U.S. financial reform is still a matter of faith 19 Apr 2010 The SEC's suit against Goldman may sway some doubters. But ending government bailouts of banks relies heavily on Wall Street believing rules will be enforced and failures will be allowed. For skeptics, though, the current Senate bill leaves enough wiggle room to induce doubt.
SEC tries to ride Goldman back to credibility 16 Apr 2010 It will take more than one highprofile lawsuit to restore the reputation of America's top financial cop. L'affaire Madoff was close to a brand killer. But the charges against Goldman are powerful evidence and a warning that the oncesleepy agency is awake and on the prowl.
Paulson’s greatest trade may lose its luster 16 Apr 2010 The hedge fund was involved in the CDO deal that has led to a fraud suit against Goldman. Paulson hasn't been charged, but the tale as told by the SEC isn't favorable to the firm. If nothing else, it shows how clever hedge fund traders and bankers can get too clever by half.
SEC finally lights fire under Goldman smoke 16 Apr 2010 The U.S. regulator is going allin, charging the popular totem of Wall Street greed with CDO fraud while dragging in the most famous beneficiary of the mortgage meltdown, the hedge fund Paulson & Co. Goldman's shares swooned 15 pct. Its reputation, and the SEC's, are on the line.
Fears of UK hung parliament may be overstated 16 Apr 2010 Sterling fell after the leader of the small Liberal Democrats performed well in the first of three prime ministerial debates. Investors worry a coalition or minority government might be weak and indecisive. Fair enough, but the scenario also has opportunities.
Crisis, what crisis? 15 Apr 2010 That could be motto for the election manifestos published by Britain's main political parties this week. Neither Labour nor the Conservatives addressed the country's fiscal crisis headon. Instead, they have sought to bribe the electorate with promises.
Tarnish on ex-car czar could rub off on Obama 15 Apr 2010 The big financier the Wall Streetbashing president brought in to rescue Detroit is in hot water. Exbuyout boss Steve Rattner is still exposed to a kickbacks scandal his firm just settled. It's an awkward scenario given how much the $60 bln auto bailout may cost taxpayers.
Consensus on U.S. financial reform starts to crack 14 Apr 2010 The final push in D.C. is showing that failure can't be ruled out. The White House is ready to go ahead with no support from Republicans who are daring it to try. And some on both sides believe no bill could be good politics. Further compromises are needed to avoid gridlock.
UBS vote shows Swiss still sore about bonuses 14 Apr 2010 Almost 40 percent of the Swiss bank's shareholders opposed its board's 2009 pay plan. Meanwhile, the opposition Social Democratic party is pushing for a bonus tax. Any Swiss bankers hoping for a return to business as usual after the crisis have misjudged the public mood.
German legal threat another worry for Greece 14 Apr 2010 The German academics who want to block the Greek bailout in the courts probably won't win their case. But the mere possibility pushed up Greek bond yields. Or perhaps investors are taking stock of how many Germans feel strongly that Berlin should just say no to Athens.
The other PIIGS are smart to help Greece 13 Apr 2010 It may seem odd that debtladen Portugal, Italy, Ireland and Spain will contribute 10.5 bln euros to Greece s 30 bln bailout facility. But not acting would be far more expensive, and the other PIIGS may even make money. Still, if another one needs a bailout, it won t be easy.
Powerful union boss opens new front for Obama 13 Apr 2010 Public employee labor leader Andy Stern helped get the president elected and then the healthcare bill passed. But his surprise exit from atop the SEIU could leave Obama's relations with a political ally strained just as China trade and government worker pay issues escalate.
UK election may be fought on peak between dips 13 Apr 2010 The current government says it wants to win the UK election to secure the recovery. But data show the recovery is fragile despite the huge fiscal stimulus that must be withdrawn. Warring politicians aren't trumpeting the needed cuts or the real risks of a double dip.
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.
UK bank competition probe shouldn’t be a whitewash 12 Apr 2010 An incoming Tory government may not press for a full Competition Commission inquiry into UK banks. A lighter probe would help accelerate a profitable sale of state holdings in RBS and Lloyds. But proper scrutiny of the UK's overconsolidated banking sector is more important.
IMF faces whole new kettle of fish in Greece 12 Apr 2010 The IMF is back at the peak of its power. But with Greece it has taken on a novel challenge repairing the government's finances with neither a default nor currency devaluation. No bailout in modern history has managed this. It won't be easy to make Greece the first.
Political meddling in UK M&A diddles investors 12 Apr 2010 The ruling Labour party has proposed a raft of irrelevant or unjustifiable obstacles to UK takeovers if it wins the election. The emotional purchase of Cadbury has made protecting companies an unlikely campaign issue. But shareholders' rights are being forgotten.
Bank investors should practice healthy distrust 9 Apr 2010 Financial firms are looking safer. But quarterly earnings aren t a perfect guide to the risks they take, as shown by the Lehman shenanigans and by official borrowing data. Absent better disclosure, shareholders and regulators should assume banks are downplaying their bets.
International investors should snap up Chile debt 9 Apr 2010 It s their first chance in seven years to buy sovereign bonds. Rebuilding after February s earthquake may cost 20 pct of GDP, but Chile can afford it thanks to the government s exemplary economic policies. If those and high commodity prices continue, the future looks bright.
U.S. bank fix impeded by false dual mandate 8 Apr 2010 Most bank regulators are supposed to focus on their charges' soundness. But they face political pressure to adopt a second mandate, namely promoting lending in the hope of boosting employment. Trouble is, one calls for banks to hold more capital against assets, one for less.