Pushy policy can help green finance to grow 1 Sep 2016 Green finance is high on the agenda at the G20. Policymakers see it as a way to fund much-needed infrastructure. Investors are also starting to pay more attention to environmental issues. Though big challenges remain, the top-down effort gives green finance a fighting chance.
China is wrong venue for an SDR revival 1 Sep 2016 Beijing wants to revive interest in Special Drawing Rights, the IMF quasi-currency it is about to join. The World Bank will sell $2 bln of SDR debt in China to help. Global investors badly need an alternative to the dollar but China's rickety bond market is a poor place to start.
Hershey’s kiss-off sets a new bar 31 Aug 2016 The U.S. confectioner snubbed a $25 bln offer from Oreo maker Mondelez, arguing it is worth more. That puts pressure on boss John Bilbrey to get the stock up at least to the bid price if not to where it said it would entertain talks. Otherwise, Hershey may become more vulnerable.
Stars are aligning for German bank merger fest 31 Aug 2016 Commerz and Deutsche Bank held talks earlier this month on a possible tie-up. These may have come to nought, but low rates and a bleak outlook make consolidation an increasingly good idea. The two biggest players may prefer other tie-ups, though.
BHP gives legal eagles lesson in accountability 31 Aug 2016 The mining giant is nixing CEO Andrew Mackenzie's bonus after last year's fatal Samarco dam collapse, days after its lawyers sidestepped blaming management. Withholding compensation is easier and may also be a faster way to persuade executives to pay attention to safety risks.
Rousseff ouster gives Brazil impetus to grow 31 Aug 2016 The country's Senate has impeached the president. Her replacement Michel Temer may be able to use that to his advantage and push unpopular steps to cement recovery next year. But lawmakers who were keen to dump Rousseff may be less willing to back his austerity measures.
Apple’s tax spat could blight European banks 31 Aug 2016 The tech giant’s $14.5 bln EU tax bill has shades of a $9 bln U.S. fine handed to BNP Paribas in 2014. Despite big differences, both have the whiff of a transatlantic raid on those deemed able to pay. EU banks awaiting U.S. fines, like Deutsche Bank and RBS, have cause to fret.
Libya is the fly in OPEC’s ointment 31 Aug 2016 Whether the cartel can push up oil prices depends on Tripoli. Libya’s production is small but unpredictable. Include the war-torn country in any output cap, and other OPEC members may end up forced to produce less. Ignore it, and efforts to rein in production could be wasted.
Bad finance: Japan Inc’s problem treasury shares 31 Aug 2016 Canon, Fujifilm and other blue-chips own lots of their own stock. Unnoticed, that can add phantom billions to valuations. Treasury shares can also bias bosses towards equity-heavy acquisitions or other deals that dilute shareholders. They should be cancelled, not held in limbo.
Cornerstones send HK stocks to trading graveyard 31 Aug 2016 Chinese state firms are relying on friendly investors to list in Hong Kong. The practice leads to unrealistic pricing and immobile shares. The city's stocks are already thinly traded; cornerstone-heavy IPOs make the problem far worse. No wonder bankers are fed up.
Potash giant emerges from ashes of failed deals 30 Aug 2016 Merger talks between Canada's Potash Corp and Agrium follow a string of aborted combinations dating back to Australian miner BHP Billiton's $39 bln swoop on Potash in 2010. As a commodities boom has gone bust, friendly attempts to forge a more modest merger look achievable.
Argentina’s Macri loses skirmishes but winning war 30 Aug 2016 The president's big-bang approach to fixing the economy after years of state largesse has yet to pay off. A court has even blocked home-heating bill hikes. But Macri is learning no battle plan survives contact with the enemy. A more measured strategy will bring results in 2017.
Exiting French economy minister is odd insurgent 30 Aug 2016 Leaving the government frees Emmanuel Macron to speak out before the 2017 presidential elections. The former banker’s most radical quality is mixing policies and ideas from both left and right. That makes him less dangerous, and more likely to be absorbed by established parties.
Apple makes for an easier target than tax fairness 30 Aug 2016 The EU wants Ireland to recoup up to $14.5 bln from the iPhone maker. Even that's only 6 pct of its cash. U.S. authorities dislike the ruling, but also are eyeing Apple's stash. Both the company and Ireland want their deal to stand. The global tax grab is unlikely to end well.
TPP push could use a cattle drive 30 Aug 2016 The Obama administration's wobbly attempts to promote the trade deal are stalling. The nation's ranchers, meanwhile, have cooked up a juicy pitch highlighting the simple financial benefits of the pact. That's a far superior way to gather Americans around the same table.
Europe’s bite at Apple could leave bad aftertaste 30 Aug 2016 The European Commission wants companies to pay their fair share of tax. Zeroing in on Apple’s alleged sweetheart deal with Ireland fits that agenda. But it could misfire. Reeling from Brexit, Dublin might feel pressure to make itself even more friendly to corporate taxpayers.
Warsaw charm offensive shows London’s strengths 30 Aug 2016 Poland hopes to woo investment banks from the UK to its capital city. Credit Suisse, Goldman and BNP Paribas each have 300 or more staff in-country. But most are IT support, not revenue creators. The point is that financial hubs are built on far more than low costs.
China’s interbank market may spread financial flu 30 Aug 2016 The repo market could transmit stresses from weak lenders to the wider financial system before authorities can intervene, a new report argues. Wacky products funding long-term projects with short-term money could fail, sparking a credit crunch.
Tokyo’s analysts outperform on a bad metric 30 Aug 2016 Sell-side researchers everywhere are under pressure to be kind to companies. Yet Japan stands out for the uniformity of opinions, a Breakingviews analysis shows. More than half of big stocks in the country don't have a single negative rating. No wonder short-sellers are circling.
BlackRock’s governance activism finds big target 29 Aug 2016 The manager of $5 trln of funds withheld votes from two Exxon directors at the $360 bln oil giant's annual meeting. CEO Larry Fink has spoken out against management short-termism and recently took on a Hong Kong gold miner. BlackRock is slowly and quietly finding its voice.
Eddie Lampert is more whaling captain than hedgie 29 Aug 2016 Once upon a time, the investor was hailed as the next Warren Buffett. His decade-plus obsession with Sears resembles Ahab's with Moby Dick. Extending another $300 mln loan to the flailing retailer is the latest sign that Lampert just doesn't know how to let go of the harpoon.
Mexico can build on its Enrique Ford moment 29 Aug 2016 An improving economy already has helped reverse a migration tide Donald Trump wants to stop with a wall. Higher factory wages - à la Henry Ford's wisdom - are boosting car sales at home and enlarging the middle class. That also benefits the United States in ways worth fostering.
Mylan copies own EpiPen, parodies U.S. drug system 29 Aug 2016 The $23 bln pharma group, under fire for raising prices, is launching generics identical to its branded anti-allergy injectors at half the price. The unusual move raises questions about Mylan's motives. Even if they're genuine, it's an indictment of a byzantine market structure.
Twin engines power BYD in electric car race 29 Aug 2016 The Chinese group's vehicle sales surged in the first half. Government subsidies are fueling growth and BYD's in-house battery unit give it an edge over local rivals. A rare dividend payment reveals the confidence of boss Wang Chuanfu even as competition intensifies.
China’s blue-sky fix does more harm than good 29 Aug 2016 A seat at the global leadership table comes with a big dose of criticism. A vision of blue skies and friendly allies for the G20 meeting shows that the People's Republic needs thicker skin. Solving problems requires facing them honestly and not further distorting market reality.
Apollo wagers $4.3 bln on Amazonian capitulation 26 Aug 2016 Leon Black's private-equity firm is taking Rackspace private as the cloud-computing firm has struggled to compete against Amazon, Microsoft and other tech heavyweights. If Rackspace's strategic shift to sell services on these platforms succeeds, Apollo will have a nice payday.
Review: Taking the woe out of scarce H2O 26 Aug 2016 Drought and rising global water needs often seem intractable sources of tension. John Fleck's "Water is for Fighting Over" uses cooperation over the much-contested Colorado River to challenge such assumptions. It offers hope for water's role in sustainable economic development.
Yellen defends Fed tools but is wary of using them 26 Aug 2016 The U.S. central bank chief stood up for techniques like asset purchases, amid political attacks on the Fed's powers. But keeping lawmakers on side could constrain Yellen's choices. One example is her apparent reluctance to raise interest rates despite a strengthening case.
Chancellor: Zero-coupon bonds are not a joke 26 Aug 2016 On April Fools' 10 years ago Breakingviews suggested Washington fund itself with perpetual bonds paying no interest. The idea is now being seriously touted by some monetary policymakers. For households with cash and other assets that would evaporate, this is no laughing matter.
Burkinis oust economics in French identity tussle 26 Aug 2016 A ferocious debate over bans on full-body swimwear sounds like pre-election posturing, but is more than that. France is less and less able to hang its identity on a unique economic and social model. As a result, the battleground is shifting to its deep-seated secular tradition.