January, 2010
Financial reform checklist
Here’s a useful thing from Barclays Capital banking analysts Jonathan Glionna and Miguel Crivelli.
It’s a checklist of the steps to various financial reforms; Financial reform being, for the moment,
A good day for the Sage
After his surprise move into US railways late last year with the $26.6bn purchase of rail operator BNSF, Warren Buffett is expanding his presence in the reinsurance industry — a sign, say some analysts,
Further reading
Elsewhere on Wednesday,
- Poverty and the American suburb.
- Competitiveness gaps could hurt Euro – No Really!
- Perhaps Gordon Brown just hates Mervyn King?
- Hayek vs Keynes, the rap.
- Security at Davos.
Pink picks
Comment, analysis and other offerings from Wednesday’s FT,
Martin Wolf: Volcker’s axe is not big or sharp enough
“I admire Mr Volcker and strongly support his desire to develop a financial sector that supports the wider economy…”,
Snap news
Breaking pre-market news on Wednesday,
- SAP Q4 profit falls as customers cut spending – statement.
- BBVA Q4 profit plunges 94 per cent to $44m on asset writedowns – statement.
- Tullow Oil to place new shares equal to 10 per cent of current capital -statement.
Money for nothing
Dire Straits wisely observed back in 1985 that it’s nice — but possibly derisible — to have people give you money for nothing.
Nevertheless, it happens to be the way to do it if you’re the US Treasury (H/T Clusterstock).
Bonkers Bove, the blueprint
As an addendum to Monday’s political rant, Rochdale Securities banking analyst Dick Bove has made a flow chart.
It is, by his own admission, rather “poorly drawn,” but it looks like this:
Davos time!
The great, the good and the simply pompous of finance have been gathering in Davos, Switzerland for the annual World Economic Forum on Tuesday.
Lucky for us — the great uninvited — the rise in social media means we too can feel part of the buzz and economic hot air conjecture.
Dead cat splat? UK GDP edition
H/T Taxloss.
An eye-catching quote…
…from the eye-catching-quote machine that is Mr Bill Gross.
The UK is a must to avoid. Its Gilts are resting on a bed of nitroglycerine.
In fact, the Pimco man is in fine form with his February letter to investors, in which he mulls his status as an aging (65) financial rock star,
QEstions on UK GDP
Just-released UK GDP figures show Britain’s economy emerged from recession in the last quarter of 2009.
But the fourth-quarter figure, a growth of 0.1 per cent, is very much below the Bank of England’s own expectations.
“UK gilts resting on a bed of nitroglycerine”
It must have been, what, a couple of days since someone from Pimco last fired a broadside at the UK?
So, the top man, Admiral Bill Gross, has now taken it upon himself to deliver another round of cannon fire.
[MoneyTech] Rise of the news-reading machines
From the FT — some giant leaps for robot-kind in the world of trading:
The arms race in trading technology is set to intensify this week as Thomson Reuters, the news and market data company, on Monday unveils a service for “high-frequency” traders allowing them to make split-second trading decisions based on news articles “before the information moves the market” .
Lunch Wrap
On FT Alphaville Tuesday morning,
- The (UK) recession is over!
- And the market reacts.
- A big year for European government bonds.
- That European funding problem, charted.
- On underestimating the regulatory reaction.
Markets Live transcript 26 Jan 2010
Markets Live chat transcript for the chat ending at 12:14 on 26 Jan 2010. Participants in this chat were: Neil Hume, FT Bryce Elder NHHi there NHGood morning NHand welcome to Markets Live
The trials of Papaconstantinou
While Greece may have side-stepped immediate funding catastrophe with its successfully placed five-year bond issue, that’s not to say there aren’t further trials for the sovereign issuer down the road.
Greed & Fear and David Stockman on where it all went wrong
CLSA’s Christopher Wood in an extra edition of his weekly Greed & Fear newsletter highlights a timely criticism of the US approach to fixing the financial system by David Stockman, Ronald Reagan’s former director of the Office of Management and Budget.
The sands of Greek bond issuance
Greece’s new sovereign five-year issue received unexpectedly high demand in initial price talk on Monday.
The bond gets officially priced mid week, and on that matter Standard Chartered published an interesting view on Tuesday:
Sterling falls, gilts rally after GDP reading
Specifically, sterling lost around half a cent against the dollar while gilt futures rallied after the report showing the UK economy had emerged from recession in the fourth quarter — but only just.
March gilt futures:
It’s over
After six quarters the UK’s longest, and possibly deepest recession since the second world war has ended – but only JUST.
Q4 GDP rose 0.1 per cent quarter-on-quarter, well below forecasts. (A 0.4 per cent rise was expected).
Goldman overpay? Surely some mistake
Here’s something we missed last week — the US Treasury’s Tarp warrant report.
The US government, you’ll remember, received a bunch of long-dated options in return for bailing-out various banks — to the tune of $205bn — in 2008 and 2009.
Chanos: ‘We’re not calling’ for a China crash
“We’re not calling for an impending crash of China”, investor Jim Chanos told CNBC on Monday. Well thank God for that.
As CreditWritedown’s Edward Harrison notes:
[Chanos] is bearish on China because of an unprecedented credit-induced bubble in Chinese real estate.
Further reading
Elsewhere on Tuesday,
- The status of financial reform.
- The most irony-impaired Wall St research title – ever.
- Apple Tablet overdose.
- Not again! Beware the four new asset bubbles.
- Sign of the Apocalypse:
Pink picks
Comment, analysis and other offerings from Tuesday’s FT,
Gideon Rachman: When nations turn into hoarders
Earlier this month Britain’s minister for food and rural affairs, gave a speech in which he argued that “Food security is as important to this country’s well-being as energy security”.
Snap news
Breaking pre-market news on Tuesday,
- Anurag Dikshit sells remaining 9% holding in PartyGaming – statement.
- Q1 figures from Siemens beat expectations – statement.
- Novartis names Joe Jimenez as its new chief executive – statement.
Who’s afraid of the Volcker rule?
John Kemp, columnist at Reuters, admits there is no easy way of identifying how much money the major banks make from prop trading.
However, he points out there is a way to breakdown which banks depend most heavily on trading income rather than investment or commercial banking activities.