May, 2011
Whistleblowers in muniland
The Bond Buyer’s Patrick Temple-West has an interesting article on Tuesday based on comments made Friday by the interim director of the IRS’s government entities bond office:
The Internal Revenue Service’s tax-exempt bond office has received referrals of around 30 whistleblower claims of potential abuses in the municipal bond market,
What fiscal transfer to Greece do you want?
Why they’ll extend private Greek debt maturities — in two charts:
Both those tables were put together by JPMorgan analyst David Mackie in a note published a week or two ago. They’re well worth resurrecting.
[EM Private Equity] The past, present and future of EM PE
FT Alphaville will be reporting this week from the annual Global Emerging Markets Private Equity Conference in Washington, DC — and we plan to use the event as an excuse to write a series of posts on this fascinating market throughout the next week or two.
Those flatlining money market funds
It’s hard times for money market funds.
With the repo market broken, and new post-crisis regulation, they’re left to cope as best they can with what’s essentially a broken business model in an environment of extremely low interest rates.
A proclamation from the Spanish Ministry of Public Works…
Just in case you were wondering…
Spain’s Ministry of Public Works has been busy, undertaking a roadshow last week with the above accompanying PowerPoint presentation, to help inform investors in the UK,
The LSE’s giant ball
Two questions: Why? And how much did it cost?
Press release from the London Stock Exchange:
The Chancellor of the Exchequer, the Rt Hon George Osborne MP, today launched the London Stock Exchange’s new market open ceremony in Paternoster Square.
There’s no change for the US driver…
… because the gasoline crack (the difference between the price of crude and the price of gasoline — a key metric in determining whether there’s enough incentive for a refinery to process crude) is roofing.
Man alive
We’d been wondering how those trend-following black boxes performed during last week’s commodity rout and now, thanks to Man Group, we have an inkling.
The following went up on the hedge fund managers website on Monday night and shows the AHL strategy lost 5.3 per cent last week due to the wild swings in commodity prices and to a lesser extent,
Markets Live transcript 10 May 2011
Markets Live chat transcript for the chat ending at 11:27 on 10 May 2011. Participants in this chat were: Neil Hume, FT bryce.elder NHHola Rabble NHsorry we are late NHjust finishing a post on Man Group
To avoid Greek restructuring losses – an accounting loophole for banks
“We previously expressed the view that, ‘unless the government concerned was prepared to suffer significant economic costs (and in effect, restore bond holders to the position they were in before credit concerns arose) there is no way for holders to avoid having to book losses in their financial statements’.”
Roubini’s guide to a Greek debt restructuring
Cut, paste and mail to your favourite holder of Hellenic debt:
It’s a ‘how-to’ manual for a Greek debt restructuring from Nouriel Roubini (plus Arnab Das, Jennifer Kapila, James Mason, David Nowakowski,
Off the Pace [updated]
Surely heads are going to roll at UK-based Pace.
The world’s biggest maker of television set-top boxes has followed March’s disingenuous results statement with a profits warning on Tuesday morning that has knocked a third from its share price:
Further reading
Elsewhere on Tuesday,
- Counting the (central bank) costs of kicking the Greek debt can.
- The “crucial simplifying assumption” underpinning the eurozone.
- Are markets in 1973 mode, or 1907?
- Why valuation matters more than capital.
Pink picks
Comment, analysis and other offerings from Tuesday’s FT,
Philip Stephens: The Catalan secret of Salmond’s success
It would be premature to tear up the map of the United Kingdom. After the nationalists’ storming of the Edinburgh parliament it would be just as unwise to assume the future of Scotland’s 300-year-old union with England is secure,
Snap news
Breaking pre-market news on Tuesday,
- Microsoft close to deal to buy Skype — report.
- CME increases trading margins for US crude futures by 25 per cent — statement and report.
- Pace warns on profits — statement.
Further further reading
For the commute home,
- How to make money in microseconds.
- Going public is uncool.
- The year’s top stock pickers.
- LinkedIn’s nouveau riche.
- Stock recommendation changes matter most.
The world’s strongest bank is…
… Singapore’s Oversea-Chinese Banking, according to analysis published by Bloomberg Markets magazine on Monday:
The winners receive a healthy dose of schadenfreude (not you #16) and a signed copy of the Basel III rules.
Guest post: Four fiscal deals—would any matter?
By David Gordon, Sean West and Helen Fessenden of Eurasia Group. The views expressed are strictly their own.
With all eyes on the Gang of Six, naïve hopes of a deficit deal are blossoming in Washington.
The long is the short of it, says Andrew Haldane
If in the long run we’re all dead, in the short run we’re all disease-ridden invalids blinded by incandescent temptation, staggering around with little idea of what we’re doing.
That’s (almost) the gist of a paper published Tuesday by Andrew Haldane,
Onions vs speculators
Real Time Economics commented on Monday on the difference between the recent movements of onion vs corn prices:
While prices of many agricultural commodities have soared, farmers received just 7.49 cents for a pound of onions in April,
US household deleveraging flattened in Q1
The Federal Reserve Bank of New York’s Q1 report on household debt and credit is out, and it was the first quarter where total consumer debt held steady after nine straight quarters of declines:
The report contains mostly decent news,
Econ bloggers are uncertain about something
After our smart-alecky writeup of the last quarterly economics blogger survey, the good people at the Kauffman Foundation asked FT Alphaville to participate in the Q1 2011 edition, and we obliged.
As Barry Ritholtz noted in the comments to our prior post,
Euro solidarity/desperation, gold edition
At this point, extra EU loans to Greece would be dead money, susceptible to debt haircuts pari passu with private creditors.
But if you’ve got to do a one-off fiscal transfer, and an entire currency union is at stake…
Moody’s on Spain’s regional, retail shift
To the sunny climes of Valencia, Spain.
Where the region’s local government has just decided to issue up to €900m one-year and two-year retail bonds. It’s part of a regional Spanish trend, you see.
Cembalest changes his mind on the subprime crisis
Here’s something you might have missed during last week’s (UK) holiday.
Michael Cembalest has made a retraction. JPMorgan’s private banking chief investment officer (and reportedly the only JPM-er who refused to do business with Ponzi-schemer Bernard Madoff,
The financing pyramid and margin debt
Here’s an interesting point from Cullen Roche at Pragmatic Capitalism on Monday.
Margin debt — the amount that speculators borrow to buy stocks (or other assets for that matter) — is rising quickly.
The guilty Greek maturities
Fresh from S&P on Monday:
Standard & Poor’s Ratings Services today said that it has lowered its long- and short-term sovereign credit ratings on the Hellenic Republic (Greece) to ‘B’ and ‘C’, from ‘BB-’ and ‘B’,
CSR’s unpopular deal
If CSR, the maker of Bluetooth chips, was looking for an excuse to revise or (possibly) ditch its unpopular £418m all-share acquisition of Zoran, it has just been handed one.
Zoran, the loss-making US imaging and video technology group has just filed disappointing first quarter numbers, warning forecasts for the second quarter will be lower than expected.
Markets Live transcript 9 May 2011
Markets Live chat transcript for the chat ending at 11:36 on 9 May 2011. Participants in this chat were: Neil Hume, FT bryce.elder NHHola Rabble NHand welcome to ML NH60 minutes or so
A (hard) Greek restructuring by the numbers
Or, losers in a Greek debt restructuring.
Some estimates courtesy of JPMorgan’s flows and liquidity team:
The ECB bought a large amount of Greek government bonds through its Securities Market Program.