloom over massive corporate job cuts and global recession fears.
John Thain, the markets and Merrill’s marks
John Thain, speaking to Maria Bartiromo on CNBC this afternoon, repeatedly said that Merrill’s $15.5bn loss in the fourth quarter was driven by the significant deterioration in the credit markets in November and “particularly in December.”
“It has been an honor” – John Thain
Reader advisory: on the advice of people paid to worry about these things, we are reposting this memo but are closing the post to comments.
Sent Jan 25, 22:56:11
Subject: To my Merrill Lynch colleagues,
FHLB, the ‘L’ stands for Libor
Well, no, not really, but there is a connection.
Dollar Libor continued its upward drive for a fourth day today — the longest run of rising rates since early October and interestingly, the upward tick may have something to do with the US’s Federal Home Loan Banks,
ECB to markets: “No, we can’t”
That, at least, is UniCredit’s interpretation of the latest rheotoric from the European Central Bank and its officials, a stance which the bank’s chief economist Marco Annunziata describes as a “peculiar reversal of logic”.
“It has been an honor” – John Thain
Sent Jan 25, 22:56:11, Subject: To my Merrill Lynch colleagues,
It has been an honor to lead this company over the last very difficult year. The decisions that I made were always with the best interests of our shareholders and employees above all.
Roll-yield losses, redux
As discussed here previously, the current state of contango in the crude-oil market is failing to dissuade retail investors from piling into long WTI futures positions. This is despite the fact that the contango means investors in passive ETF-type funds stand to lose on every contract expiry (because funds have to pay a premium to roll positions into the next month).
British Airways’ nosedive
British Airways has just unleashed a bombshell of a trading statement.
Further economic weakness in January and the outlook for February and March combined with the fall in sterling, are impacting our outlook for the year ended 31 March 2009.
A golden disconnect
There was some interesting activity in the price of gold on Friday, when the precious metal moved above $900 an ounce for the first time since October.
You can see an intraday chart of Friday’s moves below (click to enlarge) or read this blow by blow account by Dresdner (emphasis ours).
Won’t somebody please think of the children?
This is Caitlin.
In August, Caitlin’s friends at HM Treasury gave her a gift of £250 to invest in the future. Perhaps, she thought, with prudent investment this sum may one day grow enough to fund a term or two at a former polytechnic,
Factoid du jour – Dow Jones Industrial edition
(Actually, it is a few days out of date, but interesting nonetheless – it comes courtesy of John Mauldin).
What would happen if the share prices of Citigroup, General Motors, Bank of America and Alcoa went to zero? Apart from financial Armageddon,
London property datapoint du jour
Actually not quite du jour. This one’s from Saturday’s FT Weekend. It’s the percentage change in the average price of prime central London property from Sep. 2007 to Jan. 2009, adjusted for currency fluctuations:
Preparing for QE failure
Oh dear. Deutsche Bank is already advising its clients to prepare for the failure of quantitative easing in the UK.
In our view, the rescue package is a step in the right direction. However, the time window for the Bank of England to implement its QE could be restricted.
Roubini: the UK is not Iceland
Nouriel, fresh from his trip to the UK last week, has written up his thoughts on the outlook for the UK. If you didn’t actually catch him last week, he appeared on a couple of BBC programmes that made for interesting viewing/listening.
Lunch Wrap
On FT Alphaville Monday morning,
- Bloomberg quote of the day.
- More about the yen.
- Introducing, the ING blueprint.
- PwC’s Satyam auditors arrested.
- The Credit Crunch photo competition.
UK saving again
On first view the latest mortgage data from the British Bankers’ Association on Monday appears to confirm the miserable state of the UK economy. The headline numbers point to a 52 per cent fall in mortgage approavls in 2008,
Does a single European bond hold the answer?
FT columnist Wolfgang Münchau raises the idea of a single European bond in today’s FT.
The article poses some solid food for thought. Münchau points out that while it is widening sovereign bond spreads across various eurozone members that may have provided a relatively ‘bad’ pretext for the discussion,
Markets live transcript 26 Jan 2009
Markets live chat transcript for the chat ending at 12:02 on 26 Jan 2009. Participants in this chat were: Neil Hume, FT (NH) Bryce Elder, FT (BE) NH:Good morning and welcome to Markets Live
Credit crunch photos
FT Alphaville is helping to judge a competition for the best photo of the credit crunch.
Citizen-photojournalism site Demotix is hosting the contest. It’s open to anyone: they’re looking for defining,
Satyam/PwC auditors arrest…
A little more detail on the arrest of two of PwC’s Satyam auditors yesterday. The India Business Standard reports that the two have been arrested for “conspiracy” and “cheating”. The International Business Times,
The ING blueprint
As officials at HM Treasury burn the midnight oil on the Asset Protection Scheme, the centrepiece of last week’s Bank Rescue Plan (part II), the Dutch government has come up with a plan to deal with some of the toxic assets festering in its banking system.
More about the yen…
For those who might have missed a neat and incisive rundown on the yen’s robust trajectory of recent months in Saturday’s FT, we give you a short summary:
Despite rapidly deteriorating Japanese economic data,