Hadas: Russian Revolution won’t be the last 30 Dec 2016 Soviet communism initially looked like the future, but rapidly became a cruel failure. Its disappearance left big-government democratic capitalism as the sole surviving system. A century later, that hybrid model is now under global threat. It might not last another century.
Banking whales have had their day 29 Dec 2016 A year ago, Bank of England boss Mark Carney suggested regulators had cracked the "too big to fail" bank problem. Yet new rules keep coming, and international cohesion is fading. The biggest cross-border lenders like HSBC will find it ever harder to make their cost of capital.
Europe’s best antidote to populism is unpopularism 28 Dec 2016 Parties that promised to take on the elite had a roaring 2016. Even so, the withering of the moderate centre isn’t inevitable. In Greece the pendulum is swinging away from radical government. Liberals with sound economic policies can win – if they’re willing to make enemies.
Russian sanctions will shrivel to soccer boycotts 23 Dec 2016 Pro-Kremlin leaders in Europe and the U.S. plus a rising oil price will embolden Vladimir Putin in 2017. That could lead to a rethink on sanctions and a soft response to Baltic sabre-rattling. Western protests will be limited to threatening boycotts of the 2018 World Cup.
Race to build will add impetus to old-world stocks 23 Dec 2016 Infrastructure is one of the few areas where Donald Trump, Angela Merkel and Theresa May will agree in 2017. Not all the numbers bandied about are as big as they sound. But it should create jobs in developed economies – and gee up long-underperforming infrastructure stocks.
Grocery sector is ripe for big checkouts 22 Dec 2016 Pressure on traditional food retailers is relentless, and many-pronged. Customers are spending less of their budget on food and suppliers like Unilever are toying with selling direct to shoppers. Then there’s Amazon. The solution isn’t better retailers – it’s fewer of them.
Christine Lagarde exit would boost IMF’s credibility 19 Dec 2016 The multilateral lender's managing director has been found guilty of negligence in France. Lagarde has provided steady direction, but keeping her in place risks denting the fund's image. Besides, it's a chance to rethink the outdated tradition of all IMF bosses being European.
EU’s de-stressed insurer test is self-defeating 16 Dec 2016 Life insurers look weak in their first stress test since so-called Solvency II reforms. Regulatory carve-outs mean they may not necessarily need capital. But the anonymous nature of the exercise means that investors can't be certain which are the ones to avoid.
EDF buys time for more political tinkering 15 Dec 2016 The troubled, state-controlled French utility has raised 4 bln euros by selling a 49.9 pct stake in its power grids. EDF’s plan to repair its weak balance sheet is on track. But a deteriorating business and more government-directed investments will short-circuit any recovery.
EU bank forbearance trade may get another boost 14 Dec 2016 Europe's lenders may need 276 bln euros of new debt to shield taxpayers from bailouts, says a regional watchdog. The market might struggle to absorb the volume. However, most banks are yet to face hard deadlines. It’s another area where regulators might help out investors.
Kering shows up luxury’s diversity problem 14 Dec 2016 Unlike peers, Gucci's owner now has a relatively progressive new global parental leave policy. Women also make up two-thirds of Kering's board. Beyond that, the sector is a relative underperformer on diversity - even though at some labels women drive 80 pct of sales.
Actelion looks like a lose-lose for Sanofi 14 Dec 2016 The French firm is mooted as a buyer for the Swiss biotech group after J&J walked away. The financial logic looks equally strained, and overpaying would smack of desperation about Sanofi's own business. With drug prices under pressure, pharma M&A will not get any more rational.
Bollore’s Mediaset raid looks oddly logical 13 Dec 2016 Vivendi, controlled by Vincent Bollore, bought 3 pct of Silvio Berlusconi’s Mediaset. There’s little sense in bidding for the whole, given weak synergies between Italian and French TV. It may pressure Berlusconi to settle outstanding litigation, though. And Mediaset is cheap.
Draghi’s market first-aid kit ready for 2017 8 Dec 2016 The ECB boss is extending the central bank’s asset buying until the end of next year but will unexpectedly reduce purchases from April. It may sound muddled. In fact, these and other changes give Draghi more scope to support markets throughout a politically fraught year.
French bond rot has capacity to spread 7 Dec 2016 Gallic bonds are trailing euro zone peers. This suggests investors are worrying that the far-right's Marine Le Pen might do better in the 2017 presidential elections than polls show. Were her chances to improve materially, market damage would quickly spread across the region.
City of London should woo not threaten on Brexit 6 Dec 2016 A bad-case Brexit might demolish some of the financial sector's record 71 bln pounds in tax contributions, outlined in a new report. Other bits of the economy could also suffer from the fallout. But bankers might gain more from an upbeat case for their salvation.
Hollande’s problem was bigger than Hollande 2 Dec 2016 France's president saved his ruling Socialist Party from electoral annihilation by saying he won't seek a second term. His flaws had become obvious. But whoever seeks the country’s highest office faces the same challenge of reconciling modernisers with those opposed to reforms.
Trump can make or break global growth hopes 28 Nov 2016 Tax cuts and more spending in the United States could help lift world growth to 3.6 pct by 2018, the OECD reckons. But President-elect Donald Trump could reverse the boost with protectionist policies. The rosy scenario rests on shaky assumptions about international cooperation.
Francois Fillon is test of French reform appetite 28 Nov 2016 The former prime minister's win in conservative primaries makes him a theoretical shoo-in to become president in 2017. But his economic platform is more radical than anything French voters have been willing to countenance up until now. The race will be closer than anticipated.
Remy Cointreau can stay for another round in China 24 Nov 2016 The spirits group’s first-half operating profit grew 7 pct on strong U.S. and Chinese demand. Remy cut its Asian exposure after a 2012 corruption crackdown in the PRC, but now sales of posh drinks in China could beat other lines. The only catch is a recovery looks priced in.