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Important Economic Updates from July 12-13 | Advantage zyaada

DELHI, INDIA - MARCH 23:  In this photo illust...

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Facts that are counting this week but in the larger scheme were not really pertinent , say us.. for tweetseminars or longish commentary. In other words, these facts are what a newspaper in the traditional sense delivers as part of the continuing rolling down of the same stories that made the business world yesterday, and last week And even everything that begun in 2008, dare I write new essays of condemnation everyday?

FACT: Italian Banks Unicredito and Intesa SanPaolo each worth $25 bln in Market Cap before the sunshine took them down on Friday and Monday.Italian Banks have also raised $15 bln in fresh capital in 2011 among Intesa SanPaolo, Monte dei Paschi di Sienna , Unione Banche de Italiane (UBI) and Banco Popolare or Euro 10.5 bln. The Italian Parliament is considering proposals worth $57 bln or Euro 40 bln to cut down deficit.

  • Italy’s sovereign debt of 120% of GDP is more than the combined debt of Portugal, Ireland and Greece and yet just 1/3 that of Spain and the deficit is hardly 6% as of now at its worst
  • A run on Italian Fixed Income can cause an engineered default , the worst kind for the Euro just as Equities continue to tumble and Portugal and Irish 10-Y yield cat 13.7% catches up with Italy’s 16.5%. Liquidity is already a problem for Italian debt and bank equity. Spain can’t even wait 3 months ( Citi’s Matt King on Reuters Insider)
  • Crude and Japan took their final toll on the May US trade deficit with a 1% dip in exports and 3% rise in import causing a giant $50 bln trade deficit for the US(Exports at $175 bln and Imports at $225 bln)
  • Paulson, the hedgie lost $10 bln in one month alone as Lehman paid him for his penny buying of the stock in equal amounts till April
  • The Euro at its worst is not likely to go below 1.35 right now and this is the worst.(Reuters Insider/TA)
  • US banks are not just going to shrink revenues but balance sheets too even as loan loss reductions are outweighed by drawdowns on the housing debacle and that is itself will lose BofA its no/1 lender tag to JP Morgan
  • Morgan Stanley and JP Morgan fee income saves them a lot of red faces but succession news at both has been strangely uplifting for both to say the least with Mike Cavanagh and James Gorman taking over as most likely kids in the blue bus at JP Morgan and Morgan Stanley respectively. Anshu Jain  is happy with a CoCEO position at Deutsche Bank when Ackerman leaves the building
  • All that sovereign junk is held with local stalwarts like Unicredit and puts these banks at a much bigger risk than the sovereigns themselves but banks CDS are trading at 250-300 bps at the worst.
  • Irish CDS is ruling at 1060 basis, after (you guessed it) Moody’s shot down its rating to junk fror wanting more of the kool aid
  • NOTW shutdown and possible sacrificial loss of Hinton, Les may only strengthen Murdoch’s bid for BSkyB
  • Chinese Candy needs Nestle as much as Nestle needs China
  • Indian reshuffle sees more first time ministers out of party noisemakers though of the more civilised variety and it does not change an iota on India’s economic estimates for the next year though MSA was considered for the Cabinet too
  • Chinese CPI, at its highest at 6.4% and a lot of wage revision now 19% annually since 2008 against 8-10% in the last 4-5 years has effected move out of production with NPR choosing to go back to USA, many textile retailers considering more Vietnam and Bangladeshand mostly Chinese companies preempting labor migration by
    Italian Parliament pink

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    traveling inward.

    China’s GDP at 9.6% for the 6 months of 2011 was an eye opener on the resilience of the Chinese factor growth as IIP/PMI  for manufacturing  dipped into sub normal

  • Mumbai and Karachi along side Delhi and other Indian and Middle East cities remain the cheapest places in the world to live (and die ) in
  • OPEC is going to increase production by 1.35 to 1.4 mbpd after the scare it got at the IEA meet
  • Private Equity is my favorite kind of borrower, say Bank Credit managers
  • Derivatives Trading and overall volumes including CLO and most Prop trading have fallen 40% since 2007 as new regulation makes a mark on bank managements. It was nearly $900 tln without a clearing house for it and now may have difficulty in staying at $450 tln too

 

Morgan Stanley Building

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4 comments on “Important Economic Updates from July 12-13 | Advantage zyaada

  1. Pingback: Bank Results Season: JP Morgan prints $0.27 EPS in Retail, loses $0.34 in Mortgages | The Banking and Strategy Initiative

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  4. Monster Trucks 2
    October 10, 2011

    This website has more than enough good information on it, I check on it every few hours. I wish other sites spent as much time as this one does making information to the point to readers like myself. I recommend this site to all of my facebook friends. This website will make some massive passive profit Im sure.

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