September, 2011
Vickers harmonies
The Vickers report: nice ideas, needs some work — but is there enough legal basis to get the reforms passed? It’s worth asking.
Higher “loss-absorbing” capital is the capstone of the Independent Commission on Banking’s overhaul of UK lenders.
Cash for gold, financial market edition
Presenting a screenshot of Monday’s London interbank gold forward rates page from Reuters:
The above are live rates, meaning what’s on the screen is what the institution in question was willing to trade at when we took the screen shot.
Currency basis swaps as a funding tool
Currency basis swaps are all the rage again. SocGen has even referred to the basis swap market as a key means for managing “access to short-term USD liquidity” in its “hard facts” release.
Of course,
Markets Live transcript 12 Sep 2011
Markets Live chat transcript for the chat ending at 11:20 on 12 Sep 2011. Participants in this chat were: Neil Hume, FT Bryce Elder/FT Izabella Kaminska NHHola NHBonjour
On SocGen’s pawnshop defence
Societe Generale has released ‘hard facts’ about its liquidity position on Monday.
Among the points the bank says it has managed to successfully manage a reduction in access to USD funding through a disposal of USD legacy assets,
Found: China’s missing M2
Remember China’s missing M2?
Wei Li and Stephen Green at Standard Chartered began pointing out in March that China’s official measure of this type of money supply wasn’t reflecting reality, due to some accounting rule changes.
A mystery central bank in USTs?
FT Alphaville has already noted the extreme specialness of the current benchmark US Treasury 10-bond.
On Friday, however, that specialness reached new levels of extremity, with Bloomberg reporting repo rates of as low as minus 2.92 per cent.
La démolition
The Austrians, the Belgians, the Germans — and the French.
Chart of Europe’s biggest fallers early on Monday, via Reuters. It’s getting worse at pixel time.
SocGen’s ‘hard facts’
Where BNP Paribas goes, Societe Generale follows.
In an extraordinary release, the embattled French bank has given the market some ‘Hard Facts’ to chew over on Monday morning.
Click to enlarge.
GIIPS — how very politically correct.
Independent Commission on Banking — the report
Click image for the full report:
Ring fences ahoy:
Analysis to follow.
Further reading
Elsewhere on Monday,
- That’s not a palace. It’s a… museum. Yes.
- Electronic fax? Really.
- Subprime mortgages, more credit-worthy than the US government?
- The mega mortgage ReFi.
- Assymetric,
Pink picks
Comment, analysis and other offerings from Monday’s FT,
Clive Crook: A bold bid to reset the presidency
Barack Obama’s economic policy address to a joint session of Congress last week lived up to the billing,
Snap news
Breaking pre-market news on Monday,
- Societe Generale announces plans to free €4bn of capital by 2013 through disposals — statement.
- Lloyds Banking Group assessing the full implications of the final report from the Independent Commission on Banking — statement.
FTfm on AV
Some highlights from Monday’s FTfm.
Shareholder dissent is on the rise
Companies based in Europe’s most troubled peripheral nations are seeing a sharp rise in shareholder dissent as investors increasingly rebel against boardroom pay schemes and proposals for rights issues
CDS:
The Weekender
This week on FT Alphaville,
- We asked why Britain still has a AAA rating.
- Trichet did a half-decent reenactment of A Few Good Men.
- Operation Twist Two didn’t bother Goldman one bit.
- Sorry journalists,
[Something for the weekend] It’s not the banks, it’s the bankers
By Neil Collins
It’s not the banks, it’s the bankers
No inside information is needed to know what George Osborne is doing this weekend. He’s just taken delivery of the Vickers report, and must at least claim to have read it by the time everyone else sees it on Monday. We’ve a pretty good idea of the contents,
To tender or not to tender Greek bonds
Or, game theorising the worst case scenario in Greece. (Alternatively, How much would you pay for a deckchair on the Titanic?)
We probably won’t know the results of the Greek debt exchange for a little while,
Risk off, Europe edition #784
An unnerving afternoon, and we could be headed for another tense weekend. Dow’s off three per cent at pixel time.
You already know that ECB chief economist Jurgen Stark has resigned — ostensibly for “personal”
US Markets Live transcript 9 Sep 2011
Markets Live chat transcript for the chat ending at 15:10 on 9 Sep 2011. Participants in this chat were: Cardiff Garcia John McDermott, FT Joseph Cotterill, FT CGHello! JMGood morning from New York
Reminder: US Markets Live today at 10am New York, 3pm London
Kickoff at the usual time and usual place.
John McDermott leaves this afternoon for a two-week bloody adventure to Colombia’s Ciudad Perdida, and in addition to helping him pack and wishing him well,
The man who bought too much?
(Reuters) – ECB Executive Board Member Juergen Stark will step down from his post because of a conflict over the central bank’s controversial bond-buying programme, two sources told Reuters on Friday.
(ECB had no comment to Reuters.
[Something for the weekend] Coming soon to FT AV….
… our first weekly columnist.
From this weekend, Neil Collins, the former City editor of the Daily Telegraph, will be giving AV readers his acerbic take on the markets.
Collins is one of the most experienced financial journalists in the UK.
No clean exit from RBS
Attention George Osbourne.
The UK taxpayer will not get out of RBS clean. There will be no early return to recent share price highs and the bank will not meet its return on equity targets (15 per cent by 2013!),
Markets Live transcript 9 Sep 2011
Markets Live chat transcript for the chat ending at 11:33 on 9 Sep 2011. Participants in this chat were: Neil Hume, FT Bryce Elder/FT NHhola rabble NHsorry we are bit late
Goldman says let’s Twist again
Found.
Someone who thinks a change in the composition of the Federal Reserve’s balance sheet (a new Operation Twist) would be a good idea.
Guess who? (Obviously it’s not Bill Gross).
Give up?
OK then,
On the difference between virtuous and vicious circles
There’s something to reading Ben Bernanke’s speeches from a passive communication point of view. It’s not so much what he says, but what he doesn’t say. Or rather what he infers by saying something else.
A Greek T-bill oddity
From the English edition of Kathmerini (hat-tip to a reader):
The prospect of a freeze in payments appeared even more serious on Thursday, after Greek commercial banks failed to cover the sum of 300 million euros of supplementary,
Further reading
Elsewhere on Friday,
- Solyndra and the Obama connection.
- Swiss bank gets into derivatives.
- The exorbitant burden of a US dollar reserve currency.
- More on the copper disconnect.
- Are hedge fund returns reflecting liquidity risk premium?
- High noon for Greece.