Comment, analysis and other offerings from Thursday’s FT,
John Gapper: A short story of a star hedge fund
Perhaps politicians will shift their attention to another possible subprime culprit, an Illinois-based hedge fund whose founder, made $280m for himself in 2007 after it executed one of the most notorious trades of the meltdown, writes the FT columnist. Magnetar, the fund in question, did not pretend to be engaged in something socially useful by trading subprime securities. It was simply making money for its partners and investors by examining closely the shaky foundations of the mortgage mania, and undermining them.
David Pilling: Japan’s splendid isolation may be at risk
The world has fallen out of love with Japan and Japan with the rest of the world, says the FT’s Pilling. Aside from discussions with Japanophiles – who wax with justifiable lyricism about the country’s efficiency, marvellous cuisine and exquisite sense of beauty – mention of the country these days is likely to provoke a raised eyebrow or a gently suppressed yawn.
Daniel Gros: Only Athens can rescue Greece
After two months of heated debate among policymakers and intense speculation in the markets, the basic conditions for the joint International Monetary Fund/European Union rescue operation for Greece have now been decided. But will this package be sufficient? A closer look shows that it can at best tide the country through a rough patch; the underlying problem will remain, says Gros, director of the Centre for European Policy Studies.
Analysis: UK economy – drenched in debt
Ten days into the UK election campaign, tonight’s televised debate between the party leaders will offer a brief diversion into home affairs, but the issue on which politicians know they are being judged is the economy.
Lex on UK takeover rules
When Kraft’s chief executive Irene Rosenfeld made a takeover approach to Cadbury last August, she surely never imagined the result would become a UK election issue. But Kraft’s subsequent closure of a Cadbury factory it had earlier suggested it could keep open, rather than the controversial way the acquisition itself was transacted, has thrust the deal onto the campaign agenda.
Brussels Blog: Questions over Greek rescue package remain
When they announced their provisional rescue package for Greece on Sunday, European officials pointed not only to its size – at least €30bn- but also its details. For euros and details are what the markets have been demanding these last frustrating weeks. Yet there still seems to be a fair amount of confusion about the package – or ‘mechanism’, as it is referred to in Brussels-speak – and how it will be put into play, or ‘activated,’ if you like.
Money Supply: Leaning on the Loonie
It seems Canadians were boosting sales near the border in the New York and Minneapolis Federal Reserve districts, according to the Federal Reserve’s Beige book, a periodic anecdotal assessment of regional economies.
Energy Source: Opec quiet on >$80 oil
How will Opec respond if crude oil prices remain above $80 a barrel? There are increasing concerns that sustained high prices will damage economic recovery, and Opec itself knows that prices rising too high could damage its own prospects, by leading to a fall in consumption.