China property gets $650 mln vote of no confidence 13 Dec 2022 Controlling shareholder Yang Huiyan is shedding 7% of Country Garden's services arm, a first. She doesn’t seem to need the money given state support for the developer, and it’s an odd time to sell. It suggests deep scepticism about Beijing’s real estate rescue package.
Sam Bankman-Fried lacks cover of systemic risk 13 Dec 2022 The former boss of bankrupt crypto firm FTX has been arrested. That hasn’t happened to financial hall-of-shamers that are more mainstream. The decentralised nature of crypto makes isolating people easier. The more complex the institution or blow-up, the harder it is to pin blame.
Democracy remains vulnerable despite a good year 12 Dec 2022 Autocrats like Xi Jinping and Vladimir Putin have suffered setbacks. So have demagogues like Donald Trump. But the tough economic outlook presents further challenges for democratic systems. So does the fact that many people feel their lives have little meaning, says Hugo Dixon.
China’s reopening will come with big late fees 9 Dec 2022 Strict quarantine rules have helped authorities to keep money onshore, including $760 bln in travel spending. If China fully relaxes, capital outflows could be Beijing’s next headache. But the damage to outward-facing parts of the economy from keeping borders closed is worse.
Jiang Zemin made China richer and more unequal 30 Nov 2022 China embraced entrepreneurs, developed markets and alleviated poverty under former President Jiang Zemin, who has died aged 96. His pragmatism probably saved the Communist Party. But the inequality his era spawned still haunts his successors.
Private equity’s pay boom may have peaked 29 Nov 2022 The average European buyout partner has 20 mln euros of outstanding carried interest in their current fund, reckons Heidrick & Struggles, up a quarter from 2021. Junior wages soared. Yet a possible fundraising slowdown and layoffs elsewhere in finance will slow the gravy train.
Ackman’s Hong Kong short is logical, not likely 24 Nov 2022 The hedge fund boss is wagering the local currency’s dollar peg will snap. The economic case is stronger than during his last try in 2011: the peg is forcing rate hikes even as the highly-leveraged city’s economy contracts. But the risks of alternatives might stay Beijing’s hand.
Piyush Gupta might be banking’s boldest boss 15 Nov 2022 Buying banking assets is complex at the best of times. Singapore’s $65 bln DBS added a geopolitical twist when it agreed to acquire Citi’s Taiwan consumer bank. As tensions rise, Gupta is holding his nerve on the deal due to close next year. Then again, he has little choice.
Buffett places classic chips in $4 bln Taiwan bet 15 Nov 2022 His Berkshire Hathaway now owns 1.2% of TSMC. The semiconductor giant’s stock has taken a beating this year, in part on fear China might invade Taiwan, its HQ. But the company has a near-monopoly in cutting-edge tech. Such traits have long appealed to the Oracle of Omaha.
Capital Calls: Cross-border M&A, Riches to rugs 9 Nov 2022 Concise views on global finance: The market reaction to U.S.-based Chart Industries’ $4.4 bln deal to buy Scotland’s Howden reinforces the idea that it’s a bad time to shop overseas, while Peloton’s founders are shifting gears with a new bespoke carpet business.
Elon Musk’s $44 bln Twitter challenge begins 3 Nov 2022 The Tesla boss is now the proud owner of the social media platform. In this Viewsroom podcast, Breakingviews columnists discuss the billionaire’s plans to boost revenue, the implications for the electric carmaker’s shareholders, and what the saga tells us about mega-deals.
Michael Klein’s fourth act may be his toughest 28 Oct 2022 The former Citigroup rainmaker who went solo and then launched $5 bln of SPACs is now set to run Credit Suisse’s advisory unit. It’s odd for a director to parachute into the C-suite, but the bank had no better pick. The bigger issue is CS First Boston’s clunky ties to its parent.
Adidas’s Kanye West bet is still in credit 27 Oct 2022 The 18 bln euro sportswear maker severed ties with the musician over offensive comments. In this Viewsroom podcast, Breakingviews columnists discuss how the financial benefits to Adidas nevertheless outweighed the costs. That may spur other brands to pursue outspoken stars.
Adidas-Kanye split leaves investors in the money 25 Oct 2022 The $18 bln sportswear group cut ties with the musician, now called Ye, after he made offensive comments. Its sluggish response risks a boycott. But given Yeezy sneakers’ high profit margins in recent years, shareholders may already have won more than they stand to lose.
Xi Jinping has silver linings for rest of world 17 Oct 2022 A third term for China’s nationalistic leader would risk a cold war or even a hot one. But Xi’s policies are hurting the globe’s second-largest economy. That will make it harder for China to throw its weight around – and helps fight climate change, says Hugo Dixon.
Elon Musk’s second run at his $44 bln Twitter deal 13 Oct 2022 A judge in Delaware has given the Tesla CEO until the end of the month to make good on his vow to buy the social media giant. In this Viewsroom podcast, Breakingviews columnists delve into the many twists of this M&A saga, Musk’s options, and what’s likely to happen next.
Bernanke bank-crisis Nobel requires markets sequel 10 Oct 2022 The former Fed chair and two fellow economists won the prize for showing how lenders can fail and cause a depression. Bernanke put theory into practice in 2008, averting a slump. But ultra-low interest rates built up financial risks which are only now becoming fully apparent.
Canary Wharf’s post-pandemic property conundrum 4 Oct 2022 The east London financial hub’s owner is expanding even as tenants like HSBC consider ditching their leases. In this Exchange podcast, CEO Shobi Khan explains how renting out swanky apartments and luring a new breed of tenant can insulate the landlord from a property slump.
Capital Calls: Apple tests discretionary spending 28 Sep 2022 Concise views on global finance: The company’s reversal on iPhone 14 production is a sign that inflation-battered consumers are thinking differently about discretionary items.
Vodafone’s new activist is mixed investor blessing 21 Sep 2022 French tycoon Xavier Niel bought 2.5% of the $34 bln telecoms company. That will cheer fellow shareholders, like Cevian Capital, who are pushing CEO Nick Read to simplify the group. Yet the risk is that Niel is more interested in getting hold of its Italian assets on the cheap.