November, 2009
Sleeping with private equity
There’s been considerable gnashing of teeth over the downfall of the venerable American bed maker, Simmons. Having helped people sleep better for more than 135 years, the company answered to five different private equity masters before tumbling into insolvency under its most recent owner,
Dubai tells skeptics to shut up
Dubai’s rulers have lost patience with suggestions that all is not well with the emirate’s finances, or that relations with Abu Dhabi are strained.
As the FT reported on Monday, Dubai’s Sheikh is having none of it:
Chinese yuan appreciation pressure mounts
Chinese industrial output in October accelerated at its fastest rate in seven months, according to figures released on Wednesday.
Analysts are now cautioning that sort of rebound will only heighten pressure on China to appreciate its currency versus the US dollar as exports rebound and domestic focus once again is forced to turn to inflation.
‘The dollar is the most crowded long in history’
So stop calling the current vogue for betting against the greenback a “crowded short”, says boutique brokerage Aviate Global.
And their logic is hard to fault. As the world’s de facto currency the world is,
Cuckoo for CoCos
Fresh off the London Stock Exchange, more Lloyds CoCos (that’s Contingent Convertibles) for everyone:
EXCHANGE OFFERS – MAXIMUM ECN NEW ISSUE AMOUNTS
On 3 November 2009, Lloyds Banking Group plc (“Lloyds”) announced two Exchange Offers relating to certain Existing Securities for Enhanced Capital Notes guaranteed by Lloyds or Lloyds TSB Bank plc,
The US v. Cioffi and Tannin, or how not to scare would-be fraudsters
The post-Madoff campaign by US regulators and federal prosecutors to portray themselves as tough on (white collar) crime was dealt a blow on Tuesday, when a jury cleared two former Bear Stearns hedge fund managers of all the charges against them.
Prepare for a junk-bond deluge in shipping
Central bank policy may have successfully pushed down Libor rates following the Lehman blow-out, but banks still appear rather reluctant to pass on those lowered costs to commercial and retail clients.
Hamps across America
There’s a key word missing in the below press release on the US Treasury’s Hamp programme:
WASHINGTON – Today, the Obama Administration released the next monthly report for the Making Home Affordable (MHA) loan modification program.
Lunch Wrap
On FT Alphaville Wednesday morning,
- The UK inflation fan-dango.
- The quant disruption that never was.
- Hedge funds’ runny liquidity.
- Some Talf-tastic CMBS.
- Boardroom execution at Reed.
Markets live transcript 11 Nov 2009
Markets live chat transcript for the chat ending at 12:18 on 11 Nov 2009. Participants in this chat were: Neil Hume, FT (NH) Miles Johnson, FT (MJ) Bryce Elder (BE) NH:hola NH:and welcome to Markets Live
UK inflation fan-dango
Just what did the UK’s Monetary Policy Committee base their decision last week to increase quantitative easing by £25bn on?
The Bank of England’s quarterly Inflation Report.
The MPC raised its forecast for inflation to around 1.6 per cent (from 1.42 per cent) over the next two years – with the rate just exceeding the Bank’s inflation target of 2 per cent by mid-2012.
Hedge funds’ runny liquidity
Here’s your latest asset-liability worry: Hedge funds.
Finance blog Sober Look has an interesting post on the subject which uses a chart from Hedgebay, a provider of a secondary market for investors’ stakes in hedge funds:
Talf-tastic CMBS
Ta-dah! Behold the first new CMBS deal in over a year:
(From Structured Finance News, click to enlarge)
`DDR’ is Developers Diversified Realty Corp., an Ohio-based shopping mall Real Estate Investment Trust (Reit).
Boardoom execution at Reed
Forget the recent reshuffle at Barclays, this is a proper executive-level knifing.
After just 8 months in the job, Ian Smith, chief executive of Reed Elsevier — which publishes the New Scientist and The Lancet — quit on Wednesday morning.
More fun with JGBs, more headaches for Japan
Japanese government bonds – not a topic that normally fires up commentators and investors – are moving increasingly into the spotlight following – shock, horror – warnings about a possible credit rating downgrade to Japan’s sovereign debt.
Further reading
Elsewhere on Wednesday,
- If we were friends with John Paulson…
- Muni bonds: Buyer beware, really.
- The romance with stimulus isn’t just a fling.
- Your big chance to balance the US budget.
Pink picks
Comment, analysis and other offerings from Wednesday’s FT,
Martin Wolf: Victory in the cold war was a start as well as an ending
“A crisis is a strange way to celebrate an anniversary.” This is the wry judgment of Erik Berglöf,
AV after dark
On FT Alphaville late Tuesday,
- Ambac warns of bankruptcy risk.
- Former Bear Stearns fund managers not guilty of fraud charges, jury finds.
- Fairground financial punditry?
- (Scary) chart du jour:
Snap news
Breaking pre-market news on Wednesday,
- ING reports profit helped by gains from investment – statement.
- Unicredit Q3 profit falls 26 per cent as provisions increase – statement.
- National Express announces £360m rights issue – statement.
Hedge funds bite into Cadbury
Paulson & Co, the New York hedge fund run by John Paulson, has disclosed a 2.08% stake in Cadbury following Kraft’s £9.8bn ($16.4bn) hostile bid this week, signalling growing hedge fund interest in the UK confectionery group following Kraft’s hostile bid.
Bill seeks to strip Fed of powers
An influential US Senate committee has proposed a sweeping overhaul of the country’s regulatory architecture that would strip powers from the Federal Reserve and create a single banking regulator. The bill,
Ambac shares plunge on fears
Shares of US bond insurer Ambac Financial sank 33% on Tuesday after the company warned it may be forced to seek bankruptcy protection if it cannot fix its liquidity problems, reports Reuters. Ambac said it may pursue strategies including “a negotiated restructuring of its debt through a prepackaged bankruptcy proceeding”
AIG’s Benmosche threatens to quit
Robert Benmosche has told the board of AIG that he is considering stepping down as chief executive of the state-controlled insurer, just three months after taking the job, reports the WSJ. At a board meeting last week,
HSBC fears exclusion from bank sales
HSBC’s chief executive on Tuesday expressed regret that the bank was likely to be frozen out of the bidding process for assets being sold by the UK state-backed RBS and Lloyds Banking Group. Michael Geoghegan said that while HSBC had not been explicitly banned from the sale process,
Buy-out groups vie for BCA
British Car Auction has attracted bids from a clutch of private equity groups that are expected to submit final offers next month valuing Europe’s biggest vehicle reselling network at between £400m ($670m) and £500m.
NatExpress launches cash call
National Express will launch a £370m-£375m rights issue on Wednesday, drawing a line under weeks of speculation over the bus and rail operator’s future. The cash-raising exercise will be fully underwritten,
Lloyds Banking cuts 5,000 jobs
Lloyds Banking Group has announced 5,000 job cuts as it integrates its wide-ranging businesses. The majority of the losses – 2,820 – will come from its group operations, including ITwith the remainder split between the insurance and mortgage businesses.