April, 2011
Further further reading
For the commute home, where budget decisions are made for rather than by children,
- Corn goes pop! Reaches a 33-month high.
- “Expendability”: what the Saudi king has learned from Libya.
- Greg Ip on Paul Ryan’s budget proposal.
Forecasting the end of fast growth
Fast economic growth, like all good things, must end. But when?
An NBER working paper by Barry Eichengreen, Donghyun Park and Kwanho Shin released on Monday uses data from 1957 through 2007 to suggest when and why slowdowns occur in fast-growing economies.
Avoid the bank between 9-11am, and on Fridays…
… as those are the time and day of the week when robberies are most likely to occur.
That’s from the FBI’s just-released bank crime statistics report for full year 2010, which turned out to be a much lousier year than 2009 (for the bank robbers):
FOMC minutes from the March 15 meeting
The FOMC on Tuesday released the minutes of its March 15 meeting, and we excerpt a few things below.
Our earlier post on the March 15 statement summarised the language changes from the FOMC’s statement in February.
Shutdown shenanigans: something for the weekend?
Across the tape a little while ago, from Reuters:
NO BUDGET AGREEMENT REACHED AT WHITE HOUSE MEETING, REPUBLICAN HOUSE SPEAKER JOHN BOEHNER’S OFFICE SAYS
FT Alphaville is struggling to say anything new about the consequences of a potential federal government shutdown — we’ve already covered the economics (twice),
Don’t wait for Fed rate hikes — Morgan Stanley
FOMC minutes are out Tuesday afternoon and we’ll be at the ready for signals of an exit strategy for the Fed.
In a short note out in advance of their release, Morgan Stanley adds its name to those warning a “tightening moment”
Life after Gbagbo: a view from the bonds
Or, an interesting walk on the wild side in political risk.
It was generally a bad day to be Laurent Gbagbo on Tuesday. His generals are negotiating a ceasefire at pixel time while the French think he’ll probably leave Ivory Coast within hours,
Nasdaq-100 index takes a bite out of Apple
From Bloomberg on Tuesday morning:
Apple’s representation will be reduced to 12.33 percent of the index on May 2, from 20.49 percent, Nasdaq OMX Group Inc. (NDAQ) said in a slide show on its website today,
Two views on QEased commodities prices…
The role — if any — of easy monetary policy in pushing up commodities prices has become a hot-button topic recently. So here are two pieces of recent research on the subject, both from central banks.
Markets Live transcript 5 Apr 2011
Markets Live chat transcript for the chat ending at 11:22 on 5 Apr 2011. Participants in this chat were: Joseph Cotterill, FT Tony Tassell Neil Hume, FT JCHello – and welcome to FT Alphaville’s THIRD attempt at doing ML today
The importance of debt maturity
Boring title, we know. But stick with us ’cause there’s all sorts of thematic points in here — from sovereign debt crises to the weakness of short-term financing to interest rate shocks.
After the financial crisis,
HMV staggers onward
Prepare the obituary.
HMV has issued another profits warning on Tuesday morning, although this time the problem appears to be one of footfall rather than competition from the supermarkets or iTunes.
Greek and Irish interest rate stress tests
If this week’s mooted 25bps hike in ECB interest rates is the beginning of a trend, there’s already plenty of evidence it will damage private debt sustainability in the periphery.
More on all that public debt,
Five reasons the yen will strengthen
Since March 11, analysts in Tokyo have widely predicted that the Japan’s triple disasters – earthquake, tsunami and nuclear plant crisis – would heighten risk averseness among Japanese investors.
Indeed,
The Fed’s secret liquidity
Back in August 2010 FT Alphaville quoted BarCap’s Joseph Abate on the notion that wrapping up the ‘Supplementary Financing Program’ (SFP), which sells bills on behalf of the Fed, could be a useful stealth easing/liquidity measure.
Greece and its most grim sovereign-bank loop
Ireland has made an unwelcome name for itself as a country where a state and financial system have become most uncomfortably entwined — the sovereign-bank loop on steroids, if you will.
Just think of that Emergency Liquidity Assistance (ELA) which sees the Irish central bank accepting far dodgier collateral in return for loans to banks than the European Central Bank’s own-brand of repos.
Further reading
Elsewhere on Tuesday,
- Meet the new Goldman, same as the old…
- Confessions of an investor.
- Buffett’s ruthlessness is oddly absent.
- Deals, deals, deals.
- How to say ‘stress’ in German.
Pink picks
Comment, analysis and other offerings from Tuesday’s FT,
Gideon Rachman: It’s 1989, but we are the Russians
For the western world, the “Arab spring” threatens to be a classic case of good news and bad news,
Snap news
Breaking pre-market news on Tuesday,
- HMV issues another profits warning; covenant test pushed back until July — statement.
- Australia govt set to reject takeover of ASX – report.
- Amlin sees claims of £80m-£150m from Japan earthquake and tsunami – statement.
Further further reading
For the commute home, where your discount windows have always been transparent and available with easy credit,
- Appetite grows for asset-backed securities. Exotic ones, no less. Awesome.
- A venture capitalist is caught running a weed empire.
Earnings vs event-driven stock correlations
During last summer’s US economic slump, the CBOE S&P 500 implied correlation index hit a couple of intraday record highs before starting a consistent (if jumpy) downward trend through the end of the year,
Settling in (or not) for a long-term Libyan oil swap
Monday — a dramatic day in the story of Libyan rebels’ bid to get their country’s crude to the outside world.
It is getting out one end, at least. The Equator, a Liberian-flagged tanker, is in Egyptian waters heading for Tubruq,
DeKalb County, Georgia on municipal minds
On Friday S&P stressed its March 29 five-notch downgrade of the GO and appropriation-backed debts of DeKalb County, Georgia was “not the canary in the coal mine, but more the anomaly”.
But in a municipal market report also out on Friday,
Stress tests, not seniority, as the ESM’s big flaw
S&P recently cut Portugal’s rating. It notably blamed the risk of Portugal taking ESM loans senior to its bonds (inter alia), which markets have been flagging for a while.
When also cutting Portugal last week — Fitch notably didn’t.
Dead cats bounce west
A chart to ruffle some sovereign CDS feathers, via Markit:
It’s a run-down of the ten best performing credits in the first three months of 2011, as contained in Markit’s new Sovereign Report. It blows away a few longstanding sovereign risk preconceptions – viz.
Some circumstantial copper evidence
Sean Corrigan, chief investment strategist at Diapason Commodities, was the first to detect a correlation between China’s loose monetary policies and copper prices. His basic finding; the greater the amount of loans extended in China,
Premium capture is the new 436(g), Citi says
The repeal of Rule 436(g) sent the securitisation industry into a tizzy in the summer of 2010.
Now a component of last week’s proposed risk retention rules for Mortgage-Backed Securities (MBS) is sparking comparisons from some analysts,
Markets Live transcript 4 Apr 2011
Markets Live chat transcript for the chat ending at 11:35 on 4 Apr 2011. Participants in this chat were: Neil Hume, FT Joseph Cotterill, FT Tony Tassell
NHHola Rabble
NHwelcome to ML
The volatility is out there
FT Alphaville has pondered over why the Vix is currently so low.
We’ve also wondered if QE may be inadvertently triggering a gigantic ‘Bernanke put’ in the equity market, pushing volatility elsewhere — specifically into the FX market.
Head in the clouds at Autonomy
Autonomy’s idiosyncratic approach to investors relations continues.
The FTSE 100 software company has chosen to respond to a recent scathing note from JPMorgan analyst Daud Khan not with a quiet phone call,