RBS

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Frontrunning: February 27





  • Germany Crisis Role in Focus After G-20 Rebuff (Bloomberg)
  • G20 to Europe: Show us the money (Reuters)
  • Draghi’s Unlimited Loans Are No Panacea (Bloomberg)
  • Geithner says Europe has lowered risks of "catastrophe" (Reuters)
  • Gone in 22 Seconds (WSJ)
  • Gillard beats Rudd to stay Australian PM (FT)
  • Brazil Will Continue Reducing Interest Rates, Tombini Says (Bloomberg)
  • China to Have ‘Soft Landing’ Soon: Zoellick (Bloomberg)
  • China To Be Largest Economy Before 2030: World Bank (Reuters)
  • Obama pressed to open emergency oil stocks (FT)
 
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Daily US Opening News And Market Re-Cap: February 23





Despite the release of better than expected German IFO survey, stocks in Europe remained on the back foot after the EU Commission slashed forecasts for 2012 Eurozone GDP to -0.3% vs. 0.5% previously, while EU's Rehn added that the Euroarea has entered a mild recession. As a result Bunds advanced back towards 139.00, whereas the spread between the Italian/German 10-year bond yields widened marginally on the back of touted selling by both domestic and foreign accounts ahead of the upcoming supply on Friday. Looking elsewhere, EUR/USD erased barriers at 1.3300 and 1.3325, while today’s strength in GBP/USD can be attributed to a weaker USD, as well as touted EUR/GBP selling by a UK clearer.

 
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Frontrunning: February 23





  • IMF Official: 'Huge' Greek Program Implementation Risks In Next Few Days (WSJ)
  • European Banks Take Greek Hit After Deal (Bloomberg)
  • Obama Urged to Resist Calls to Use Oil Reserves Amid Iran Risks (Bloomberg)
  • Hungary hits at Brussels funds threat (FT)
  • Bank Lobby Widened Volcker Rule Before Inciting Foreign Outrage (Bloomberg)
  • Germany fights eurozone firewall moves (FT)
  • New York Federal Reserve Said to Plan Sale of AIG-Linked Mortgage Bonds (Bloomberg)
  • G-20 Asks Europe to Beef Up Funds (WSJ)
  • New Push for Reform in China (WSJ)
 
Tyler Durden's picture

Complete List Of Europe's Expanded Bank "Junk"





The good people at Knight put together a comprehensive list of potential ratings for banks in Europe after Moody's came out with their outlooks. We agree that banks getting shifted to non-investment grade is a big deal.  We saw the impact for Portugal once it got taken out of the indices, and we think for banks it will be an even bigger deal to lose that investment grade status.  Sure, they can still go to the LTRO, but it is hard to function as anything other than a zombie bank once you lose that rating...

 
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New York Fed Is Back To Transacting Opaquely, Sells AIG Holdings To Goldman





The last time the Fed tried to dump Maiden Lane 2 assets via a public auction in a BWIC manner, it nearly crashed the credit market. This time, the FRBNY, headed by one ex-Goldman Sachs alum Bill Dudley, has decided to go back to its shady, opaque ways, and transact in private, with no clear indication of the actual bidding process or transaction terms, and sell $6.2 billion in Maiden Lane 2 "assets" to, wait for it, Goldman Sachs, the same firm that would benefit in the first place if AIG's assets imploded (remember all those CDS it held on AIG which supposedly prevented it from losing money if AIG went bankrupt?). One wonders: does Goldman have a put option on the ML2 portfolio if the market experiences a sudden and totally impossible downtick some day? But all is well - we have assurance from the Fed that the sale happened in a "competitive process." Luckily, that takes care of any appearance of impropriety.

 
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Frontrunning: February 8





  • Greek Premier to Seek Bailout Consensus Amid Political Quarrels (Bloomberg)
  • Merkel makes case for painful reform (FT)
  • Bernanke Cites Risks to Progress of Recovery (WSJ)
  • Proposed settlement with banks over foreclosure practices dealt a setback (WaPo)
  • Merkel Approval in Germany Climbs to Highest Level Since 2009 Re-Election (Bloomberg)
  • Francois Hollande will spark next euro crisis (MarketWatch)
  • China’s Central Bank Pledges Support for Housing Market (Bloomberg)
  • Italy Pushes for Europe Growth Policy (Bloomberg)
  • Santorum bounces back in Republican race (FT)
  • China 'Big Four' Banks Issued CNY320 Billion New Yuan Loans In Jan (WSJ)
  • Gasoline and diesel prices raised (China Daily)
 
Tyler Durden's picture

Frontrunning: February 1





  • China’s factories in strong start to 2012 (FT)
  • Merkel to court Chinese investors (FT)
  • States to decide this week on mortgage deal (Reuters)
  • Europe is stuck on life support (FT)
  • IMF's Thomsen Says Greece Must Step Up Reform (Reuters)
  • Tax cuts expiry to slow US growth (FT)
  • Government health spending seen hitting $1.8 trillion (Reuters)
  • Romney Win in Florida Primary Shows Strength (Bloomberg)
  • EU regulator blocks D.Boerse-NYSE merger (Reuters)
  • Greek Bondholders said to get GDP Sweetener in Debt Swap Agreement (Bloomberg)
  • S. Korea Plans to Buy China Shares (Bloomberg)
 
Tyler Durden's picture

Frontrunning: January 30





  • Euro-Region Debt Sales Top $29B This Week (Bloomberg)
  • Greek Fury at Plan for EU Budget Control (FT)
  • Greek "football players too poor to play", leagues running out of money, may file for bankruptcy (Spiegel)
  • After insider trading scandal, Einhorn wins the battle: St. Joe Pares Back Its Florida Vision (WSJ)
  • China Signals Limited Loosening as PBOC Bucks Forecast (Bloomberg)
  • China's Wen: Govt Debt Risk "Controllable", Sets Reforms (Reuters)
  • IMF Reviews China Currency's Value (WSJ)
  • Watching, watching, watching: Japan PM Noda: To Respond To FX Moves "Appropriately" (WSJ)
  • Cameron to Nod Through EU Treaty (FT)
  • Gingrich Backer Sheldon Adelson Faces Questions About Chinese Business Affairs (Observer)
 
Tyler Durden's picture

Frontrunning: January 25





  • Angela Merkel casts doubt on saving Greece from financial meltdown (Guardian)
  • Germany Rejects ‘Indecent’ Call to ECB on Greece, Meister Says (Bloomberg)
  • Obama Calls for Higher Taxes on Wealthy (Bloomberg)
  • Fed set to push back timing of eventual rate hike (Reuters)
  • Recession Looms As UK Economy Shrinks By 0.2%, more than expected (SKY)
  • King Says BOE Can Increase Bond Purchases If Needed to Meet Inflation Goal (Bloomberg)
  • When One Quadrillion Yen is not enough: Japan's first trade deficit since 1980 raises debt doubts (Reuters)
  • Sarkozy to quit if he loses poll (FT)
  • U.S. Shifts Policy on Nuclear Pacts (WSJ)
  • ECB under pressure over Greek bond hit (FT)
 
Tyler Durden's picture

The CDS Market And Anti-Trust Considerations





The CDS index market remains one of the most liquid sources of hedges and positioning available (despite occasional waxing and waning in volumes) and is often used by us as indications of relative flows and sophisticated investor risk appetite. However, as Kamakura Corporation has so diligently quantified, the broad CDS market (specifically including single-names) remains massively concentrated. This concentration, evidenced by the Honolulu-based credit guru's findings that three institutions: JPMorgan Chase, Bank of America, and Citibank National Association, have market shares in excess of 19% each has shown little to no reduction (i.e. the market remains as closed as ever) and they warn that this dramatically increases the probability of collusion and monopoly pricing power. We have long argued that the CDS market is valuable (and outright bans are non-sensical and will end badly) as it offers a more liquid (than bonds) market to express a view or more simply hedge efficiently. However, we do feel strongly that CDS (indices especially) should be exchange traded (more straightforward than ever given standardization, electronic trading increases, and clearing) and perhaps Kamakura's work here will be enough to force regulators and the DoJ to finally turn over the rock (as they did in Libor and Muni markets) and do what should have been done in late 2008 when the banks had little to no chips to bargain with on keeping their high margin CDS trading desks in house (though the exchanges would also obviously have to step up to the plate unlike in 2008).

 
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Frontrunning: January 19





  • The Fed's HFT price manipulation code stolen? U.S. Charges Programmer With Stealing Code (Reuters)
  • One million homeowners may get mortgage writedowns: U.S. (Reuters)
  • In MF Global, JPMorgan again at center of a financial failure (Reuters)
  • China's Money Rates Slump After PBOC Injects Money (Reuters)
  • Athens closes in on bondholder pact (FT) - or not
  • Hedge Funds May Sue Greece If Loss Forced (NYT)
  • China Said to Weigh Easing Constraints on Banks as Growth Slows (Bloomberg) - But wasn't a rate cut already priced in on Monday?
  • Obama Under Attack Over Keystone Rejection (FT)
  • Chinese Economy Heads for Soft Landing in 2012 (China Daily) - don't really expect "China Daily" to tell you otherwise
  • Brazil Cuts Interest Rates Further to 10.5% (FT)
  • India to Launch $35bn of Public Investments (FT)
 
Tyler Durden's picture

Frontrunning: January 17





  • Greece Running Out of Time as Debt Talks Stumble (Bloomberg)
  • China Economic Growth Slows, May Prompt Wen to Ease Policies (Bloomberg)
  • Spain Clears Short Term Debt Test, Bigger Hurdle Looms (Reuters)
  • U.S. Market Shrinks for First Time Since 2009 (Bloomberg)
  • IMF, EU May Need to Give E. Europe More Help (Bloomberg)
  • Securities Regulator to Relax Rules on Listing (China Daily)
  • Monti Seeks German Help on Borrowing (FT)
  • Draghi Questions Role of Ratings Companies After Downgrades (Bloomberg)
 
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