Money‚ Markets & Macroeconomics

Bitcoin’s slide blows digital stardust to winds

20 November 2018

Fans dreamed the cryptocurrency would consign conventional finance to the dustbin. But it’s more vulnerable than stocks and bonds to investor funk, plummeting a third in a month and 75 pct from its peak to below $5,000. Bitcoin’s flaw remains its lack of fundamental value.

Beyond Meat IPO could go from rare to charred

19 November 2018

Investors who take a bite of the plant-based meat maker could get a taste of rapid growth, top-notch leaders and a way to address the looming food crisis. But the company is restricting some shareholder rights and faces competition from traditional and fellow upstart firms alike.

Facebook’s higher calling is now a liability

19 November 2018

The social network is getting grief from U.S. lawmakers for hiring Washington consultants to fight critics. Many companies do that, including older tech firms. Facebook, though, has styled itself as more than just a company. Mark Zuckerberg is now tripping up on that high bar.

Euro budget is a withered carrot for fiscal rebels

19 November 2018

France and Germany want to set up a pot of money to fund investment in the euro zone. The fund will only be available to those who comply with EU fiscal rules. The idea is a nice one but there may be too little money and too much complexity for the incentive to be effective.

Levi Strauss IPO would be financially retro

16 November 2018

The jeans group may go public more than 30 years after a family-led LBO. It has done well in the recent retail turmoil that hit the likes of Nordstrom and a mooted $5 bln valuation looks fair. But the skinny from Levi’s own ups and downs is that staying private is a better fit.

Review: New tech brings golden age of media

16 November 2018

The internet has provided ample fodder for the endless debate over culture versus commerce. In “Digital Renaissance,” business professor Joel Waldfogel says consumers have more good music, movies and television shows than ever to choose from, and haven’t bankrupted industry.

Watch UK bonds to see when there’s a real crisis

16 November 2018

The pound suffers every time concern flares that Britain may crash out of the European Union. But gilts strengthen since bleaker economic prospects make higher interest rates less likely. The clearest sign investors have had enough would be when both weaken at the same time.

Europe can play a waiting game with Italian rebels

16 November 2018

Italy’s anti-austerity budget flouts Brussels’ fiscal rules. Declaring Rome in breach and imposing penalties would fuel euro scepticism ahead of key European elections. Better to tone down the rhetoric, and let a slowing economy and hostile markets weaken the executive’s hand.

Mozambique removes only part of tuna bond whiff

16 November 2018

The war-scarred African nation wants to restructure its defaulted obligation by linking repayments to future gas sales, giving bondholders extra security. But developing $50 bln of projects in such an exotic locale is unlikely to avoid snags. Delays could mess up creditors’ sums.

Viewsroom: Europe fights U.S. Big Tech

15 November 2018

Digital titans like Alphabet and Apple may rule the roost, but EU rules on data privacy are helping startups flourish on the other side of the Atlantic. Meanwhile, Facebook’s inability to police fake content spreads to Africa. Plus: Mumbai’s ride-share drivers go on strike.

UK government turmoil hardens Brexit dilemma

15 November 2018

Two cabinet ministers have quit, weakening Prime Minister Theresa May and reducing the already-slim chances that parliament will support her deal to leave the European Union. That makes the alternatives of a painful and chaotic Brexit, or a second referendum, more likely.

PG&E woes show climate is clear and present danger

14 November 2018

The California utility may be to blame for the wildfire that’s claimed 48 lives. Its value has halved and it may run out of cash. The planet’s warming is already worsening fires, floods, and water scarcity. Yet most investors and companies still treat it as a longer-term risk.

Oil forecasting goes from tough to pointless

14 November 2018

In recent months crude has hit $86 a barrel, fallen to $65, and is now rising again. Oil prices drive other markets, but predicting them can be a waste of time. Changing demand outlooks, Saudi turmoil and Trump are only the most volatile of a series of uncertainties.

Hadas: Fear of fiscal deficits is overdone

14 November 2018

Mainstream economists agree that governments can safely spend more than they take in, but worry about big funding gaps. Some dissidents make a good case for going deeper in the red. They could be bolder. Most domestic borrowing can be replaced with straight money-printing.

Brexit compromise confirms Britain’s hard choices

14 November 2018

Prime Minister Theresa May’s draft deal would bind the UK to the EU without the benefits of membership. Even if her cabinet backs it, parliament may not. Opponents have two options: crash out of the bloc next March, or call another referendum. The fight will only get more bitter.

Fluke contraction is least of German economic ills

14 November 2018

GDP shrank in the third quarter. One-offs were to blame so a quick rebound is likely. The real problems, like insufficient digital investment or too few skilled workers, are harder to fix. Chancellor Angela Merkel did too little and will drop the mess in her successor’s lap.

Wall Street can be effective forest-fire fighter

13 November 2018

The Camp Fire is California’s most deadly and destructive ever. Such conflagrations, worsened by climate change, cost the Golden State some 6.5 pct of GDP last year. A new financing tool can make forests more resilient – and protect everything from water to air to livelihoods.

Mexico’s revolutionaries risk spoiling the party

12 November 2018

President-elect López Obrador doesn’t take office until next month, but he and his fellow leftists have already upset markets with moves to nix an airport project and rein in bank fees. Such fumbles could help guide Brazil’s far-right populist Jair Bolsonaro as he nears power too.

Governor’s exit would gut India’s central bank

12 November 2018

A power struggle with New Delhi could force out Urjit Patel. Losing two RBI chiefs in two years would ruin the credibility of India’s most respected financial institution. It also heralds more jostling elsewhere between populist governments and independent-minded central bankers.

U.S. stress tests risk falling on slippery slope

9 November 2018

Fed supervision chief Randal Quarles wants to tweak the annual exams. Some revisions are warranted, like giving banks test results before they decide how much capital to return to investors. But scrapping the watchdog’s ability to fail a firm gives Wall Street too much leeway.