June, 2010
Further reading
Elsewhere on Tuesday,
- Extremely Troublesome Funds (ETFs) and the flash crash.
- The financialisation of commodities, again.
- Things are different at the zero bound.
- An update on current economic conditions.
Pink picks
Comment, analysis and other offerings from Tuesday’s FT,
Jeffrey Sachs: Time to plan for a post-Keynesian era
Mainstream Keynesian economics is facing its last hurrah, writes Sachs, director of the Earth Institute at Columbia University.
Snap news
Breaking pre-market news on Tuesday,
- Tesco says CEO Terry Leahy to retire; Philip Clarke to succeed – statement.
- Chloride recommends £800m/325p a share cash offer from ABB – statement.
- UK retail sales rebound in May – report.
In praise of synthetic CDOs (not)
Here’s an argument you rarely see ventured forth nowadays:
Synthetic CDOs were good for everybody…
…Like any product, a synthetic CDO is only as good as the materials used to make it. Most synthetics exposed investors to investment grade corporate debt and resulted in light credit losses.
BP’s summer (dividend) holiday
Here’s some bad (but not entirely surprising) news for investors in BP: its dividend might be about to go on a summer sabbatical.
Goldman Sachs thinks the payments, which account for around 12 per cent of the income generated by the FTST All share index,
Spanish banks – Facts and Fiction
Worried about the Spanish banking system? Don’t be. The domestic economy could double dip, wholesale funding costs could spike and yet Spain’s banks wouldn’t need a massive infusions of new capital.
So says Bank of America Merrill Lynch in a 77-page report published on Monday,
Chinese banks, beyond the bubble
Europe’s sovereign debt crisis has sparked renewed funding fears for western banks, but their Chinese peers are still in the frame for China’s property bubble.
Or perhaps not, according to Barclays Capital.
Markets Live transcript 7 Jun 2010
Markets Live chat transcript for the chat ending at 11:24 on 7 Jun 2010. Participants in this chat were: Neil Hume, FT Bryce Elder NHGood morning NHand welcome to Markets Live
Cameron shows Hungary how it’s done
Britain’s Prime Minister David Cameron spoke out on the state of the UK economy on Monday morning, and he wasn’t pulling any punches.
The scale of deficit is worse than we thought… economic growth will not fix the problem…
Do hurry up with those SPV details, Europe
It was a generally bad start to Monday for eurozone government debt — and it’s time to play ‘spot the odd sovereign out’ again, in Markit’s table of intraday CDS levels:
Meanwhile, last week’s growing bond yield spread pressure on stronger eurozone sovereigns continued to build on Monday — flashes via Reuters:
ECB deposits at record high
Probably not surprising in light of Friday’s market turmoil and bank rumours, but still interesting; overnight deposits at the ECB have hit a new record of €350bn on Friday.
From Reuters:
Use of
Another week, another euro panic
When Hungarian officials embarked on what Lex terms their “bone-headed exercise in expectations management” on Friday, it sent the forint tumbling and credit default swaps on the country’s debt surging by more than 100 basis points to 425.
Further reading
Elsewhere on Monday and at the weekend,
- Lost decade, here we come.
- What Sex and the City 2 tells us about deflation.
- A good crisis wasted.
- Copper concerns.
- A brief history of the use of complementary currencies.
Pink picks
Comment, analysis and other offerings from Monday’s FT,
Mort Zuckerman: America’s jobless picture is alarmingly bleak
We are drifting, writes Zuckerman, editor in chief of the US & World News Report.
Snap news
Breaking pre-market news on Monday,
- Prudential sales sales in Asia up 33 per cent in first five months of 2010 – statement.
- BP says containment cap system collated 10,500 barrels of oil from Gulf of Mexico leak – statement.
FTfm on AV
Some highlights from Monday’s FTfm.
The real vultures vs the eurozone
Real vultures knew their naked short on Greece was vulnerable before chancellor Merkel violated the game laws by shooting at them.
Guest post: El-Erian on the need to listen carefully to what the G-20 is saying
Pimco’s chief executive and co-chief investment officer Mohamed El-Erian reacts to this weekend’s news out of Busan, South Korea.
_____
Count me among those that believe that the G-20 is one of the better approaches to global governance in a world that desperately needs improved international policy coordination.
Two thirds of the way…
…to a fresh bear market. Major US indices after Friday’s rout:
Related links:
US jobs data cast doubt on recovery – FT
US market snapshot: Dow(n)
The rout in US equities continued apace going into the final 30 minutes of trade on Wall Street on Friday:
via Google Finance
Markets in everything, Madoff claims edition
*Cue cheesy infomercial music and voice-over narration*
Have you been burnt by by Bernard Madoff? Suddenly can’t afford your valet? Has your kid’s college fund disappeared along with your Centurion card? Never fear,
CDS report: Investors discover Hungary
Volatility remains high and the markets, which seemed to be fixated only on the European sovereign situation in the recent past, seem to have many more sources to find volatility. Early in the week,
[MoneyTech] ‘Someone will always have the data first’
Financial blogger Kid Dynamite has weighed in on “latency arbitrage”: the fact that some investment firms have access to data — and are subsequently able to trade on such — before other market participants.
Get ready, get set, deleverage! With one notable (US) exception
Here’s something for the weekend — a nice overview of US debt, courtesy of BNP Paribas.
The idea is to look at all forms of American debt, private as well as government.
As you can see from the below charts,
US non-farm payrolls rise 431,000, jobless rate falls to 9.7 %
US non-farm payrolls rose 431,000 on Friday, the US Bureau of Labor Statistics said on Friday. This was below a Bloomberg poll of economists which had forecast the data would show a 536,000 rise, which would have been the largest since 1983.
Not for the forint-hearted…
What happens when government spokespeople start saying things like this:
June 4 (Bloomberg) — Hungary’s economy is in a “grave situation” because the previous government “manipulated” figures and “lied” about the state of the economy,
SocGen shares hammered on derivatives concerns (updated)
Shares in Société Générale took a beating on Friday over rumours that derivatives positions in trouble:
SocGen stock had fallen 3.9 per cent at pixel time. Flashes, via Reuters:
RTRS-SOCIETE GENERALE SHARES FALL 3.5 PCT,
Markets Live transcript 4 Jun 2010
Markets Live chat transcript for the chat ending at 11:03 on 4 Jun 2010. Participants in this chat were: Bryce Elder Tracy Alloway, FT BEGood morning BEAnd welcome to Markets Live
Coins of the UK (public spending) realm
Got a spare 10 minutes? Some technical expertise? Experience in handling large volumes of data?
Then you might be able to get some use from the just-released UK Coins data. That’s the Combined On-line Information System,