Business set for boost in Hungary 12 Apr 2010 Sunday's election puts Viktor Orban's centerright Fidesz party back in charge. Orban's plans include tax cuts and help for domestic entrepreneurs and farmers. If he can also achieve reductions in stillhigh public spending, Hungary's private sector could be among the winners.
Euro zone shows Greece a little love 12 Apr 2010 Euro members have agreed that 30 billion euros could be extended at a little over 5 percent higher than euro zone yields, but much lower than what markets were demanding. Athens would ideally prefer not to tap the funds. But either way, it still faces an uphill struggle.
Poland’s economic legacy is tribute to its victims 12 Apr 2010 The country grieves after the loss of its president, central bank head and other prominent figures. But Poland's institutions and economy look sound. Elections will be brought forward. The tragedy has not plunged Poland into crisis, and the economy should keep growing.
BoE should beware of debt monetisation 8 Apr 2010 For now, the UK central bank is in wait and see mode. But big purchases of government debt with printed money have risks, as the Fed s Fisher has pointed out. If investors think government debt is being monetised, disaster looms. The BoE shouldn t rush to add to its gilt pile.
Yuan may not be one-way bet for traders 7 Apr 2010 The Chinese authorities seem to be set to depeg the currency. Beijing wants to protect exporters and kick speculators, so expect a complex managed float, not a single big revaluation. The yuan's ultimate direction is surely upwards, but the journey may not be a straight line.
Yuan negotiations should be multilateral 1 Apr 2010 Americans complain the loudest about China's fixed currency. But the EU also runs a big trade deficit with China, and rival lowcost producers are squeezed. Widening the debate could depoliticise it but might also weaken the U.S. case. Not everyone hates the status quo.
Ireland risks falling into debt spiral 31 Mar 2010 The government's postbubble pain is not over. Irish banks will be propped up, adding more debts to the deficits that come with a 7 percent GDP drop. Poor recovery prospects point to evermounting debts, unless something is done. Further public sector cuts seem essential.
California treasurer has right idea on CDS 31 Mar 2010 Bill Lockyer is asking the big banks that underwrite the state's bonds to tell him about their role in the market for related credit insurance. It's a fair question. And this kind of disclosure could be a better way to deal with CDS concerns than a hasty and simplistic ban.
Yuan’s rise is inevitable and helpful 31 Mar 2010 China is suffering from growing pains, including a currency that is fixed but shouldn't be. The undervalued yuan threatens to create a disastrous trade war with the U.S. But compromise is within reach. China's hot economy makes a little yuan appreciation advisable now.
CLO expirations could roil markets 30 Mar 2010 Call it a quirk of fate. Many European buyout loans will come due just as many CLOs, the structured vehicles that financed them, start winding down. That leaves a large funding gap. To close it, new investors are required. Borrowers should expect a rough and expensive transition.
Weak U.S. productivity could create Long Recession 30 Mar 2010 Financial crises are too often followed by slow and meager recoveries. It could happen in America, if business productivity slumps. The omens are not good, especially bad trends in the pace of innovation. Washington can help. While cutting deficits, it should promote growth.
Dubai World lenders have some power in debt talks 30 Mar 2010 The emirate needs the consent of lenders before it can take full ownership of property unit Nakheel, a move it sees as vital to protecting the local economy. That gives Dubai World's creditors leverage in negotiating a better restructuring deal. They may have some success.
Greek interest rates should stay high 29 Mar 2010 Athens will almost certainly get its latest 5 bln euro bond away, thanks to a generous coupon and the promise of an EU/IMF safety net. But to keep default away, Greece has to combine wages cuts with fast GDP growth. It's possible, but current yields reflect justified doubt.
U.S. savers doing little to fund economy’s needs 29 Mar 2010 The U.S. savings rate dropped to 3.1 pct in February, well below the level seen in 2009. That s a step in the wrong direction, with problematic knockon implications for both trade and budget deficits. Above all, low savings leave the U.S. ever more dependent on foreign cash.
Investors can curb the rights issue middlemen 24 Mar 2010 UK investors are angry about the fees banks charge for underwriting equity issues. Even the competition watchdog sounds worried. But institutions could take the initiative and offer to underwrite cash calls themselves for a lower rate. They just need an honest broker.
IMF in Greece is euro’s disgrace 24 Mar 2010 To soothe Germany's concerns, euro zone leaders are working on a compromise that would tap IMF money to help Greece solve its financing problems. This wasn't necessary, but illustrates the euro's basic flaw: the lack of a credible crisisresolution mechanism.
Budget for votes riskily delays UK debt pain 24 Mar 2010 The preelection budget could have been even worse. But it still includes populist measures like a tax cut on property purchases. And while deficit forecasts have been shaved, they remain optimistic and alarming. At best the UK delays its pain; at worst it heads for crisis.
Markets aren’t ready to blow LBO bubbles — yet 22 Mar 2010 Buyout buzz has gained momentum thanks to shrinking debtmarket risk premiums. HarleyDavidson, RadioShack and Supervalu all got the treatment recently. Sure, LBOs are back from the dead. But bigger examples will remain scarce for now. Loan markets, especially, just aren t ready.
EU summit Greek standoff could restart contagion 22 Mar 2010 Despite Germany's fierce rhetoric opposing a Greek bailout, there is still a chance of compromise at this week's EU summit. But if euro zone leaders can't clarify their position, the crisis could spread to other weak members such as Portugal and Spain.
Yuan may be less undervalued than it appears 19 Mar 2010 Some U.S. congressmen want to slap duties on Chinese goods unless Beijing revalues the yuan. Yet China's premier insists the currency isn't cheap, and Goldman Sachs research supports his view. The revaluation lobby is loud, but its case is open to challenge.