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Posts Tagged ‘Bonds’

Facebook struggled to raise equity, so the equity cult is dead, says the FT. Really!?

So the FT think that Facebook struggled to raise equity? Funny, I thought the raising part went very well. It was the trading part that broke down. FB managed to raise $16bn at $38, or 65x earnings. I call that a success. I think Mark and his bankers do to.

John Authers and Kate Burgess argues in today’s FT that the six decade equity cult is dead and that bonds will now seriously take over as the investment of choice. The FT continues to say that companies don’t issue equity anymore but raise cash through the credit markets instead because equity financing is too expensive. It think the FT needs a little Finance 101.

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Risk management at JP Morgan

Today’s news that JP Morgan lost $2bn on trading credit derivatives looks like a particularly nasty story and is likely to go on for some time. According to some estimates JP Morgan has a position of $100 billion in credit derivatives, with what appears to be little or no risk management.

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Market dislocation

November 21, 2011 Leave a comment

I’ve wondered for a while why none core (and some core) European bond markets have sold off and equities haven’t. I guess equities are playing catch up today. And the only safe havens are Bunds, Gilts and Swedish treasuries (2.02% on the 30 year last week)… and US Treasuries.

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Greek Euro exit unlikely

May 12, 2011 1 comment

Greece cannot exit the Euro. Greece does not want to exit the Euro. Greece will not exit the Euro. Just think about what would happen if Greece did.

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Bafin looks a bit naked

Germany’s financial regulator Bafin has come to the rescue and banned naked short selling of eurozone sovereign bonds, CDS and 10 leading German financial stocks. It wasn’t a good idea in 2008 and this is one idea that does not become better with age.

According to a recent study on the effects of the short selling bans of 2008, it only makes a bad situation worse. We don’t really need a study to tell us that, it’s only common sense.

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