April, 2009
[Ireland's Bad Bank] Nationalise all banks…
Well, the Irish ones at least. And before you ask, this is not the view of some raving Bolsheviks but 20 of Ireland’s top economists.
In a letter published in the Irish Times on Friday they argue that proposals to buy €80-90bn of property related loans from the country’s main financial institutions are wrongheaded and will not clean up the Irish banking sector.
Forever blowing bubbles
Rather tragically appropriate in a new and different light: the Hammer’s anthem.
Reports the Guardian:
West Ham United will be taken over by a consortium of international banks in the coming weeks.
“Eaten alive by investment bankers”
In fact, the quotation is worth citation in full:
I witnessed trusting and naive provincial building society executives and non-executives, who had no real understanding of securitisation or structured finance or any other aspect of the workings of global capital markets,
[The Stanford Series] Stanford victims unite!
Not sure when this was set up but the forums make for particularly interesting reading.
Related links:
Locating Stanford billions will take five years – FT
Sir Allen speaks – FT Alphaville
The overhyped IPO comeback? Blame Rosetta Stone
How far have expectations fallen?
The ecstatic hype about Thursday’s robust stock market debut of Rosetta Stone – only the fourth IPO this year in the US markets – has turned into a widespread prediction that equity capital raising is back.
Further reading
Elsewhere on Friday,
- The ‘real deal rally’ – or just another fake?
- The pitfalls of taking an ‘It’s-a-V!’ view of the global recession.
- Krugman rethinks US productivity growth.
- Gasparino:
Pink picks
Comment, analysis and other offerings from Friday’s FT,
Editorial comment: Capitol capital
If default rates in this crisis are similar to those of the 1982 recession, US banks will need at least $1,500bn to stay afloat,
Snap news
Breaking pre-market news on Friday,
- Legendary Investments CEO resigns — statement.
- Corporate: Filtrona, CSS Stellar, Low & Bonar, Morgan Crucible, Costain, The Eastern Europen Trust.
JPMorgan earns $2.1bn on record sales
JPMorgan Chase on Thursday reported a 10% fall in net income to $2.1bn in the 2008 first quarter, beating analysts’ expectations. The results were driven by record quarterly profits of $1.6bn in the investment banking unit,
Dimon criticises government aid
Jamie Dimon, chief executive of JPMorgan Chase, on Thursday said the bank wanted to be free of government intervention and could repay $25bn in federal aid without raising new capital. Speaking after JPMorgan reported strong Q1 results driven by record investment banking profits,
GM plans offer for bondholders
General Motors is planning a formal offer to all bondholders by April 27 to exchange their $27.5bn in claims for equity, reports Bloomberg. Ahead of a June 1 deadline for a US-backed bankruptcy, the carmaker was told this week by the White House’s auto task force to try to restructure its debt out of court.
FSA accused by whistleblower
The UK’s FSA securities watchdog has been accused of “apathy and complacency” in its regulation of building societies during the boom by a former supervisor-turned- whistleblower. Vince Cable, Treasury spokesman for the Liberal Democrats,
ZFS buys AIG auto unit for $1.9bn
Zurich Financial Services on Thursday confirmed speculation about its US expansion plans with the $1.9bn acquisition of AIG’s Personal Auto Group. The deal marks the largest disposal by the US insurer since last year’s government rescue and significantly extends ZFS in the personal lines insurance market.
Lloyds, RBS to offer loans as bonuses
Lloyds Banking Group and Royal Bank of Scotland are set to offer loans to staff who have seen bonus payments deferred for up to three years. RBS and Lloyds are now paying some staff bonuses in subordinated debt – in the form of bonds rather than shares – over three years following public controversy over bonuses paid by banks that received government bailouts.
General Growth files for Chapter 11
General Growth Properties, the second-biggest US shopping mall owner, filed for bankruptcy on Thursday amid the collapse in commercial property prices. The Chicago-based company owns more than 200 US malls,
Google’s growth spurt ends
Google’s revenues in the first quarter of this year fell below the preceding quarter for the first time in the company’s history as the global recession brought an end to its unprecedented 11-year growth spurt.
First loss for French finance house
Caisse des Dépôts et Consignations, France’s state-owned finance house, on Thursday unveiled its first loss since it was founded in 1816. CDC recorded a 2008 net loss of €1.47bn ($1.9bn) after making provisions of €3bn on its assets;
CDS blamed in bankruptcy filings
Credit default swaps are being blamed for playing a role in two bankruptcy filings this week. Bankers and lawyers are concerned that some lenders to troubled companies such as newsprint producer AbitibiBowater – which filed for bankruptcy protection on Thursday – and mall owner General Growth Properties,
Rosetta Stone rises 40% in IPO
Rosetta Stone, the language software provider, on Thursday staged the strongest US stock market debut in a year when its shares surged nearly 40% on listing. Together with Bridgepoint, the online college,
SocGen sees Asian M&A wave
Société Générale plans to expand its investment banking business in Asia, creating new posts for 25 investment bankers and about 15 M&A specialists in the hope of a wave of acquisitions of European,
Locating Stanford billions to ‘take years’
It will take at least five years to locate funds lost by investors in the alleged $8bn “Ponzi” scheme run by Texan billionaire Sir Allen Stanford, warned court-appointed liquidators of the offshore bank at the heart of the purported scheme.
Deutsche Börse to launch platform
Deutsche Börse on Thursday raised the stakes in the battle for dominance of European share-trading with plans for a new, pan-European equities trading platform allowing investors to trade blue-chip equities across the region.The new platform,
Icahn, Kerkorian in Vegas showdown
Two of the best-known US investors are preparing to face off in a high-stakes game that could reshape the face of Las Vegas, reports the WSJ. Activist investor Carl Icahn is pushing troubled casino operator MGM Mirage to restructure in bankruptcy court,
Overnight Markets: Up
Asian stocks advanced on Friday, led by banks and automakers, as better-than-expected earnings from JPMorgan and falling US jobless claims lifted confidence that the global recession is easing. Futures on the S&P 500 lost 0.3% after the gauge gained 1.5% on Thursday afternoon.
Recession, depression, secession
Interesting news reaches us via US-based energy blogger Gregor. Apparently there’s a bit of a 10th amendment craze sweeping through the union of states that is the country of America. The message being,
Aerospace mothballs
Ahead of Boeing’s results on April 22, we thought this chart might be instructive. Click to enlarge.
That’s the number of aircraft in temporary storage. The increase in late 2008/early 2009 is startling — and much worse than in the previous down cycle,
The crude inventory problem, pictorial edition
As reported earlier on FT Alphaville, the latest US inventory data shows crude stocks are piling up again — a hint that a much anticipated price recovery may not be on the cards just yet.
Sean Corrigan,
Mapping the unemployment crisis, US edition
Felix Salmon over at Reuters is right: this is a great graphic.
Much in the same vein as the Guardian’s UK unemployment map we liked so much earlier this week, this one, from Slate, shows US employment data in terms of the net change in employment.