Indonesian tax amnesty odd help for private banks 10 Apr 2017 A tax amnesty that saw citizens declare $365 bln in assets has been a blessing in disguise for top private banks. The ultimate outflows to Indonesia were a fraction of the headline amount. More importantly, the scheme gave lenders the excuse to do some overdue spring-cleaning.
Weak U.S. hiring looks like blip in steady economy 7 Apr 2017 For Donald Trump, who touted strong jobs growth in February, a mere 98,000 new positions last month was a reversal. The 12-month average is still over 180,000, though, and key unemployment rates declined. One month of data, good or bad, rarely tells the whole story.
Trump’s Syria strikes don’t justify crude worries 7 Apr 2017 Oil spiked after U.S. missiles rained on Syria. The fear isn’t that supplies will be disrupted but that Syrian ally Iran, which has been increasing its output of crude, will be hit with renewed sanctions. Even if that happens, other forces could keep markets well supplied.
Europe dangles 2008-style bank moral hazard trade 7 Apr 2017 The EU’s willingness to let Italy bail out sickly banks looks a retreat from post-crisis reforms on bank failure. Investors might conclude that senior creditors will always be saved. A key change since the financial crisis – abolishing implicit subsidies – is being muddied.
Even Cohn-Warren can’t bring back Glass-Steagall 6 Apr 2017 The mixed bag of supporters for separating commercial and investment banking now includes Gary Cohn. The former Goldman Sachs president advising Donald Trump is aligned with Wall Street scourge Elizabeth Warren. Congress, however, is too busy to bother with breaking up banks.
Viewsroom: Jamie Dimon’s bank-reform cheat sheet 6 Apr 2017 The JPMorgan CEO’s latest shareholder letter hands President Trump and Republicans plenty of tips and sound bites for rolling back post-crisis rules. But the administration’s failure to replace the Fed’s departing top regulator throws more doubt on a Dodd-Frank overhaul.
South Africa’s slow burn cuts chances of quick fix 6 Apr 2017 President Jacob Zuma seems to be doing his best to get foreign investors to dump domestic assets. That may not lead to a sudden stop: only a small minority face being forced sellers. The bad news is that this could slow the process to replace him with a more responsible leader.
Hadas: Hard Brexit could have sting in the tail 6 Apr 2017 Conventional wisdom is that even a "clean break" with the European Union just means a slower UK growth rate. But if modern revolutionaries gain control, Britain might end up with less foreign money and fewer trading partners. That would bring a huge drop in living standards.
China’s reformers could use tough line from Trump 5 Apr 2017 The U.S. president has threatened his Chinese counterpart with punitive trade policies. A more creative approach would target barriers to foreign investment in the People’s Republic. That would find support from U.S. corporations – and China’s frustrated pro-market faction.
Republicans lose their way on Main Street 5 Apr 2017 The chairman of a House panel told CFPB Director Richard Cordray he should be fired. This escalating fight saps resources from guarding consumers against predatory lenders and debt collectors. Political dogma is obscuring the agency's mission and a populist message from voters.
Saudi will find luring May was the easy part 5 Apr 2017 The British prime minister’s charm offensive in Riyadh may help sell more planes and halal lamb. It also sends a message to EU negotiators. What Saudi really needs is investment, people and skills – which hinge on the so-called soft issues Theresa May seems happy to overlook.
Markets snooze their way to Le Pen showdown 5 Apr 2017 French government bond prices suggest a lower probability of far-right Marine Le Pen winning the presidential election than bookies do. Markets may be too calm about the disruptive potential of voter apathy, or a left-wing alliance. That limits their ability to reassure.
Britain is appropriate spearhead for bonus rethink 5 Apr 2017 UK ministers want to cut so-called long term incentive plans from executive pay. Such schemes can work, but all too often don’t. Turning them into less opaque deferred bonuses could preserve domestic competitiveness, while aligning Britain with peers that value greater clarity.
China’s auxiliary capital looks like Brasilia 5 Apr 2017 Beijing wants to relocate some government functions to a new city 100 km away. State media compare the plan to the Shenzhen free trade zone, which drove economic reform in the 1980s. This bureaucratic backwater won't do anything of the sort, but it's clever urban planning.
Latin America needs leaders who can say “adios” 4 Apr 2017 A reluctance to cede power is a common failing in a region known for strongmen and weak institutions. Protesters who torched Paraguay’s Congress over the issue last week had the right idea, if wrong method. Rulers’ refusal to let go clouds prospects in Ecuador and Venezuela too.
Empty Fed seat an obstacle to banks’ reform hopes 4 Apr 2017 Regulatory chief Daniel Tarullo defended the central bank’s post-crisis rules in a farewell speech. Trump wants a rollback but first he’ll need to replace the governor, which could take months. While bank bosses are clamoring for reform, the Fed may be on autopilot for a while.
Brexit forces issues that are best left murky 4 Apr 2017 A phony battle over how Spain and Britain might treat tiny Gibraltar is a distraction, and a warning. If Britain’s exit from Europe becomes a mechanism for settling old scores, it could kill the constructive ambiguity on which the UK, the euro and the single market all depend.
Iceland needs euro peg like cod needs bicycle 4 Apr 2017 The North Atlantic state’s finance minister suggests fixing the crown’s value to its euro zone peer. Iceland’s economy could use cooling. But its volatility means that focusing attention on inflows – or even pegging to a more appropriate currency – makes more sense.
Flu exposes U.S. folly in weighing fear and risk 3 Apr 2017 Americans are 1,000 times more likely to die from this common illness than terrorism. The current, and worst, bird-flu outbreak in China means the imbalance is even higher. Washington's decision to spend so much more on homeland security than preventing disease is misguided.
Dixon: Start preparing for fourth Greek bailout 3 Apr 2017 Despite a last-minute wrangle over pensions, Greece is likely to get the next chunk of the money due under its current bailout plan. But this will only buy Athens time until the middle of 2018. After that, a new programme, and more fraught negotiations, will probably be needed.