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Frontrunning: April 18

Tyler Durden's picture




 
  • First Japan now... Australia Ready to Help IMF (WSJ)
  • "Not if, but when" for Spanish bailout, experts believe (Reuters)
  • Spain’s Surging Bad Loans Cast New Doubts on Bank Cleanup (Bloomberg)
  • Spain weighs financing options (FT)
  • Spanish Banks Gorging on Sovereign Bonds Shifts Risk to Taxpayer (Bloomberg)
  • Spain and Italy Bank on Banks (WSJ)
  • Chesapeake CEO took out $1.1 billion in unreported loans (Reuters)
  • China preparing to roll out OTC equity market – regulator (Reuters)
  • Angry North Korea threatens retaliation, nuclear test expected (Reuters)
  • North Korea Breaks Off Nuclear Accord as Food Aid Halted (Bloomberg)
  • Fannie Mae Fix Said to Retain Some US Mortgage Role (Bloomberg)

Overnight Media Digest:

WSJ

* The City of London Corp is forming a working group with five leading banks as well as the U.K. Treasury, the Bank of England and the Financial Services Authority to support growth of yuan business in the city.

* Shareholders of Citigroup handed the bank a scathing rebuke, rejecting a board-approved compensation package for its senior executives.

* Warren Buffett disclosed he has prostate cancer and will receive treatment in the coming months but gave no indication of plans to step back from Berkshire Hathaway.

* The State Department is prodding several large banks to resume doing business with foreign embassies in the U.S. after several accounts were closed amid a crackdown on money laundering.

* Pfizer is close to selling its infant-nutrition business to Nestlé for at least $9 billion in what would be one of the largest deals so far this year.

* In a bid to capitalize on the growing market for fast Internet access on planes, Honeywell has signed a deal with satellite-operator Inmarsat to provide gear for airborne broadband connections.

* First Solar Inc once the dominant U.S. solar-equipment maker, is slashing its work force by nearly a third and shutting a factory as it contends with a solar-panel glut that the company called "the new market reality."

* Best Buy founder and chairman Richard Schulze has long run the company like a family business. Now, his long shadow could complicate the hunt for a new chief executive at a crucial juncture.

FT

SUPPLY CHAIN BLOW TO CARMAKERS

Automakers are scrambling to avert a shock to their global supply chain caused by a shortage of a critical resin used in car parts.

YPF SWOOP FOLLOWED FAILURE OF CHINA DEAL

Repsol tried to sell a controlling stake in its Argentinian oil company to a Chinese energy group before it was nationalised by Buenos Aires, according to two people familiar with the talks.

RIVAL CHIEF TO HEAD PANMURE GORDON

Panmure Gordon, the UK stockbroker, will on Wednesday announce the appointment of Philip Wale, currently head of rival Seymour Pierce, as its new chief executive.

CANADIAN APPROACHED FOR TOP BOE JOB

Mark Carney, the governor of Canada's central bank, has been informally approached as a potential candidate to replace Sir Mervyn King as head of the Bank of England in June next year.

GOLDMAN ADDS CAUTION TO RISK APPETITE

Goldman Sachs' daily value at risk - a measure of the trading risk assumed by the Wall Street bank - fell to the lowest level since before the financial crisis, surprising analysts and prompting questions over whether the bank is quietly tweaking the way it does business ahead of new rules and regulation.

JAPAN OFFERS $60 BILLION TO BOOST IMF FIREPOWER

Japan is to give $60 billion to the International Monetary Fund's effort to expand its resources, pledging to lead the global effort to prevent the sovereign debt crisis in Europe damaging economies around the world.

VODAFONE ESCALATES TAX DISPUTE WITH INDIA

Vodafone has threatened legal proceedings against India's government under a bilateral investment treaty in a move that further escalates the group's campaign against proposed tax changes.

LNG PLANT TO BE FIRST IN US FOR 40 YEARS

Construction at the first liquefied natural gas export facility to be built in the U.S. for more than 40 years is set to start within three months, the chief executive of the company behind the project has said, after it secured its final approval from the U.S. energy regulator.

NYT

* In a stinging rebuke, Citigroup shareholders rebuffed on Tuesday the bank's $15 million pay package for its chief executive, Vikram Pandit, marking the first time that stock owners have united in opposition to outsized compensation at a financial giant.

* As data usage multiplies on mobile devices, carriers say they need more spectrum, but scientists and engineers say newer technologies can improve efficiency.

* Warren Buffett disclosed on Tuesday that he had prostate cancer, a development that would probably heighten the questions over his successor as the chief executive of his conglomerate, Berkshire Hathaway.

* As federal regulators put the finishing touches on an overhaul of the $700 trillion derivatives market, a major provision has been tempered in the face of industry pressure.

* An accelerating wave of partner defections from the New York law firm Dewey & LeBoeuf is now threatening to violate the firm's loan agreements with its banks.

* A confidential report prepared for investors this year and obtained by The New York Times says that Sony will lay off about 60 percent of EMI's publishing staff within two years, as part of $70 million in annual savings.

* Louis Freeh, who is charged with the job of returning assets to MF Global's creditors, is expected to testify alongside regulators, as well as another trustee tasked with returning money to customers.

* First Solar, which is based in Arizona, announced that it would stop all of its German production as part of a broad restructuring plan that will cut its global work force by 30 percent, or 2,000 workers, and sharply reduce its global production capacity.

Canada

 

THE GLOBE AND MAIL

- In the past three and a half years, the federal government has appointed 100 new judges in provinces across the country - and 98 of them were white. The lack of diversity among judges raises questions in Canada where one in every five citizens belongs to a visible minority. r.reuters.com/syw67s

 - Canadians' household debt levels are already at near-record levels. The Bank of Canada thinks they will swell even higher. r.reuters.com/tyw67s

Reports in the business section:

- BCE Inc is ramping up its presence in the push-to-talk business market, in a strategic strike aimed at dethroning rival Telus Corp as the Canadian king of that lucrative niche. r.reuters.com/xyw67s

- Canada's Alimentation Couche-Tard Inc is to buy Norwegian company Statoil Fuel and Retail ASA for an agreed 15.9 billion crowns ($2.8 billion) to gain a foothold in Europe's top-performing economies. r.reuters.com/pax67s

NATIONAL POST

- Wildrose leader Danielle Smith was drawn off-message again on Tuesday after Calgary-Greenway candidate Ron Leech told a radio station he had an electoral advantage because he is white. r.reuters.com/cax67s

- A Washington state-based fertility clinic is advertising sex selection in a British Columbia newspaper for Indo-Canadians. r.reuters.com/jax67s

Reports in the business section:

- Rogers Video is getting out of the rental business as the market for DVDs continues to decline. The move, which comes on the heels of the closing of movie rental giant Blockbuster Video, leaves Canadians without a national movie rental chain. r.reuters.com/max67s

- Oracle thought about building its own smartphone in 2009, and considered buying Palm or Research in Motion to do so, according to testimony in the Google-Oracle patent infringement case that started yesterday.

 

European Economic Update:

  • Sweden Riksbank Rate Decision 1.50% (unch) – in line with expectations. Consensus 1.50% (unch). Previous 1.50%.
  • Euro Area Current Account -5.9B. Previous -10.1B.
  • UK Claimant Count Rate 4.9% - lower than expected. Consensus 5.0%. Previous 4.9%.
  • UK ILO Unemployment Rate 8.3% - lower than expected. Consensus 8.4%. Previous 8.4%.
  • Switzerland ZEW Survey for April 2.1. Previous 0.0.
 

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Wed, 04/18/2012 - 07:16 | 2354124 dannyboy
dannyboy's picture

Guess what aussies, your paying for europe aswell now ;)

Wed, 04/18/2012 - 07:29 | 2354140 vast-dom
vast-dom's picture

well at least Spain's bond auction drove the rally yesterday....Spain must be really strong!

 

/sarc off

Wed, 04/18/2012 - 07:17 | 2354125 Jason T
Jason T's picture

The simple idea that if 1 can't pay 2, then 2 can't pay 3, then 3 can't pay 4 ... to 999,999 can't pay 1,000,000 = collapse.  

So centrail banks keep printing money, getting it to 1 so he can pay 2 so 2 can pay 3 .. blah blah blah..

 

underneath this money printing campaine however is a physical economy.. that is disintigrating.  

 

Wed, 04/18/2012 - 07:17 | 2354126 stocktivity
stocktivity's picture

At the moment the EU is backing Madrid. Jean-Claude Juncker, who chairs the Eurogroup of euro zone finance ministers, said Spain was taking the necessary steps to get its economy back on track, despite a recession and unemployment at 24 percent.

 

"I don't think Spain will need any kind of external support," Juncker said. "I would like to invite financial markets to behave in a rational way. Spain is on track."

We've been "Invited".

 

Wed, 04/18/2012 - 07:21 | 2354129 BeetleBailey
BeetleBailey's picture

See Warren? Siding with the taxman - kinda - gave you those polyps.

Other comments;

"As federal regulators put the finishing touches on an overhaul of the $700 trillion derivatives market, a major provision has been tempered in the face of industry pressure."

Emphasis on the "touches". Won't be a good job, and they won't enforce it anyhow.

First Solar, which is based in Arizona, announced that it would stop all of its German production as part of a broad restructuring plan that will cut its global work force by 30 percent, or 2,000 workers, and sharply reduce its global production capacity.

Solar: Growth Industry indeed. What have I been thinking??? This is the future............<sarc>

Indo-Canadians: Sperm is the gold standard...or the cold standard.

Wed, 04/18/2012 - 07:34 | 2354145 JohnKozac
JohnKozac's picture
"Exclusive: Chesapeake CEO took out $1.1 billion in unreported loans"

 

Ambitious fellow, eh? So Chesapeake shareholders take all the risk if the loans turn sour?

How nice.

Wed, 04/18/2012 - 08:09 | 2354217 duo
duo's picture

naw, they will get a share of the OKC NBA team.

Wed, 04/18/2012 - 08:11 | 2354218 lizzy36
lizzy36's picture

CHK has been run for the benefit of Aubrey, for the life of the Company.

Remember in 2008, when he got massive margin calls had to dump 90% of his stock and then got the largest pay package in all of the S&P 500 - $115m.

Guy is a complete douche. Nothing would make me happier than CHK going down.

Wed, 04/18/2012 - 08:19 | 2354238 overmedicatedun...
overmedicatedundersexed's picture

CHK massive debt, a CEO who makes corzine look good, providing a product at historic low value..seems like Jimmy will be beating the drum tonight to load the boat ..LOL

Wed, 04/18/2012 - 08:35 | 2354284 Hobbleknee
Hobbleknee's picture

Sweden also pledged $10 billion USD to the IMF yesterday.

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