Hugo Dixon: Cameron, UK hurt by Syria vote fiasco 30 Aug 2013 Never in modern history has a British prime minister lost a parliamentary vote authorising military force. Cameron may cling on to power, but his authority at home has taken a hit. So has his standing abroad, and Britain’s influence. The PM himself is largely to blame.
Belarus-Russia spat clears way for potash plunge 30 Aug 2013 A diplomatic row following Belarus’ arrest of a top Russian potash executive dashes chances that the former Soviet producers’ alliance can be revived. The rival North American cartel won’t survive much longer. Farmers and consumers should cheer at the prospect of lower prices.
Shadow bank leverage curbs need more work 30 Aug 2013 Regulators are right to want to curtail socially useless froth in opaque areas of markets. But proposals to enforce limits on lending against specific assets look overly rigid in some areas and too lax in others. What’s more, exempting sovereign debt entirely looks short-sighted.
Edward Hadas: The overvaluing of overwork 29 Aug 2013 The death of an investment bank intern in London has raised a worthy reflection on the voluntary work ethics of the young elite. Their painfully long hours may reflect a desire to be socially valuable - the ultimate luxury when leisure is mass produced. Change would be welcome.
South Africa looks like grim shadow-BRIC 29 Aug 2013 The country is sometimes listed as a near member of the group of developing world giants. Alas, it comes close in the wrong direction: Russia’s one-party rule, Brazil’s corruption, China’s spiraling labor costs and India’s inefficiency. It desperately needs a better growth model.
Vodafone needs to deliver on Verizon exit 29 Aug 2013 Shares in the UK telco have jumped on confirmation of talks to sell out of its U.S. venture with Verizon for a reported $130 bln. Recent U.S. consolidation may have made Verizon move on price. Vodafone boss Vittorio Colao won’t be forgiven if he now fails to secure a good deal.
Turkey’s lira bluff will need creative backup 29 Aug 2013 The central bank has ruled out raising interest rates to defend the lira but can only count on a thinning cushion of foreign reserves. Governor Erdem Basci hinted at expanding his unorthodox policy tool kit. In such uncertain times, such creativity will have to be compelling.
Italian tax deal shows Berlusconi’s still kicking 29 Aug 2013 The Letta government has struck a deal on Rome’s mansion tax. Berlusconi’s political career may be ending, but his legal wrangles and populist antics threatened the government and rattled markets. Failure to implement serious reform could ruin the country’s weak chances to grow.
The euro’s serene summer may come to an abrupt end 29 Aug 2013 Europe’s single currency has risen against the dollar in the last two months, avoiding the gyrations which have plagued global bond and equity markets. But the mood is souring. Investors are flocking to the options market to bet the euro will fall. The odds are it will.
Co-op’s gory details aid case for creditor bail-in 29 Aug 2013 A 709 million stg pre-tax loss in the first half shows why regulators have told the UK bank to find 1.5 billion stg in new capital. But for Co-op’s new bosses, the bad news is also good news. It makes it easier to persuade angry creditors that burden-sharing is fair and inevitable.
Fracking may change U.S. foreign policy for good 28 Aug 2013 The abundant supply of hydrocarbons made accessible by hydraulic fracturing has brought America much closer to energy independence and created a buffer for the global oil price. The shift gives Uncle Sam new latitude in handling problems in Syria and throughout the Middle East.
Carney to market: Go ahead, make my day 28 Aug 2013 OK, the new Bank of England head isn’t so aggressive. But he used his first speech to reassert that the BoE would act to curb rising market rates if they hamper a UK recovery. Carney looks more in control. Still, he needs supportive data, and co-policymakers, to take such action.
G4S cash call shows need for speed 28 Aug 2013 Equity markets are soft yet the UK security contractor is placing around 350 mln stg of new shares to swerve a credit downgrade. Any more would have required a rights issue. With Syria creating uncertainty, and interest rates rising, there was virtue in taking a speedy solution.
West faces only high-cost options in Syria 28 Aug 2013 Surgical strikes against the Assad regime’s military facilities may aim to undermine its ability to deploy chemical weapons. There would be a price for doing nothing, but action is fraught with risks and could exacerbate regional instability.
Loss of prime broking diversity could hurt 28 Aug 2013 Lehman taught hedge funds to spread business across multiple prime broking units in investment banks. But leverage and liquidity rules may make the banks hike prices and become pickier about custom. That could mean fewer brokers, bigger hedge funds – and costlier blowups.
Hugo Dixon: West mustn’t rush into Syrian conflict 27 Aug 2013 Before it takes any military action, the West needs to present compelling evidence that Bashar al-Assad gassed his people. Any intervention must also be a specific response to the gas attack rather than suck the West into the civil war. In the process, refugees should not be forgotten.
Accor’s newest broom would sweep governance aside 27 Aug 2013 The French hotel group’s board reckons appointing the head of its leading private equity shareholder as CEO can revive its fortunes. True, Colony’s Sebastien Bazin may speed up the sale of real-estate assets. But investors need to weigh short-term gains against a loss of control.
Slim’s support makes own bid for KPN look cheap 26 Aug 2013 The Mexican tycoon is backing the Dutch telco’s disposal of its German business to Telefonica Deutschland. But the new price raises KPN’s standalone value, making the smallish premium in Slim’s offer for the parent seem miserly. KPN needs to squeeze more out of its lead investor.
China can learn from Russia on political martyrs 26 Aug 2013 The trial of Bo Xilai echoes that of Mikhail Khodorkovsky eight years ago. Like the jailed Russian oligarch, Bo could some day become a symbol for the regime’s failings. The difference: China’s leaders have a chance to keep their prosperity promises. Fail, and Bo may come back.
Trading floors prove a shrewd trade for Blackstone 23 Aug 2013 The crisis yielded surprisingly few M&A bargains. Blackstone found one right at the heart of the City. In 2009 it bought half of the site that houses UBS and Icap from a wobbly British Land. Four years on, foreigners’ love of London property means the bet will pay off handsomely.