February, 2010
More bonus neurosis: Thain and how times have changed
He has been keeping a low profile since his ignominious exit from Merrill Lynch in early 2009. But who can forget John Thain, former Merrill Lynch CEO, of lavish-office-refurbishment fame.
Thain on Sunday was named chief executive of the CIT Group,
Overheard in the Long Room
The members of FT Alphaville’s private forum, the Long Room, enjoy (and regularly engage in) spirited debate. Here’s a selection of what’s been said and posted just recently:
- Moorad Choudhry, head of Treasury at Europe Arab Bank,
Markets Live transcript 8 Feb 2010
Markets Live chat transcript for the chat ending at 12:24 on 8 Feb 2010. Participants in this chat were: Bryce Elder Neil Hume, FT BEGood morning. BEIt’s 11.04am BEand time,
Abbey, Bungle & Leicester
Why is Santander considering a flotation of its operations in the UK? According to the spin in the weekend press, it is so that the Spanish bank can buy the 318-strong branch network that RBS is being forced to sell as a condition of the state aid it has received.
A different government view on CMBS
The United States Government Accountability Office published its report on the US government’s Troubled Asset Relief Program last Friday.
It’s a voluminous work, but definitely worth perusing if you have time as it offers some very interesting detail into the implementation of the Tarp and related programs thus far,
When G7 bond yields tell you nothing
UBS draws attention on Monday to the fact that widening G7 sovereign CDS spreads are as yet not being mirrored by rising bond yields.
That’s not to say that CDS are being mis-priced. There just happen to be other extenuating circumstances keeping yields low,
Bonus neurosis, revisited: Mine’s bigger than yours
After all the hoohah and wild reports about $100m pay-outs, Goldman Sachs on Friday made a big move against the backlash over its compensation practices, saying it would award chief executive Lloyd Blankfein a mere $9m stock bonus for 2009,
Further reading
Elsewhere on Monday,
- Europe risks another global depression.
- But it’s great news for America’s debt binge…
- Ironic headline of the day.
-The inexact science of economics.
- Mauldin:
Pink picks
Comment, analysis and other offerings from Monday’s FT,
Henny Sender: Obama push poses a threat to Goldman
The Obama administration’s push for a separation of banking and “speculative” financial activities,
Snap news
Breaking pre-market news on Monday,
- Xstrata full-year profit falls 41 per cent to $2.7bn – statement.
- Anglo American supports Anglo Platinum’s $1.6bn rights offer – statement.
- Espirito Santo proposes acquisition of controlling stake in Execution Noble – statement.
The Blankfein bonus: $9m in stock (updated)
A number that has been keenly anticipated: the 2009 compensation for Goldman Sachs chairman Lloyd C Blankfein.
Drum roll…
Some 58,381 restricted shares – worth just under $9m on Friday’s closing quote.
US consumer credit uncrunched?
Something to celebrate, surely? Consumer debt shrank by a palty $1.7bn in December, the smallest contraction since last February and way below the $9bn contraction expected by economists.
In fact, the contraction in consumer debt is just a tenth of that originally seen in November,
Wobble? What wobble?
Or, “Who cares about Portugal/Greece/Spain/Italy/UK?”
Or, “It was a fat finger in WTI; never seen a computerised trading glitch?”
Or, “Gold is a very small market; it points to nothing.”
Or, “Contagion? We’ve had the jab.”
Should Guy Hands be barred from Britain?
Based on the contents of this delirious court filing we would argue that the answer is an unequivocal “yes.”
That’s not because Guy Hands, the founder of Terra Firma and, by extension, the boss of EMI,
WTI Friday meltdown
That’s crude on Friday afternoon, the same day BlueGold Capital Management fiercely denied rumours of company-related liquidations in the WTI market.
Related link:
Bluegold hedge fund denies causing
Ackerman’s flow monster
We drew attention on Thursday to Deutsche Bank’s tranformation over the course of 2009 into a ‘flow’ oriented business.
The move proved particularly profitable for the bank in the early part of the year,
The second lien sticking-point
Just a datapoint for you, as the debate over the US Treasury’s Hamp programme rages on.
As a reminder, the Home Affordable Modification Plan aims to help keep people in their houses primarily by lowering interest rate payments.
And the 2009 US payroll revisions show…
. . . significantly more job cuts in 2009 than originally estimated — about 617,000 more in fact.
Here’s the relevant table from the Bureau of Labor Statistics:
The sharpest revision was for March;
US payrolls fell in January – 20,000 jobs lost
Goldman were right – US employers cut jobs in January.
Payrolls fell by 20,000, significantly more than economists had forecast, according to figures released by the Bureau of Labor Statistics on Friday afternoon.
Lunch Wrap
On FT Alphaville Friday morning,
- Spencer sells, Icap warns and the City reacts.
- Europe is Lehman-fied, part trois.
- That Grεεk CDS trιggεr.
- Swiss intervention goes abroad?
- Next up for Europe,
Bluegold hedge fund denies causing WTI volatility
There are some very intriguing flashes coming out on Reuters regarding the BlueGold hedge fund on Friday:
RTRS-HEDGE FUND BLUE GOLD DENIES IT WAS RESPONSIBLE FOR VOLATILITY IN CRUDE OIL PRICES IN LAST FEW DAYS
RTRS-HEDGE FUND BLUE GOLD SAYS OIL OUTLOOK BULLISH FOR 2010,
Carry trades and reverberations Down Under
Australia might be a long way from Europe and the US, but the impact of events in those far-off regions has added to Tuesday’s surprise decision by the Reserve Bank of Australia to hold interest rates – prompting some top forecasters to call an end to the Aussie dollar’s dream run.
Markets Live transcript 5 Feb 2010
Markets Live chat transcript for the chat ending at 12:17 on 5 Feb 2010. Participants in this chat were: Neil Hume, FT Bryce Elder NHTin hat on NH BECheck
[Mining Indaba 2010] Day IV (over and out)
By Matthew Kennard:
This is going to be a truncated (and my last) dispatch. Although Indaba calls itself a four-day conference, it’s really not. Thursday is pack-up day for the companies in the main hall (and Corporate Social Responsibility day in the lecture theatre).
Europe is Lehman-fied, part trois
On Thursday we noted that a number of interesting things were happening in the CDS market. Here are some further reflections, via Deutsche Bank’s Jim Reid.
First, Portugal’s 5-year CDS (+28bps yesterday,
Swiss intervention in Asia overnight?
It’s no secret in FX markets that the Swiss National Bank eagerly defended the 1.50 EURCHF level for most of 2009.
Many analysts, however, were under the impression the days of SNB intervention were now long gone.
That Grεεk CDS trιggεr
Greek CDS continues its Icarusian journey, reaching another record on Thursday.
Meanwhile, its CDS curve remains inverted — indicating that the market thinks there’s a higher risk the country will default in the short-term,
This little sovereign went to market…
For your consideration, a selection of five-year sovereign CDS spreads from Europe as of Thursday’s close:
And for comparison, some non-European peripheral CDS spreads. First the US:
And representing the CEE,