Deutsche Bank staff say up to $12bn losses hidden || HSBC ‘may pay $1.8bn’ over money laundering || Asian stocks higher on US data || Citi cutting 11,000 jobs || Fiscal cliff talks a little more upbeat || US gas exports green lighted || Freeport acquisitions get lukewarm reception || McAfee arrested in Guatemala Read more
No explanation had been given by S&P at pixel time. [Update: it's pasted below the jump.] But the situation is pretty clear: Greece’s “voluntary” buyback of the PSI bonds is being carried out in distressed conditions (ie it will otherwise lose eurozone financial support). Read more
ROUND-UP
Apple dragged down the Nasdaq. The tech index fell 1.1 per cent, a drop almost entirely accounted for by Apple. The S&P 500 closed up 0.2 per cent at 1,409.28 (Reuters). Read more
Greece, apparently. Closely followed by Italy.
Those are the conclusions by Transparency International in their latest corruption perceptions index,which looks at how the public sees state sector corruption. The index, which this year includes 176 countries, focuses on perceptions of graft rather than empirical data because of the secrecy surrounding such goings on. Read more
Consultation paper from the Financial Services authority, fresh off the printing press on Wednesday morning… Read more
Live markets commentary from FT.com
Oh dear, Mongolia’s new dollar bonds “tentatively nicknamed Genghis Bonds” (h/t Katie Martin) have been hit by some shocking, hard to predict, political instability.
From Reuters:
One of the members of Mongolia’s fragile coalition government has ordered its ministers to leave their posts, a move that has sent the country’s bonds into a tailspin and could threaten the passage of crucial legislation.
Read more
Republicans in capital gains tax fight || Freeport plans return to energy || Schäuble puts brake on bank union plan || Australian economy loses steam || Tesco signals end of American dream || Paulson blames Europe bet for losses || Markets update || Rogoff’s robots! || The positives in cancelling central banks’ holdings of government debt || Why are Shanghai markets suddenly rising? Read more
Rogoff and Shuttleworth versus Theil and Kasparov at the Oxford Martin School. While the video is from November, we felt the need to review it given Rogoff’s op-ed on Tuesday covering the same subject.
Rogoff’s argument, which in part is intended to counter Robert Gordon’s ‘no robots’ thesis, is that… Read more
We’ve run a couple of posts here on FTAV recently about how cancellation of QE debt isn’t really such a big deal: more an accounting change than anything material because both treasuries and central banks are part of the public sector.
Here is an argument that this mere accounting exercise could be worthwhile — particularly if the debt-laden developed countries descend into another downturn. Read more
China’s markets are zooming upwards, and quite honestly who knows why? It could be something to do with the big politburo meeting yesterday, at which various pronouncements about the economic outlook were made. We’re not sure the remarks should be interpreted as meaning that continued large scale, infrastructure-focused stimulus is a certainty. Read more
Elsewhere on Wednesday,
- Mohamed El-Erian hearts NNT.
- Helicopters or not – doesn’t really matter.
- A happy Krugman is a happy… econblogosphere? Read more
Asia stocks rise, Shanghai Composite surges || UK austerity set to extend into 2018 || Tesco reconsiders difficult US venture || HSBC sells Ping An stake || Schäuble cools on eurozone banking union || Osborne to announce UK pension accounting review || Fiscal cliff talks set off Republican discord || Freeport returns to energy || Greek hospitals running out of gloves, gowns Read more
ROUND-UP
US stocks fell, insert fiscal cliff explanation here. The S&P 500 fell 0.2 per cent to close at 1,407.05. Gold fell below $1,700 a troy ounce (Financial Times). Read more
And so ends a little saga-within-a-saga in the Argentine bond holdout case (but one which shed interesting light on the various sides’ litigating strategies). Read more
Wednesday’s annual charity day at Exotix, the frontier markets brokerage. To that end…
Gabriel Sterne, Exotix analyst, has presented clients with his top ten eurozone crisis quotes of 2012. Of course Sterne gave the answers to who said them, but we thought it might be fun for readers to try and guess. We’ll reveal the answers later. Read more
Lord Dennis Stevenson (former HBOS and Pearson chair ) sent two rather telling letters to the FSA in 2008. Both were mentioned during Tuesday morning’s session with the Parliamentary Commission on Banking Standards and one of which claimed HBOS was “in as secure a position as it could be” roughly half a year before its collapse.
No “lurking horrors in our business or balance sheet” either.
Oh dear. Read more
The Reserve Bank of Australia cut its cash rate on Tuesday to 3 per cent — making a total of 175bps worth of cuts since November 2011, and bringing the rate to its lowest level since the depths of the financial crisis.
The RBA’s governor’s statement alluded to the bank’s discomfort over the stubbornly high Australian dollar, which is not doing what it tended to do in the past and falling to provide a fillip to the economy: Read more
Is this the watershed moment for international audit firms in China?
The SEC’s announcement it was launching administrative proceedings against the Big Four audit firms (plus BDO)’s Chinese affiliates was dramatic, but big audit firms in China have for some time been stuck between a rock and a hard place, because Chinese law prohibits audit work papers being moved out of the country. Read more
Live markets commentary from FT.com
Here’s embattled agriculture combine Olam on Tuesday morning:
Read more
Need some help from the ghost of Fiscal Cliff future with regards to what happens if current unsustainable trajectories are unchanged?
It’s possible you need look no further than Europe. While the causes of the cliff are different, it’s still the sort of drop off that can teach a valuable lesson or two. Read more
Mike Lynch has put together a website as a contact point and to publish views from himself and other former Autonomy management.
There is not much on the site so far, and most of it will be boring to anyone who’s been following the story; eg Lynch’s open letter to HP directors (of November 27); a clip of his interview with Maria Bartiromo on November 20. Read more
Elsewhere on Tuesday,
- The austerity dictionary.
- The hedge fund dictionary.
- Just what is a recession?
- The factory floor as a core competency. Read more
Asian shares fell on Tuesday after a US manufacturing showed a fall in activity. The MSCI Asia Pacific was 0.1% and the euro hovered near a six-week high on optimism over Greece’s plan to buy back debt. (Reuters)(Bloomberg)
“Republicans proposed steep spending cuts on Monday but gave no ground on President Barack Obama’s call to raise taxes on the wealthiest in their first formal proposal to avert a “fiscal cliff” that could push the US economy into recession.” John Boehner presented a $2.2tn deficit reduction package over 10 years, including $800bn in new taxes – much lower than the $1.6tn target for new revenue proposed by the president last week. (Reuters)(Financial Times) Read more
ROUND-UP
A subpar ISM saddled stocks. The S&P 500 closed down 0.47 per cent at 1,409.46. The Institute for Supply Management survey of manufacturing fell to 49.5 in November, below forecasts of 51.3, and the first reading below 50 since July (Financial Times). Read more
UPDATE – Beyond the to-and-fro about stays and the Second Circuit in the post below…
Bank of New York Mellon has filed for leave to appeal Judge Griesa’s revised order for Argentina to pay (and for third parties not to assist it in not paying – including BNY). This is a significant move given the role of BNY enabling payments to restructured holders as their trustee. It was kind of stuck in the middle over the dispute between Argentina, holdouts and restructured bondholders, and had last asked courts to clarify its obligations. This filing marshals indenture trust law, Rule 65(d) of the Federal Rules of Civil Procedure, and “dangerous precedent” to seek to challenge the merits of Judge Griesa’s ruling itself. Read more
Don’t ask the SFO, or accountants Grant Thornton, for that matter.
Here’s a long, angry letter sent by the Vincent Tchenquiz camp some months ago to Grant Thornton, forming part of the furious legal dispute between the Tchenguiz Brothers and the SFO.
At the bottom of page 19 you’ll find a section headed “Sainsbury’s proceeds.” It is allegedly the case that when the financial cops pounced — acting on information from GT, who were handling the unwinding of Iceland’s Kaupthing — neither the SFO or GT really understood how the modern stock market works. Read more
Older entries
1How cancelling central banks' holdings of government debt could be a useful thing
2BoE on HFT: "A large absolute noise contribution"
3A Dutch auction for Greece...
4And the most corrupt EU state is...
5Why are Shanghai markets suddenly rising?
Show more6Stevenson called "delusional" by others in 2012. Called "knowledgeably and well briefed" by himself in 2008. Go figure.
7Olam's capital raise U-turn - a block on Block?
8It's too early to call the FLS a flop, ok?
9The SEC charges the (Chinese) Big Four
10Quote... unquote, euro crisis edition [updated]
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