While the G-20 agreement to move forward with a coordinated approach to bank capital rules and employee incentive payments is progress, it is important to recognize that what took place was effectively an apple pie and motherhood statement. The one stake in the ground was the commitment to make Tier 1 Capital a key metric. […]
Read more...Earlier this week, on the eve of a G-20 meeting, some European ministers were not only threatening to implement tough restrictions on the financial services industry, but they also asserted that the G20 was largely in alignment. That did not seem credible, particularly given the US propensity to talk tough and do very little on […]
Read more...From derivatives expert Satyajit Das of Traders, Guns & Money fame: In the 1980s, the Japanese were taking over the world. In the 1990s, it was going to be an ‘Asian’ century. These days the pundits are betting on the ‘Chinese Age’. Like all such glib predictions, despite their superficial appeal, they mask complex undercurrents […]
Read more...It must be lonely being a China bear….particularly for those dubious about its longer term prospects, as opposed to those who might simply think its stock market is a bit ahead of itself even after its recent correction. Vitaliy Katsenelson, in an article at MorningStar, beings almost sounding a tad persecuted before he warms up […]
Read more...Conspiracy theorists will have to wait until the article described in Inside Science is published to determine whether it delivers on its claims. It purports to analyze stock holding across 48 countries and alleges they are held in very few hands. But the work was done by physicists, which means they may not have understood […]
Read more...Some investors see the Baltic Dry Index, a proxy for the shipping rates for dry bulk cargoes, as an indicator of international trade activity. BDI is admittedly noisy, and so needs to be interpreted along with other information. Chinese imports have been a driving factor in commodities demand, which drives the BDI. The price of […]
Read more...This idea of China being ahead of the game in anything environment protection related probably strikes readers as ironic, given reports of extensive industrial pollution, such as air pollution on a scale that is changing weather patterns, large scale lead poisoning, and cadmium in the soil. As Forbes commented recently, “China: Where Poisoning People Is […]
Read more...Ambrose Evans-Pritchard has a good piece up at the Telegraph on an issue that appears not to have gotten the attention it merits, namely, the level of underutlization of capacity and the risk it poses to anything dimly resembling recovery. Evans-Pritchard brings up a related topic, that deflation is a bigger issue that most commentators […]
Read more...It was conventional wisdom in the US and UK financial press that Europe was dong a hopelessly bad job of responding to the economic downturn, that it needed to do vastly more in the way of fiscal stimulus, that it was consigning its citizens to continued recession, and the Te Germans in particular were to […]
Read more...Japan may be on the verge of some major shifts, The fact that what amounts to one-party rule in Japan appears at an end ought to be significant, but the proof will be in the pudding. The island nation has been ruled by the Liberal Democratic Party for virtually the entire postwar period, with politics […]
Read more...Oh, there is nothing like a global retreat of liquidity to reveal who was wearing a swimsuit. And what wags like Warren Buffett fail to add, when a lot of people were found to be unclad, you also get to see who looks best of a typically not so fetching bunch. In this case, California […]
Read more...Even though China keeps putting out cheery official numbers, its purchases of commodities are down, suggesting there is less to its stabilization than meets the eye. It’s early to say that this is conclusive, but there is a good bit of other anecdotal information and some firmer information raising questions about the true state of […]
Read more...In a Financial Times comment. Michael Pettis gives a well-reasoned and glum forecast for Chinese growth, namely, that it is unlikely to exceed 5% to 7% over the next few years. The reason he sets forth is that China was able to show growth rates in excess of domestic consumption growth thanks to US exports. […]
Read more...Submitted by Edward Harrison of Credit Writedowns. Germany never participated in the upswing of the housing bubble. This fact has led German politicians of all stripes to mistakenly believe their banking system was somehow immune to the problems infecting bubble markets like the US or Spain. Unfortunately, it has not worked out that way because […]
Read more...Submitted by Edward Harrison of Credit Writedowns. Last week, I followed up Yves Smith’s excellent post on “Why Big Capital Markets Players Are Unmanageable” with “More on why big capital markets players are unmanageable.” I would like to extend the discussion beyond the U.S. border into a look at how the universal banking model abroad […]
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