September, 2010
Further reading
Elsewhere on Friday,
- The 10 biggest myths about gold.
- What’s a ‘divilian’?
- Krugman and Wells on Rajan, Roubini and Koo.
- The problem with investing in hedge funds (but don’t tell anyone).
Pink picks
Comment, analysis and other offerings from Friday’s FT,
Martin Wolf: The risks of a premature tightening
There are risks to cutting the UK’s fiscal deficit too slowly. However there are also risks in cutting it too fast,
Snap news
Breaking pre-market news on Friday;
- Johnson & Johnson in talks over €24.75 per share offer for Crucell — statement.
- Nando’s Group makes cash offer for Clapham House, owner of the Gourmet Burger Kitchen — statement.
Junk windfall
We’ve been keeping a watchful eye on this year’s junk debt bubble rally, if only because its implications could stretch well into the future.
It remains unclear whether investors have made a wise decision by going further out on the yield curve and snapping up speculative-grade bonds in near-record amounts.
The Rock of O’Sisyphus
Have we been missing the Irish forest for the (ahem) Anglo Irish trees?
Uncertainty over how much the Irish government will have to fund Anglo Irish’s liabilities before it’s wound down has stalked the market recently.
From Russia in a hurry…
As pointed out to us by some friendly sources — there’s been some interesting moves in the USD/RUB crossrate on Thursday:
And the rumour doing the rounds is that might in someway be tied to this story via Bloomberg:
Wedding function [GO]
Is this like, the saddest thing EVER?
Beware Greeks bearing game theory
Attention George Papaconstantinou — the more you insist upon something, the no likelier it is actually to be true. Although your credibility will collapse even further when the opposite happens.
As the Greek finance minister said on Wednesday,
More mystery in quarterly repo patterns
Readers might remember a WSJ story earlier this year which highlighted intriguing end-of-quarter peculiarities in New York Fed data on primary dealers in repo markets.
The WSJ’s point was that the irregularities could have been the result of banks trying to mask their risk levels in the past five quarters by temporarily lowering their debt,
More yennery: What next?
In the tsunami of commentary triggered by Tokyo’s move on Wednesday to intervene in currency markets to curb the yen’s rise, some views of its implications strike us as more cogent than others.
For example,
Markets Live transcript 16 Sep 2010
Markets Live chat transcript for the chat ending at 11:27 on 16 Sep 2010. Participants in this chat were: Neil Hume, FT Bryce Elder NHHola market fans NHit’s 11.03am or thereabouts
All you ever wanted to know about the economics of the Oktoberfest…
… but were afraid to ask.
Unicredit have just published useful report for anyone heading for Munich this weekend for Oktoberfest 2010.
The key message from economist Alexander Kock CFA is that there is no danger of deflation at this year’s 17-day beer drinking extravaganza.
It’s good to talk up (and down) BT pensions (updated)
Thursday morning and the biggest FTSE 100 faller is BT Group:
The reason can be traced to a downgrade and report from Morgan Stanley, which suggests the UK’s pension regulator might propose a quicker deficit reduction scheme for the giant BT pension fund:
Profiting from the white stuff
Not cocaine but milk.
Now, you probably missed the recent big news in the world of milk – Tesco matching Asda’s promotion on white stuff, reducing the price of a four-pint plastic bottle from £1.53 to £1.25.
Clutching at dividends
The world has become full of risk-averse investors, and stocks will suffer.
Wait — let’s edit that.
The world has become full of yield preservers, and they will suffer stocks. Or — as is current fashion — stock dividends.
Inflation and the BoJ
The narrative that emerged on Wednesday about the Bank of Japan’s intervention is that it was done for two reasons: devaluing the yen against the dollar to boost Japan’s export industries, and — because the bank wasn’t sterilising the yen sales — to give the economy an added inflationary bump.
Further reading
Elsewhere on Thursday,
- ‘Hostility and marginalization’ at Goldman?
- Ultimate privacy: how to vanish without a trace.
- Kidney exchange and markets in life years.
- Going for the gold — fundamental as well as technical.
Pink picks
Comment, analysis and other offerings from Thursday’s FT,
John Gapper: Paulson made the right sacrifice
The argument over the decision by Hank Paulson, along with Ben Bernanke of the Federal Reserve,
Snap news
Breaking pre-market news on Thursday;
- John Lewis Partnership reports 15 per cebt rise in half year operating profits; Waitrose Deliver sales up 54 per cent – statement.
- ASC shares suspended following report of bid for German construction group Hochtief – report.
Goldbugging con’t…
Breakfast with Dave (Rosenberg, of Gluskin Sheff) on Wednesday included this remarkable, self-explanatory chart:
As we noted in early September, with inflation expectations low it isn’t just the inflationistas buying up gold,
Statement re: press comment
An entry for the media/corporate smackdown hall of fame.
MELBOURNE, AUSTRALIA — (Marketwire) — 09/15/10 — Ivanhoe Mines Ltd. (TSX: IVN)(NYSE: IVN)(NASDAQ: IVN) -
Editors and journalists are advised that stories published in The Australian newspaper on September 15,
The self-denying sovereign wealth fund
This is – in a way - yet another of those posts commemorating the fall of Lehman Brothers, two years ago to the day.
Then again — the post-Lehman sovereign wealth fund really has become something to behold,
US manufacturing: now what?
Another day, another pair of freaking economic indicators sending out mixed signals on the state of US manufacturing.
Industrial capacity utilization and industrial production in the US both climbed slightly in August,
All hail, dollar repo in Europe
As we’ve already noted, the International Capital Market Association (ICMA)’s September survey of the European repo market has a wealth of interesting data and statistics.
Here’s one we found particularly telling,
Tales of (not so) ancient Greece
If you could ever read an ECB working paper and the latest issue of Vanity Fair in conjunction with each other — and benefit — well, that time is now.
Michael Lewis’ elegiac — Iliadic — eye-popping piece in the magazine gave readers a colourfully stereotyped take on just how Greece got itself into a crushingly vast public debt problem before it took an EU bailout this year.
LSE volume watch
We often hear equity traders moaning about low volumes. But it seems right now they have a point.
Below are the top 10 stocks ranked by volume on the London Stock Exchange on Wednesday:
As you can see,
European repo is back from the dead, says ICMA
The International Capital Market Association’s latest review of the European repo market is out, and there are some interesting findings to say the least.
Chief amongst them is the fact that European repo markets have recovered almost fully from their Lehman crisis setback,
When bunds and euros are climbing
A slight curiosity, this. Citigroup’s FX team notes that bund futures rose late on Tuesday — and so did the euro against the dollar.
Here’s the chart:
And it shows, not only do they hardly ever
Tough crowd, Mervyn?
Bank of England governor versus — err — Big Barn Farm during a rare appearance at the UK’s Trade Union Congress on Wednesday:
For the benefit of readers outside the UK, CBeebies is a television channel for children — and Bob Crow’s a rather militant trade union leader.
Bond and bill auctions, bashed all round
Now here’s an unglücklich result for Germany’s debt management agency.
That is, if results from Wednesday’s 10-year bund auction are anything to go by. Flashes via Bloomberg (emphasis ours):
GERMAN BUND AUCTION: