We haven’t written up our full take on Wednesday’s (nuts) oral argument in NML v Argentina (sorry), though you should read this, just out from the Second Circuit on Friday…
The court has ordered Argentina to specify “precise terms” of how it would wish to pay holdouts, differently to the current injunction to pay them ‘ratably’ in full: Read more
It’s Friday quiz time! Ready? Here goes:
What do you get?
[Hint: It's America.] Read more
That’s the euro down 0.4 per cent or so against the dollar and crossing the $1.30 mark. Sterling (aka the Great British Krona) is also continuing its torrid start to 2013, losing another 0.9 per cent against the dollar and touching $1.50. Read more
Live markets commentary from FT.com
Shinzo Abe’s phaser || Iksil in headlines that also contain “Lehman” || US braces for spending cuts || Spain’s companies suffer earnings slump || China manufacturing slows || Greece missed revenue targets by large margin || Poland to restart debate to join euro || US regulator to water down SEF rules || Markets update Read more
Frankly we’re bored of this, but:
That question deserves some serious thought, don’t you think? Read more
Gotta love a good contrarian yen call.
As we’ve written multiple times, the yen’s recent fall been based on policy which has yet to appear, namely on expectations of Abenomics. Japanese authorities have done an excellent job of short-term monetary fear-mongering, but as Gavyn Davies put it recently there is a severe risk that the international hedge funds which have been driving the decline in the yen might come to the conclusion that the emperor has no clothes. Read more
Elsewhere on Friday,
- Banker bonus FAQ (for bankers).
- What to do with fat cats? Chuck them in the swimming pool.
- More disclosure, smarter disclosure. Read more
Asian shares fall, Japan rises on easing hopes || Sequestration cuts imminent || Official China PMIs lower || Lib Dems win Eastleigh, Tories come third || Lloyds to announce more PPI provisions || Australian towns win $21m in S&P CPDO case || US student debt delinquencies soaring Read more
The EU’s Council and Parliament agreed on the text for two-pack laws on “enhanced surveillance” of sovereign bailouts on Thursday. It should be on the books soon.
So, if what happened in Greece last year was “exceptional and unique”… Read more
Some time ago Brussels decided that capping bankers’ bonuses is going to help prevent another financial crisis. A very fashionable move. In fact, the passage of the Basel reforms was contingent on a cap being introduced, so after months of negotiations, a deal was finally stuck this week.
From the FT (our emphasis):
Bankers’ bonuses are to be capped at twice their salary and banks will be subject to a strict transparency regime, under a provisional EU deal that includes minimal concessions to cushion the most severe pay crackdown since the 2008 financial crisis.
Courtesy of Goldman Sachs.
Swedish oil company Lundin Petroleum declined to comment on rumours that it has been in talks to sell a significant equity stake to China Petrochemicals Corporation. Read more
All this has happened before and will happen again… at least, so hopes the Japanese government.
Current finance minister Taro Aso has been keen to channel the spirit of his 1930s equivalent Korekiyo Takahashi, whose polices are widely credited with pulling Japan out of the Showa Depression. It’s understandable. Read more
Strong currencies are the bane of every triple-A rated, QE-less economy in currency war-torn 2013, it seems. It’s become an increasingly irksome point in Australia, where the initial exuberance over cheap foreign holidays has been slowly replaced by worries that it’s squeezing the non-mining sectors.
An FOI request by Bloomberg yielded a bunch of documents from the Reserve Bank of Australia about the currency’s overvaluation problem. Specifically, how bad it is and who’s to blame. Well, who among other central banks*, at least. Here’s list of the definitely-implicated: Read more
Live markets commentary from FT.com
EU secures deal to cap bankers’ bonuses || Iberia charge pushes IAG to €997m loss || RBS seeks more time for branch disposals || Apple shareholders in protest vote on pay || Shell puts Arctic ambitions on ice || JC Penney loses one-third of its sales || Markets: Bulls back in charge Read more
We assume that the Bumi survivalists, led by Sir Julian Horn-Smith, never really expected Nat Rothschild to just retire from the scene after suffering defeat in the boardroom power struggle.
And so it has proved. Rothschild is still a subscriber to the Jakata Post and he’s noticed a curious item — the allegedly late disclosure of the sale of a stake in a subsidiary to what is reportedly a Bakrie family entity. Read more
As was widely tipped early this week, Asian Development Bank president Haruhiko Kuroda has been nominated for Bank of Japan governor, while academic Kikuo Iwata and Hiroshi Nakaso, a BoJ official, were put forward for the two deputy governor roles.
It wasn’t a big surprise: as the FT reports, the yen briefly weakened to 92.6 from 92.4 on the news, before regaining that loss. Read more
Elsewhere on Thursday,
- It’s Frankfurt that should be your worry – not Rome.
- Ricardian equivalence and the case of the EU.
- Aeroflot’s prospective 1-year old board member. Read more
Asian markets up || Kuroda nomination confirmed || European bank bonus caps passed || Vivendi may suspend GVT sale || Shell pauses Arctic campaign || Argentina won’t pay holdouts regardless of ruling || Chinese provinces cut growth targets || BP ‘misreported’ vital data Read more
ROUND-UP
Stocks soar to five-year high. Wall Street’s S&P 500 had its biggest one-day gain, or 1.3 per cent, since the start of January, supported by a better than expected survey of durable goods orders (excluding transport). Now at 1,515 points, the New York benchmark was striving to recover last week’s five-year closing high of 1,530. The Dow jumped 175 points, or 1.3 per cent to 14,075, its highest level since Oct. 15, 2007. The FTSE All-World equity index added 0.9 per cent and the FTSE Eurofirst advanced 0.9 per cent. Milan’s FTSE MIB index recovered early losses to close higher on the day. Demand for the dollar fell, with the dollar index sliding 0.3 per cent. Copper declined 0.2 per cent to $3.57 a pound while Brent crude fell 0.7 per cent to $111.95 a barrel (Financial Times). Read more
We are talking here about Glenstrata, of course, going ex-Mick Davis and cum-Ivan Glasenberg as soon as the last bits of competition authority clearance arrive…
Ivan has already sent industry tongues a-wag with some off-the-grid comments at a BMO Capital Markets conference in Florida, as reported by Reuters:
What we’ve got to do, when the markets do get stronger, no need to keep building a new asset and let’s keep the market tight for a while…
Okay. Negative interest rates have now gone fully mainstream in the UK thanks to this week’s testimony by Bank of England deputy governor Paul Tucker.
Even the Daily Mail is writing about it.
But a number of major misunderstandings are popping up as a result. So let us try to clear some of them up. Read more
Live markets commentary from FT.com
Convexity in Vix futures || Deflating shadow credit in China || BoE deputy on NGDP || Italian election aftermath || JPMorgan job cuts || New US defence secretary || Online gambling approved in New Jersey || Visa & Samsung agree on mobile payments || Markets cautious but more stable Read more
It’s Charlie Bean, the Bank of England’s deputy governor for monetary policy, on nominal income targets. An old wine in a new bottle apparently, even if it is edging closer to the establishment.
Some excerpts (with our emphasis):
The question is: would outcomes have been materially better under an alternative framework, such as a nominal income target?
First, a reminder of the degree to which China’s growth has been increasingly fuelled by credit over the past few years:
The chart above doesn’t quite show it, but non-bank credit growth outpaced bank loans last year. The rise of China’s shadow banking scene has happened very rapidly — much of the growth only happened since 2009. Read more
Elsewhere on Wednesday,
- A perfectly fair and reasonable way to rank central bankers.
- Draining excess reserves and the Fed’s exit strategy.
- Who’s going to move on China’s aluminium stockpiles? Read more
Older entries
1On negative interest rates and hoarding
2Beppe Grillo at market's close
3Has Ivan started drinking what Mick was drinking?
4Ye olde Abenomics
5Time to leave Whale enough alone?
Show more6Shinzo Abe's phaser
7Further reading
8Cap and still trade
9Deflating shadow credit in China
10Currency moves contextualised
Show fewer