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Monday, 08 February 2016

BREAKINGVIEWS

Pro Chrysler Jeep line technician Bob Basemann shows off a tattoo n Thornton, Colorado December 19, 2008.

Decent U.S. jobs report leaves Fed in quandary

05 February 2016

Wage growth may finally be taking hold. Americans are getting better-paying work, spurring more people to seek it. January’s headline figure of 151,000 new jobs undershot estimates, though. And Janet Yellen et al know they’ll be blamed for global market volatility, too.

Pumpjacks taken out of production temporarily stand idle at a Hess site near Williston, North Dakota November 12, 2014.

Hess stock buyback folly is one for the ages

05 February 2016

The $11 bln oil explorer is selling shares to shore up capital. Not long ago, it repurchased more than twice as many at double the price amid an Elliott insurgence. The toxic mix of a cyclical industry, activism and financial engineering should be a required boardroom case study.

The NFL Super Bowl XLIX football game in Glendale, Arizona February 1, 2015.

Super Bowl 50 could mark peak sports TV

05 February 2016

More than 100 mln people are due to watch the Panthers and Broncos battle for supremacy on Sunday amid $10 mln-a-minute ads. Live sports are pivotal for broadcasters but the $18 bln price tag is getting harder to justify. As cord cutting accelerates, the chalice will be poisoned.

Spanish Prime Minister and People's Party (PP) leader Mariano Rajoy pauses during a campaign rally ahead of Spain's general election in Valencia, Spain, December 18, 2015.

Spain at risk of a lost year

05 February 2016

The country’s political parties still haven’t formed a government seven weeks after an inconclusive election. In the short term, it’s unlikely to have a big impact on the economy. But a prolonged stalemate could hurt confidence and sap momentum, as well as deter corporate deals. 

A Benjamin Franklin U.S. 100-dollar banknote and a Chinese 100-yuan banknote depicting the late Chinese Chairman Mao Zedong, are seen in a picture illustration in Beijing, China, January 21, 2016. REUTERS/Jason Lee

Breakdown: The cost of China’s capital outflows

05 February 2016

Foreign currency reserves shrank by $513 bln last year, reversing two decades of cash flooding in. The decline has spooked global markets, put pressure on the yuan and prompted a renewed rush for the exits. Breakingviews looks at the causes and consequences of the exodus.

Customers line up outside a Bank of East Asia's (BEA) branch in Hong Kong September 24, 2008. Hong Kong lender BEA denied on Wednesday local rumours questioning its stability, which had drawn hundreds of people to at least one of its branches and drove it

Elliott’s HK bank fight smacks of desperation

05 February 2016

The activist fund is pushing for a sale of Bank of East Asia. Other big shareholders are unlikely to join in. It’s also a bad time to seek a buyer for a group with such a large exposure to China. Elliott’s latest salvo suggests it’s getting nervous about its $500 mln bet.

Philippe Dauman of Viacom in Half Moon Bay, California, July 22, 2008.

Viacom's boardroom drama belongs on reality TV

04 February 2016

CEO Philippe Dauman replaced Sumner Redstone as chair of the $18 bln media firm, thwarting the controlling stockholder’s daughter, Vice Chairwoman Shari Redstone. She wanted an independent leader. Investors may not like the soap opera, but it has potential as a much-needed hit series.

A lock icon is seen on an Internet Explorer browser in a photo illustration in Paris April 15, 2014.

Activist + private equity = no M&A for Symantec

05 February 2016

The internet security group netted $5.3 bln from selling Veritas. Pressured by Elliott, it’s now borrowing $500 mln from Silver Lake and returning all the cash to investors rather than keeping a war chest. Symantec’s questionable dealmaking record makes the straitjacket merited.

BNP Paribas bank Chief Executive Officer Jean-Laurent Bonnafe attends the presentation of the bank's 2012 annual results in Paris February 14, 2013.

BNP Paribas merits shift up EU bank pecking order

05 February 2016

France’s largest bank’s 30 pct discount to tangible book value implies investor fears about its so-so capital and exposure to stricken oil groups. BNP Paribas’ top line in its three main arms still grew in the final quarter. It should be trading nearer the likes of ING.

Coils of steel are seen at the ArcelorMittal Factory in Florange, Eastern France, October 18, 2013.

Arcelor does more than needed, less than enough

05 February 2016

After a $7.9 bln net loss for 2015 and big writedowns, the steelmaker has launched a $3 bln rights issue. It buys time for a cost-cutting programme, but ArcelorMittal’s real issue is outside its control: the aggressive supply tactics of Chinese steelmakers and Australian miners.

A man sits atop a load of cardboard at a garbage centre on the outskirts of the town of Dangcheng, located 250 km (155 miles) southwest of Beijing, March 23, 2009.REUTERS/David Gray

China's record waste deal is far from rubbish

05 February 2016

State-backed Beijing Enterprises is buying Germany’s Energy from Waste for $1.6 bln. Unlike some of China’s splashier foreign deals, this looks decently priced and makes obvious strategic sense. China badly needs more clean-technology expertise. Expect more trashy buys.

U.S. President Barack Obama delivers remarks on the economy and fuel standards during a visit to a Safeway Distribution Center in Upper Marlboro, Maryland February 18, 2014.

Obama oil-tax idea deserves at least a test drive

05 February 2016

The U.S. president’s $10-a-barrel fee would fund infrastructure and nudge consumers from fossil fuels. It might also up demand for gas-sipping autos, helping carmakers meet emissions goals. And energy firms could pass on the cost. It will, alas, surely stall in an election year.

European Central Bank President Mario Draghi adjusts his earphones as he attends a debate on the ECB Annual Report for 2014, at the European Parliament in Strasbourg, France, February 1, 2016.

Activist Draghi is failing to make his mark

04 February 2016

ECB chief Mario Draghi says rate-setters must try to stoke price pressures when inflation is too feeble for too long. Yet for all his bustle, the Italian is less trusted by investors to conjure up inflation than his wait-and-see peer, Bank of England Governor Mark Carney.

Videos

A man walks up a spiral staircase at the Museum of Contemporary Art in Chicago, Illinois, September 3, 2014. REUTERS/Jim Young

Predictions 2016: Stairway to Heaven, Highway to Hell

Read our predictions for the year ahead here

Columns

Rob Cox

Cox: Bloomberg's White House hurdle is Wall Street

04 February 2016

The media mogul mayor may yet try to be U.S. president. Hands down he’d be the richest contender ever. It would take extreme candidates Bernie Sanders and Ted Cruz as nominees for Michael Bloomberg to run. The bigger issue is that he’d have his deep ties to finance to explain.

Hugo Dixon

Dixon: How to rehabilitate capitalism

01 February 2016

The classic leftist response to capitalism’s unfairness - tax and spend - has failed. A better bet is to fight unfairness caused by corruption, vested interests and tax cheating, while investing in education. India and Italy show some of the right ideas.

Features

Fiona Maharg-Bravo

European mobile mergers won’t kill competition

01 February 2016

The European Union is reviewing a UK merger between O2 and Three. Other deals are in the works. More concentration raises the spectre of higher bills for consumers. But past tie-ups suggest that’s not inevitable at all.

Una Galani

Malaysia's strongman faces a challenge to impress

21 January 2016

Prime Minister Najib Razak has survived a political scandal over dubious payments he received. He has also managed to tame debt at the sovereign fund he championed. Though his position looks secure, low oil prices and racial divisions will test efforts to repair his legacy.