BREAKINGVIEWS

Fox’s final stop could be $76 billion

22 June 2018

Back out the bits that Disney and Comcast don’t want, adjust for the time vale of money, and it looks like investors think Rupert Murdoch’s media empire will squeeze $5 billion more from its two suitors. Though the numbers could still shift, it suggests the fight isn’t over.

Saudi Arabia finds OPEC solution that helps itself

22 June 2018

At the oil producer group’s Vienna meeting Riyadh needed to hike output without sparking an Iranian walkout. It succeeded, and in a way that could gee Saudi oil revenue. The catch is that President Donald Trump may soon twig that the deal may not help to curb high oil prices.

Conagra food deal could leave heartburn

22 June 2018

The $15 bln owner of Hebrew National and Reddi-wip could tie up with smaller rival Pinnacle after hedge fund Jana has come calling. Bulking up is one way to fight slow growth as consumers shift from processed fare. But justifying a deal requires cost cuts which may be a stretch.

Airbus’ Brexit certainty drive is wishful thinking

22 June 2018

The nature of the planemaker’s business means that earmarked transition periods after a UK exit could be too short. But its call for clarity on future arrangements will fall on deaf ears. Even if UK politicians weren’t bungling the process and wanted to help, they can’t.

Greece swaps bailout hell for eternal purgatory

22 June 2018

Eight years after seeking financial help Athens can at last support itself, helped by extra euro zone funds and debt relief. But borrowings of over 300 bln euros mean it must maintain a tight budget, and submit to regular scrutiny. Doubts over its debt sustainability will linger.

Saudis’ OPEC tightrope has trade war safety net

22 June 2018

The kingdom’s desire for oil output hikes faces pushback from Iran, its usual antagonist. Even if it strikes a deal in Vienna on Friday, lost supply from Venezuela may still push up prices. Riyadh’s saving grace could come if a trade war between the U.S. and China saps demand.

BoE wrangle reflects rate setters’ identity crisis

22 June 2018

The opposition Labour party wants the Bank of England to include productivity targets in its mandate. The idea seems flawed - monetary policy is a weak tool for boosting efficiency. But it reflects a growing political dissatisfaction with independent yet impotent central banks.

America Inc. may want to revise China growth plans

22 June 2018

Trade tensions might hit the U.S. stock market from another angle. A Communist Party tabloid just published an op-ed warning Beijing could target DJIA constituents such as Apple and Boeing. The scope of retaliation is limited by economics, but big expansion could be curbed.

Mongolian coal IPO may keep wandering

22 June 2018

The Central Asian nation revived plans to list its prize mine, seven years after it tried at a $15 bln valuation. Coal prices have rebounded from 2015 lows and Chinese demand is strong. With just one big customer and years of false starts, though, investors will need convincing.

U.S. sales-tax fix has global parallels

21 June 2018

The Supreme Court scrapped precedent and said states can force retailers to collect levies on sales to residents even if the sellers aren’t physically present. States will regain a tax base eroded by geographical arbitrage and the internet – two causes of worldwide tax tensions.

Tax reform puts utilities’ good credit at risk

21 June 2018

Debt investors have long favored power companies because their regulated monopoly status provides good assurance of payback. But tax cuts are limiting companies' billing power and their ability to deduct investment spending. Natural disasters add an extra layer of risk.

People’s Fed will provide armor in economic dip

21 June 2018

Chairman Jay Powell says he’ll speak in plain English about what the U.S. central bank does. He also admits the Fed doesn’t have all the answers. Demystifying it should strengthen its credibility. That will be handy when the economy turns and politicians are pointing fingers.

Intel scandal matters little today, a lot tomorrow

21 June 2018

The ouster of CEO Brian Krzanich for a relationship that breached company policy need not be a disaster. It shows the relevant rules apply to all, and Intel can run itself smoothly for a while. Mounting tech challenges, however, make it critical to find the right replacement.