Trump and Warren make odd antitrust bedfellows 6 Dec 2017 The liberal senator says mega-deals like Aetna’s $77 bln sale to CVS kill competition. She backs the DOJ fighting AT&T-Time Warner and has concerns about past merger remedies. It puts her in the same camp as the president. Such an alliance of convenience puts pressure on big M&A.
Hadas: The mystery of lost competition 6 Dec 2017 The U.S. tax cut is expected to boost corporate earnings but not lower prices or raise wages. That implies there’s too much tacit collusion for basic economic theory to work as designed. Limited price competition is great for shareholder value, but bad for the economy.
France and Germany look too alike to bond market 6 Dec 2017 The gap between French and German bond yields this week hit its lowest since 2009. Plans to revamp the way the euro zone works may spur investors to overlook differences between countries’ public finances. But a lack of discrimination is premature, and stores up fresh problems.
Brexit deal hinges on enlightened obfuscation 5 Dec 2017 A plan for Northern Ireland to accept some EU rules has met with opposition in Belfast and demands for similar treatment elsewhere. Prime Minister Theresa May's best hope is to fudge tough decisions, and use the threat of a chaotic exit – or another election – to quash dissent.
ICO bust heralds U.S. crypto-currency rules chaos 4 Dec 2017 The SEC has taken its first action against a coin offering, alleging the perpetrators fraudulently raised $15 mln. The CFTC, though, just gave the green light to bitcoin futures. The growing regulatory discord on virtual currencies increases the risks to investors.
Rushed U.S. tax bill rewards oil, real estate 4 Dec 2017 The Republican Senate plan snuck in tax breaks for oil and gas partnerships, real-estate investment trusts and other sectors. One hiccup puts the research tax credit favored by business at risk. But overall, corporate America and the wealthy may receive an early Christmas gift.
GOP casts principle aside in scramble for tax win 2 Dec 2017 Senate Republicans passed a tax cut plan after last-minute changes papering over deficit concerns and the bill’s tilt to the wealthy. Differences with the House must be reconciled. But an escalating Russian influence probe makes the party even more frantic to claim a victory.
Wall St poised to stop worrying and love bitcoin 1 Dec 2017 Crypto-currencies are set to take center stage. Mike Novogratz is launching a hedge fund, exchanges are teeing up futures contracts, big banks are likely to enter the fray and even the Fed is taking notice. It may end in tears, but the industry won’t ignore a $300 bln market.
Holding: Bet on Supreme Court to lift gambling ban 1 Dec 2017 New Jersey’s suit to legalize sports wagers makes financial policy sense, but the constitutional argument is stronger. Limits on the feds’ power mean states do their own thing on everything from pot to guns. A court already inclined that way is likely to extend it to betting.
Guest view: Bitcoin bubble obscures real worth 30 Nov 2017 Crypto-currencies are like South Sea Company shares: unanalyzable, but here to stay. For one thing, they offer a government-proof store of wealth. For another, real technological advances exist along with the scams. More stable prices are, however, needed for long-term value.
Botched process leads to Frankenstein tax plan 30 Nov 2017 U.S. Senate Republicans are rushing into a vote on their tax-cut effort. Changes to appease GOP critics have yet to be settled, including a trigger to raise taxes if growth falls short. Lower-income Americans will also face higher bills. Lawmakers are creating a scary mess.
Saudi needs OPEC cuts to work, but not too well 30 Nov 2017 The oil cartel agreed to extend cuts until the end of 2018. Its moderation has drained inventories and lifted prices. Further cuts won’t boost prices enough to balance Saudi’s budget. Then again, that gives the crown prince a reason to continue with his challenging reforms.
U.S. doesn’t even have a corporate tax problem 30 Nov 2017 Proposals in Congress would cut the levy on companies and, temporarily, on individuals. The move may give a late-cycle boost to the economy but add to the deficit and debt. The irony is that corporate profit is already plentiful while Uncle Sam's tax take is historically low.
Cox: Trump bump aside, U.S. stocks lag in 2017 30 Nov 2017 The president has unprecedentedly staked his political colors to the mast of rising equity prices, calling the S&P's rally a validation of his policies. Yet most other markets around the world have done even better. There are bigger forces at work than U.S. corporate tax rates.
Indian economy shaking off Modi’s shock therapy 30 Nov 2017 Growth of 6.3 pct last quarter suggests fallout from the premier's policy pileup is fading. He’s leading a bold drive to improve the way India is governed. Getting a few more things right, like the resolution of bad debt, is a precondition to turn this into a solid economic run.
Bank of Korea had best go slow with rates 30 Nov 2017 Seoul’s first increase in benchmark borrowing costs for more than six years is a prudent step toward normalising monetary policy, given signs of economic strength. But crushing consumer debt and a housing slowdown mean the central bank must tread carefully.
Yellen gives Congress parting shot on growth, debt 29 Nov 2017 The outgoing Fed boss warned of growing deficit risks just as lawmakers weigh tax cuts that would exacerbate it. It’s also up to politicians to improve education, investment and infrastructure spending. Her message of central bank limitations is one her successor will echo.
Hadas: Bitcoin at $10,000 is even more dangerous 29 Nov 2017 The crypto-currency is on the verge of turning respectable, but a futures market cannot cure its faults. It is economic nonsense, socially irresponsible and an incoherent vote for cultural nihilism. Then there is the unadulterated greed. Disaster can't come soon enough.
Sexual misconduct will haunt 2018 annual reports 29 Nov 2017 This year brought revelations of companies using shareholder bounty to settle allegations male executives harassed and made unwanted advances on mostly female workers. In the coming proxy season, expect investor proposals pushing for greater disclosure and action on the issue.
UK plays weak hand badly in Brexit poker 29 Nov 2017 The country has reportedly bowed to EU demands that it pay up to 100 bln euros when it leaves the bloc. Months of haggling have wasted time and goodwill even before the start of talks on trading arrangements. The outcome shows the UK has a lot less leverage than it pretends.