July, 2009
Rio accused of widespread bribery
China’s “whole steel industry has been bribed” by Rio Tinto, suggested a lead article in the China Daily newspaper on Wednesday that marks a sharp escalation in a dispute rocking the global steel and iron ore industries.
Spielberg close to raising $825m
Steven Spielberg is on the verge of completing an $825m financing for his new film venture, nine months after he began looking for capital in the worst funding market in Hollywood’s recent history. The lauded director of Jaws,
Peace threatens to break out at Porsche
Porsche’s family owners were poised to settle their feud over a rescue of the ailing German sports car maker with a compromise deal that would wipe out almost all its debt. The plan includes a sale of half the sports car business for as much as €4bn to Volkswagen,
Takeover Panel’s finances squeezed
The operating income of the UK’s Takeover Panel have fallen by more than a quarter and the head of its executive wing has warned it is likely to incur a deficit this year. The Panel, which regulates takeover bids and other M&A deals involving companies registered or based in the U.K.,
A Tweak?
Twitter on Wednesday fell foul of a potential security weakness that lies at the heart of “cloud”, or internet-based, software applications, leading to the leak of a raft of internal documents from the internet start-up.
US government to end the era of the unregulated hedge fund
Legislation is being sent to the Hill today, according to a speech to be given shortly by Assistant Treasury Secretary Michael Barr:
I would like to speak to you about where we stand today in the economy at large and the forces and incentives that led us into the current crisis.
The roguest debt agency of them all
Here’s an interesting story out of Austria on Wednesday.
Via Reuters:
VIENNA, July 15 (Reuters) – Austria’s government debt agency is facing up to 380 million euros ($534 million) in losses from as much as 10.8 billion euros it invested in subprime debt-based structured investments,
Accounting brinkmanship
Accounting *yawn*. But how about accounting in German?
We are getting the first industry reactions to the IASB’s proposals to reform IAS 39, the accounting standard which sets out how to value financial instruments under IFRS,
Leading hedge fund manager to quit
… according to Germany’s business weekly WirtschaftsWoche:
FRANKFURT, July 15 (Reuters) – Porsche SE’s embattled chief executive, Wendelin Wiedeking, is leaving the company, Germany’s business weekly WirtschaftsWoche reported on Wednesday,
Trichet on the ECB’s rubbish assets
As Maverecon professor blogger Willem Buiter has been writing for a while, the ECB is uniquely different to other central banks in terms of the unconventional credit easing operations it has been conducting during the crisis,
Defensive decoupling
The Merrill Lynch fund manager survey for July is out and it shows that the big investment bank’s have been successful in persuading their clients to rotate into more defensive stocks:
Having been fleetingly underweight all the big defensive sectors,
Is Goldman Sachs a giant credit portfolio?
Jim Bianco has a fascinating post at The Big Picture, asking what is Goldman Sachs?
His answer: one big credit portfolio.
And he has some convincing charts, including this one, showing the commercial bank’s (née investment) stock price against the option-adjusted spread of an investment grade CDS index.
Arnie goes all Terminator on California budget-crisis
Da da duh da doo… da da duh da doo…
“The stakes have never been higher”
Da da duh da doo… da da duh da doo…
“Californians are worried about their childrens’ future”
Da da duh da doo…
Bulls vs Bears
From Merrill Lynch, who have just called the end of the recession based on the July Research Investment Committee report. Click to enlarge:
Merrill is clearly fully on the bull side of the table,
Lunch Wrap
On FT Alphaville Wednesday morning,
- Moody’s and the monolines.
- On negative gold-leasing rates.
- Goldman’s Q2, the media react.
- Goldman’s Q2, the analysts react.
- Trouble in Latvia (again).
Moody’s and the monolines
More monoline difficulty:
New York, July 14, 2009 — Moody’s Investors Service is modifying the rating methodology it applies to structured finance securities insured by financial guarantors. Specifically,
Markets live transcript 15 Jul 2009
Markets live chat transcript for the chat ending at 12:14 on 15 Jul 2009. Participants in this chat were: Neil Hume, FT (NH) Bryce Elder (BE) NH:good morning and welcome to Markets Live
Getting to the bottom of negative gold-leasing rates
We drew attention to Professor Antal Fekete’s concerns over the spate of ‘ongoing’ backwardation in the the gold physical market on Monday.
The backwardation apparently has much to do with a decline in the activity of those eager to sell physical gold in the market.
Goldman’s blow-out Q2, the media reacts
Apart from a fascination with how much money Goldman Sachs made by the day, minute, hour and second in the second quarter of 2009, the media reaction to Tuesday’s record-breaking figures mostly focuses on whether they will be some sort of regulatory backlash.
Trouble in Latvia, again
Uh oh. This can’t be good.
From Reuters (our emphasis):
RIGA, July 15 (Reuters) – The International Monetary Fund has put forward new, difficult conditions for Latvia to receive further loans, the prime minister said on Wednesday in a further sign the Fund is being tougher than the European Commission.
The business of financial commentary
We try not to indulge in media navel gazing here at FT Alphaville, but sometimes something comes along that just deserves a wider audience.
Step forward, Felix Salmon, the blog ambassador at Reuters,
Goldman’s blow-out Q2, the analysts react
There are two clear takeaways from the analyst reaction to Goldman’s blow-out second-quarter results on Tuesday.
Firstly, while the results were pretty impressive, there’s a lot of uncertainty about where future profits will be coming from.
CMBS watch
The CMBS market looks like it was roiled yesterday — the day before the second Talf offering — by S&P downgrades.
Further reading
Elsewhere on Wednesday,
- An EU commissioner’s pipeline dreams.
- Could France’s special bond be its unravelling?
- Gasparino tells CNBC to stop protecting Goldman Sachs.
- On the matter of some rapidly disappearing central bank liquidity swaps.
Pink picks
Comment, analysis and other offerings from Wednesday’s FT,
Martin Wolf: After the storm comes a hard climb
Is the world economy on its way out of the crisis? Has the world been learning the right lessons? The answer to both questions is:
Snap news
Breaking pre-market news on Wednesday,
- WPP buys majority stake in T&A Communications in Vietnam – statement.
- Incentives lift ACEA European car sales in June – statement.
- International Power secures $780m forward start revolving credit facility – statement.
Goldman bonuses top the boom years
Pay at Goldman Sachs this year is set to beat the boom levels enjoyed before the financial crisis, with employees on track to earn a record $770,000 each on average. The news accompanied surging second-quarter profits,
Myners promises alternative to draft EU hedge rules
The European Commission’s draft directive on hedge funds and private equity funds can and will be improved, according to the financial services minister, Lord Myners. “The UK government does agree there is a case for regulation at the EU level,” Lord Myners told the House of Lords EU subcommittee on Tuesday,