November, 2011
Markets Live transcript 4 Nov 2011
Markets Live chat transcript for the chat ending at 12:35 on 4 Nov 2011. Participants in this chat were: Neil Hume, FT neil collins Bryce Elder/FT NHHola Rabble NHWelcome to Markets Live
Five steps to financial crisis
The farce of the eurozone’s debt crisis is understandably captivating, but is an even bigger situation developing in China? Credit-fuelled gullibility lies at the heart of most bubbles, but such gullibility provides quality fodder for fraudulent schemes too.
RBS – encouraging results?
Revenues below consensus, expenses higher than consensus, impairments significantly below consensus. Result: figures that please the market.
Well, that how we’re reading Friday’s third quarter results from state-controlled RBS:
The epistemology of US banks’ European exposure
Can we really know anything about US banks exposure to Europe?
A familiar epistemological question, which is being asked again in the wake of MF Global’s demise and Jefferies’ circuit-breaking slide.
The Jefferies issue
As FT Alphaville has noted, Egan-Jones downgraded Jefferies, citing the disclosure in Jefferies’ 10Q that the firm’s “sovereign obligations” amounted to €2.68bn, or 77 per cent of its €3.49bn shareholder equity.
Further reading
Elsewhere on Friday,
- Eurozone balances of payments, reality check du jour.
- The Fed cavalry isn’t coming to the rescue.
- No, wait — yes, it damn well should be.
- G20 promises and pie-crusts.
Pink picks
Comment, analysis, and other offerings from Friday’s FT,
Editorial: Draghi displays an excess of discipline
When Mario Draghi’s name was first mooted as a successor to Jean-Claude Trichet at the helm of the European Central Bank,
Snap news
Breaking pre-market news on Friday,
- Anglo American acquires Oppenheimer family’s 40 per cent interest in De Beers for $5.1bn — statement.
- RBS books additional charges against Greek debt holdings;
Further further reading
For the commute home,
- Happy birthday Reformed Broker blog!
- Matt Taibii lets loose on Mayor Bloomberg.
- Groupon, beware.
- And why it won’t raise its IPO prize.
- Calculated Risk on mortgage rates.
Would you feel three basis points?
Eat your words Senator Tom Harkin.
“Quite frankly, I bet nobody would even feel it,” the Iowa Democrat said on Tuesday in relation to his plan to introduce a US financial transaction tax.
Nonsense,
Cash in the attic, IMF edition
Fortifications at the ready! Given Merkel’s nein, Draghi’s pff and China’s err no to commit yet-more capital to the EFSF by process of elimination the only option left is…… the IMF.
Why not just beef up the policy lender to prop up the eurozone currency countries.
A vote on the €300+bn Papandreou put
As we watch the snaps from the Greek PM cross the tape on Thursday afternoon…
RTRS-GREEK PM SAYS WE ARE BEARING A CROSS AND WE ARE BEING STONED
RTRS -GREEK PM SAYS GOING TO ELECTIONS NOW WOULD BE CATASTROPHIC
RTRS – GREEK PM SAYS VOTE OF CONFIDENCE IS A GUARANTEE ON HOW WE WILL CONTINUE AND NEGOTIATE WITH OPPOSITION PARTIES
…
Jefferies: we have to explain this again? [UPDATE]
A pittance, a pittance I tell you. No, wait, even less than a pittance!
Portugal $5 million
Ireland $28 million
Italy $104 million
Greece $3 million
Spain <$178 million>
Approaching the Italian endgame
Amid EFSF revamps, Greek politics, and ECB rate cuts, remember that in the end, it all comes down to Italy.
In particular, 10-year Italian government bond yields remain well over 6 per cent at pixel time.
Greek bond accounting, encore (et enfin?)
Or, more fun with Greek bond impairments as Rome (or Athens) burns.
BNP Paribas has sold billions of euros of Italian and Spanish bonds, with a few (€362m) losses according to its Q3 2011 results.
The WTO dividend
You can say what you want about the achievements of the WTO; it sure is nice to be part of the club.
Certainly that is what the Kremlin will be thinking this morning after Russia cleared the final hurdle to joining the 153-nation trade organisation after 17 years of trying.
ECB cuts rates 25bps
Alternative headline: “faint glimmer ECB will not trash eurozone”
3 November 2011 – Monetary policy decisions
At today’s meeting the Governing Council of the ECB took the following monetary policy decisions:
Isda has a bone to pick with you (and so can we!)
Alright, you lot, stop it with the ridiculous CDS posts. Stop it! We mean it. And Isda means it too:
It’s hard to overstate the amount of nonsensical chatter on credit default swaps (CDS) in the past few days.
Italians: your country needs you
Still on a knife edge — 10-year Italian government bonds at pixel time: (click to enlarge)
Source: Reuters
On Thursday BNP Paribas poured fuel on the fire with its Q3 results, slashing its Italian exposure by 40 per cent over the last quarter to €12.2bn from €20.5bn.
Markets Live transcript 3 Nov 2011
Markets Live chat transcript for the chat ending at 12:32 on 3 Nov 2011. Participants in this chat were: Neil Hume, FT Bryce Elder/FT NHHola NHor whatever the Greek is for hello
Climb on the Headless Horse
Its CEO is exhausted and has been packed off to the sanatorium, the interim boss has his mind on other things, a large disposal plan is proving difficult to execute, there’s £30bn of debt that needs to be rolled over and the outlook for the UK economy remains dire.
Bernanke could do better
Having floated the idea that the Federal Reserve should target a nominal level of GDP, Goldman’s top economist Jan Hatzius is none too pleased that Ben Bernanke shot the suggestion down in Wednesday’s post FOMC presser.
Venizelos drops a bomb
Kaboom.
Greek Deputy PM Evangelos Venizelos’ bombshell statement upon arrival from Cannes on Thursday morning:
Further reading
Elsewhere on Thursday,
- Leda and the Greek swan.
- Why not to carry sovereign obligations on your balance sheet.
- Car registrations as an indicator of sovereign health.
- It’s both good and bad says the Fed.
Pink picks
Comment, analysis, and other offerings from Thursday’s FT,
John Gapper: Emperor Corzine’s Goldman clothes
Once upon a time, there was an emperor who had been thrown out of the kingdom of New Jersey and was seeking another place to rule,
Snap news
Breaking pre-market news on Thursday,
- Greek finance minister is against holding a referendum — report and confirmation.
- BNP Paribas reports 72 per cent fall in Q3 earnings after taking bigger than expected 2bn Greek debt hit – statement.
Further further reading
For the commute home,
- The Forbes list of the world’s most powerful people is out, with Mark Zuckerberg edging out David Cameron for the ninth spot. To quote John McDermott: “Yeah, well, I’d like to see who wins in a war between Facebook and the UK.”
Kicking the Can(nes)
Under-promise then under-deliver. Then watch markets tank. That’s the prognosis for the G20 summit, courtesy of Capital Economics’ crystal ball.
After poo-pooing suggestions Bric nations will ride to the eurozone’s rescue or take constructive measures to resolve global imbalances,
US Markets Live transcript 2 Nov 2011
Markets Live chat transcript for the chat ending at 19:18 on 2 Nov 2011. Participants in this chat were: Cardiff Garcia claire.jones@ft.com John McDermott, FT Izabella Kaminska CGAhoy!