May, 2010
Who’s exposed to Greece, bank edition
Europe’s banks are slowly fessing up to the size of their Greek exposure.
First up have been the French.
Societe Generale revealed a €3bn exposure on Wednesday, largely down to its 54 per cent stake in Greek bank Geniki.
Iberian covered bond canaries
Ahead of a much-watched Spanish bond auction plus a key European Central Bank meeting on Thursday, here’s a sign that the Greek contagion effect has penetrated even the furthest corners of European debt markets.
Lehman-Greece parallels du jour (II)
Whisper it softly — but something is afoot in money markets.
The below charts, showing US dollar, sterling and euro Libor rates, via Marc Ostwald at Monument Securities, show an ineluctable trend upwards in recent weeks.
Buiter, boiled down
Martin Wolf claims to have read (and, we guess, understood) all 68 pages of Willem Buiter’s recent tome, Sovereign Debt Problems in Advanced Industrial Countries.
But there was evidence on Wednesday that Buiter’s move from academia to commerce,
A late wobble in the price of Tories
Only a little wobble — but you can see it here in this chart from Intrade, the predictions market.
Having spiked to a perceived 92 per cent chance that Cameron & Co. will win the general election,
Further reading
Elsewhere on Thursday,
- Timing a Greek default.
- Measuring the Greek afterburn in US markets.
- The case for a first-world debt relief conference.
- Fabrice Tourre’s new Street cred . .
Pink picks
Comment, analysis and other offerings from Thursday’s FT,
Kenneth Rogoff: Europe finds that the old rules still apply
Will Europe’s crisis end only in “near misses” rather than outright defaults or reschedulings? The answer involves a range of political,
Snap news
Breaking pre-market news on Thursday,
- BNP Paribas reveals €5bn Greece sovereign exposure – statement.
- Commerzbank reports first profit in seven quarters – statement.
- Deutsche Bank ups stake in China’s Hua Xia bank to 19.9 per cent – statement.
The price of Blankfeins…
Lloyd Blankfein’s stock is up. Or rather, the perceived likelihood that he will depart from Goldman Sachs before the end of the year has fallen sharply since he popped that magic PR pill.
Here’s the relevant chart from self-styled “prediction market”
Taiwan makes it harder to prosecute insider trading
Would-be insider traders located in either London or New York — both have which have been aggressively prosecuting alleged securities misdemeanors — may want to consider moving to Taipei.
According to a report by the China Economic News Service (and a similar story in the China Post),
US lawmakers free to continue their short selling, speculative ways
On Monday, the Wall Street Journal reported that “some members of Congress made risky bets with their own money that US stocks or bonds would fall during the financial crisis”.
On Wednesday, the newspaper published a follow-up,
Forget banking. In Australia, it’s the miners who make the dosh.
Back in April, the FT reported that the City of London had been hit by a ‘brain drain’ to Australia, as British financial services professionals fled in droves for better weather and ‘comparatively more career opportunities in Sydney and Melbourne’.
CDS report: Not Just Academic
German professors file lawsuit seeking to prevent German aid to Greece
Moody’s puts Portugal’s Aa2 rating on review for possible downgrade
Greece 790bp (+48), Portugal 425bp (+67), Spain 235bp (+28),
Election Night Live!
Here, on FT Alphaville, in the small hours of Friday morning…
Neil Hume and Paul Murphy, having consumed the necessary stimulants, will be hosting a special edition of Markets Live, watching how prices react as the election results flow in.
Oil contango intensifies as Cushing stocks soar
WTI front-end futures have experienced some extreme price volatility during the past two weeks due to distortions stemming from full-to-the-brim storage facilities at Cushing Oklahoma.
(Cushing is the main physical delivery point for Nymex WTI crude)
Moreover,
Cayne TV
Tune in now via C-Span: Jimmy Cayne, former boss of former brokerage Bear Stearns, is due to appear in front of the Financial Crisis Inquiry Commission in Washington later on Wednesday.
You can catch Alan Rappeport’s live blog of the proceedings here.
Santander loses market-cap top spot
Greece-related contagion fears have knocked 23.3 per cent off Spain’s Banco Santander share price since April 16, according to ThomsonReuters data:
Which meant that as of Wednesday, May 5, 2010 Santander was no longer the largest company by market capitalisation on the Ibex 35.
Greece and the eurozone: what next?
On Wednesday, Germany’s chancellor Angela Merkel declared that “the future of Europe, and the future of Germany in Europe” was at stake. The context: an appeal to the Bundesbank, Germany’s central bank,
Euro-bashing
There was no respite for the euro or European sovereign CDS prices on Wednesday.
The euro fell further through the critical €1.30 to the dollar mark, to trade as low as $1.2881 — off more than 1 per cent — as investors focused on developing tensions in Athens.
Grim Greek austerity arithmetic
The pain is falling on Spain (in the main), but the week’s stock market panic started with fears that the IMF-led austerity plan buttressing Greece’s bailout won’t work.
Apt fears.
For as Barclays Capital’s Laurence Boone and Julian Callow point out on Wednesday,
Markets Live transcript 5 May 2010
Markets Live chat transcript for the chat ending at 11:09 on 5 May 2010. Participants in this chat were: Neil Hume, FT Bryce Elder
NHGood morning
NHand welcome to Markets Live
Eurotrash-ing (again)
No letup in the Greek bailout-fuelled sell-off on Wednesday.
The euro continued its slide against the greenback, falling below the critical $1.30 level:
The FTSE 100, meanwhile, shed as many as 50 points in early London trade.
A short history of standing ovations for Lloyd Blankfein
Here’s an interesting gauge of how attitudes to Lloyd Blankfein may have shifted over the past 14 days.
On April 21 the New York Post published a story on the Goldman Sachs CEO’s plan to testify before a US Congressional panel about the bank’s involvement in the subprime mortgage market.
Is Pru/AIA dead in the water? (updated)
That’s the question the market will be asking on Wednesday morning, after Prudential was forced to delay the UK’s biggest ever corporate fundraising (a £14bn rights issue) because of disagreement with the FSA over capital.