Biography
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- The Greek government

- One or two French banks

- The Finnish government

- Spanish banks, UK banks, hmm a few banks really

These are just some of the world-class institutions Joseph has managed to annoy with stuff he’s dug up over the years. He joined FT Alphaville way back in March 2010.

Joseph likes all the politically and legally fiddly bits of finance. He also likes credit, rates, global macro, tail risk, and all that stuff. (You should email him story ideas. He’ll take anything.)

He doesn’t have a finance background.

Russian rate hikes, then and now

Click to enlarge — from an old St Louis Fed paper

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The kitchen sinksky*

**10.5 per cent to 17 per cent**

Click to enlarge for the Central Bank of Russia’s emergency rate hike at 1am Moscow time — surpassing both the Turkish central bank’s hike in January this year and the Bank of England’s 500bps of moves on one day in 1992. Lamontsky.* Read more

The Sony Effect

Click to enlarge — in which Sony gets one of the top lawyers in the US to ask the media to destroy information from the company’s massive hacking. (Via the Hollywood Reporter)

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Transparency for me (MPC), but not for thee (FPC)

Did you know there’s something called the Eijffinger-Geraats central bank transparency index?

There is one. It’s in the Warsh Review. On Thursday, the Bank of England accepted the review’s recommendations in favour of more open central banking. So, it decided to release minutes of meetings alongside policy decisions as they come out, to release transcripts of those meetings eight years later — and to hold fewer meetings a year from 2016 (8 versus 12). Read more

A trip to the Tripoli casino

Q. How do you tell the $65bn sovereign wealth fund of a notoriously erratic government that it might lose all its money on trades you arranged for them?

A. Very carefully.

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From Russia with bonds

Ukraine will probably end this year with public debts over two-thirds the size of its economy. We won’t know the exact figure until March when official statistics come out, nor if those statistics will be able to count the GDP of the separatist east.

But it is not looking good. We thought this rated a reminder.

Because the President of Russia certainly hasn’t forgotten about it — or the unusual clause inserted into the language of a $3bn bond Ukraine owes to his government: Read more

The Irish letters

Here is an unimpressed Jean-Claude Trichet.

And here is the ECB’s full response to the revelation of the Trichet letter…

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Someone’s in rouble now

С начала года ЦБ для поддержания курса рубля потратил $68 млрд. Полторы Олимпиады улетело в пустоту.

— Alexey Navalny (@navalny) October 30, 2014 Read more

What ails StanChart — spot the difference

In the first quarter:

By the third quarter… Read more

London Whale — some NY Fed blubber

Since it’s curiously hard to find on the NY Fed’s home page, given the prominence of Bill Dudley’s recent firebreathing speech warning against complexity and cultural dysfunction in US banks…

Click for the Federal Reserve inspector general’s account of how the NY Fed failed to follow up on the early signs it had uncovered of risks in JPMorgan’s Chief Investment Office. Read more

Ukraine — call the sovereign debt cops

. . .Which is an announcement by the Ukrainian Security Service on Thursday that it has opened an criminal investigation into just how Ukraine managed to sell $3bn of some curious bonds to Russia in the last months of Viktor Yanukovych’s government. Read more

Second Circuit still not Argentina’s biggest fan

With Argentina in default, the pari passu saga has become a long, ludicrous, gruelling standoff — which plenty of financial institutions and Argentina’s restructured bondholders have been trying to escape.

And then running smack into the US court system.

On Friday the Second Circuit Court of Appeals dismissed an appeal by Citibank to get local-law, US dollar-denominated restructured bonds (the ones with the ISIN confusion) out of the pari passu embargo: Read more

Un petit TLTRO

This is well below the €100bn-plus forecasts that were consensus…

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An oligarch arrest in Russia…

And so to the website of the Investigative Committee of the Russian Federation:

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Structured Scottish independence

There is a paper to be written on how UK structured finance nomenclature borrows from the topography of a Britain which is sort of (but not quite) familiar, and which feels reassuringly permanent. We suppose it’s like the Shipping Forecast.

Aire Valley, Arkle, Arran, Brass (that one’s from Yorkshire), Darrowby, Granite (famously), Lanark, Leofric… Read more

Well they would redomicile, wouldn’t they?

Cross-posted from Lex Live — Lex’s new, free, blog. Lex has also been writing notes this week on the consequences of independence for sovereign debt, banks, and Scotland’s oil industry

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Or, why it isn’t surprising at all that RBS and Lloyds would move their respective holding companies to the UK, probably overnight, if Scotland voted to become independent. Despite the odd packaging of this as NEWS by the UK press.

It’s the emergency liquidity (or ELA). Click chart to enlarge:

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The negative zone

Cross-posted from Lex Live — which is Lex’s new, free (you don’t even have to register) blog giving an insight on what Lex writers are reading and thinking…

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Not that negative zone – Europe: Read more

Calling European ABS sellers…

Draghi: The Eurosystem will purchase a broad portfolio of simple and transparent asset-backed securities (ABSs)

— ECB (@ecb) September 4, 2014 Read more

Argentina — whom do you trust?

The Holders of a Majority in aggregate principal amount Outstanding of the Debt Securities of any Series may at any time remove the Trustee and appoint a successor trustee for the Debt Securities of such Series…

– Argentine exchange bond trust indenture (2005) Read more

In Putin’s Russia, financial plumbing blocks you

Sam Jones (formerly of this parish) writes in the FT about how the conflict in Ukraine has revealed the capacity for a new type of warfare.

This is one that has “exploded the notion that expansive communications technologies and economic interdependence were fostering a kind of grand bargain.” Against it, the great power arrayed on the other side can do little, despite its considerable conventional might.

Quite so. Take, for example, this story from Bloomberg on Friday… Read more

Escape from New York, pari passu edition

“I’m a little nervous,” the President of Argentina told the nation on Tuesday night.

We’ll bet.

President Cristina Fernandez de Kirchner had just sent a draft law to the Argentine congress.

This would offer restructured bondholders to route around New York law into Argentina’s domestic jurisdiction, set up local payment for them in the meantime, and in general, attempt to remodel bonds free of holdout lawsuits and a default that could last a long time.

And on Wednesday the market more or less retorted that it prefers to hold the defaulted paper anyway. Read more

Ukraine, war, and sovereign default

Ukraine claimed at pixel time to have fired on a number of Russian tanks crossing its borders.

Being invaded by Russia is not very conducive to a country’s GDP. But also, bizarre as it seems if its armour really is aflame in the Donbas, Russia is also the owner of Ukrainian sovereign debt. This has some precarious terms (for the borrower) restricting growth in debt to GDP to below 60 per cent. Read more

Pari passu goes to the Peace Palace

That is, Argentina filed a case at the International Court of Justice in the Hague on Thursday — claiming that US court decisions in the pari passu saga have violated its sovereign immunity in public international law.

Note that Argentina originally waived immunity within the New York law bonds owned by the holdouts. Read more

Derivatives and public entities: don’t be a day-one loser

Banco Espirito Santo has recently, and spectacularly, shown how many sins of the past lie beneath Portuguese corporate life.

Also recently, readers of the Independent (and Matt Levine) would have come across what must be one of the most pointlessly complicated derivatives transactions ever — and also involving a Portuguese company. Read more

Nine questions for African Minerals

They come from Deutsche Bank’s analysts — who have in the meantime suspended their ‘buy’ rating on the London-listed Sierra Leone iron ore miner.

Background: a related party transaction, a director resignation, an internal investigation into $50m of shareholders’ money also paid to a related party, and a four-fifths share-price drop in a year. (And a 25 per stake held by the Shangdong Iron and Steel.) Read more

Time Warner — Rupert withdraws…

There goes an $80bn bear hug. Full statement from the 21st Century Fox chairman and chief executive:

We viewed a combination with Time Warner as a unique opportunity to bring together two great companies, each with celebrated content and brands. Our proposal had significant strategic merit and compelling financial rationale and our approach had always been friendly. However, Time Warner management and its Board refused to engage with us to explore an offer which was highly compelling. Additionally, the reaction in our share price since our proposal was made undervalues our stock and makes the transaction unattractive to Fox shareholders. These factors, coupled with our commitment to be both disciplined in our approach to the combination and focused on delivering value for the Fox shareholders, has led us to withdraw our offer.  Read more

Investment in Argentine bond credit-linked notes ends less than perfectly

See the attached for an important announcement by the Brasil Sovereign II Fundo de Investimento de Divida Externa… (H/T Bloomberg)

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No, really — does anyone want to accelerate on Argentina?

It is getting to a week since holders of Argentina’s restructured bonds first had the opportunity to cry default and demand full and immediate payment. So we thought we’d ask.

And as Morgan Stanley’s analysts pointed out on Tuesday, there is $13bn of paper out there eligible to be accelerated — $30bn, counting cross-default clauses in debt which has not had payments missed yet. Read more

BES — the resolution

Click for the Bank of Portugal’s announcement of the resolution of Banco Espirito Santo: Read more

Argentina, default, and the prisoner’s dilemma

That was the Argentine economy minister, Axel Kicillof, shortly before pixel time, having announced a (rejected) ‘offer’ of the same terms as Argentina’s restructured debt to the holdouts; blamed Judge Griesa; and otherwise prepared his country for default. Direct negotiations, in short, are over for now. Read more