Yes Bank bailout to leave Indian lenders stranded 5 Mar 2020 State Bank of India looks set to rescue its private-sector rival for a pittance. That will crush lingering hopes for industry privatisation. A government-led rescue also undermines the idea that richly valued private lenders are better risk managers than their state rivals.
ArcelorMittal gets better bargain in Italian row 5 Mar 2020 A legal fumble is forcing Rome to invest in troubled steelmaker Ilva. ArcelorMittal, which was due to pay 4.2 bln euros to buy and relaunch the toxic plant, cuts its bill and exposure to Italy’s virus-infected economy. The state gets stuck with another loss-making asset.
Hong Kong buyout-firm tax cut sends wrong message 5 Mar 2020 The city plans to reduce levies on so-called carried interest. Such gains are currently taxed like pay or other profit at rates well below global norms. With recent protests rooted partly in growing inequality, sparing private equity barons even that low burden risks a backlash.
Biden is political equivalent of 10-year Treasury 4 Mar 2020 The former vice president is the Democrats’ preferred candidate for president so far, after winning at least nine states on so-called Super Tuesday. His surge shows that, like investors, voters are seeking a safe haven in uncertain times. It’s bad news for the current president.
EU green deal is a 1 trln euro diversion 4 Mar 2020 The European Union’s big investment plan to cut emissions, due on Wednesday to be backed by legally binding targets, has been getting a kicking. Fair enough: it’s a typical Brussels fudge. Its main role is to keep the EU busy until political cover exists to properly price carbon.
Fed easing shocks more than it awes 3 Mar 2020 U.S. central bank boss Jay Powell cut rates by half a percentage point because of economic risks from the coronavirus. Easing from the provider of global financial liquidity sets the scene for others to follow. The impact would have been bigger had G7 peers acted simultaneously.
Virus fight depends on practical economic measures 2 Mar 2020 Italy will spend 4.5 bln euros to fight Europe’s worst coronavirus outbreak. Keeping companies alive through tax breaks and other relief measures while the disease spreads could produce a rebound if the emergency proves short-lived. Monetary policy alone won’t kill the disease.
Lebanon gives Lazard bankers a brainteaser 28 Feb 2020 The debt-strapped nation has selected the firm to advise on a restructuring. But principal haircuts could imperil local banks, austerity would upset ordinary Lebanese, and Hezbollah’s growing power complicates everything. Lazard will be worth its fees if it can solve the puzzle.
Indian markets will resist jolt from riots 28 Feb 2020 Sectarian violence has left at least 32 dead in the capital. The unrest broke out at a time of slowing domestic growth and when global investors are jittery about the risk of a pandemic. Still, the world’s fifth-largest economy is surprisingly alluring for foreign funds.
Virus will finally force politicians to spend 27 Feb 2020 Central bankers don’t have the tools to combat the economic damage. Rather than relying on them again, governments will have to raid their coffers to safeguard public health and prop up growth. That will do short-term good, but could further distract from long-standing problems.
Heathrow ruling reflates sagging UK green stature 27 Feb 2020 Judges have grounded plans for a third runway at Europe’s busiest airport, saying the government ignored obligations to cut CO2 output. As host of a major climate change summit in November, it’s critical Britain has the credibility to push for emissions curbs. This should help.
South Africa’s spending cuts border on hara-kiri 27 Feb 2020 The government wants to lop 6% annually off public sector wages to rein in the biggest deficit since the apartheid era. That’s heroic and points to a dangerous showdown with powerful unions. Even if it prevails, widespread protests will darken an already grim economic picture.
Companies will be first line of U.S. virus defense 26 Feb 2020 The White House is downplaying the spread of the coronavirus, perhaps to calm markets. If there’s an outbreak, it may be up to CEOs to make calls that would hurt the economy, like closing factories. It would follow the trend of firms stepping up where government has left a void.
Apple scores another unwanted first on China 26 Feb 2020 After sounding the alarm earlier than peers on the impact of coronavirus on manufacturing, the $1.3 trln iPhone maker just got a clear warning from shareholders on human rights. CEO Tim Cook has kept divergent stakeholders onside pretty successfully, but that’s becoming harder.
Hadas: Wealth tax offers low-risk test of MMT 26 Feb 2020 Most taxes redistribute money that is already circulating in the economy, but proposed levies on capital would bring new funds into play, without increasing the fiscal deficit. If Modern Monetary Theory is right, a rush of well-spent new money would strengthen the U.S. economy.
Facebook tax fight slaps a levy on its reputation 25 Feb 2020 The social network is fighting U.S. authorities in court over a $9 bln tax bill. Its defense has merit. But for a $620 bln company to say it should pay less because its future was uncertain a decade ago defies common sense. That will only win Facebook more enemies.
Mubarak’s downfall taught Egypt’s Sisi key lessons 25 Feb 2020 During his three decades in charge, the former strongman, who has died aged 91, valued political stability above all else. Bolder currency reform might have defused some Arab Spring anger. Current leader Sisi took note, but has also so far been better at keeping the army on side.
Ireland has more pressing needs than unification 25 Feb 2020 Sinn Fein, which wants to form a coalition government, aspires to unify the island. Even if Irish voters were willing to take on the costs this would entail, their Northern Ireland peers are more ambivalent. Healthcare is higher up the agenda on both sides of the border.
YouTube makes itself a needless political football 21 Feb 2020 President Trump has bought prominent ads on the video platform on Election Day. That’s because YouTube has enormous reach. Yet, parent Alphabet is in regulators’ crosshairs and campaign money is a tiny slice of revenue. It’s a wonder why it accepts political ads at all.
Election that Bloomberg buys may not be his own 20 Feb 2020 The billionaire fumbled his first debate as a presidential contender. But his political machine matters more than his performance. Bloomberg has 2,100 staffers, provides corporate-style perks and may drop over $500 mln on TV ads. It’s a springboard for future Democratic hopefuls.