Wall Street Journal (October 7)
“Billionaire Warren Buffett tossed lifelines to a handful of blue-chip companies during the financial crisis. Five years later the payoff on those deals is becoming clear: $10 billion and counting.” In terms of income before taxes, the investments to companies like Bank of America, Dow Chemical, General Electric, Goldman Sachs and Mars, have yielded Berkshire approximately 40%. Berkshire received an attractive premium, but provided the companies with critical capital and something even more valuable: “Mr. Buffett’s implicit endorsement of their long-term prospects. Shares of these companies generally went up after they revealed Berkshire’s involvement.”
Tags: Bank of America, Berkshire, Billionaire, Blue-chips, Capital, Dow Chemical, Endorsement, Financial Crisis, General electric, Goldman Sachs, Investments, Mars, Payoff, Premium, Shares, Warren Buffett
Wall Street Journal (September 20)
“What will German voters be choosing when they go to the polls on Sunday? A new Parliament, definitely, but not likely a new direction for their government. In this year’s federal election campaign, the parties’ platforms could have been written two years ago, the candidates for Chancellor are allergic to bold ideas, and opinion polls have been flat for months, only tightening a little in the last few weeks. Europe’s most important election since the financial crisis is an election about nothing.”
Tags: Bold ideas, Campaign, Chancellor, Election, Europe, Financial Crisis, Germany, Government, Opinion polls, Parliament, Polls, Voters
Institutional Investor (September 17)
“As the global recession and financial crisis recede in the rearview mirror, companies have been acting more proactively in using their balance sheets in ways that enhance shareholder value. But we think they can do more…. By mid-2013, U.S. companies were sitting on cash that was equivalent to about 11 percent of their total assets, a three-decade high and earning almost nothing.” Fortunately, there are signs of change. Companies “have become more receptive to using debt to buy back shares, increase dividends and make acquisitions.”
Tags: Acquisitions, Assets, Balance sheets, Buybacks, Cash, Debt, Dividends, Financial Crisis, Recession, Shareholder value, Shares, U.S.
Euromoney (August Issue)
In the U.S., it seems everyone is becoming an entrepreneur. “Some 6 million businesses were created in the U.S. in 2012. The country is experiencing a start-up boom…. Since the financial crisis, the number of businesses being started has rocked.”
Tags: Boom, Businesses, Entrepreneur, Financial Crisis, Start-ups, U.S.
Financial Times (August 19)
Auditors bear some blame for the financial crisis, yet little has been done to improve the quality of their audits. The Public Company Accounting Oversight Board (PCAOB) has now proposed more detailed disclosure to highlight items of concern, even when a company passes the audit. “The Securities and Exchange Commission, which has the final say, should adopt the PCAOB’s proposal. This would match similar rules passed by the UK’s Financial Reporting Council…. Pass-fail cannot distinguish accounts that pass with flying colours and those that barely scrape by. Investors deserve better – and investors are auditors’ true constituency even if managers are their employers.”
Tags: Auditors, Audits, Disclosure, Financial Crisis, Financial Reporting Council, Investors, Pass-fail, PCAOB, Quality, Rules, SEC, UK
Institutional Investor (August Issue)
“In the wake of the financial crisis a few years ago, it seemed as if the world economic order had been turned upside down” The U.S, Europe and other established markets appeared risky and emerging markets “that once seemed risky began to look like a sure bet…. Today the supposed new world order already seems, well, old. Emerging markets have been among the worst-performing asset classes this year, and capital has been flowing out at a record pace in recent weeks.”
Tags: Asset classes, Economic order, Emerging markets, Established markets, Europe, Financial Crisis, Risk, U.S.
The Economist (July 27)
“After a decade of surging growth, in which they led a global boom and then helped pull the world economy forwards in the face of the financial crisis, the emerging giants have slowed sharply.” This slowdown in emerging markets “is not the beginning of a bust. But it is a turning-point for the world economy.”
Tags: Boom, Bust, Emerging markets, Financial Crisis, Growth, Slowdown, Turning-point, World economy
Washington Post (May 13, 2013)
“It’s been five years since the onset of the financial crisis — the rescue of Bear Stearns in March 2008 — and we still don’t know whether the financial system is safe.” Progress has clearly been made, but whether it’s sufficient or even the right sort remains very much to be seen. “Will Dodd-Frank save capitalism or suffocate it? It may be years before we know.”
The Economist (May 1, 2013)
“Youth unemployment is a big and growing problem.” With a few exceptions, such as Germany, youth unemployment has been grown worse since the 2008 financial crisis. “Globally nearly 290 million young people are neither working nor studying calculates the Economist, almost a quarter of the planet’s youth.”
Tags: Financial Crisis, Germany, Studying, Unemployment, Working, Youth
Washington Post (October 24)
The International Monetary Fund (IMF) released its World Economic Outlook. It predicts that during the next four years, the U.S. “will be the strongest of the world’s rich economies. U.S. growth is forecast to average 3 percent, much stronger than that of Germany or France (1.2 percent) or even Canada (2.3 percent). Increasingly, the evidence suggests that the United States has come out of the financial crisis of 2008 in better shape than its peers — because of the actions of its government.”
Tags: Canada, Financial Crisis, France, Germany, Government, Growth, IMF, U.S., World Economic Outlook
