Look out Bernanke, Fed foe seeking White House 27 Apr 2011 Ron Paul was the town crank of the 2008 Republican U.S. presidential race. But his agenda of smaller government, restraint abroad and Fedbashing seems in tune with today's Tea Party. Paul has little chance in 2012, but his views may run strongly. The Fed boss should take note.
Thain and Corzine redemption doesn’t come easy 27 Apr 2011 Since the two former Goldman partners took the reins at CIT and MF Global respectively, the shares have done well. But Thain is still grappling with CIT's funding challenge and MF Global's losses hinder Corzine's investment banking ambitions. Their rehab looks a way off yet.
Bernanke’s star turn may win over Fed critics 27 Apr 2011 The debut of the central bank chairman's oneman show, BankerMan: Turn Off the Snark, was full of high drama. One flubbed line could have sent markets heading for the exits. And though the performance was impressive, it'll take a longrunning hit to make it worth the risk.
China’s truckers sound bum note on reforms 26 Apr 2011 Sure, fuel price hikes and high fees penalise the truck drivers who staged last week's strikes. But pricier petrol is essential for a more balanced, less polluted China. If the authorities are too wary of upsetting vested interests, necessary reforms will be stifled.
Hong Kong’s yuan IPO buyers should heed history 26 Apr 2011 China's latest currency innovation recalls the nowforgotten Bshare market, where foreigners could invest directly in mainland stocks. With China's capital account closed, Hong Kong's yuan shares will have scant liquidity. When it opens, they may become irrelevant.
Rebranding tax reform could end U.S. budget logjam 26 Apr 2011 A political deal may depend on whether deficit hawk Republicans can sell the elimination of tax breaks as cutting spending rather than raising taxes. So far, most GOPers aren't buying. Voters might pass, too, once they see the effect on their tax bills. But it's worth a try.
Top U.S. corporate jurist set useful precedent 26 Apr 2011 Retiring William Chandler didn't exactly rock the boat when it came to governance and M&A in the Fortune 500 home court. But over more than 20 years on the bench, the Delaware Chancery chief gently empowered investors a bit more. His successor would do well to stay the course.
Hedge fund reawakening looks rational – for now 26 Apr 2011 The industry now exceeds $2 trln in assets, topping its precrisis size. Bad memories are fading, pension funds are handing over more cash, and return expectations seem reasonable. But investors shouldn't lose sight of the fact a third of funds still haven't recovered from 2008.
Ford’s $2.6 bln profit puts doubters to shame 26 Apr 2011 The automaker steered to its best first quarter in 13 years despite the Japan disaster and rising oil prices. It even chopped off more debt. That should convince worrywarts that Ford's weak, and wellflagged, fourth quarter was a temporary blip in its strong recovery.
UBS starts to face in the right direction 26 Apr 2011 The Swiss bank's credit trading revenue beat forecasts in Q1, while wealth management showed increasing inflows. Chief executive Oswald Gruebel's 15 billion Swiss franc annual pretax profit target is still steep. But his chances of eventually getting there have improved.
Lawson succumbs to surprisingly lowball roll-up 26 Apr 2011 Software firms often fetch huge premiums as acquirers squeeze out synergies and keep them from falling into archrivals' hands. So it's odd to see Lawson go for $2 bln less than its market cap to private equitybacked Infor. Are SAP and Oracle not in buying moods?
Gulf not yet ripe for MSCI emerging market status 26 Apr 2011 Upgrading Qatar and the UAE from frontier status in MSCI indexes would be a boon just as investors in the region are looking for safe havens. It could also deter local stocks seeking additional listings abroad. But it's not clear that either country warrants promotion.
Foreign bank exodus shows flaws in Russian policy 26 Apr 2011 HSBC has become the latest foreign lender to quit Russia's retail banking market. Though HSBC's own mistakes didn't help, its exit is also a sign of the tough environment created by the expansion of stateowned banks. This mistaken policy damages Russia's financial industry.
Lactalis braves political risk with Parmalat bid 26 Apr 2011 The French dairy giant has rushed out a 3.4 bln euro offer for the 71 pct of its Italian rival it doesn't already own. The bid is designed to beat an Italian government attempt to thwart the takeover by changing the law. But the lowball offer is a strange way to lure investors.
What if there are no stock exchange mergers? 26 Apr 2011 It's a conceivable outcome. The SingaporeAussie deal has already been nixed. Some Canadian officials consider TMX a national asset. Many challenges still lie in wait for any NYSE deal. If the answer for all bosses was consolidation, they'd be stuck again with the same questions.
New NYSE synergies deliver both good and bad news 25 Apr 2011 Pulling $145 mln more of cost cuts from its hat may allow Deutsche Boerse to sweeten its offer to help fend off Nasdaq/ICE. But it also shows how NYSE and its German partner underestimated their aggressive rivals. If such complacency extends to antitrust, it could prove fatal.
West can find ways to pressure Syria 25 Apr 2011 The reluctance to get tough on Damascus may be due to doubts about the effectiveness of economic sanctions. But the delay in taking action mostly reflects Western powers' unfounded hopes that the country is a stabilising force in the region. This shouldn't make them powerless.
Galleon verdict could hinge on purported cover-up 25 Apr 2011 Raj Rajaratnam is on trial for alleged crimes not for covering up what happened, the act that has in the past caught Martha Stewart and others. But as the jury takes his case, the credibility of prosecution claims that the hedgie tried to hide his tracks could still matter.
Barrick tries spinning copper into gold 25 Apr 2011 The Canadian firm jumped into the battle for copper miner Equinox, with a $7.7 bln bid that trumps one from China's Minmetals. It's a big premium from a company that mainly touts gold credentials. Barrick's shift as prices of both metals soar may not be the best use of resources.
Fracking leak hands Earth Day gift to green energy 21 Apr 2011 Chesapeake's fluid spill looks minor compared to BP's Macondo explosion exactly a year ago. But it will galvanize critics of hydraulic fracturing. Deepwater oil, coal and nuclear operations have all had recent disasters, too. Renewable energy firms should grab the opportunity.
Pru/AIA shambles comes under welcome scrutiny 21 Apr 2011 The UK financial watchdog is probing Prudential's failed bid for Asian rival AIA. The ambitious deal was badly communicated and suffered hitches with regulatory approval. Pru, a worldclass institution, had top investment banks advising. A year on, questions still need answering.
Fiscal profligacy puts Russia’s economy at risk 21 Apr 2011 Surging oil prices bring tens of billions of extra dollars to Russia's budget. But with crucial elections approaching, Moscow is spending the windfall almost as soon as it earns it. The spending spree has worrying implications for the country's longterm prospects.
Morgan Stanley deal redoubles pressure to improve 21 Apr 2011 Converting Mitsubishi UFJ's preferred stock to common saves CEO James Gorman about $800 mln a year and lifts equity capital. The move is smart and opportunistic. But it puts the bank's return on equity target further out of reach, leaving the recovery plan less margin for error.
Oil price Viagra is losing its effect on Big Oil 20 Apr 2011 Firstquarter earnings due next week are set to display the glow from soaring crude prices. But shares in even the most sensitive like Chevron and Hess no longer appear to be tracking higher with oil prices. And these firms' stocks could be most vulnerable if oil retreats.
No easy path for international aid in Middle East 20 Apr 2011 Financial institutions like the IMF or the World Bank will find it hard to help the region out of its economic problems. Loans with tough conditionality seem unrealistic. And any grand plan to encourage democracy risks being perceived as encouraging rebellions.
Wells Fargo walk doesn’t quite live up to the talk 20 Apr 2011 Boss John Stumpf likes to crow about growth. But Q1 core earnings fell again, just as they did for rivals. Only reserve releases, expense cuts and a lower tax rate boosted profit to $3.8 bln. That does show some deft management but it's not a basis to boast about the future.
Gold as an each-way bet is fantasy 20 Apr 2011 The $1,500plus spot price has two contradictory drivers speculative greed, and fear of a euro zone crisis and more Fed money printing. But global recovery and higher rates as presaged by the equity market look set to teach goldbugs that they cannot have it both ways.
Arab gas guzzling threatens global energy balance 20 Apr 2011 Oil traders worry Middle East turmoil will disrupt supply. But a bigger longterm concern is the region s own demand for oil. Extra Saudi Arabian usage may absorb its spare pumping capacity before 2025. Its key role as the world s swing producer could be in doubt much sooner.
TiVo’s forgotten legacy still offers upside 20 Apr 2011 Technology has moved on since the invention that transformed TVwatching showed up over a decade ago. But the DVR remains a household staple and TiVo just scored another legal victory over an imitator. Investors may have more to gain as courts catch up with the trends.
Company lawyers may get wary as U.S. gets personal 20 Apr 2011 Prosecutors should be tough on corporate misdeeds, financial or otherwise. But reindicting a former Glaxo inhouse counsel for an apparent judgment call that was supported by outside advisers looks like bullying. Even companies deserve representation without intimidation.