Money‚ Markets & Macroeconomics

The Exchange: The water-crisis marathoner

19 March 2019

Investors and companies are ill prepared for the rising scarcity of this most important natural resource. With World Water Day on March 22, Thirst CEO Mina Guli lays out the issues and explains why she decided to run 100 marathons in 100 days to draw attention to the problem.

Dianrong boss daringly says what many are thinking

19 March 2019

Co-founder Guo Yuhang blames the government for slow growth at his peer-to-peer lender. Such regulatory grievances are common from bankers elsewhere, but rare in China. The complaints will strike a chord in the industry even if they don’t alter the course of mercurial rules.

Chinese car lender’s IPO drives a hard bargain

19 March 2019

Dongzheng Automotive Finance could be worth $1.4 bln after going public, valuing the company at a big premium to rivals. Its fast growth, high returns and luxury-vehicle focus may justify that. But it’s shifting into new markets and has yet to face the rough ride of a downturn.

Hadas: U.S. colleges can try harder to be fair

18 March 2019

Elite American higher education is supposed to be a meritocracy, but last week’s admissions cheating revelations are a reminder of how much money matters. That could be changed, starting with choosing from qualified candidates by lottery and spinning off college sports teams.

Recruitment is weak link in U.S.-China tech war

18 March 2019

Trump officials are building IP theft cases and mulling AI export bans. But the government can’t stop Chinese firms from opening offices stateside and hiring from rivals: Tesla wannabe Nio has 600 workers in San Jose. Talent is fair game and U.S. firms must fend for themselves.

Breakdown: Shanghai stock venue shows promise

18 March 2019

After multiple Chinese trading-experiment flops, a new board for fast-growing tech and biotech startups looks more auspicious. Its rules strike a balance between liberalisation and discipline. The approach could improve mainland markets at the expense of New York and Hong Kong.

Algeria’s Arab Spring presents binary risk outcome

15 March 2019

Revolution is in the air again in North Africa, leaving Algerians - and Europe - holding their breath. Freed from the clutches of an ailing gerontocrat, the energy producer could become a dynamic economic powerhouse. Or the army and Islamists could restart a brutal civil war.

Italian Silk Road gambit is a double-edged sword

15 March 2019

Marco Polo’s daring travels turned Venice into a wealthy gateway to China; 750 years on, Rome wants to rebuild that special bond through infrastructure deals. Improving ties with a key trading partner makes sense. The risk of leaning East is that Italy loses clout in the West.

Viewsroom: Boeing’s struggles

14 March 2019

The U.S. aircraft maker is facing a crisis after a second crash involving an updated version of its workhorse 737 jet. There’s a financial hit to Boeing from countries grounding the plane; but there are geopolitical implications, too. Plus: China tries to stimulate its economy.

Larry Culp struggles to get new GE off the ground

14 March 2019

The $90 bln company’s CEO is warning investors to brace for a dismal first quarter and cash flow turning negative this year. His plan to sell more assets and overhaul the troubled power unit could eventually help, but it’s slow going. And a number of risks are out of his control.

China’s tax collectors could yet blunt stimulus

14 March 2019

Officials say Beijing’s $300 bln levy reduction this year sets a world record. Yet despite a big slash last year, the government’s total take kept rising. Better enforcement could partly offset lower rates, making it harder to predict just how much cuts might juice growth.

Hadas: Share buybacks aren’t worth defending

13 March 2019

Goldman does just that in a new report. They are almost like dividends, but they are sneakier in several ways. Their recent significance shows executives gaining power while small shareholders and taxing governments lose. If tighter rules kill them off, they would not be missed.

Oaktree investors get sharp end of the stick

13 March 2019

Brookfield is paying $4.8 bln for Howard Marks' and Bruce Karsh’s credit specialist, a 12 pct premium for a company that has underperformed for years. The Oaktree founders get to stay around with unlisted equity. It’s a lopsided deal, and a lesson in how asset management works.

College-bribe scandal is manna for progressives

13 March 2019

TPG’s Bill McGlashan and actor Felicity Huffman are among the big names charged in an alleged scam to get their kids into top U.S. universities. The admissions process is anyway tilted toward the rich. This case, and the entitlement on show, should put the whole system on trial.

Britain positions for longer Brexit limbo

12 March 2019

After rejecting Theresa May’s deal to leave the European Union for a second time, Britain’s parliament faces difficult choices. Assuming lawmakers also reject leaving without a deal, extending the UK’s membership looks unavoidable. But that will only delay a final decision.

Wells Fargo punching bag has no more stuffing

12 March 2019

Tim Sloan is the first big bank boss to face the wrath of a Democrat-led financial services panel. His inquisitors failed to land a blow, and focused on well-trodden issues. At this rate, financial CEOs summoned to give account have little to fear but inconvenience.

Cox: A Saturday outing with France’s gilets jaunes

12 March 2019

Protesters clad in yellow vests staged a joyful flash mob at Charles de Gaulle to oppose plans to privatise airports. There’s a sense of permanent revolt. But the array of quixotic targets championed by the movement gives President Emmanuel Macron a chance to regain his mojo.

Hadas: A bluffer’s guide to the MMT debate

6 March 2019

So-called modern monetary theory might be gaining respectability, after the radical approach was touted along with a huge “Green New Deal” by U.S. Democrats. Mainstream economists are fighting back. The debate, riddled with politics, hinges on at least five questions.

Shale drillers may be singing oil’s swan song

12 March 2019

Cash is flooding into Texas wells, attracted by quick investment returns. Yet the Permian’s short production cycles may hasten the arrival of peak oil. With sustainability investors pressing for cleaner fuels, some industry executives are already planning for a post-crude future.

UK banks’ Brexit flak jackets look durable

12 March 2019

The Bank of England has told some lenders to triple their liquid assets in case of a hard Brexit, according to the FT. Lenders have quadrupled their easy-to-sell securities to 1 trillion pounds over a decade. Standby central bank funds provide extra armour in a no-deal scenario.