January, 2010
Gold backwardation fears revisited, uh oh!
It’s been a while since the gold bugs had a tasty scare-story to feed on.
But those frustrations can now be dispelled.
The Business Insider blog brings to our attention that net gold-lease rates are back on the rise,
Markets Live transcript 22 Jan 2010
Markets Live chat transcript for the chat ending at 12:22 on 22 Jan 2010. Participants in this chat were: Bryce Elder Neil Hume, FT BEI’m in. NHOkay NHlet’s try again
Grεεk cοrpοrαtε cοntαgiοn
Is Greek CDS getting out of hand?
On Wednesday, the cost of insuring debt of the Hellenic Republic rose to a record 353.5bp, according to CMA DataVision. Which means the country’s CDS chart looks something like this:
What does the Aussie mining tax really mean?
Mining stocks were among the biggest fallers in Thursday’s sell-off. One of the factors driving the sector lower was news of a new mining tax being proposed by Australian Treasury Secretary, Ken Henry.
Some CMBS datapoints
Titan Europe 2006-3 — part of a CMBS deal put together by Credit Suisse — has been mentioned on FT Alphaville before.
The deal pooled commercial properties in France, Germany, the Netherlands, Belgium and Luxembourg,
2010: Obama’s year of the market-maker?
The ‘Volcker rule’ may be bad news for big speculative investment banks.
It might even be bad news for the inter-dealer brokers like Icap and Tullett Prebon, much of whose business is dependent on offsetting client-risk the big banks can’t internalise themselves.
Further reading
Elsewhere on Friday,
On the Obama bank proposals,
- “So. Farewell then, prop trader.”
- Just what is proprietary trading?
- Loopholes for big banks. Already.
- George Osborne likes to break banks too.
Pink picks, Obama and the banks edition
Comment and analysis on Obama’s radical new restrictions on banks:
Editorial comment: Obama declares war on Wall St
Obama’s political team is running to catch up. On the day Goldman Sachs announced Q4 earnings of $4.95bn,
Snap news
Breaking pre-market news on Friday,
- Rusal raises $2.2bn in Hong Kong IPO – Bloomberg.
- Dragon Oil reports 9 per cent increase in average daily production rate to 44,765 bpd – statement.
- Petropavlovsk launches $300m convertible bond issue – statement.
Think tank conceit
Earlier this week the Demos think tank published a hectoring report entitled Bailed-Out Megabanks Go Right On Gambling (But Now with Taxpayer Support).
So on Thursday Demos announced:
Obama Administration
Can Goldman really dodge the Volcker rule?
Dick Bove seemed to think so earlier, saying “buy” Goldman, just as the stock fell 5 per cent. But there’s been such confusion (and a lack of detail) on the Obama administration’s proposals that we should spare the Rochdale Securities’ man the chance to revise his views.
Whither Highbridge, GSAM…Citadel?
Off the bat, there are some obvious hedge fund losers – or at this stage, to be clear, potential losers – from the wide-ranging Obama/Volcker financial reform package unveiled on Thursday.
Highbridge Capital is,
Ironic chart du jour
Here’s the S&P 500 regional banks index versus the old skool S&P “investment banks” barometer (consisting of Goldman, MOST, Charles Schwab and E-Trade).
Guess which is which?
Also note the time.
White House “size and scope” announcement
No, don’t expect details – but here’s the actual press-release issued in Washington at lunchtime on Thursday:
President Obama joined Paul Volcker, former chairman of the Federal Reserve; Bill Donaldson,
The Obama-Volcker remarks in full
REMARKS BY PRESIDENT BARACK OBAMA
SUBJECT: ADDITIONAL REFORMS TO THE FINANCIAL SYSTEM
THE DIPLOMATIC RECEPTION ROOM, THE WHITE HOUSE, WASHINGTON, D.C.
11:39 A.M. EST, THURSDAY, JANUARY 21, 2010
PRESIDENT OBAMA:
Google gets things wrong…
… and not just in China it seems. They are also useless at selling property online.
That’s the view of Rightmove, which has fired off an email to staff telling them not to panic about the search engine’s imminent arrival on their patch.
Markets Live transcript II (Obama special) 21 Jan 2010
Markets Live chat transcript for the chat ending at 17:16 on 21 Jan 2010. Participants in this chat were: Neil Hume, FT Tracy Alloway, FT Paul Murphy Izabella Kaminska, FT Stacy-Marie Ishmael, FT
FT Alphaville does the Glass-Steagall Sequel
FT Alphaville is holding a special Markets Live session in light of Obama’s proposals.
Resource nationalism down under
The mining sector took another leg down on Thursday afternoon in London:
Now what could have caused that? Surely not Obama’s Glass Stegall II proposal.
Nope. Instead, traders are pinning on it on a story published by the Sydney Morning Herald on Thursday:
Whither Goldman’s prop desk
Remember when Goldman Sachs changed its legal status to a Bank Holding Company in September 2008?
The investment bank of investment banks was no longer, as it converted its official categorisation to BHC,
Glass-Steagall II?
Whoa!
So what could have prompted such a circa-2008 move on the Dow, S&P and FTSE 100 on Thursday?
Well, we can now confirm that the Obama administration is unveiling an aggressive series of regulatory changes that will ban prop trading at deposit-taking banks.
A second helping of Bob
On Monday Bob Janjuah, chief strategist (and bear) at RBS, put digit to keyboard for the first time since November.
Kicking off with a quote from Cicero the 3000+ word note (written in the style of an SMS message) concluded that 2010 would be the year when the chickens came home to roost for the “debt binge currently being undertaken by some critically important sovereigns”
Where’s the Greek CΣΣ contagion?
FT Alphaville mentioned on Monday that the CDS market did not appear to be implying much of a contagion-effect for Central and Eastern Europe in connection with troubles in the Hellenic Republic.
And having on Thursday noted the widening spread between Greek government bonds and German bunds,
Goldman posts Q4 EPS of 8.20, net income of $4.95bn
Here it is — the one you’ve been waiting for.
On Thursday Goldman Sachs reported diluted earnings per share of $8.20, on revenue of $9.62bn, for Q4 2009. Analysts had expected the bank to report an EPS of $5.20 on sales of about $9.71bn.