March, 2010
‘Hi, I’m Ben’
So the Cleveland Fed is no stranger to “really bad drawings, real simple explanations.”
But this one takes the cake.
All about the Federal Reserve:
Of particular interest – the bit about MBS-post the Fed’s massive asset-purchasing programme at six minutes in.
What next for Nevsky Capital’s flagship fund?
Nevsky Capital — the $7bn London-based emerging markets hedge fund manager that spun out of Thames River in 2007 — is to wind-up its flagship fund.
Martin Taylor and Nick Barnes, the managers of the $3.3bn flagshup fund,
Insurers and the liquidity task force
The dead kitten is becoming a cat.
Here’s a snapshot of the price action in Prudential on Wednesday afternoon:
Although it is not the only insurer moving higher:
Those gains are in part
‘The state of some countries’ public finances is certainly not speculators’ fault’
The backlash against the backlash against hedge funds and other traders of sovereign CDS has begun.
Citi was first off the mark, deploring in a note on Tuesday suggestions that so-called ‘naked’ credit default swaps ought to be banned.
No, not everyone is shorting the euro
On Wednesday, Bank of New York Mellon’s FX analyst Simon Derrick proffered some wise words on the matter of currency speculation and the recent sell-off in both the euro and pound.
Just like FT Alphaville,
CDO? CD-Ooooooh…
The monoline moan du jour comes courtesy of MBIA.
The bond insurer published fourth-quarter results on Tuesday, showing a net loss of $1.2bn.
Monoline-watchers will remember that the company’s been in something of a death spiral since the financial crisis,
Λιτότητα
That’s Greek for… oh, we’ll let you guess this one. Two clues: it starts with ‘a’, and ends in ‘y’.
Flashes from today’s just-announced Greek austerity plan:
RTRS-GREECE TO CUT STATE SALARY BONUSES
Lunch wrap
On FT Alphaville Wednesday morning,
From Kevin Gaynor, RBS chief markets economist, and Bob Janjuah, RBS chief markets strategist, FT Alphaville’s guest-editors for the day.
- Sovereign limits.
- On short selling.
Coming next for hedge funds: the Greek inquisition
Life can be so unfair for hedge funds. It seems you can’t even make a buck kicking a faltering eurozone economy when it’s down, as the FT reported on Wednesday. But you can short the whole eurozone.
Amid growing fears of a regulatory backlash against hedge funds’ trading positions on specific sovereign debt of Greece and other weak eurozone economies,
Markets Live transcript 3 Mar 2010
Markets Live chat transcript for the chat ending at 12:19 on 3 Mar 2010. Participants in this chat were: Bryce Elder, FT Neil Hume, FT Kevin Gaynor Bob Janjuah
BEHola.
BEGood morning,
[Bob and Kevin on AV] On short selling
Once again short selling is under attack, with CDS buyers now facing the same fear of attack as stock sellers experienced in 2008.
Seems to me that free markets are dead. Policy makers had no interest in ‘policing’ markets when credit and equity markets were in their rampant hey day,
The business of storage just got more competitive
If you don’t have access to storage in physical commodities trading, you’re nobody.
For banks trading physical commodities it’s a particular problem and one they’re keenly working to resolve.
The FT’s commodities correspondent Javier Blas,
[Bob and Kevin on AV] Capital Stock is too high – deflation ahead?
Economies have memories even if markets aren’t supposed to. By looking at the capital stock to labour ratio I try to explain why the global excess savings post the equity crash prompted a residential and commercial real estate binge.
[Bob and Kevin on AV] “The Greeks don’t want no Freaks”
What did the Eagles know about EMU? We should be told.
First we had Hotel California -”you can check out but never leave”, a clear reference to the lack of exit clauses in the Maastricht Treaty.
Sovereign risk and EM bulls and bears
“The financial system is broke and we are all doomed.” So says Marc Faber, making yet another splendidly bearish splash in his monthly GloomBoomDoom investor newsletter following his appearance last week at the CLSA investors’ conference in Tokyo.
Dead kitten bounce
Meow.
Goldman’s sterling-slump strategy
Wondering what to do while waiting for sterling to crash? Goldman has some ideas.
They’ve made two baskets of UK stocks — one international and one domestic. The first is made up of stocks with high exposure to foreign-generated revenue and which have,
[Bob and Kevin on AV] RBS’s HiPPo
Ross Walker is our chief UK Economist and he has developed a publication which, on a weekly basis, analyses the latest opinion polls in order to assess the likely outcome of the upcoming UK General Election.
[Bob and Kevin on AV] Sovereign limits
Whilst our wives may not always agree, the time Kevin and I spend on the road seeing clients together tends to be the most productive in terms of getting a handle on what the global investor community is ‘thinking’.
Further reading
Bob’s further reading,
- Growth in a time of debt.
- The global credit bubble and its consequences.
Kevin’s further reading,
- Trade finance post the G20.
- Stabilities and instabilities in the macroeconomy.
Pink Picks
Comment, analysis and other offerings from Wednesday’s FT,
William White: We need a Plan B to curb the debt headwinds
Economics is often about hard choices, writes the chair of the OECD’s Economic and Development Review Committee.
Snap news
Breaking pre-market news on Wednesday,
- Standard Chartered profit up 4.3 per cent on corporate lending – statement.
- Arriva FY profit before tax down 19 per cent to £121.7m – statement.
- ITV sees ad revenues up 7 per cent in Q1 – statement.
[Bob and Kevin on AV] Guest editing for the day…
Bob Janjuah and Kevin Gaynor, RBS Chief Markets Strategist and Chief Markets Economist, respectively, will be guest editing FT Alphaville on Wednesday.
This will be a genuine treat for readers, who know Janjuah as “Bob the Bear.”
Coming soon: $1,000bn resetting, recasting US ARMs
In 2007, Credit Suisse achieved something of a coup in what was then a much smaller, less mainstream financial blogosphere.
Analysts at the bank produced the following chart, which quickly (and uniquely) went viral,
Vince Stanzione, sterling showman
Sterling seems to have quieted down after a somewhat ructious start to the week. But this might just be the calm before the storm, especially if self-styled investor/guru Vince Stanzione has anything say about it.
US regulators discover sovereign risk
Before you accuse US banking regulators of being slow to act on the ongoing sovereign shakeout, Comptroller of the Currency John Dugan wants you to know that they’re on the case.
As Reuters reported on Monday: