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Friday, 22 May 2015

BREAKINGVIEWS

Greece

Debt extension could help Syriza but hurt Greece

22 May 2015

Europe could split off payments owed to Greece from its second bailout, according to reports. The move could break an impasse over reform talks and avoid a messy default. Yet Europe would have less leverage over the Syriza-led government and the Greek economy would suffer. 

David Cameron

UK can use bank reform as EU bargaining chip

22 May 2015

France objects to Britain adopting its own extra-tough bank structural reform, reports say. But there’s little to gain from ring-fencing retail lenders, and a flexible UK can negotiate a better deal with Brussels. A  British retreat could kill two birds with one stone.

HP's China deal extracts harmony from awkwardness

22 May 2015

Selling 51 pct of its Chinese networking unit for $2.3 bln to a state-owned company looks like a partial retreat from an unfriendly market. But the U.S. tech giant now has a powerful ally with deep ties to Beijing. Rivals from Cisco to Microsoft should consider similar matches.

malaysia

Malaysia's GDP blueprint has a credibility deficit

22 May 2015

Najib Razak has vowed to make the country rich by 2020. Investors are wary. The opposition chief is in jail, race relations are tense, and a scandal-plagued state investment fund has hurt the prime minister’s authority. A slumping ringgit shows there could be trouble ahead.

A customer holds a bag full of food inside of a Shake Shack store in New York January 30, 2015.

Shake Shack unveils a cluckin' $250 mln sandwich

21 May 2015

The value of Danny Meyer’s upscale burger chain shot up 8.5 pct, seemingly on news that it may start outlets serving up chicken-based fare. Investors seeking signs of exuberance in wearables might do better looking at edibles. Shake Shack is now worth 550 times earnings.

Ancestry.com

Sale would add to gnarly Ancestry.com family tree

21 May 2015

The genealogy website went public in 2009, only to sell itself to a Permira-led private equity consortium three years later. Now it’s on the block again, according to Reuters. The company has been struggling to turn nostalgia into profit. A new owner may not fare any better.

A journalists requests to ask question as European Central Bank (ECB) President Mario Draghi addresses an ECB news conference December 4, 2014.

ECB struggles with central bank news frenzy

21 May 2015

When markets hang on your every word, rate-setters have to be careful what they say to whom. An ECB board member crossed the line and the euro zone central bank is under fire. Now it’s clamping down on dealings with media. Such undersharing can be just as bad as oversharing.

The Barclays headquarters building is seen in the Canary Wharf business district of east London.

Bankers get ammo but no ally in regulation tussle

22 May 2015

Financiers unhappy with tougher regulation can cite new analysis from the BIS. The central banks’ own central bank says new standards will probably change how economies and markets work. But the BIS is firmly focussed on coping with the new paradigm, not returning to the old one. 

A bull statue is seen in front of flags of (L-R) Hong Kong Exchange, China and Hong Kong outside the

Real cost of Hong Kong mega-slump: under $3 bln

22 May 2015

The mystery collapse of Hanergy, Goldin Financial and Goldin Properties wiped $44 bln off their market values in two days. But actual losses for those who bought during the rally in recent months are far smaller. Big numbers aren’t always what they seem – especially in China.

The Hewlett-Packard (HP) logo is seen as part of a display at the Microsoft Ignite technology conference in Chicago, Illinois, May 4, 2015.

HP improves on logic of its split

21 May 2015

CEO Meg Whitman originally thought separating the company’s PC arm would incur $1 bln a year in extra costs. The figure is now down to about $425 mln. That should help the split narrow the $61 bln HP’s stubborn conglomerate discount, even if it won’t create a glowing new future.

A road sign warning drivers of elderly people crossing the road is seen in Hale, northern England February 19, 2015.

Spendthrift U.S. retirees set up somber stagnation

21 May 2015

Dour days lie ahead for Americans, thanks in large part to Baby Boomers. The biggest generation, just beginning to leave the workforce, has saved even less than past groups and isn’t likely to reap more government benefits. Their relative penury will slow down GDP growth.

Liberty Media chairman John Malone talks to reports as he arrives at the Sun Valley Inn in Sun Valley, Idaho July 8, 2009.

John Malone's trigger finger could get itchier

21 May 2015

The original cable cowboy’s home turf has been invaded by Patrick Drahi, a protégé who rode in guns blazing to buy Suddenlink. Malone typically leads the industry herd, but might be challenged anew for Time Warner Cable. Then again, maybe the deal is big enough for both of them.

An employee is seen walking over a mosaic of pound sterling symbols

Laggard fund managers miss LTIP-ping point

21 May 2015

Two-fifths of FTSE 100 companies are heeding calls to reform bosses’ long-term incentive plans. But several of reformer-in-chief Fidelity’s UK quoted fund manager peers are yet to sign up. They should be championing governance best practice. Non-compliance merits explanation. 

Videos

Columns

Edward Hadas

Edward Hadas: The uses and abuses of GDP

20 May 2015

The standard measure of output is a useful indicator of short-term trends. It can also help compare levels of development. In poor countries, faster GDP growth is a good policy goal. But in richer countries, GDP-think misses important economic changes and challenges.

Rob Cox

Rob Cox: Why Remington's investors shouldn't sell

19 May 2015

Gun safety groups and Snoop Dogg pressured Cerberus to cleave the maker of a notorious assault rifle from its funds. Now Cerberus can get back to work raising money. Social activists need to behave more like their shareholder brethren to have any hope of changing this business.

Hugo Dixon

Hugo Dixon: EU reform is more than renegotiation

18 May 2015

David Cameron needs to realise this as he builds up to the referendum on the UK’s membership of the EU, which could take place as early as next year. The UK prime minister may get little from set-piece renegotiation of Britain’s EU relationship; reforms are more promising.

Features

Edward Chancellor

Review: The virtual bubble of bitcoin

15 May 2015

The digital currency fits well in the inglorious history of finance. Nathaniel Popper tells the story in “Digital Gold”. Bitcoin’s hot idea, limited supply and uncertain value helped spawn a price explosion. After the bust, the underlying technology may still have a future.

BV

HSBC in 2020: An imagined letter to shareholders

15 May 2015

Moving its head office to Shanghai marks a new era for the bank, writes chairman Hank Paulson in a make-believe memo. However, despite escaping hostile regulators in the aftermath of Britain’s divorce from the European Union, HSBC faces many challenges, both familiar and new.