Money‚ Markets & Macroeconomics

Trump’s Paris accord call will be anticlimactic

26 May 2017

Even if the president pulls the U.S. out of the 2015 agreement, the impact should be limited. Cities, states, companies, investors and other countries will keep the anti-climate-warming momentum going. The bigger hit will be to America’s soft power and, potentially, its economy.

Jared Kushner conflicts hang on White House wall

26 May 2017

Donald Trump's son-in-law is under FBI scrutiny over Russian contacts. He and Ivanka Trump also didn't disclose their art collection. And the Kushner family used Jared's name to drum up Chinese business. The entanglements undercut his role in the administration, and its agenda.

UK Labour Party’s soft Brexit would still be hard

26 May 2017

The opposition is gaining in polls ahead of Britain’s June 8 vote. Leader Jeremy Corbyn is more pro-immigration than Tory Theresa May. Yet he is less pro-EU than he looks, and is less likely to be business-friendly – which could allow European negotiators to be tougher.

China puts currency market forces on notice

26 May 2017

It may tweak the way the yuan is priced each day, effectively giving policymakers more control over its value. In reality, the daily price-fixing is only a small part of how China manages its currency. It’s another step back from reform and suggests mounting economic worries.

Where to put Europe’s bank regulator? Try Bulgaria

26 May 2017

Brussels has invited member states to bid to host the European Banking Authority when its current host, Britain, quits the EU. The EBA hasn’t exactly dazzled in its handling of bank stress tests. But it could be a decent trophy for a non-euro country that feels unloved by the bloc.

Review: A premature requiem for the liberal order

26 May 2017

Globalisation is in retreat and democracy under attack. Two new books foresee a gloomy future for the Western-led economic and political system. Yet just as some were too quick to proclaim its triumph in 1989, the obituaries sparked by Donald Trump’s election may prove too hasty.

Fox pokes sleeping advertising bear

25 May 2017

Cars.com, Peloton and others yanked commercials from Sean Hannity's popular prime-time show as he pushes a fake conspiracy theory. Brands also have targeted Bill O’Reilly and YouTube of late. Madison Avenue may slowly be transforming from a passive investor to a more activist one.

Holding: Courts may save startups from redemptions

25 May 2017

Cashing out venture capitalists on demand can leave other investors in a lurch. A case involving onetime dot-com darling Oversee.net and Oak Hill suggests judges have growing concerns. It’s an overdue warning about how such conflicts can hurt fledgling firms and their owners.

Viewsroom: Trump budgets his way to la-la land

25 May 2017

Basic economics - and decency - fall by the wayside in the administration’s pitch that it can create $2 trln of revenue by cutting $3.6 trln of costs. OPEC and U.S. fields battle for oil supremacy. Zimbabwe invents the zollar. And Bill Ford escapes his CEO’s crash unscathed.

FX market might benefit from statement of obvious

25 May 2017

New guidelines for the $5 trln-a-day currency trading market exhort participants to behave ethically and fairly. That will hardly deter miscreants. Still, the code has a good stab at clarifying grey areas and avoids creating exploitable loopholes. Best of all, it will evolve.

Post-election Merkel might change her spots

25 May 2017

Angela Merkel may have the option to pick the right-of-centre FDP as her new coalition partner in September, polls suggest. The FDP advocates low taxes, fiscal discipline and a euro zone without Greece. That could be an obstacle to euro reform, or a grand bargain with France.

Italy’s latest bank mess allows EU to act tough

25 May 2017

For a variety of reasons, the European Commission hasn't forced losses on Monte dei Paschi senior creditors. Tumbling bond prices of the smaller Veneto banks suggest they will be an easier target. Robust action would partially restore the credibility of Europe’s bail-in regime.

Human cost of Obamacare repeal bill is too high

24 May 2017

The U.S. House legislation, newly scored, threads the financial needle by cutting healthcare outlays and taxes about equally. But 23 mln Americans could lose insurance by 2026, doubling the number without cover, and premiums may skyrocket. It's hard to see the Senate buying it.

ETF industry dances faster with risky new ideas

24 May 2017

The tradable funds have grown wildly popular as an easy way to play the market. Now sponsors are dialing it up with plans for ETFs tracking asset-backed securities and the first fund to lever stock exposure four times, among others. The frenzy may end with a bang, not a whimper.

Trump budget is schizophrenic on infrastructure

24 May 2017

This week's White House plan adds $200 bln of federal money over a decade. On the flipside, though, it slashes several existing infrastructure-related programs. There are some practical suggestions but, as in the overall budget, smoke and mirrors hamper any real analysis.

Hadas: The next financial crisis could be in forex

24 May 2017

Foreigners are happy to hold U.S. dollars, but a swelling supply of currency brings risks of a disastrous loss of confidence. With overseas greenbacks at 11 pct of world GDP and global politics fractious, the dilemma identified by Robert Triffin in 1960 remains all too pertinent.

Sovereign downgrade will keep Beijing on its toes

24 May 2017

Moody’s has downgraded China for the first time since 1989, now ranking it below Taiwan. It is mostly symbolic as foreign debt ownership is minimal and local corporate ratings follow their own logic. But the public reprimand will check Beijing's ambition to attract funds onshore.

Brazil’s economy teeters at the abattoir gates

23 May 2017

Laws and sausages alike are famously messy to make. That Brazil's President Temer, a master of the dark legislative arts, may lose his job over meatpacker JBS's corruption charges is perhaps fitting. But pension reform still needs forcing through Congress, whoever's in charge.

Trump’s oil-reserve selloff plan is too hasty

23 May 2017

With U.S. crude imports decreasing, rethinking the size of the government's 688 mln barrel stockpile may make sense. But flattering the White House budget by $17 bln isn't a good reason for selling nearly half of it. Strategic and market factors should be the drivers.

CFAs look past financial returns for their rewards

23 May 2017

Philadelphia is a long way from Wall Street, judging by the atmosphere at the annual confab of investment advisers. With Jack Bogle and Robert Shiller warning of a subdued outlook for percentage gains, ethics and client service rang out in the city of brotherly love.