This week on FT Alphaville…
- We made a video asking whether robots would take all the jobs. Read more
Political change in a democratic republic can be painfully slow, and thus even the improved chance of a meagre and incremental positive change is a good enough excuse to celebrate when it comes.
The two immigration proposals that emerged early this week from the Senate and from the President could well meet this standard, though it all depends how the politics shakes out. Read more
Andrew Dilnot strikes again:
Further dispatches from the Danish Institute for International Studies’ conference in Copenhagen on “Central Banking at a crossroads”.
Today we focus on the new age of collateral-based finance and the presentation given by Manmohan Singh (speaking in an independent capacity rather than as a representative of the IMF). Read more
Another month, another payrolls number in the 150k range — except this one comes with big positive revisions to the prior two months. The unemployment rate ticked up slightly, but careful with this report, as it includes an updated population estimate in the household survey, and also the annual benchmarking in the establishment survey to reflect a new count of total jobs. Read the explanations at the bottom of the release for detail.
From the BLS: Read more
Live markets commentary from FT.com
US banks squeezed as mortgage profits hit || Hagel grilled by angry Republicans || US challenges AB InBev’s Modelo deal || Explosion at Mexico’s Pemex HQ kills 25 || Wasendorf jailed for 50 years for fraud || Markets update: a tentatively positive start to month Read more
China’s official January manufacturing PMI fell to 50.4 from 50.6 while the HSBC survey rose to 52.3 from 51.5.
And yet it seems like only yesterday we were puzzling over why the HSBC survey seemed so much more bearish than the official figures… Read more
Elsewhere on Friday,
- Relax: banks’ risk measurements are rarely off by much more than a factor of ten.
- OCC leadership gets another surprise overhaul.
- Why the markets cannot influence financial institutions. Read more
China’s official manufacturing PMI falls, HSBC rises || Asian markets mixed, Japan rises on positive earnings || Barclays probed over whether it loaned money for Qatari stake || ‘London Whale’ warned others about his trades || US challenges AB InBev’s Modelo deal || Explosion at Pemex kills at least 14 || Samsung’s share of tablet market doubled in Q4 Read more
ROUND-UP
FT markets round-up: “A strong January for global stocks has finished meekly as an unexpected bout of caution over the US economy triggers a mild retreat of some benchmarks from cyclical highs. There has been renewed selling of the Japanese yen late in the New York trading day with the currency hitting Y91.56 against the dollar, its weakest level since June 2010. The proximity of the payrolls report was fostering the tentative mood in markets, delivering softness in industrial commodities and a stall in recently buoyant growth-sensitive currencies, but a mixed reaction across highly-rated fixed income products. Gold is cheaper by $14 at $1,663 an ounce. The FTSE All-World equity index is down 0.2 per cent after the Asia-Pacific region, excluding Japan, lost 0.3 per cent. The FTSE Eurofirst 300 drops 0.6 per cent, and Wall Street’s S&P 500 has settled 0.3 per cent lower and is back under 1,500.” (Financial Times) Read more
Getting a favourable leader in the Economist is pretty Establishment, surely.
At the very least, it’s interesting that the red-top weekly has managed to endorse and explain a fairly specific nominal GDP target for the Bank of England. Read more
LTRO-porn continues… this time it’s semi-core.
As we noted before, the higher than expected repayments by banks of the Long Term Refinancing Operations to the ECB might also push up the amount of paper in circulation as collateral which was tied up in carry trades is returned to banks. That would put pressure on markets which benefitted from the LTRO cash.
What we didn’t think of was Belgium. Poor thing. Read more
Yep, China again.
Here’s a table from a fresh IMF paper pondering the country’s Lewis Turning Point, the moment when people streaming into cities from farms will be fully absorbed, industrial wages will take off, and — an estimated 350m jobs later after it began — the era of cheap Chinese labour will end. Click to enlarge. Read more
FT Alphaville has just returned from the Danish Institute for International Studies’ conference on central banking in Copenhagen.
The theme was “central banks at a crossroads” — which we thought was particularly apt — and discussions ranged from collateral-backed finance and shadow banking to central bank independence. Indeed, many thanks to the DIIS for having us.
But one presentation, we would have to say, stood out more than most; that of Anat Admati, George G.C. Parker professor of finance and economics at Stanford Graduate School of Business, who’s out with a new book this month entitled “The Bankers’ New Clothes“. Read more
You gotta roll with fashion:
China’s growing demographic challenges have been well documented and their economic impact much discussed. So how about urbanisation being touted as the solution?
After all, more people working in cities generally means more productive workers, hard to argue with that. But Beijing’s traditional policy of encouraging urbanisation through greater infrastructure investment is getting ever diminishing returns. If the government really wants more people to move to the cities, argues Wei Yao at Société Générale, it must start treating its new urbanites better. Read more
In our last post, we covered up-to-date figures on some of the major components of the headline Spanish deposits number. Here we discuss a new component that will come into play over the next few months. In fact, it might have already been a factor in November’s number.
It’s the €40bn of previously undeclared assets of Spanish residents! The finance minister announced last week that this was simply hiding in a sofa (or possibly multiple sofas), and it wasn’t all that hard to find once they went to the trouble of removing all the cushions. Or, something like that…
OK, actually it’s the amount that came to light through the government’s tax amnesty that closed on November 30th, 2012. But hey, that would have been a hell of a couch, eh? Read more
Live markets commentary from FT.com
Costs drag Deutsche Bank to €2.2bn loss || FSA targets banks on interest rate swaps || Chinese hackers target New York Times || US economy slips into reverse || Chinese steel mills face tax pressure || Russia concerned over Israeli air strike || Markets update: a pretty meek finish to a very strong month for stocks Read more
The measurement of Spanish deposits is whatever you want it to be! Or at least it sometimes seems that people regard it as such.
FT Alphaville has previously discussed how hard it is to meaningfully interpret this number. The last time we went there, to try to explain various underlying components of the figure and which direction they’re travelling, the media was aflutter with tales of deposit flight.
Now, there are stories of deposits and capital returning… and we need to add further driving factors to the headlines. What with the tax amnesty that unearthed some €40bn of previously undeclared assets of Spanish residents, as announced by the finance minister last week, and all. Read more
Elsewhere on Thursday,
- No, a robot won’t take your job, says robot.
- Some genuine creative destruction.
- Patents were a problem in Thomas Jefferson’s day too. Read more
Asian markets fall on US GDP and Japan’s industrial production || FSA to investigate annuities market || Rio says Mongolian mine on track after halt report || MPs criticise Barclays’ bonus culture || Split over blame for West Coast fiasco || Governments can’t blame companies for tax evasion Read more
And a dissent from Esther George. Full statement from the Fed’s open market committee:
Information received since the Federal Open Market Committee met in December suggests that growth in economic activity paused in recent months, in large part because of weather-related disruptions and other transitory factors. Employment has continued to expand at a moderate pace but the unemployment rate remains elevated. Household spending and business fixed investment advanced, and the housing sector has shown further improvement. Inflation has been running somewhat below the Committee’s longer-run objective, apart from temporary variations that largely reflect fluctuations in energy prices. Longer-term inflation expectations have remained stable. Read more
“Alicia Keys has come to BlackBerry because she believes in the product and technology, and subscribes to our overriding philosophy to “Keep Moving”: to empower people through mobile computing and communications,” said BlackBerry President and CEO Thorsten Heins…
Yes, Blackberry’s Global Creative Director outed herself as an iPhone junky! a year ago. Read more
That’s a very small €3.7bn take up by banks participating in the European Central Bank’s three-month Long Term Refinancing Operation on Wednesday. We’d expected more. Read more
At times, pursuing a defaulted sovereign debtor for full payment can almost (almost) come across as a facetious exercise. As when NML’s latest brief in the Argentine pari passu case quotes Casablanca. Read more
Older entries
1The perpetualisation of debt
2Joining the Establishment, UK NGDP targeting edition
3On SWFs being paid to borrow
4It's not a collateral shortage, it's a scarcity of collateral
5The Fed holds
Show more6Spain finds €40bn hidden in sofa
7He isn't the Prime Minister, he's a very naughty statistician, part two
8Banks vs babies
9A cap and trade proposal... for immigration
10Belgium and the LTRO
Show fewer