October, 2009
Vedanta hit by Indian fraud investigation
Vedanta Resources is one of the biggest fallers in the FTSE 100 on Tuesday morning, with shares in the Indian mining company falling 127p, or 5.6 per cent, to £22.06.
Here’s why:
Oct. 27 (Bloomberg) — Sesa Goa Ltd.,
South Korea in a won-win situation
From gloom and doom just eight months ago to figures showing the strongest quarterly economic growth in seven years on Tuesday, South Korea is on a roll.
Indeed, the country sums up the much over-used term,
The UK has a ‘disturbing parallel’ with Japan, says Posen
The good news — quantitative easing will not cause inflation.
The bad news — we need to reform the whole banking system before QE can be withdrawn.
So says Adam Posen, the newly-recruited Bank of England monetary policy member and “Lost Decade”-specialist,
Switching banks: Learn to love the one you’re with
James Surowiecki raises some interesting points in a column in this week’s New Yorker magazine on why big US banks are getting even bigger and more powerful as a result of the financial crisis.
The simple answer is that the combination of a series of banking mergers and the disappearance of competitors such as Lehman Brothers left the surviving institutions in much better shape than before.
Further reading
Elsewhere on Tuesday,
- Fixed rates and protectionism.
- Why are big banks even bigger?
- Maybe insider trading is okay…
- Australian dollar disaster.
- “This crisis will discredit those who ignore asset bubbles”.
Pink picks
Comment, analysis and other offerings from Tuesday’s FT,
Kenneth Griffin: We must overturn the status quo in derivatives
Griffin, founder and CEO of Citadel Investment Group, writes: Following the collapse of Long Term Capital Management,
AV after dark
On FT Alphaville late Monday,
- The real money supply, globally.
- Goldman says US gov’t boosted home prices by 5 per cent.
- B(e)arCap.
- How to survive The Tightening.
Over in the Long Room,
Snap news
Breaking pre-market news on Tuesday,
- UBS appoints Robert McCann to head new US wealth management unit – statement.
- Yell extends refinancing deadline until October 28 – statement.
- Barratt Developments warns investors that UK post strike could delay requests to take up rights issue allocations – statement.
Brussels orders ING break-up
ING on Monday unveiled a radical break-up forced on it by the European Commission that will see the Dutch financial services group sell off its insurance and investment management business following last year’s state-bail out.
Court asked to back Lehman scheme
PwC, the administrators of Lehman Brothers in Europe, on Monday asked the UK’s Court of Appeal to approve a plan it says will help speed the winding-up of the collapsed bank. The consultancy firm is attempting to overturn an August court ruling that blocked the plan,
UK banks face tougher reporting rules
UK banks could be forced to disclose the value of their holdings in officially prescribed detail if they do not meet the spirit of a new reporting code. The code, published by the British Banker’s Association on Monday,
City attacks Osborne on bonuses
UK business leaders have attacked shadow chancellor George Osborne’s “simplistic” proposals to cap bankers’ bonuses, accusing him of exploiting public anger against bankers. The backlash came after Osborne urged the government to impose an “emergency” ban on banks with retail arms paying cash bonuses of more than about £2,000 per employee.
Macquarie buys Canada’s Blackmont
Macquarie Group said on Monday it would buy Canada’s Blackmont Capital for C$93.3m, in a move that gives the Australian investment bank key retail distribution in Canada. Blackmont, one of Canada’s largest independent,
Cadogan agrees spin-off from Fortis
US hedge fund group Cadogan Management has signed a deal to spin off from Fortis Bank, in a step that investors hope will attract new assets, reports Reuters. Cadogan will be fully owned by its employees after the deal closes,
Yell misses debt deadline
Yell, the UK telephone directories group, on Monday failed to meet its deadline to win enough lender support for plans to restructure its £3.8bn debt. Yell is on Tuesday expected to announce a second deadline extension to give lenders more time to approve the plans.
BNY Mellon sees M&A chances
Bank of New York Mellon sees more acquisition opportunities in Europe than in Asia, according to Robert Kelly, the bank’s chairman and CEO, reports Reuters. Kelly said European financial institutions had been harder hit by the financial crisis than their Asian counterparts and were refocusing as a consequence.
Galleon judge pushes SEC
A federal judge’s ruling could force the government to tip its hand early to defendants in the burgeoning Galleon Group insider-trading case, reports the WSJ. On Monday, US district judge Jed Rakoff told the SEC to be ready to begin the civil insider-trading trial in five months.
Ex-Bear Stearns manager wins ruling
Former Bear Stearns hedge fund manager Matthew Tannin won a round during his trial in New York on fraud charges on Monday when a judge ruled the jury cannot see an email in which he wrote about his fears of a “blow up risk”
Overnight markets: Down
Asian stocks followed US and European stocks down on Tuesday, led by commodities companies and building-material producers. Futures on the S&P500 fell 0.19% after the gauge dropped 1.17% on Monday.
The real money supply, globally
By which we mean the folding stuff (and coins) issued in 137 countries. Compound annual growth in the real money supply since 1971 is 9.09 per cent, according to Dollardaze.org, where Mike Hewitt has been crunching the numbers:
Goldman says US gov’t boosted home prices by 5%
According to a Goldman Sachs analysis, interventions by the US government in the housing market added an average of 5 per cent to home prices nationally.
As the WSJ’s Developments blog noted over the weekend,
CDS report: iTraxx Crossover closes at tighest level since June 08
Markit’s Gavan Nolan wrote this CDS report
European CDS indices ended the day little changed as investors awaited clarity on earnings and key economic data later this week. The Markit iTraxx Europe index moved tighter early in the session as stock markets staged a modest rally.
How to survive The Tightening
The scene: midnight in a small Midwestern town.
It’s a slumber party. Pigtailed, middle-aged, fund mangers are sprawled over sofas watching films.
Painting their toe nails, eating frozen yogurt,
Stocks spooked – has Rosenberg’s time arrived?
There was a wobble on Wall Street just before lunch in New York on Monday. The Dow and the S&P 500 both saw early gains wiped out – each index suddenly moving around 1 per cent lower. European stocks followed suit – London’s FTSE 100 fell 1.25 per cent in the minutes before the close of business there.
Icelandic collapse complete
McDonald’s is fleeing the country — citing the weakness of the krona.
Oct. 26 (Bloomberg) — Iceland’s McDonald’s Corp. restaurants will be closed at the end of the month after the collapse of the krona eroded profits at the fast-food chain,
UK regulator beats up on the banks (or not)
One measure of the FSA’s lack of confidence in its own future is the language now being employed in its press releases.
Monday’s missive — FSA announces tough new code for financial reporting disclosure — was full of fury and threats and calls to action.
More bad news for Tishman Speyer and NY commercial real estate
One day after the Federal Reserve’s Beige Book suggested a recovery in US commercial real estate was a ways off, the New York Times reported on a court decision that could affect on thousands landlords across the city:
Black Swan for dummies
Were you fooled by Nassim Nicholas Taleb’s randomness?
Was the Black Swan too dark for your comprehension?
Was the fourth quadrant off your radar screen?
Never fear, for the Black Swan man himself has penned a paper outlining his rare event-theory idea and “common errors”