Comment, analysis and other offerings from Tuesday’s FT,
Analysis: Securitisation runs out of road
The FT’s Gillian Tett and Aline Van Duyn write: When the European Securitisation Forum held its annual meeting in June 2007, thousands of bankers descended on Barcelona to drink champagne and dance to a bankers’ rock band called D’Leverage. Last month, when the trade body representing financiers engaged in slicing and dicing debt held its 2009 event, a mood of grim austerity prevailed. Instead of a seaside resort, the proceedings took place in a hotel on Edgware Road, a traffic-clogged London street better known for cheap takeaways.
Reservations about the dollar
David Woo, head of FX strategy at Barclays Capital, writes: Speculation is high that currency issues will be discussed at the Group of Eight leaders’ meeting in L’Aquila this week. China has called for reform of the global reserve system and creation of a new international reserve currency based on special drawing rights (SDRs). Although the Chinese deputy foreign minister suggested on Sunday that China expected the dollar to be the world’s main reserve currency for “many years to come”, action speaks louder than words.
Pursuing “the middle ground”
Teun Draaisma, equity strategist at Morgan Stanley, writes: Macro and the next big market move has become everyone’s favourite investment topic over the past two years. We suspect it is time to move on to the micro of sectors, stocks and styles.
Gideon Rachman: Obama must be firm on foreign policy
An opinion poll released last week revealed some heartening news for the US. President Barack Obama is the most popular political figure in the world. The least trusted leaders, according to a poll of 20 countries conducted by worldpublicopinion.org, are President Mahmoud Ahmadi-Nejad of Iran and Vladimir Putin, the Russian prime minister. When Mr Obama has breakfast with Mr Putin in Moscow on Tuesday, it will be a meeting between the world’s romantic hero and one of its pantomime villains.
Michael Skapinker: Popular rage is the only brake on top pay
I was supposed to spend last Friday afternoon attacking bankers’ pay — but my invitation to do so was withdrawn because I was deemed too wishy-washy. The event was to launch a schools’ debating competition. The organisers wanted some grown-up debaters to give the students an idea of how it should be done. They asked me to speak in favour of the motion that “the government should impose limits on bankers’ pay”.
Lex on Deutsche Telekom
Richard Moat must hope that his second week as head of T-Mobile UK will be quieter than the first. Since last week’s news that Vodafone might bid for Deutsche Telekom’s struggling UK business, all manner of combinations have been mooted, from an outright sale to Vodafone or Telefónica, to a joint venture with France Telecom, Mr Moat’s former employer.
John Authers’ Short View: Market momentum
Markets have run out of momentum since the US banks passed their stress tests. Look at US bank stocks. The news on May 8 that 10 large banks would have to raise $75bn in capital prompted a euphoric reaction. Investors were relieved that regulators thought financial stress could be relieved with so little pain.
Letters:
- Explaining equity’s whopping discrepancy
- Mergers helped stifle competition
- Whistleblower bounty must go hand-in-hand with reform