November, 2010
For Skymark, superjumbo orders show super-timing
Rolls-Royce and European aircraft maker EADS are still reeling from the fallout of recent jet engine failures in their Airbus’ A380 super-jumbos (and for Rolls-Royce an additional incident on a Boeing 747),
Dylan Grice vs Brics
Something from Société Générale’s Dylan Grice (and something of a reply to his SocGen colleague Albert Edwards), who recently indulged in the “mugs game” of forecasting capital gains in world equity markets,
Just another support services blowup
Boom. Another ‘star’ of the UK support services sector implodes.
Rok, the social housing and construction group, filed this sorry little statement on Monday morning:
The board of Rok plc (the “Company”)
Further reading
Elsewhere on Monday,
- The resetting of clocks and monetary neutrality.
- A new game in corporate America.
- China, circa 19th century America.
- Ben does it again…
- Thoughts on the G20 amidst the so-called ‘currency war’.
Pink picks
Comment, analysis and other offerings from Monday’s FT,
Clive Crook: Obama can cut a deal on taxes
To pass legislation in the next two years, Barack Obama and the new Republican-controlled House of Representatives will have to work together,
Snap news
Breaking pre-market news on Monday,
- Standard Chartered rights issue take-up 98.5 per cent – statement.
- Gazprom Q2 ’10 income 169.7bn rbls vs poll 163.5bn – report.
- Commerzbank targets 2014 risk weighted assets of €300bn – statement.
FTfm on AV
Some highlights from Monday’s FTfm.
Europe’s bonuses to outstrip US
European asset managers are likely to bag higher bonus payments than US managers this year thanks to their stronger international
Further further reading
- Economists react to the jobs report.
- BofA faces lawsuits on $375bn worth of MBS.
- Careful what you predict, especially in writing.
- Build America bonds hit the $150bn issuance mark.
- Dissenting voices on QE2.
So who is left to buy Irish bonds?
The European Central Bank probably dipped a toe into buying Irish bonds on Friday, halting (for the moment) a capitulation in Ireland’s spreads.
No one else is joining in, though, and the ECB isn’t inclined to help out forever.
Citi slapped with subprime RMBS lawsuit
No sooner had rumblings over Citigroup’s “toxic mortgage pipeline” began — than the bank becomes the next in line to be embroiled in a mortgage-related lawsuit.
Spotted in Citi’s just-filed third-quarter 10-Q:
Payrolls: upside surprise, but…
We don’t do listicles here very often, but the format seems appropriate for chopping up Friday’s payroll report — given how much data there is to chew on.
So…
1. The headline number — 151,000 jobs added in October — was more than anybody was expecting,
Who’s been buying Irish bonds?
And the Irish bond yield rises have … stopped, for now, if not exactly rallied.
In fact, the three-year Irish bond yield halted just short of the 6 per cent threshold:
While the 10-year yield has plateaued at 7.5 per cent at pixel time.
Unwinding the US Treasury trade
This. Is. Crazy.
That’s the five-year-30-year swap curve for the US, eurozone, UK and Japan.
The stand-out of course is that steepening US yield curve. And there really is something perverse about the country undertaking the biggest bout of unconventional monetary policy ending up with the steepest curve.
Macro Live transcript 5 Nov 2010
Markets Live chat transcript for the chat ending at 12:58 on 5 Nov 2010. Participants in this chat were: Neil Hume, FT Cardiff Garcia Tracy Alloway
NHHello again
NHand sorry for being late
It’s a FUN RUN, not a bank run
Here’s one for the irony books.
Although please ONLY read on if you can easily differentiate between (A) a fun run hosted by a bank and (B) an actual run on a bank. And just to be clear …
(A) looks like this:
Backing away from Ireland – epistemically
Deus Ex Machiatto might be talking about bank funding in his latest blog post, but you could well extract his thinking to the sovereign market too:
Just being solvent is not enough. The market withdraws funding long before insolvency,
Markets Live transcript 5 Nov 2010
Markets Live chat transcript for the chat ending at 12:09 on 5 Nov 2010. Participants in this chat were: Neil Hume, FT bryce.elder NHHola rabble NHwelcome to ML NHAlphaville’s daily market chat
Breaking out the bubbly in commodities
Oil in US dollars may be trading closer and closer to its bubbly 2007 highs — at about $86.47 a barrel on QE2-caused dollar weakness — but the commodities picture is even starker elsewhere. Take a peak at the (weekly) Diapason Commodities Index in sterling.
Tarp UK
This might put a smile back on the face of Steve Morgan, the Mr Angry of UK housebuilding.
It’s a policy paper from Fathom Financial Consulting that says the Bank of England should think about using quantitative easing to buy-up bad mortgages.
Xstrata’s iron-ore ambitions
A little bit of takeover tussle Down Under highlights the long-held ambitions of Anglo-Swiss miner Xstrata to add iron ore to its coal and metals-focused businesses.
Not only that, Xstrata’s hot pursuit
RBS and its CDO … or APS … hit
Poor Royal Bank of Scotland.
RBS has fallen victim to one of the quirks of fair value accounting in its just-released third-quarter results, in which the bailed-out British bank posted a net loss of £1.14bn,
Beyond Europe’s bailout fund — a Q&A
There are, to be honest, many reasons to run as fast as you can in the opposite direction of the eurozone’s peripheral sovereigns right now.
But there’s one longer-term factor that has hoved into view lately.
Further reading
Elsewhere on Friday,
- 4,000 words on the Fed’s monetary policy.
- “The market withdraws funding long before insolvency, typically.”
- Battle of the bloggers — does the Fed print money or not?
- The ongoing turmoil in microfinance.
Pink picks
Comment, analysis and other offerings from Friday’s FT,
Philip Stephens: Angry America raises the barricades
Angry at Barack Obama, angry at the world, America has turned its back on the president who promised to change everything,
Snap news
Breaking pre-market news on Friday,
- RBS reports Q3 operating loss of £1.14bn after Asset Protection Scheme charge — statement.
- Shell to sell interests in six Gulf of Mexico fields — statement.
Further further reading
For the commute home,
- The US Federal Trade Commission has been on a merger-delaying mission this year.
- “Bank of America’s top executives have no idea what goes on inside the bowels of their company.”
Macro Live 2: payroll preview
FT Alphaville’s new feature, Macro Live — our real-time econo-chat that precedes the release of key US economic indicators — returns on Friday, November 5. The topic of the day is the October non-farm payrolls report.