Cannabis industry shops for a suit and tie 16 Nov 2018 Money is pouring into weed as valuations rise and legal barriers fall – nudged further by recent U.S. election results. Companies like Canopy, Aurora and MedMen are starting to take on a veneer of acceptability. That doesn’t make them good investments, but it’s progress.
Mark Zuckerberg pushes wrong kind of independence 15 Nov 2018 Facebook’s CEO is setting up an external committee to police fake news and hateful content after more revelations about how he and others dealt with Russian meddling. But outsourcing decisions won’t fix Facebook’s culture. Removing Zuckerberg as chair would be a good first step.
Goldman has half a defense in 1MDB mess 14 Nov 2018 Two former executives accused in the Malaysian corruption scheme openly lied to the bank, U.S. authorities say. Rival firms have found leniency in similar cases. But an indictment also cites a culture that favored deals over compliance. That could warrant a deferred prosecution.
Snap shareholders deserve little sympathy 14 Nov 2018 Some are suing the social-media firm for misleading them before its IPO about competition from Instagram. Now U.S. watchdogs are conducting a probe. Bad conduct deserves punishment. But investors willingly bought stock with no rights in an immature company with lots of rivals.
Mexico’s revolutionaries risk spoiling the party 12 Nov 2018 President-elect López Obrador doesn’t take office until next month, but he and his fellow leftists have already upset markets with moves to nix an airport project and rein in bank fees. Such fumbles could help guide Brazil’s far-right populist Jair Bolsonaro as he nears power too.
EU tech’s unholy alliance takes shape in Lisbon 12 Nov 2018 Europe is tackling the deficiencies that made it a digital also-ran, like lack of talent and funding. Yet vast data hoards and market share still give U.S. giants like Google a massive advantage. Policymakers at last week’s Web Summit in Portugal seemed eager to close the gap.
U.S. stress tests risk falling on slippery slope 9 Nov 2018 Fed supervision chief Randal Quarles wants to tweak the annual exams. Some revisions are warranted, like giving banks test results before they decide how much capital to return to investors. But scrapping the watchdog’s ability to fail a firm gives Wall Street too much leeway.
UBS’s Ermotti can afford a legal brawl or two 9 Nov 2018 The Swiss lender has refused a $2 bln U.S. settlement over missold securities, according to Reuters. Barclays, which spurned a similar deal, offers some hope of a lower eventual hit. With healthy capital, Ermotti has headroom to fight both this and a separate French tax battle.
Italy will get few favours from EU’s new bank cop 7 Nov 2018 The European Central Bank picked respected regulator Andrea Enria as its top banking supervisor. The industry’s chronic low profitability and poor money-laundering controls are his main challenges. The Italian is unlikely to take a softer line on cleaning up lenders’ bad debts.
William Hill turnaround looks like a shaky bet 6 Nov 2018 The British bookmaker wants to double operating profit by 2023 through growing its online and U.S. businesses. Given domestic political heat and economic weakness, it’s the right strategy. But non-UK growth will have to shoot the lights out for the group to hit its targets.
Facebook’s Africa friends need heart, not darkness 5 Nov 2018 Cameroon used a fake cannibalism video Mark Zuckerberg’s $430 bln outfit left on its pages to justify a military crackdown. Facebook has not done enough to combat online abuse as social media booms on the poorest continent. But effective monitoring would hardly break the bank.
South African boring is once again interesting 2 Nov 2018 New rules for the Rainbow Nation’s struggling mining industry strike a decent balance. Making investors bear less of apartheid’s social legacy will stop the sector’s decline. Taking the affirmative action shackles off explorers might even create some much-needed growth.
India’s central bank spat has a global hue 1 Nov 2018 New Delhi has ratcheted up tensions with a mooted threat to invoke a never-used power to meddle with the RBI. With the rupee sinking, it’s a terrible time to undermine the bank's independence. Donald Trump’s readiness to fault the U.S. Fed has given others cover to be bolder.
U.S. regional banks finally feel watchdog warmth 31 Oct 2018 The Federal Reserve wants to modestly loosen liquidity rules for commercial banks like U.S. Bancorp and PNC. That will leave the United States’ biggest global lenders – the likes of JPMorgan and BofA – the only ones stuck with a largely undiluted post-crisis Dodd-Frank regime.
Wilbur Ross finally picks right fight with China 30 Oct 2018 Washington has put a provincial chipmaker under an embargo similar to that which crippled telecoms giant ZTE. Fujian Jinhua is accused of IP theft by Idaho-based Micron; this retaliation presumes guilt. Still, targeting smaller state-backed firms is smarter than blanket tariffs.
Best to avoid answering call of Chinese telecom 29 Oct 2018 China Unicom, Mobile and Telecom delivered solid earnings growth this year and have mostly bucked the slide in the broader market. Valuations are cheap, they’re insulated from U.S. tariffs and a merger could help. The costly rollout of 5G, however, could offset those benefits.
China’s Guinea snub sends bearish iron ore signal 29 Oct 2018 Chinalco has stepped back from a 2016 deal to take control of the $23 bln-plus Simandou project from partner Rio Tinto. That’s a headache for the mining giant and a blow to West Africa's ambitions. It suggests Beijing sees sustained cooling in demand for the steel ingredient.
Strange solar deal puts sunlight on market mayhem 24 Oct 2018 Hanergy Mobile Energy wants to buy out Hong Kong-listed Hanergy Thin Film at a $27 bln value and take it public in mainland China. The same man behind the mess that has left the target’s shares frozen for years controls the parent. It hardly makes these market structures shine.
Facebook hires one weapon for two-handed fight 19 Oct 2018 Nick Clegg, former UK deputy PM, will lead global affairs at the $450 bln social network. His anti-Brexit stance and EU background could help with tribulations in Brussels. But he’s an odd choice to deal with Washington, where scrutiny may intensify after the midterm elections.
Holding: Company babysitters get deserved spanking 18 Oct 2018 The U.S. Justice Department will cut back on hiring monitors for corporate wrongdoers. Trusted to keep Citi, Apple and others in line, these super-nannies often turn into meddlers fond of excessive oversight and fees. Policing business misconduct is too important to outsource.