United States of America

The Exchange: A chat with Gary Cohn

18 September 2018

President Trump’s first National Economic Council director and former Goldman Sachs No. 2 discusses the financial crisis and its aftermath with Gina Chon. He also gives his take on tax cuts and trade, and explains why JPMorgan boss Jamie Dimon would make a “phenomenal” president.

Elliott flexes its two biggest muscles at Sempra

18 September 2018

The $32 bln utility agreed to add two new board members and says it will review a break-up. Meanwhile, Elliott’s lawyers won back a $275 mln fee from when Sempra bought Texas utility Oncor. Paul Singer’s fund specializes in persuasion and litigation. This time, both paid off.

Investors can ignore glimmers of China trade hope

18 September 2018

The latest round of U.S. tariffs on $200 bln of its goods, and China’s response, could have been worse. That buoyed markets. But investors are missing the bigger picture. Talks and hearings haven’t stopped things getting to this point, and they are likely to escalate further.

Gary Cohn too quick to vote for President Dimon

18 September 2018

JPMorgan chief Jamie Dimon would be “phenomenal” in the White House, the former Trump adviser says, adding that running the country is like heading a global firm. There are parallels. But Dimon isn’t restrained by an unwieldy Congress – or strict limits on what he can pay.

Trump makes and breaks case for new global order

18 September 2018

The U.S. president’s propensity to impose tariffs and ditch multilateral accords may prod developed and emerging countries to plan sturdier safety nets for the world economy and financial system at the G20 and elsewhere. Trump is also the reason they will struggle to succeed.

Financial crisis mostly put “D” in dealmaking

18 September 2018

Many of the bank investments and takeovers inked as markets cratered a decade ago brought at least as much pain as progress to the instigators. Think JPMorgan buying Bear and WaMu. Breakingviews looks back at some of the flops – and a couple of high-flyers.

Marsh & McLennan pays hefty price for global push

18 September 2018

The U.S. insurance broker is buying UK rival Jardine Lloyd Thompson for 4.3 bln pounds in cash. Mooted savings of $250 million a year don’t justify the hefty 34 percent premium. As competition heats up, Marsh is relying on JLT to continue its rapid growth in emerging markets.

Google’s car deal is hazard light for auto groups

18 September 2018

Renault and Nissan will install the Android operating system in their cars from 2021, making it more likely others will follow. That extends the search giant’s data dominance beyond smartphones. Consumers will win, but carmakers may give up a valuable source of future income.

Guest view: Trump trade war threatens Korean peace

18 September 2018

Invoking national security to impose tariffs on car exporters such as Hyundai and Kia is myopic, argue the Korea Society’s president and a former U.S. ambassador to Seoul. As fresh talks with Pyongyang start, it’s worth remembering that politics cannot be divorced from economics.

U.S. utilities face decades of perfect storms

17 September 2018

Carolina power companies grapple with hurricane damage while a Massachusetts gas firm is reeling from explosions. California’s push for green energy could hurt credit. Even after decades of rising investment, power companies will struggle to strengthen and modernize networks.

Speedier FX markets offer muddier signals

17 September 2018

Electronic trading and automation has made the foreign exchanges even zippier, a BIS report says. That has both increased fragmentation in the $5-trillion-a-day currency market and given more clout to the biggest banks. Knowing who is doing what and why is even harder to discern.

The Exchange: Congresswoman Maxine Waters

17 September 2018

The senior Democrat on the U.S. House Financial Services Committee recalls the lack of answers that lawmakers had in the wake of the 2008 financial crisis. The Exchange went to Congress to discuss that period and find out her priorities if she takes over the banking committee.

U.S. Congress requires banking boot camp

17 September 2018

More than 60 pct of lawmakers were first elected after the 2008 financial crisis, and a good chunk after Dodd-Frank was passed. So the meltdown’s causes are lost on many, as is how banking works. With regulatory change on the docket, Breakingviews has drawn up a bluffer’s guide.

The Benioffs become Time’s Person of the Year

17 September 2018

The Salesforce co-CEO and his wife are buying the magazine from Meredith for $190 million. They join the likes of Jeff Bezos and Laurene Powell Jobs, who have swooped in to save struggling news outfits. The cachet of old-school media brands appeals even to newish tech riches.

Reinsurers’ lean years will trigger M&A wave

17 September 2018

Insurers are bracing for $20 billion of damage from Hurricane Florence, following record losses in 2017. Rising claims aren’t the sector’s only problem: hedge funds and other new investors are eroding margins too. The best way to survive may be swallowing a rival.

Trump’s China tariff weapons are getting blunter

17 September 2018

The U.S. administration is set to move forward with duties on another $200 bln of imports. Initially, it deftly avoided consumer goods. The expanded list, though, is more policy sledgehammer than scalpel. The pain will be felt by American households and Chinese exporters alike.

Chancellor: Lehman’s easy money extends to China

17 September 2018

The last in a series of essays marking the 10th anniversary of the crisis argues the ultralow rates that inflated assets and led to widespread capital misallocation, wealth inequality, financial instability and other risks in advanced economies are even more evident in China.

Cannabis stocks have whiff of 2006

14 September 2018

A weed ETF has doubled in price in just over a year, while a Canadian producer has been targeted by an activist because its stock “only” trades at eight times EBITDA. Demand is real and legalization is coming. But online gaming’s sharp correction 12 years ago offers a warning.

U.S. oil producers lose grip on global crown

14 September 2018

Fields in Texas were meant to help make the country a bigger exporter of black gold than Saudi next year. But pipeline construction is delayed longer just as American inventories are falling. U.S. drillers risk losing control of the market the longer logistics problems linger.

Norway power failure a rehearsal for bigger shocks

14 September 2018

The 114 mln euros Einar Aas lost betting on energy markets was not enough to sink the clearing house backing the trades. But the damage wreaked by one man implies deeper frailties. An increasingly volatile carbon price would make the commodities market vulnerable to a repeat.