Euromoney (May Issue)
“The central bank-driven global money-go-round has been turning ever faster since last summer. Now the Bank of Japan has turbo-charged it. So far, investors are enjoying the ride. But a bout of nausea cannot be ruled out.”
Tags: Bank of Japan, Central banks, Expansion, Investors, Monetary policy, Outlook, Risk
The Economist (May 11, 2013)
Following the darkest days of the financial crisis, more than a few European bankers and leaders were caught gloating. It looked like the big Wall Street investment banks had been beaten. “Almost five years on it is Europe’s banks that are on their knees and Wall Street that is resurgent.” But this comeback may be a nightmare in disguise. “Indeed, it is American taxpayers and investors who should worry about the dominance of a few Wall Street firms. They bear the main risk of future bail-outs.”
Tags: Bail-outs, Europe, Investment banks, Investors, Taxpayers, U.S., Wall Street
Businessweek (April 23, 2013)
Credit ratings agency Standard & Poor’s (S&P) is trying to dismiss a fraud suit being filed by the U.S. Department of Justice. Both “outrageous” and “even insulting,” S&P’s defense asserts “S&P cannot be held liable for its prolific claims of integrity and analytic skill because those boasts were the sort of baloney that investors and the wider public never take seriously in the first place… In other words: Only a sap would believe the nice things we say about our work.”
Wall Street Journal (April 18, 2013)
“Gold’s Plunge Is Cause For Optimism.” Gold investors may not feel the same after watching their asset lose over 15% of its value since February. Still, the plunge could signal a promising trend if capital is redirected from dollar-devaluation hedges “toward investments in what has been called ‘the economy of the mind’—that is, new entrepreneurial endeavors and industries.”
Tags: Devaluation, Dollar, Economy of the mind, Gold, Investors, Plunge, Trend
“New York Times (April 7, 2013)
U.S. regulators like FINRA need to confront today’s changing market where trading “has increasingly migrated away from public exchanges, like the New York Stock Exchange, to private trading venues, mostly operated by big banks.” With approximately 40% of trades being handled through dark pools and internalizers, markets are losing transparency and may become more susceptible to crashes and manipulation. Canadian and Australian regulators have already taken steps to protect their markets. U.S. regulators need to get with the program. “The market cannot be efficient if many orders never see the light of day. An inefficient market is neither fair nor stable, which makes a strong regulatory response to protect investors imperative.”
Tags: Australia, Canada, Dark pools, Efficient markets, FINRA, Investors, NYSE, U.S.
Wall Street Journal (April 3, 2013)
“Japan’s quadrillion-yen market for government bonds is grappling with something it usually doesn’t face: volatility. Price gyrations are rising as bond investors try to assess how Prime Minister Shinzo Abe’s fresh attack on deflation will play out in a market accustomed to a steady decline in consumer prices and a cautious, predictable central bank.”
Tags: Abe, BOJ, Bond market, Consumer prices, Deflation, Investors, Japan, JGBs, Volatility
Financial Times (March 17)
“Net buying of Japanese equities by overseas investors amounted to slightly more than Y1tn in the first week of March – the highest weekly figure in Tokyo Stock Exchange records going back to 1982.” IPOs have also shot to top position in Tokyo and now rank second globally. “As investors have warmed to the pro-growth policies of Shinzo Abe, prime minister, since the beginning of January, newcomers to Japan’s markets have raised Y181bn ($1.9bn) – more than issuers in Singapore, Hong Kong and Australia combined.”
Financial Times (March 11)
“Welcome back, Mrs Watanabe. The mythical keeper of Japan’s household savings has spent a long time in retreat, selling a net Y3.6tn of foreign securities over the past 18 months amid a strong yen and weak overseas prospects. But as the effects of “Abenomics” start to trickle down to consumers and private investors in the world’s third-largest economy – and as global recovery hopes brighten – this canny player of global currencies and interest rates has begun to stir once more.”
Tags: Abenomics, Currencies, Interest rates, Investors, Japan, Mrs. Watanabe, Securities
Euromoney (March Issue)
“Investors are probably being too bullish about the size and buying power of Africa’s middle class.” Following a 2011 African Development Bank (ADB) report which pegged the middle class at 313 million, “it has become commonplace to hear wonderful things about the rise of Africa’s middle class.” The ADB’s figure, however, is misleading as it includes individuals making between $2-5 per day. Using a more conservative definition of those making $10-20 per day, Africa’s middle class would probably number less than a quarter of the ADB’s estimate. “Africa has vast potential, but investor sentiment today is pricing in a level of progress towards it that is not yet backed up by facts.”
Tags: ADB, Africa, Investors, Middle class, Misleading, Potential, Sentiment
Forbes (February 5)
“The U.S. Justice Department announced plans to file civil fraud charges against Standard & Poor’s (S&P) relating to the atrocious ratings that Standard & Poor’s gave to toxic subprime mortgage-backed securities…. This is a welcome—if long overdue—development for investors who have been waiting for years for the Feds to take decisive action against those responsible for crashing the world economy.”