May, 2010
Pink picks
Comment, analysis and other offerings from Thursday’s FT,
Richard Haass: Goodbye to Europe as a high-ranking power
Europe’s loss of centrality also reflects its failings. Greece is the most pronounced problem,
Snap news
Breaking pre-market news on Thursday,
-Tullett Prebon says takeover talks have been terminated; provides trading update – statement and statement.
- BT reports full year results ahead of expectations;
Because one panel on the flash crash wasn’t enough…
SEC chair Mary Schapiro’s testimony to the congressional hearing convened on the flash crash is less than 24 hours old, but already there’s talk of hosting another talking shop on the matter.
Politico reported on Wednesday that the first item on the agenda of the freshly-announced joint SEC-CFTC committee on “emerging regulatory issues”
CDS report: Sovereigns, banks resurgent
Sovereigns extend rally – Portugal (192bp, -42), Spain’s (144bp, -21), Greece (490bp, -40)
UK (76bp, -9) performing well following formation of new government
Banks resurgent after difficult session yesterday
European credit markets today continued where they left off yesterday and extended the recent rally.
Quick, run for the Goldschläger!
Gold zoomed through fresh record highs on Wednesday. See this chart:
And it’s largely thanks to unprecedented demand stemming from Germany and Austria on the day. Or so we are told.
As Ed Tuly,
Et in Arcadia ego
Oh dear. Here’s an unwelcome blast from the past for Greece’s bailout, via the FT:
The Greek rescue package will fail, according to Cristina Fernández, Argentina’s president, whose country suffered the world’s biggest debt default in 2001.
Did futures cause the ‘flash crash’?
The NYT has followed up on the testimony of CFTC chair Gary Gensler before the Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises, which held its first hearing into the ‘flash crash’ of May 6.
All about EM tightening prospects
While Europe’s sovereign debt crisis has grabbed the attention of global markets, inflation is again clawing its way back in emerging economies, as Philip Poole of HSBC notes on the FT’s Beyond Brics blog.
[South Africa 2010] UBS on which stocks – and teams – will win the 2010 World Cup
Expect to see more of these in the coming weeks — the World Cup is, after all, less than a month away.
The analysts at UBS have taken a break from the sovereign debt crisis to make some World Cup “just for kicks”
Markets Live transcript 12 May 2010
Markets Live chat transcript for the chat ending at 11:32 on 12 May 2010. Participants in this chat were: Neil Hume, FT Bryce Elder NHHola NHIt’s 11.03 am NHand that means
‘Financial crisis is far from over,’ BoE’s King says
The Bank of England’s latest inflation report has just been released.
The top line is that Governor Mervyn King still appears unconcerned about inflation, because if anything the CPI basket will undershoot the target even if rates stay steady.
Banking and broking JVs 101: How not to do it
It’s hard to know whether to feel sorrier for the bankers and brokers at Morgan Stanley or its Japanese joint-venture partner (and part-owner), Japan’s Mitsubishi UFJ Group.
As Bloomberg reports, those
The dismal performance of Dead Presidents
A structured finance curio for you on Wednesday morning.
The Wall Street Journal reports that US prosecutors are investigating some Morgan Stanley-arranged synthetic subprime CDOs. The WSJ doesn’t give specific names/Cusips or tranches,
In fiat money we do not trust
Has the €750bn EuroTarp package been a success?
One market does not think so.
As you can see the price of gold is rising against every major currency, not just the embattled euro.
According to Greg Gibbs of RBS this is because the market,
The Cameron baby bounce
After days of negotiations, David Cameron has finally become the UK’s new prime minister — having stitched together a two-party coalition at the last minute.
The market reaction to the news?
Muted,
A sticky CDO situation for Morgan Stanley
James Buchanan and Andrew Jackson are two dead American presidents.
They are also two Morgan Stanley-arranged synthetic CDOs, for which the bank is reportedly now being investigated by US prosecutors.
The slippery slope to non-sterilisation
QE or QE?
The ECB announced over the weekend it would begin buying government and private sector bonds — leading to accusations that it was embarking on Federal Reserve and Bank of England-style quantitative easing.
Talking US Treasuries
The results of the first of this week’s three auctions of US government debt are in.
Via RBS’ William O’Donnell:
3 Year Treasury Auction Results Auction
Date: 05/11/2010
Size: $38 Billion ($2B less than last month)
Maturity:
Further reading
Elsewhere on Wednesday,
- The rise of the International Monetary Fed.
- ‘The Greek bailout is like the US in Afghanistan’.
- Europe’s political trilemma.
- Stock pickers, unite!…
- …You have nothing to lose but your equity premium!
- Five mysteries of the Flash Crash.
Pink picks
Comment, analysis and other offerings from Wednesday’s FT,
Martin Wolf: Governments up the stakes with markets
Governments are playing double or quits in their game with financial markets, writes the FT’s Wolf.
Snap news
Breaking pre-market news on Wednesday,
- Allianz Q1 net profit €1.6bn – statement.
- Maersk says raises 2010 profit outlook – statement.
- RWE says Q1 operating profit up 14 per cent – statement.
The devalued euro, in real terms
Chart du jour, courtesy of Clusterstock, showing the rising price of gold, in falling euros:
Related links:
Gold hits all-time high as investors seek haven – FT
Risky assets fail to extend relief
FDIC considers living wills, safe harbours
Two important developments in FDIC world on Tuesday.
First, the failed-bank overlord formally proposed a new rule that would require the largest US banks to prepare ‘how-to’ guides for regulators who might need to dismantle them further down the line.
SEC cracks down on ‘illicit’ short selling
This is a first:
The Securities and Exchange Commission today charged two Boca Raton, Fla., residents for engaging in illegal short selling of securities in advance of participating in numerous secondary offerings to make illicit profits.
Schapiro on the flash crash: no evidence of a fat finger
Well, there goes that theory.
According to the testimony of SEC chair Mary Schapiro before the Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises on the flash crash of May 6 (emphasis in the original):
Gordon Brown resigns. No, really.
The crackshot live-bloggers over at the FT’s Westminster blog are on the case (warning: for UK politics wonks only):
5.36pm: Jim wants to contradict my contradiction of his post (see 5.24pm), making the point: