The Reformed Broker – Joshua M Brown: chart o’ the Day: Rotation Now Undeniable I spent the first half of the year and (plenty of last fall) debating the prospects of a Great Rotation with the naysayers. Many of the doubters were those who work in credit trading or bond management – they did not… Continue reading The Great Rotation
The Washington Post – Right now, Larry Summers is the front-runner for Fed chair The word among Federal Reserve watchers right now is that the choice is down to Janet Yellen or Larry Summers as Ben Bernanke’s replacement. I can’t find anyone who really thinks it’ll be Roger Ferguson, Tim Geithner, Alan Blinder, or some… Continue reading The Next Federal Reserve Chairman
Reuters – U.S. SEC urges money funds to be prepared for tri-party repo defaults U.S. securities regulators are warning the $2.6 trillion money market fund industry to be careful of the risks in the so-called repo market, part of the unregulated shadow banking system that large investment banks use to fund their business. The U.S.… Continue reading QE And Bank Regulation Hurts The Repo Market
<Click on chart for larger image> The Financial Times – Market turbulence revives fears over ETF structural issues The global sell-off last month sparked the highest amount of settlement failures in parts of the $2tn exchange-traded fund market in nearly two years, reviving a debate over whether the popular investment vehicles suffer from structural issues… Continue reading What Are The Structural Issues Among ETFs?
Bloomberg Businessweek – Fed Criticized for Oversight of Bank-Owned Commodity Operations Risks in banks’ commodities businesses can be managed by limiting them to frequently traded products and setting curbs on volume, Randall Guynn, head of the financial institutions group at law firm Davis Polk & Wardwell LLP, said at the hearing. Regulators also can require… Continue reading Regulating Banks Commodity Trading
Caixin Online –The Implications of Diverging Monetary Policies The monetary policies of major economies are diverging for the first time since 2008. The euro zone, Britain and Japan are sustaining quantitative easing, while the United States, China and other major emerging economies are on a tightening path. The divergence is creating trends in some markets,… Continue reading Monetary Policy
The Wall Street Journal – Signs Suggest China Warming to Idea of Stimulus Of particular concern to policy makers is the labor market. HSBC’s employment subindex came in below the headline number at 47.3, the lowest level since March 2009, when firms laid off workers en masse in the teeth of the global financial crisis.… Continue reading China
The Financial Times – US offers mortgage risk to investors Private investors will take over some of the risk of default on $22.5bn of mortgages currently guaranteed by US taxpayers, in a landmark deal designed to reduce the federal government’s outsized role in the country’s housing market. Freddie Mac, the government-controlled mortgage finance giant, on… Continue reading The Government Wants You To Invest In Mortgages
The Financial Times – Meredith Whitney: Detroit aftershocks will be staggering As jarring as the reality may be to accept, Detroit’s decision last week to declare bankruptcy should not be regarded as a one-off in the US municipal market – which is what the bond-peddlers are now telling their clients. The aftershocks of the largest… Continue reading Meredith Whitney Speaks About Detroit
The New York Post – Ex-stats insider: Time to trash outdated CPI The Consumer Price Index is broken and needs to be fixed, says Keith Hall, the former head of the Bureau of Labor Statistics, whom my readers met last week. Hall created a stir by saying what most of us thought was obvious: The… Continue reading Trash The CPI!
The Wall Street Journal- Wells Fargo Ousts ICBC as World’s Biggest Bank Comparing market capitalization to deposits shows investors value Chinese banks at about eight cents for every $1 of deposits. That is lower than beleaguered Spanish banks, which are valued at nine cents, and at the same level U.S. banks were valued in 2009.… Continue reading Wells Fargo Is Now The World’s Largest Bank