January, 2009
Coping with the recession, #1543
From today’s Bloomberg landing page:
Incidentally, we hear terminal installations are down pretty sharply.
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Further reading
Elsewhere on Monday
- The real demand for US Treasuries – and it’s not from China
- Snookered: Of all people still running banks today, Bank of America’s Ken Lewis should have known better
- Why the Fed should LITERALLY throw money out of helicopters
- A new president,
Pink picks
Comment, analysis and other offerings from Monday’s FT,
Wolfgang Münchau: The benefits of a single European bond
It is difficult to see how a common bond issuance would solve the acute problem of a hypothetical payment default of a member state of the eurozone.
BofA had role in Merrill bonuses
Bank of America played a role in Merrill Lynch’s controversial decision to pay $4bn in bonuses in December just as mounting losses were threatening to derail BofA’s takeover of Merrill. BofA has said that the payment of $4bn in bonuses,
Pfizer nears $67bn deal for Wyeth
Pfizer was nearing agreement Sunday night on a deal to buy rival drug maker Wyeth for about $67bn in a move that would reshape the global drug industry. Pfizer will pay the equivalent of $50.19 per share for Wyeth – comprising $33 in cash and 0.985 of a share of Pfizer stock for each Wyeth share.
French banks plan joint functions
French banks Crédit Agricole and Société Générale plan to announce Monday an agreement to combine large parts of their asset-management operations, reports the WSJ. The banks aim to create a joint venture with about €700bn ($909bn) in assets under management,
US tax probe of UBS widens
UBS is under legal pressure as US prosecutors expand their investigation into whether the Swiss bank helped tens of thousands of Americans avoid paying taxes, reports the WSJ. Investigators believe the number of US clients that UBS helped to avoid taxes could be much higher than the earlier estimate of about 17,000,
UBS bonuses could inflame debate
A package of more than £1bn in bonuses for staff at UBS, the Swiss bank, is expected next month and threatens to reignite the debate over excessive compensation for bankers, reports The Times. UBS is to pay out around SFr2 billion (£1.3bn) in bonuses next month,
US car parts sector seeks $10bn bail-out
The autoparts supply sector, hit by the sharp drop in US car production, is to request at least $10bn of federal bail-out funds from the Tarp scheme. Industry representatives plan to formally request access to Tarp funds soon,
France to aid Airbus
The French government is to provide €5bn in credit guarantees to help Airbus sell aircraft to customers that are struggling to secure finance for their purchases because of the credit crunch. Paris will channel the money to the aerospace group via French banks,
Schaeffler and Continental in aid talks
Schaeffler and Continental are in talks with two regional governments about a possible state bail-out, as the German car parts makers struggle under a combined debt of €22bn ($29bn). The governments of Lower Saxony and Bavaria are in talks with Conti and Schaeffler over state aid packages,
Corus and GKN to slash jobs
Corus, Britain’s largest steelmaker, will this week announce cuts of 3,500 jobs from its global workforce of 41,000, with more than 2,000 jobs to go in the UK where it employs 20,000. The announcement,
PwC staff detained in Satyam probe
Indian police have detained two PwC auditors in their first move against the professional services firm over the scandal afflicting Satyam Computer Services. Police said the pair were detained for interrogation over the scandal,
S&P cites liquidation risks
US companies face a greater risk of liquidation because sources of finance that would allow them to reorganise under the US bankruptcy code are drying up in the financial crisis, S&P has warned. In the US,
Eurozone warned on quantitative easing
Unconventional emergency measures to boost the eurozone economy could prove difficult for the ECB to implement, a member of its governing council has warned, highlighting the institution’s nervousness about following such steps in the US and UK.
Focus DIY chief blasts insurers
Focus DIY, the UK home improvement retail chain, has called for a government investigation after the company’s credit insurers withdrew almost all cover for its suppliers. Less than 5% of the stock Focus buys is now insured,
Citi sells $12bn in state-backed bonds
Citigroup on Friday moved to bolster its strained balance sheet by selling $12bn of government-guaranteed bonds, the largest issuance since the US authorities agreed to backstop financial companies’ short-term debt in November.
Goldman takes fizz out of Davos
In a nod to the new mood of sobriety, Goldman Sachs has quietly cancelled its glittering annual party at the World Economic Forum in Davos and has sharply reduced its delegation to the event, which starts Wednesday.
Overnight markets: Thin start
Asian stocks rose on Monday, led by shipping and mining companies after cargo rates and metals prices advanced, outweighing drops by contractors on earnings concerns. Markets in Australia, South Korea,
The Weekender
On FT Alphaville this week,
- On Monday, thoughts on the latest bailout package from the UK government.
- BoE becomes the bad bank?
- Her Majesty’s AIG.
- And the FSA’s sly changes to banks’ capital adequacy calculations.
CDS update: “Credit and equity, at least in the banking sector, are no longer entwined”
This CDS report was written by Markit’s Gavan Nolan
It will come as no great surprise, even to the those living in blissful ignorance of hardship, that the UK is in recession. But official confirmation came today,
Brace yourselves for record corporate defaults in 2009
In August last year, Moody’s issued what was then considered a gloomy outlook for corporates in the US. The ratings agency said it expected the global default rate to reach to 6.3 per cent by the following August,
The sovereign ratings on the wall
Paul De Grauwe cautions in today’s FT about the weight currently being placed on rating agencies’ pronouncements about sovereign ratings. Is there a chance, he asks, that where once they were wildly optimistic,
In defence of sterling
Sterling continues its daily plunge:
Ever contrarian, we here at FT Alphaville feel it is therefore our intrinsic duty to put forward the case for the UK’s beleaguered currency.
For one, the position of sterling as a global reserve currency must be considered.
Interest in emerging market funds wanes
After two weeks of positive flows, funds dedicated to emerging markets registered outflows equivalent to nearly 0.5 per cent of total assets, EPFR data show.
Asia ex-Japan funds were hit hard by increased risk aversion,
CDS Report: Insurers and Infineon rock the boat
European credit market indices were wider again on Friday morning, rattled by concerns about the insurance sector and news of an insolvency filing by Qimonda, a German memory chip maker. Qimonda said it had failed to obtain rescue financing from the German region of Saxony,
Dear Jim Rogers… (Cc: David Cameron)
RBS analysts wrote a thoughtful letter to Jim Rogers earlier today – in riposte to his “Armageddon-esque vision of Britain”.
Perhaps they should Cc. in David Cameron…
David Cameron warned yesterday that Britain was “running the risk”