Presenting, a rather charming tale from Nicholas Colas, group chief market strategist at ConvergEx, who recently attended an algorithm-themed conference, and discovered — to his surprise — that quants aren’t really like regular people.
(Emphasis from Colas.) Read more
From the FT:
The board of Bumi Plc is weighing up severing ties with one of its Indonesian businesses as part of a restructuring aimed at reviving investor confidence in the controversy-hit London-listed coal miner… Read more
When commentators cast around for reasons to explain the strength of the Australian dollar in the face of falling iron ore and coal prices they all arrive at the same answer - haven bond buying by central banks/ sovereign wealth funds. In fact, we’ve also made that very point.
Something of a puzzle is emerging in the UK’s labour market.
The overall employment picture is definitely improving. According to the latest figures from the Office of National Statistics, the economy added more than 431,000 new jobs in the past year and the employment rate is now considered to be relatively high. At the same time, however, there’s no doubt that labour productivity has been falling — quite the opposite to the picture in the US, where productivity has been rising sharply. Read more
Apparently Emirates boss Tim Clark can say this with a straight face.
From a filing to the Australian Competition and Consumer Commission. Read more
George Magnus of UBS has a 29-pager out on Monday questioning if the Asian miracle may finally be over? FT Alphaville is still poring through the details, but couldn’t wait to bring you a substantial chunk of the note which is dedicated to the role of technology and its impact on Asian market dynamics.
We’ve noted on more than one occasion that economists may be missing a trick when it comes to how technology is changing the global economy. More so, that developments like 3D printing, could even pose a black-swan risk for Asia in their own right. Read more
An ever larger number of voices (FT Alphaville included) are exploring alternative theories to explain our current crisis, many of which focus on the role of technology, productivity and sustainability.
One conclusion is that society (or at least one part of it) is finally experiencing what has long been theorised about as the steady-state economy. Read more
Could it be that the stampede of Oxbridge graduates clamouring to work 100-hour weeks in Canary Wharf is slowing? Perhaps four years of banking crises, scandals and enthusiastic ‘banker bashing’ is having a real effect on the industry’s appeal?
The rise in starting base salaries offered by investment banks in London seems to suggest so. First year salaries were in the region of £36,000 going into the crisis (2007 and 2008). They had been flat at that level for a good few years before then. Read more
Protesting private equity monster points menacingly at Alphavillain. The scene at Bain Capital’s NY outpost, Madison Ave and 57th, ahead of tonight’s starring role for the firm in Romney’s convention speech.
Yep it’s the incredible shrinking iron ore price…
By now, everyone is familiar with the mantra that QE is [arghh!] money-printing and that a major unintended consequence could be a chronic and uncontrollable inflation. (One could call this the goldbug, Austrian, Republican case).
Less well known, perhaps, is the theory that QE could be just as unexpectedly deflationary — because long-term micro yields come to threaten a number of financial sectors outright, as well as general expectations of risk-free returns which lead to capital destructive feedback loops. Read more
We noted our growing love for one John Mann MP before and it looks like his proposals are gaining some traction. From earlier in August:
Mann is suggesting that incentivising measures should include a suspension of all town centre car park fees up to Christmas, a reduction of Vat on DIY product, a crash programme of building pensioner bungalows and a re-introduction of green technology incentives such as solar panels. Read more
It’s an indirect path from one to the other.
Gawker on Thursday unloaded some 950 pages of filings from Bain Capital-affiliated offshore funds in which Mitt Romney has invested his fortunes over the years. We’re still reading through the docs, though Dan Primack (who’s already read through them) thinks there’s not much to the issue. Read more
Ahead of Greek PM Antonis Samaras’ meeting with Angela Merkel on Friday we thought a look at Germany’s cast and position might be worthwhile… especially since the Greek leader is set to pitch for a two-year extension to meet fiscal targets set out in the loan agreement at that meeting.
As the FT notes: Read more
Click to enlarge:
It’s the product of all those Select Committee hearings, including appearances by Messrs. Diamond and Tucker. It is only a preliminary report. But it does not have kind words for the authorities who failed to stop the attempted manipulation of Libor before and during the financial crisis. (Barclays management is of course completely coruscated.) As jaded as we’ve all become by the Libor scandal, it’s pretty damning. Read more
As low cost producers, with arguably the best resources in the world, it’s little wonder that BHP Billiton and Rio Tinto are shipping as much iron ore as they possible can from their mines in the desolate Pilbara region of Western Australia. Assuming a $7/tonne freight rate, Lex estimates, the landed iron ore price in China would have to fall to $37/t before Rio lost out.
So even with the iron price at a near three-year low of $112 , Rio and to a lesser extent BHP are making a killing and will continue to do so as higher cost producers (mainly Chinese) fall by the way side. Read more
During a recession, people stay at home more rather than going out. It’s cheaper. Either that, or they are guarding the cash they stashed under the mattress.
The Economist has treated us to a couple of examples of companies that do particularly well from the two tendencies of stashing cash and staying in: money printers, and online dating agencies. Read more
We asked, and you answered by completing FT Alphaville’s (wholly unscientific) survey on Tuesday.
hastily put together intricately designed poll reveals that 41 per cent of finance professionals, students, developers, and random people* think that Greece will exit the euro within the next year. Read more
Should we really be so shocked when people respond to incentives?
It’s a rhetorical question former TARP Special Inspector General Neil Barofsky posed on Thursday via Twitter. What triggered it was those Olympic badminton players who deliberately tried to lose their match. Read more
Seek bailout secrets!
Hack mail passionately, oh
That’s how FT Alphaville imagines Herman van Rompuy, President of the EU Council – and a keen haiku writer – might respond to news of his hacked email. Read more
Manchester United’s filing for its $383m IPO, finally. Click to enlarge. Enjoy!
Man Utd in deal with Chevrolet on jerseys – FT
We apologise but Paul and Bryce partied so hard over the opening weekend of the Olympics that they need two weeks to recover…
A fellow reveller mirrors ML's slumber