November, 2009
Further reading
Elsewhere on Wednesday,
- Peak Oil: the media’s new version of shark attacks.
- Does CEO envy drive M&A?
- “Die Robin Hood Bankerin”: A German banker transfers money from rich to poor.
- A professional opinion on The Rajaratnam Defence.
Pink picks
Comment, analysis and other offerings from Wednesday’s FT,
Martin Wolf: Give us fiscal austerity, but not quite yet
Financial crises have devastating impacts on the public finances. The impact is also most severe where the pre-crisis excesses were greatest.
AV after dark
On FT Alphaville late Tuesday,
- S&P reverses on its “UBS is below average” bank capital model claim…
- …after UBS complained.
- The upcoming UK tracker time-bomb.
- So Goldman’s Hatzius was almost right after all.
Snap news
Breaking pre-market news on Wednesday,
- Akzo Nobel announces debt tender offer – statement.
- Yell gets valid acceptances on about 84 per cent of open offer shares – statement.
- Corporate: Compass,
Bank secretly lent RBS, HBOS £61.6bn
Royal Bank of Scotland and HBOS came within minutes of closing cashpoints and normal business operations, the Bank of England confirmed on Tuesday, revealing that it extended £61.6bn in emergency funds to the banks in October last year.
Lloyds launches £13.5bn rights issue
Lloyds Banking Group on Tuesday launched the UK’s largest rights issue to raise £13.5bn, offering new shares at 37p each, a discount of nearly 40% ahead of a shareholder vote on Thursday. The rights
Fed sees risks in low rates policy
Federal Reserve officials have expressed concerns that near-zero interest rates could fuel “excessive risk-taking in financial markets” but believe the possibility is “relatively low,” according to minutes from the Fed’s November meeting.
Fear pushes US rates into negative
Yields on short-term US government debt have fallen into negative territory as banks and investors park their cash in havens before the year’s end. Strong demand for US Treasury bills with durations of one year or less suggests that fear still pervades the financial system as investors show their willingness to forgo interest income or even take a small loss to own securities considered safe.
China banks set to raise capital
China’s banks are preparing to raise tens of billions of dollars in additional capital next year and beyond to meet regulatory requirements following an unprecedented expansion of new loans in 2009. The country’s 11 largest listed banks must raise at least Rmb300bn ($43bn) to meet more stringent capital adequacy requirements and maintain loan growth,
FSA fines Nomura £1.75m
Nomura has been fined £1.75m for “extremely serious” failings in its equity derivatives business as part of a regulatory crackdown by the UK’s FSA financial watchdog. The penalty stems from the failure by one of its former employees in Hong Kong to properly account for market volatility levels in his trading book.
WestLB seeks more state support
WestLB is scrambling for fresh financial support as its owners wrangle with the German government over a capital rescue for the stricken Landesbank. WestLB said on Tuesday it was in “intensive and constructive” talks with Soffin,
Koenigsegg abandons Saab deal
The future of Saab was in doubt on Tuesday after a consortium led by Swedish niche carmaker Koenigsegg pulled out of talks to buy General Motors’ premium car brand. Koenigsegg blamed the move on delays in closing the deal after months of negotiations with the Swedish government over financial support.
Australia hits TPG with tax bill
Australian tax authorities have launched a surprise action against US buy-out firm TPG, reports the WSJ. The Australian Taxation Office is pursuing more than $620m in taxes and penalties from TPG over its recent IPO of retail chain Myer.
Facebook paves way for IPO
Facebook has followed Google’s lead and introduced a dual-class stock structure, the clearest sign yet that the world’s most popular social networking site is preparing for an eventual public offering.
BBC considers Worldwide float
The BBC has been holding discussions with City advisers about floating part of BBC Worldwide, its commercial arm, in response to pressure from the government and commercial rivals to dilute its media market power.
Galleon founder attacks wiretap
Raj Rajaratnam, founder of the Galleon hedge fund group at the heart of an insider trading scandal, on Tuesday attacked prosecutors’ use of court-authorised wiretaps as a violation of his constitutional rights and questioned the credibility of a key witness.
AIG board approves CEO pay
AIG, the US insurer that received billions of dollars in a US bailout, said on Tuesday that it has been authorised by its board to pay CEO Robert Benmosche’s $7m compensation, after it laid to rest concerns that he may quit the post,
Overnight markets: Up
Asian stocks rose on Wednesday, reports Bloomberg, led by automakers and mining companies, after Australia’s central bank said the economy had entered a “new upswing” and a Japanese export report beat economist estimates.
A Twin Cities FX scandal – SEC freezes Pat Kiley assets
Dum-di-di-dum, di-di-dum, di-di-do…. (click to listen)
With failing economies, failing banks and failing stocks, bonds, IRAs, mutual funds, you can make profits during chaotic times…
S&P reverses on its “UBS is below average” bank capital model claim
Oh dear. Just four months months after its widely criticised flip-flop on CMBS ratings, Standard & Poor’s has managed to tie itself into a fresh series of knots.
The rating agency is now backpedalling on its assessment of UBS. Specifically,
SEC manages to win an insider trading case
What’s this? Has the SEC managed to successfully prosecute someone for insider trading?
Looks like it, according to Reuters:
Federal securities regulators won an insider trading case when a jury in Boston ruled that a former Fidelity employee illegally profited from trading stocks that the mutual fund giant was buying for itself.
So Goldman’s Hatzius was almost right after all
Think back to the end of October when Jan Hatzius, Goldman Sachs economist and sometime clairvoyant, suddenly lowered his forecast for the third quarter US GDP from 3 per cent to 2.7 per cent.
The air was thick with conspiracy theories.
Cautiously optimistic Fed officials cut unemployment forecasts
Officials at the Federal Reserve lowered their projections for US unemployment in the coming years, according to the minutes of the most recent meeting of the Federal Open Market Committee.
The minutes,
UBS is not a “below average” bank
Swiss bank UBS has responded to Monday’s report from Standard & Poor’s, which you may recall ranked 45 of the world’s leading banks according to their risk-adjusted capital (RAC) ratios.
By S&P’s reckoning,
The upcoming UK tracker time-bomb
The world may by now be familiar with the ticking financial time-bomb represented by Option ARM mortgages.
According to Fitch up to $100bn of such mortgages — an adjustable-rate home loan that allows the borrower to choose whether to pay interest or principal — will recast from introductory,
Congressional Alpha
US legislators appear to be rather shrewd stock pickers.
Congressional equity portfolios outperformed the wider market by an average of 55 basis points per month from 1985 to 2001, according to research cited by the Washington Post.
FDIC’s insurance in the red, ‘problem banks’ hit 16-year high
There are some shocking numbers in Federal Deposit Insurance Corp’s (FDIC) quarterly banking report for the three months to September 30, which the agency released on Tuesday.
Numbers like: -$8.2bn and 552.
Call off the search, Sports Direct edition
It’s over.
After a two and half year search, the UK’s biggest sports retailer has finally found someone brave enough to take on the job of chairman.
From RNS on Tuesday.
Sports Direct International plc today announces the appointment of Dr Keith Hellawell QPM as non-executive Chairman of the Board with immediate effect.
European investment funds see risk appetite return
Well what do you know. The latest research from Greenwich Associates has found that risk appetite has returned among retail clients of European investment funds — particularly for corporate bonds.