August, 2011
Emergency Markets Live transcript 18 Aug 2011
Markets Live chat transcript for the chat ending at 15:28 on 18 Aug 2011. Participants in this chat were: John McDermott Joseph Cotterill, FT Paul Murphy Cardiff Garcia Izabella Kaminska JMWarning
Emergency Markets Live in five minutes: 9:55am NY time
(That’s 2:55 pm, London time.)
The emergency Markets Live circuit breakers are tripping on Thursday.
Just as well the Nyse implemented rule 48 this morning.
10-year US Treasuries were touching 2.04 per cent yields at pixel time while US crude futures were down over $4.
The Tobin tax lives on – part two
Yesterday the Merkozy plan for a Financial Transaction Tax caused some hefty damage for London-listed exchanges and brokers.
Not a surprise really. The analysts at Adam Smith Institute were hopping mad on Thursday:
The ‘high-powered money’ problem
Fed dissenter Richard Fisher has taken to speaking in the language of Ben Bernanke’s own Great Depression paper “Nonmonetary effects of the financial crisis in the propogation of the Great Depression”,
Markets Live transcript 18 Aug 2011
Markets Live chat transcript for the chat ending at 11:21 on 18 Aug 2011. Participants in this chat were: Neil Hume, FT bryce.elder NHBonjour markets rabble NHwelcome to Markets Live
A name and shame policy from the CFTC? [Updated]
(* Please see comment at end of post.)
The Wall Street Journal is out with a very interesting commodities story on Thursday.
And it’s interesting on two fronts.
First, due to the information it carries and second,
The Fed dissenters
So now we know why FOMC members Fischer and Plosser voted against Bernanke’s “on hold till ’13″ policy.
From Bloomberg:
Philadelphia Fed President Charles Plosser said in an interview yesterday that taking action after stocks tumbled “signaled that we are in the business of supporting the stock market.” Richard Fisher,
The BBB recovery
An early morning helping of doom and gloom, courtesy of Morgan Stanley, which has cut its global growth forecast for 2011-12 by a full percentage point.
The bank – one of the more bearish houses on the Street – reckons the US and Europe are dangerously close to recession because of fiscal tightening and policy blunders,
From 1896 to 2011, in UK borrowing costs [updated]
The 10-year gilt yield fell under 2.4 per cent early on Thursday:
It was 2.37 per cent at pixel time.
So we’re not just well under the twentieth-century record low (1946, when yields fell to 2.5 per cent).
Further reading
Elsewhere on Thursday,
- Taibbi tears up the SEC.
- Big old food prices infographic.
- “I am Toby Scammell and last week I was sued by the SEC for insider trading…”
- …And why that might not be a good idea.
Pink picks
Comment, analysis and other offerings from Thursday’s FT,
Jeffrey Sachs: The great failure of globalisation
Transatlantic leadership is falling short, writes Sachs, Director of The Earth Institute at Columbia University.
Snap news
Breaking pre-market news on Thursday,
- New York Fed “very concerned” about European banks facing funding difficulties in the US — report.
- Holcim suffers as Swiss franc rises — statement.
- Foster’s Group rejects SABMiller bid — statement.
Further further reading
For the commute home,
- Tough day for our neighbors in New Jersey, whose state was downgraded and whose hero was mockingly offered payment NOT to wear A&F clothing.
- Good to Great… is neither.
Grassley to SEC: try ducking me this time
Matt Taibbi’s latest piece in Rolling Stone – Is the SEC Covering Up Wall Street Crimes? – has a lawmaker scrambling to get an answer to the question, and you get no points for guessing which one (flashes from Bloomberg):
The UK labour market isn’t working
Wednesday’s UK jobs report is a stark reminder of the inadequacy of government policy — past and present — to reduce unemployment, and in particular youth unemployment.
The number of unemployed people in the three months to the end of June was 2.49m,
Stop worrying about China and US Treasuries
An exasperated Michael Pettis always makes for an enlightening Michael Pettis column.
This time he trains his eye on the possible implications of the recent announcements by China that this time it means what it says about diversifying its reserve holdings out of USD assets.
The Tobin Tax lives on
A couple inter-dealer brokers, a bank with a big investment banking arm and a spread betting company were among the biggest fallers on the London stock market on Wednesday.
The reason: the Merkosy plan for a Financial Transaction Tax,
Pre-funding the EFSF
Interesting spot from Credit Suisse’s fixed income analysts on the matter of the EFSF buying bonds (i.e. the ECB’s exit strategy, if it plans to stop the SMP). As they write:
The EFSF is widely thought not to pre-fund,
Eurobonds and the shadow of the future
Sometimes, you have to turn to US history to realise how very confused the eurozone is at the moment…
Merkel and Sarkozy want balanced member-state budgets in 2012, but no eurobonds for the foreseeable future.
E-bonds can work
Eurobonds, e-bonds, common sovereign debt issuance or whatever you want to call them are widely regarded as the solution to the Eurozone crisis. No less an authority that George Soros told us so this week.
A dollar bidder at the ECB
OK — caveats first. It’s only one bank and the amount it’s tapped at Wednesday’s ECB dollar swap, $500m, isn’t exactly a systemic sum.
But a taboo has been broken…
Banks appear to have feared the stigma of approaching the ECB for dollar funding so far,
Markets Live transcript 17 Aug 2011
Markets Live chat transcript for the chat ending at 11:29 on 17 Aug 2011. Participants in this chat were: Neil Hume, FT Tony Tassell NHBonjour rabble NHwelcome to markets live
The City earnings game
We all know that selective disclosure of price-sensitive information – for example, guiding down analyst forecasts – is frowned upon by the regulatory authorities in this country.
And that creates a problem for listed companies.
More on the Fitch reaffirmation
We were as relieved as anyone that Fitch, as expected, declined to follow S&P’s lead on Tuesday, but here’s a chart that nevertheless gave us something to ponder:
It shows the results of a sensitivity analysis tucked away near the back of Fitch’s full report,
SNB declines to show its pegleg
But it is firing up the printing presses again.
Initial market reaction.
Further reading
Elsewhere on Wednesday,
- ”…merely saying anything or everything can go wrong, while true, is quite useless and not profound.”
- Bank of America accounting question du jour.
- Against “superequity”
Pink picks
Comment, analysis and other offerings from Wednesday’s FT,
Martin Sandbu: Europe need not wait for Germany
Size matters, writes the FT’s economics leader writer. That is the lesson to draw from Washington’s debt ceiling debate and the downgrade of its sovereign credit rating by Standard &
Snap news
Breaking pre-market news on Wednesday,
- SABMiller goes hostile with $10bn bid for Foster’s Group — statement.
- Carlsberg cuts full-year guidance; cites tough Russian market — statement.
- A.P.