January, 2009
Lunch Wrap
On FT Alphaville this morning,
- The yuan must be devalued
- … but the pound should not be: rebutting Jim Rogers
- UK GDP suprises to the downside
- John Thain: commode on legs
- Dr Doom in the UK – “banks are insolvent…
Dear Mr Rogers…
From RBS:
Dear Mr Rogers,
We followed with interest this week’s media scrum around your Armageddon-esque vision of Britain.
That the UK economy faces serious recession is beyond doubt. Few doubt either that the pound is at risk of further decline,
Markets live transcript 23 Jan 2009
Markets live chat transcript for the chat ending at 12:11 on 23 Jan 2009. Participants in this chat were: Neil Hume, FT (NH) Bryce Elder, FT (BE) NH:Good morning and welcome to Markets Live
He spent what?!
On reports former Merrill Lynch CEO John Thain spent over $1,200,000 decorating his office and distributing up to $4bn in discretionary bonuses just three days before the BofA acquisition, we here at FT Alphaville are prepared to give the beleaguered executive the benefit of the doubt.
UK in recession, official
The UK’s in recession, and it’s worse than we thought.
From Reuters:
KEY FIGURES FOR PRELIMINARY Q4 GDP
Q4 08: -1.5% QQ, -1.8 YY (FCAST -1.2% QQ, -1.4 YY
Q3 08: UNCHANGED AT -0.6 QQ, 0.3 YY
The quarterly figure is the biggest since Q2 1980,
Albert Edwards LOL China
As the debate over how bad things in China are rages on, growing Sino-sceptic Albert Edwards offers his two pennies on the country’s latest statistics.
Well, to be accurate, he laughs out loud at them:
Dr Doom on the UK
As we revealed yesterday, Nouriel Roubini, aka Dr Doom, is on these shores.
On Friday morning, the New York University economics professor appeared on Radio 4′s Today programme and gave his verdict/outlook for the UK economy.
ERM, convergence might not work
When fear of foreign exchange exposure wrought havoc in Eastern European markets last October, the region’s chief saving grace was a ubiquitous commitment to accelerating its entry into the euro zone; this was particularly true of Poland and Hungary.
Further reading
Elsewhere on Friday:
- Nationalisation is not a dirty word
- But is ‘nationalisation’ contagious?
- And will it end all our banking problems?
- The Geithner Thing
- So do we want the Chinese
Pink picks
Comment, analysis and other offerings from Friday’s FT,
Martin Wolf asks if UK banks are too big to rescue
Here are two frightening statistics: over the past five years, the balance sheets of many of the world’s largest banks more than doubled;
Snap news
Breaking pre-market news on Friday,
- Pfizer in talks to buy Wyeth for $60bn – WSJ
- Dexia-Banque Postale deal under review – paper
- Corporate results from Midas Capital, Aveva , Marston’s
BofA axes Thain as Merrill deal sours
John Thain was ousted from Bank of America on Thursday, just three weeks after closing the sale of Merrill Lynch to BofA, in a sign of the deepening crisis around the deal. Thain, who became chief executive of Merrill 13 months ago,
Behind Thain’s ousting
The sudden departure of John Thain from Bank of America, described by BofA as “mutually agreed”, came after rising tensions that followed the revelation last week of Merrill’s Q4 $15bn loss and after the FT reported Wednesday that he had accelerated Merrill Lynch’s bonus payment plan for 2008,
Gapper blog: Fiddling while Merrill burned
Reputations get shredded fast in a financial crisis, but the speed of John Thain’s descent from hero to zero is extraordinarily rapid, says the FT’s John Gapper. In mid-October, he seemed the smartest guy in the pack,
US says China ‘manipulating’ currency
Tim Geithner, President Barack Obama’s choice for Treasury secretary, on Thursday accused China of “manipulating” its currency and pledged “aggressive” diplomatic action on the issue. The comment,
£30bn equity rush to hit UK
Dozens of British companies are preparing to issue fresh equity in coming weeks with bankers expecting more than £30bn to be raised this year through share offerings. Wolseley, the building materials distributor,
UK considers new aid to Northern Rock
British MPs have urged the UK Treasury to reveal the magnitude of liabilities incurred by the rescue of the banks. A Commons committee report published Friday says that taxpayers deserve to know the potential costs of nationalisations and part-nationalisations.
KBC receives €2bn cash injection
KBC Group, one of Belgium’s largest remaining banks, is to receive a €2bn cash boost from state coffers after it incurred a full-year loss of €2.5bn. The news comes amid speculation that a further round of Belgian state aid,
Santander praised ‘impeccable’ Madoff
A fund controlled by Santander, one of Europe’s biggest banks, heaped praise on Bernard Madoff weeks before his arrest for an alleged $50bn fraud, calling his market timing “impeccable” in a report to investors that lawyers say raises questions about the bank’s risk controls and due diligence operations.
Day of gloom for tech leaders
Microsoft on Thursday announced its first company-wide job cuts in its 34-year history, capping a day of gloom for the technology sector. The software giant’s plans to cut up to 5,000 jobs came as Sony plunged deeper into crisis after the electronics and entertainment group warned it would suffer its first full-year operating loss in 14 years,
Samsung reports first-ever quarterly loss
Samsung Electronics, South Korea’s biggest company worth around $48bn, posted its first-ever quarterly net and operating losses as its core memory chip and display units battled diving prices, and the technology giant faces yet more pain as the global slowdown saps demand,
Turquoise secure after fundraising
Turquoise, the share trading platform launched four months ago, has raised enough money in a recent round of funding to secure its financial position for the rest of the year, the company said Wednesday.
Lazard to review Debenham’s £900m debt
Debenhams has appointed Lazard as financial adviser with a brief to revise the indebted UK department store chain’s capital structure. Lazard will consider a potential equity raising, covenant waiver and renegotiating the maturity of the debt beyond the existing 2011 repayment deadline.
St James’s recruits new partners
Sales of long-term savings products at St James’s Place, the upmarket UK wealth management group, fell 2% last year, as the financial turmoil took its toll on its wealthy customers. But St James’s said it was able to increase its dedicated network of self-employed financial advisers,
Veteran Citi directors to go in shake-up
Citigroup is to revamp its board with the departure of long-standing members Kenneth Derr and Franklin Thomas following criticism of its ability to supervise the troubled company’s executives and strategy.
Overnight markets: Down
Asian stocks fell Friday, led by technology companies and commodity producers, after Sony forecast its first annual loss in 14 years and economists predicted China’s economy will slow further. Wall Street led the equity market declines on Thursday as government bonds also came under further selling pressure.
Will CIFG’s real owners please stand up?
What’s this? Ratings action on a monoline that wasn’t a downgrade? Hard to believe, but true – CIFG, the French bond insurer jointly owned by Banque Populaire and Caisse d’Epargne, has achieved what no other bond insurer has since this crisis kicked off:
Sony (II): Sir Howard’s way?
Could this be the beginning of the end game at Sony – at least for the troubled phase now embroiling the once-sexy consumer electronics and entertainment giant?
As mentioned earlier, Sony stunned investors on Thursday afternoon Tokyo time with an announcement that it would post a Y260bn ($2.9bn) annual operating loss – its biggest ever – and cited sliding demand,