December, 2009
A merry Halifax Christmas to you!
Just in time for the holiday shopping rush, the Halifax reported on Tuesday that UK house prices increased by 1.4 per cent in November — meaning homeowners can all feel a bit richer and spend freely on go-go hamsters,
[Outlook 2010] Thundering Herd bullish on Euro equities
BofA Merrill Lynch has managed to trump JP Morgan’s optimism, and is targeting a 30 per cent gain for European equities next year.
Strategist Gary Baker says valuations remain attractive and top line forecasts are too conservative given that macro estimates are (apparently) showing 7.5 per cent nominal GDP growth in 2010.
Dubai who?
How quickly the world forgets.
Just 13 days ago, markets were reeling from Dubai World’s request for a debt standstill.
But last week investors were already clamouring to ratchet up the risk, according to UBS’s Global Risk Radar.
Making an example out of Greece
When it comes to Greece, Laurent Fransolet at Barclays Capital observed back in November that:
. . . there is a decent correlation between these holdings of government bonds by Greek banks and the amount of financing Greek banks have taken at the ECB,
Presenting RBS’s toxic assets
As you may have read, HM Treasury has released full details of the toxic RBS assets being guaranteed under the Asset Protection Scheme.
Annex A of the 100 page report (which was quietly put up on the HM Treasury website on Monday) provides the full breakdown of the £282bn assets being insured.
Further reading
Elsewhere on Tuesday,
- The rally apologista’s handbook.
- The importance of capital requirements.
- The new Decembrists and financial reform discussion.
- The hardest job on Wall Street:
Pink picks
Comment, analysis and other offerings from Tuesday’s FT,
Robert Aliber: Tariffs can persuade Beijing to free the renminbi
International payments arrangements are at an impasse much as they were in the summer of 1971,
AV after dark
On FT Alphaville late Monday,
- US consumer credit falls again, but the decline is slowing…
- Not the Kiss of Death Awards, 2009 edition.
- Remember New Century? The SEC sure does.
- Pimco hires Neel Kashkari.
Snap news
Breaking pre-market news on Tuesday,
- China central bank reaffirms loose monetary policy – Reuters.
- Dubai shares tumble to lowest in five months – Bloomberg.
- Corporate: Tesco, Xstrata, SABMiller,
Apax in £975m Marken buy-out
Apax Partners will on Tuesday announce the £975m buy-out of Marken, a distributor for the pharmaceutical industry, generating big profits for its management and Intermediate Capital Group, which acquired the company in 2007.
Japan unveils $81bn stimulus
The Japanese government on Tuesday unveiled a Y7.2 trillion ($81bn) economic stimulus package amid signs that the country’s economic recovery and Prime Minister Yukio Hatoyama’s popularity are waning,
Dollar dips on Fed comments
The dollar dipped on Tuesday after Federal Reserve chairman Ben Bernanke dampened speculation of an early US interest rate rise, while shares faltered on renewed concern about the global recovery, reports Reuters.
UK lobbies foreign banks for funds
The UK government is lobbying top investment banks, including Goldman Sachs, Deutsche Bank, JPMorgan Chase, UBS, Credit Suisse and BNP Paribas to contribute £25m-£35m each to a new “national investment corporation” to lend capital to the small businesses.
Creditors in Dubai World talks
A group of international and regional banks met Dubai’s struggling conglomerate, Dubai World, for the first time on Monday as talks began on the company’s request to restructure debts of $26bn. People close to the talks said it was a “kick off” meeting for what is expected to be a protracted process,
Shanks urges Carlyle to improve bid
Shanks Group has received a £535m ($882m) unsolicited takeover approach from Carlyle Group, the US buy-out firm, prompting the UK waste management company and its two top shareholders to call for a sweetened offer.
Gorman starts Morgan Stanley reshuffle
Morgan Stanley’s James Gorman, who will succeed John Mack next month as the bank’s chief executive, is close to unveiling management changes that include shifting the bank’s finance chief to co-head its flagship securities business.
Pimco hires Kashkari
Neel Kashkari, who ran the US government’s $700bn Tarp scheme during the Bush administration, has joined Pimco, the asset manager specialising in bonds. The move is likely to provoke criticism of the “revolving door”
HK further delays Rusal IPO
Oleg Deripaska is likely to have to give up his attempt to launch a $2bn IPO of his UC Rusal aluminium group before Christmas after the Hong Kong Stock Exchange announced a further delay on Monday. The move meant the offering of up to 10% of the company’s shares would have to be pushed back to next year,
Repo dealers fear impact of new rules
Wall Street dealers are concerned that proposed new rules by Congress could have unintended consequences on a key area of financing for banks and top financial institutions. Under a proposal passed by the House Financial Services Committee last week,
UK backs £167bn of overseas bad debt
UK taxpayers stand behind more than £167bn of toxic assets in the US, Ireland, the Middle East and beyond, it emerged as the Treasury disclosed details of what Royal Bank of Scotland has dumped in the state insurance scheme for bad debts,
Greece warned on rating risk
Greece’s financial difficulties escalated on Monday after it was warned of a possible credit rating downgrade and Jean-Claude Trichet, ECB president, said Athens would have to act “courageously” to bring its budget under control.
SEC charges New Century executives
The US SEC on Monday filed civil fraud charges against three former executives of New Century Financial, the collapsed lender, in its latest attempt to hold individuals accountable for the subprime mortgage crisis.
Overnight markets: Mostly down
Asian stocks mostly fell on Tuesday, reports Bloomberg, led down by the Nikkei 225 after Federal Reserve Chairman Ben Bernanke said the US economy faces “formidable headwinds,” and Japan unveiled an $81bn stimulus programme.
US consumer credit falls again, but the decline is slowing…
US consumer credit fell by a smaller-than-expected $3.5bn in October, according to data released by the Federal Reserve on Monday. Analysts had forecast a decline of $9.5bn.
In October, consumer credit outstanding fell at a 1.69 percent annual rate to $2,480bn,
Not the Kiss of Death Awards, 2009 edition
Much like the so-called Curse of the Magazine Cover, awards to financial institutions have proved to be an interesting contrarian indicator over the years.
As Fintag noted in May, past winners of the Hedge Funds Review’s European Performance Awards — or what he dubbed the “Kiss of Death”
Remember New Century? The SEC sure does
The US Securities and Exchange Commission on Monday charged three former top executives of New Century Financial Corporation — the bankrupt subprime lender – with securities fraud.
The SEC said the defendants — former chief executive and co-founder Brad Morrice,
Pimco hires Neel Kashkari
Pimco, the world’s largest bond fund, has hired Neel Kashkari – the man best known for being put in charge of the US Treasury’s $700bn bailout plan at the tender age of 35.
Dealbreaker has the Pimco memo announcing the hire in full;
Gartmore fillip for Europe’s IPO market
After last week’s Hochtief Concessions IPO car crash, here’s some good news for all those European companies jostling to come to market in 2010.
Private equity-owned fund manger Gartmore’s ₤400m flotation is fully subscribed three days before the books officially close,