June, 2011
Re-inventing Opec
Wednesday’s Opec meeting may have resulted in a no-change decision on production targets, but as more and more people are noticing, its importance lay elsewhere — in signalling some significant turmoil within the organisation itself.
Markets Live transcript 9 Jun 2011
Markets Live chat transcript for the chat ending at 11:25 on 9 Jun 2011. Participants in this chat were: Neil Hume, FT bryce.elder NHHola Rabble NHapols for being late
Fresh woe from Britain’s high street
Just when you thought it was safe to go back into the UK retail sector…
… along comes another shocking trading statement.
The price action in Home Retail Group on Thursday morning:
Ouch.
The Ice Age – in pictures
He might have been knocked off his Extel perch by sidekick Dylan Grice, but SocGen’s dancing bear Albert Edwards is still our favourite ‘strategiste global’.
And is he loving the recent batch of weak economic data.
Nomura says Spanish banks are funding 24 years worth of housing
During the Spanish boom of 2004-2008 the country started construction of about 3.26m new houses, according to Nomura’s figures, and sold about 2.86m in the Costa Brava beach house craze.
By the end of 2009,
Money for nothing
It’s the £10,000-a-seat ARK charidee hedge fund bash this evening and to mark the event we have an interesting graphic from the Short View’s James Mackintosh.
It shows hedge fund performance — where HFRI is the monthly,
SOMA helluva change at the New York Fed
A big thank you to Shyam S. Rajan at Bank of America Merrill Lynch’s US rates team, for drawing our attention to this subtle yet significant change at the New York Fed on Wednesday:
The Federal Reserve Bank of New York’s Open Market Trading Desk is making the following change to the System Open Market Account (SOMA) securities lending program:
Draghi’s disclosures
What fun.
The frontrunner for the next European Central Bank head — the Bank of Italy’s Mario Draghi — has published his CV and answers to a questionnaire, as part of written evidence to the European Parliament in support of his application.
Further reading
Elsewhere on Thursday,
- Opec divided.
- And the significance of Opec announcements.
- A closer look at automated trading in energy markets.
- Was the CME too late to raise silver margins?
- The world is turning to coal.
Pink picks
Comment, analysis and other offerings from Thursday’s FT,
John Gapper: Groupon is at a loss to justify itself
Whether or not one thinks Silicon Valley is in the middle of a bubble, Groupon’s IPO is disquieting,
ENRC – ‘More Soviet than City’ [updated]
Wednesday’s AGM statement from ENRC, the Kazakh mining group and FTSE 100 constituent:
The Chairman, Dr Johannes Sittard, announced that the Group has initiated a comprehensive review of its corporate governance.
Further further reading
For the commute home,
- Running a Brazil-focused hedge fund must be quite a challenge: “All you have to do is buy the Bovespa stock index and government bonds. It’s not like you have to be superactive or a great trader.”
Will the last Irish bank to leave the market please turn out the lights
Quite a bombshell in Bank of Ireland’s latest, after-hours update on its bid to raise €4.35bn in capital to plug crisis losses:
If stockholders approve the proposals, the combination of the proceeds of the Rights Issue,
Crisis banks were partying like it’s 1998
Do US banks learn from experience?
Answer A: Yes, like lab rats and jilted lovers, they adapt and do better next time.
Answer B: No, like Einstein’s take on insanity, they just keep trying the same (bad) thing.
Pitiful profits prospects
What will happen to US corporate profits once the economy is forced to let go of the government’s helping hand?
That’s the subject of a new note from Credit Suisse, and the answer is predictably discouraging.
The wonkiest web debate ever – Germany’s ‘stealth bailout’
Holy cow, who knew the intricacies of the eurozone’s payment system could be so controversial?
Hans-Werner Sinn, a respected German economist, riffed on a point first made by John Whittaker, an economics professor at Lancaster University,
The T-bill that broke America’s credit [updated]
Hypothetically, obviously. At this stage.
Its CUSIP number is 9127953B5.
It was issued on 2 March 3 February 2011.
And it currently pays investors a princely yield of 0.018 per cent, for the (ahem) ‘risk’ of holding it.
Her Majesty’s bank bond buyback
The Commissioners of Her Majesty’s Treasury hereby certify that the debt instrument, the details of which are specified in the schedule to this Certificate, will not be deemed as Guaranteed Liabilities for the purposes of the Deed of Guarantee dated 13th October 2008,
Dear Herr Schaeuble
Right then, some market reaction to Herr Schaeuble’s letter to President Trichet of the European Central Bank.
It’s from the very bearish Harvinder Sian at RBS.
He thinks Germany’s move to protect its balance sheets is inherently negative for the stability of the periphery and in the extreme for other core Eurozone countries.
Bernanke: I’ll now take questions from the floor…
“… Yes, you, the short man in the smart suit.”
“Jamie Dimon, JP Morgan. I’d just like to ask…”
“Wait, I meant Hilsenrath.”
How to tinker with bank risk-weightings
Risk-weightings for bank assets are still relatively new things.
Codified in the Basel II rules first published in 2004, they were meant to shift financials away from set levels of required capital,
Markets Live transcript 8 Jun 2011
Markets Live chat transcript for the chat ending at 11:21 on 8 Jun 2011. Participants in this chat were: Neil Hume, FT bryce.elder NHHola Rabble NHWelcome to ML etc NHRight then
Why Horta-Osório is talking down Lloyds [updated]
António Horta-Osório rarely misses an opportunity to talk down the prospects of Lloyds Banking Group.
He was at it again over the weekend, telling the FT that the turnaround at Lloyds could take up to five years:
European securitisation – now mostly retained
A milestone, of sorts, in the European structured finance market.
At the end of the first-quarter of 2011, retained securitised debt made up a bigger proportion — at 51.7 per cent — of total outstanding debt (€2,076bn) than debt placed with investors,
Dear ECB — get lost, yours, Wolfgang
Written in a week when the European Central Bank made its strongest attack yet on burning Greek bondholders…
Via Reuters — the full text of a letter from Wolfgang Schaeuble, German finance minister,
Misys enters the final phase
Another day and another Misys bid rumour.
This time it’s talk of a 425p a share bid for the company, which provides software, systems and financial services to big banks, from a US rival.
Whether or not there’s any substance in this story,
China has ‘upped the ante’ in financial suppression, Dylan Grice says
Dylan Grice. Bless ‘im.
The Societe Generale strategist has managed to combine three of our favourite themes — China’s great central economy and big local government debt problems, financial repression and volatility.