February, 2010
Soros’s bubble buy
It’s just as well that George Soros has a philosophy (as the Wall Street Journal reminds us) of spotting a bubble and buying it, as he puts it.
When it comes to gold, which he famously described at the recent World Economic Forum in Davos as “the ultimate asset bubble”,
Markets Live transcript 18 Feb 2010
Markets Live chat transcript for the chat ending at 12:15 on 18 Feb 2010. Participants in this chat were: Bryce Elder Miles Johnson, FT
BERight – and we’re off ….
BEGood morning
‘We believe the market might be underestimating the risks the [Spanish] financial system faces’
Straight reporting this.
On Thursday Credit Suisse cut their 2010-2012 earnings estimates and price targets for all the Spanish banks they cover by an average 11 and 7 per cent, respectively. They currently have underperform ratings on purely domestic Spanish banks,
Eurozone liquidity murmurs
You’re looking at use of the European Central Bank’s marginal lending facility, which allows eurozone banks to pledge collateral in return for short-term liquidity. You can see there’s been a relative spike in usage over the past few days.
Watershed moment in Nigerian telecoms: someone is lying…
A single big deal in African telecoms might look like a bold gamble, (or a very expensive bout of M&A whimsy). But two in a week, worth a combined $13.2bn, made it look like the Chinese and Indians know something about the prospects for African telecoms that some other big telco players don’t.
Introducing Project Veritas (née Baseball)
Otherwise known as Harbinger’s plan to sew a coast-to-coast US satellite communications network through the acquisition of SkyTerra Communications of the US and then Inmarsat, which is quoted in London and is a constituent of the FTSE 100.
Further reading
Elsewhere on Thursday,
- Lucas van Praag, Goldman’s PR prince profiled.
- The real intergenerational theft.
- And the Fed’s real exit strategy.
- “The US economy ceased to function this week…”
Pink picks
Comment, analysis and other offerings from Thursday’s FT,
Satyajit Das: Stripping away the disguise of derivatives
Reaction to revelations that Greece used derivatives to disguise its true level of borrowing is reminiscent of Captain Renault (played by Claude Rains) in Casablanca:
Snap news
Breaking pre-market news on Thursday,
- VT Group rejects raised offer of 68op-715p a share from Babcock – statement.
- ENRC to pay $300m for assets owned by three of its founder shareholders – statement.
Fed: we need to shrink our balance sheet, but how?
The Federal Open Market Committee released the minutes of the Jan 26-27 session on Wednesday.
The meeting minutes revealed disagreement — or at the very least, debate — over the nature and timing of any moves to reduce the size of the Federal Reserve balance sheet.
风水指数 二零一零 or feng-shui your investment
Here’s A bit of feng-shui fun.
CLSA Asia-Pacific Markets has issued a fresh, auspiciously-correct investment reading for 2010, following the exceptional success of the feng shui calendar they published last year.
‘The risk of [Greek] contagion is low but…’
Brian Yelvington, formerly of CreditSights and now director of fixed income research at Knight Libertas, on Tuesday published his thoughts on the possibility of systemic contagion in the eurozone.
By his reckoning:
‘Think Spring 2009…’
…and substitute “sovereigns” for “banks.”
That was the almost blasé message from Barry Knapp, the highly-regarded New York-based BarCap strategist, commenting in his latest US Portfolio Strategy weekly on the cocktail of woes that have been holding back financial markets:
Treasuries, dollars and sense
See what you’ve done?
All the clamouring over recently-published US Treasury data has forced Capital Economics to print a note on the subject. TIC December data had China selling $34.2bn in USTs during the month.
“The US is not a viable concern anymore” – Duncan
FT Alphaville spoke with Richard Duncan, partner at Blackhorse Asset Management and author of The Dollar Crisis on Tuesday, regarding his new book The Corruption of Capitalism. And while he is pretty pessimistic on the US,
Provisioning for losses the Spanish way
No, it’s not a simplified double-helix. It’s a graphic representation of dynamic provisioning — the new darling of accounting methods. As JP Morgan notes in its 184-page opus on financial reform, regulators around the world are looking at the method as a way to better prepare banks against losses.
That terrible, terrible 2007 vintage [Corrected]
Back in 2008, the great, good and downtrodden of the structured finance industry gathered in the desert — alright, the Las Vegas Venetian hotel — for an annual securitisation conference hosted by the American Securitization Forum.
Lunch Wrap
On FT Alphaville Wednesday morning,
- US Treasuries get dumped.
- “The US is not a viable concern anymore.”
- The (customer) cost of reforming banks.
- A UK employment fall/fail.
- Banks carry-ing on in Spain.
Bearing the cost of reformed banks
More on that doomsday regulation scenario for banks.
JP Morgan has published a whopping 184 pages on the potential impact of proposed regulatory reform on financials — that’s things like the Volcker rule,
Markets Live transcript 17 Feb 2010
Markets Live chat transcript for the chat ending at 12:15 on 17 Feb 2010. Participants in this chat were: Neil Hume, FT Bryce Elder NHGood morning NHand welcome to Markets Live
UK employment *fall*/*fail*
Yep, the UK claimant count unexpectedly rose in January. In fact it was the biggest rise since July.
From the Office of National Statistics on Wednesday:
The claimant count in January 2010 was 1.64m,
Low-cost flying liquidity collars
What is Sir Stelios Haji-Ioannou up to?
We ask the question because for the second time in five months the easyJet founder has made liquid some more of his holding in the no-frills airlines.
From the RNS on Wednesday morning:
Carry-ing on in Spain
Funding costs. Familiarise yourself with the term.
It’s making headlines on Wednesday, having cropped up late last year, and is likely to continue to be a buzzword this year. The reason? For a start wider spreads on government bonds are feeding into banks’ funding costs.
Dumping US T-bills
A good day for China conspiracy theorists, a bad one for holders of US Treasuries, as official US figures confirmed that earlier paranoia about Beijing’s plans to dump Treasuries were proven correct.
From Wednesday’s FT:
Further reading
Elsewhere on Wednesday,
- Thumbsucker: should we rethink macroeconomic policy?
- Why market reporting should be ignored, part 912.
- 10 short-term tips for investors worried about debt bomb.
- Revenge of the Wall Street traders.
Pink picks
Comment, analysis and other offerings from Wednesday’s FT,
Martin Wolf: How to walk the fiscal tightrope
Niall Ferguson is not given to understatement, writes the FT’s Wolf. So I was not surprised by the claim last week that the US will face a Greek crisis.
Snap news
Breaking pre-market news on Wednesday,
- BNP Paribas reports net income of $5.83bn, as defaults drop- statement.
- ING posts underlying 2009 net profit of €748m – statement.
- Legal & General reports over £650m UK net cash generated in Q4 – statement.