Thought for the weekend

| Oct 14 23:11 | Comment |

This paper focuses on the structure of mediatized discourses on the former Greek minister of finance Yanis Varoufakis, which are labeled Varoufakiology.

Through a multimodal discourse analysis of cartoons and photographs, which have been collected systematically in social and mainstream media through hypermedia ethnography, it is argued that neolectal stylistic features, including body posture, clothing and negotiation style are the emerging themes that prevail in mediatized communication with and about Varoufakis. Read more

Alphachat: comparing the candidates’ tax plans, and a GBP view from the US

Cardiff writes mostly about US macroeconomic issues, with daily excursions into other topics about which he claim no expertise. Before Alphaville, Cardiff spent a little more than two years as a reporter at Dow Jones Financial News covering investment banking, asset management, and private equity. Along the way he has written freelance pieces on a variety of other topics from behavioural psychology to Muay Thai, the latter also being a personal interest that involves frequently getting kicked in the shins (and torso, and head).

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| Oct 14 23:07 | Comment |

Alphachat is available on Acast, iTunes and Stitcher. Read more

Employment and immigration in oil-exporting countries

| Oct 14 19:18 | Comment |

Citigroup suggests a rather grim fix for oil-exporting countries struggling with the drop in crude prices: Lower ambitions for economic growth, and fewer unskilled immigrants.

Limiting immigration is a tactic that’s appealed to other countries recently (we’d make a snarky comment about the UK, if only we Yanks were in any place to feel superior). But we’re willing to at least entertain the logic, since GCC countries — the United Arab Emirates, Bahrain, Kuwait, Oman, Qatar, and Saudi Arabia — are in a very different situation than Europe and the US. They’ve historically relied heavily on foreign nationals’ labour in the private sector, and employed domestic workers in oil-funded government jobs.  Read more

Aswath Damodaran doesn’t *quite* agree with Bernstein’s bashing of DCF models under zero rates

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| Oct 14 15:25 | Comment |

After reading through Bernstein’s thoughts on the problems with Discounted Cash Flow modelling in a world of zero rates — namely that “if it is not possible to put a ‘price on time’ then there is a genuinely intellectually painful environment where model structure is called into question” — we decided to ask Aswath Damodaran, Professor of Finance at the Stern School of Business at NYU, what he thought.

In summary… he was not impressed. Read more

A double deficit and a falling pound

Izabella Kaminska joined FT Alphaville in October 2008. Before that she worked as a producer at CNBC, a natural gas reporter at Platts and an associate editor of BP's internal magazine.

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| Oct 14 15:19 | Comment |

As many economists have noted, a key problem for the UK is its negative international investment position (IIP), which fuels a large part of the country’s current account deficit. This is derived from the difference between total assets and liabilities of rest of the world holdings (RoW), and constitutes a net asset position of £269bn (in favour of foreigners).  Read more

China’s property bubble, land reform edition

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| Oct 14 11:41 | Comment |

One of these lines is not like the other…

Screen Shot 2016-10-14 at 14.59.55 Read more

Markets Live: Friday, 14th October, 2016

Paul Murphy is the founding editor of FT Alphaville.

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| Oct 14 11:01 | Comment |
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FT Opening Quote: Man Group to buy Aalto Invest

| Oct 14 08:03 | Comment |

Man Group to buy Aalto Invest,Flat flows for Ashmore, HarbourVest persists for SVG. FT Opening Quote, with commentary by Jennifer Thompson, is your early Square Mile briefing. You can sign up for the full newsletter here.  Read more

Further reading

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| Oct 14 06:33 | Comment |

Including…

– The Streetwise Prof with a pitch perfect illustration of Blockchain hype.

– Brexit: Some lessons for Greece.

– And, the City exodus is already happening, it just doesn’t look like you expect it to.

– Chris Arnade continues to report on America’s class divide.

– The BoE asking how closely related are the UK’s ‘twin’ deficits and should we be concerned?

– And, did the BoE cause Brexit?  Read more

FirstFT – The $100bn tech fund, Britons rush for Irish passports, and the world’s most stressful cities

| Oct 14 06:32 | Comment |

SoftBank and Saudi Arabia to create one of the largest tech investment funds in the world Read more

Markets Live: Thursday, 13th October, 2016

Paul Murphy is the founding editor of FT Alphaville.

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| Oct 13 11:00 | Comment |
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World’s smallest violin at the ready: the billionaire crisis is here

Izabella Kaminska joined FT Alphaville in October 2008. Before that she worked as a producer at CNBC, a natural gas reporter at Platts and an associate editor of BP's internal magazine.

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| Oct 13 10:55 | Comment |

Tis the millennials who shall inherit the earth. And the millennials like to wear trainers.
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Bernstein questions foundation of finance. Again.

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| Oct 13 09:20 | Comment |

Bernstein, having tried to slap down passive investing as the road to serfdom, has now set itself against DCF models in a zero rate world. Read more

A few thoughts for “one participant”

| Oct 13 08:30 | Comment |

Finally, one participant expressed the view that prolonged periods of low interest rates could encourage pension funds, endowments and investors with fixed future payout obligations to save more, depressing economic growth and adding to downward pressure on the neutral real interest rate.

– The Federal Reserve’s September meeting minutes, released Wednesday afternoon. Read more

FT Opening Quote: Unilever’s marmite moment

| Oct 13 08:18 | Comment |

Unilever’s marmite moment, Sales up at Sky, Hargreaves Lansdown revenues higher. FT Opening Quote, with commentary by Matthew Vincent, is your early Square Mile briefing. You can sign up for the full newsletter here. Read more

Further reading

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| Oct 13 07:25 | Comment |

Including…

– Admati et al on the leverage ratchet effect.

– In defence of active management, and an attempted smackdown of Sharpe, from AQR.

– Frances Coppola on the effects of a falling GBP.

– Dan Davies “‘splaining a few points which currently appear to be sustaining a delusion that there is a back door into the Single Market for financial services in London after Brexit.”

– John Hempton doubles down on Twitter: “The conclusion is inescapable. Jack Dorsey – the Twitter CEO – should be fired.”

– Elon Musk’s wild ride.

– And Obama talks to MIT’s Joi Ito about AI, morality and redesigning the social compact. Read more

FirstFT – Wells Fargo chief steps down, the world’s toughest school exam and the problem with positive thinking

| Oct 13 07:24 | Comment |

Decision to replace John Stumpf with two longstanding insiders drew immediate political fire Read more

Goldman’s dreams of oligopoly

Paul Murphy is the founding editor of FT Alphaville.

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| Oct 12 15:34 | Comment |

M&A that drives an industry toward oligopoly is the good kind, apparently. Read more

Brexit and Britain’s dutch disease

Izabella Kaminska joined FT Alphaville in October 2008. Before that she worked as a producer at CNBC, a natural gas reporter at Platts and an associate editor of BP's internal magazine.

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| Oct 12 12:07 | Comment |

The pound is up on the back of Theresa May agreeing to opposition demands for “a full and transparent” Brexit debate in parliament before activating Article 50.

But even if it wasn’t, would it really be that bad for the British economy? Let’s pause for some perspective maybe? Read more

Markets Live: Wednesday, 12th October, 2016

Paul Murphy is the founding editor of FT Alphaville.

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| Oct 12 11:00 | Comment |
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Virtual training for real life bankers

| Oct 12 10:53 | Comment |

VIRTUAL REALITY IS THE FUTURE AT LLOYDS BANKING GROUP

That’s an actual non-virtual press release from actual non-virtual part-government owned UK bank Lloyds, put out earlier this week. The otherwise unfeasible situations candidates will be placed into aren’t specified, but judging from these pictures provided to Wired UK, they include ‘pointing while in an empty room’, ‘looking at space ships and skyscrapers’ and ‘hunting for gold bricks in Ancient Rome’: Read more

The RMB and potential Brexit camouflage

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| Oct 12 09:31 | Comment |

Here’s A repeated theory: Brexit-shenanigans has caused GBP to go nuts. Crashes have flashed, journalists have frenzied, the FX and political worlds have been transfixed. And during this period, China has cynically decided to weaken its currency versus the US dollar while everyone was distracted.

As we said, it’s just A theory but here’s what an accompanying chart might look like, courtesy of CreditSights:

Screen Shot 2016-10-12 at 11.57.28 Read more

In search of China’s hidden credit

| Oct 12 09:14 | Comment |

What is the true size of China’s debt load, and how fast is it growing? The answer has significant implications for the global economy. Global watchdogs including the International Monetary Fund and the Bank for International Settlements (not to mention this blog) have become increasingly shrill in their warnings that China’s rising debt load poses global risks.

Estimates of Chinese debt based on official figures are frightening enough — an FT analysis put the figure at 237 per cent of GDP at the end of March — but an increasing number of analysts now believe that the true figure may be higher. Read more

Procrastination as a strategy in the global reach for yield

| Oct 12 08:30 | Comment |

New US money-market fund regulations go into effect on Friday, in case you happened to miss Libor’s climb and the reams of press coverage in the two years since the rules were introduced.

Because the topic has been widely covered, we thought there would be a pretty smooth transition into October. Why would someone put off making that kind of change until right before a big deadline? Read more

FT Opening Quote: Sterling stages slight recovery

| Oct 12 08:03 | Comment |

Sterling stages slight recovery, investment for Monarch, slowdown at Domino’s. FT Opening Quote, with commentary by City Editor Jonathan Guthrie, is your early Square Mile briefing. You can sign up for the full newsletter here.  Read more

Further reading

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| Oct 12 06:10 | Comment |

Including…

– Crash: how computers are setting us up for disaster.

– A note on smart contracts and crypto currencies: ” Eventually, there will have to be a legal and political settlement about what code the global financial markets should run on. Ultimately, the code runs on people, not the other way around.”

– Relatedly, inside safe assets with Anna Gelpern.

– Ryan Avent on the pound and the fury.

– Soft Brexit, it’s not that hard?

– And Paul Mason on postcapitalism and the city. Also, on the flip-side dangers of some sort of neo-feudalism emerging. Read more

FirstFT – Trump unshackled, Cambridge university issues first bond and why millennials are switching off social media

| Oct 12 06:02 | Comment |

Republican nominee reverts to bare-knuckled campaigning Read more

Is Ve Interactive really a unicorn?

| Oct 11 17:12 | Comment |

ve_2048x1152-590x331

In 2013, YuMe floated at $9. It’s now worth less than half that. Marin Software. Same year. Floated at $14, today it trades at $2.35. Tremor Video. 2013 again. Sold at ten bucks a share. Worth just $1.73 today. And Rocket Fuel. The “most successful-ad-tech IPO of 2013“. Investors paid $29! It’s now worth just $2.55. Read more

On the ongoing demise of globalisation

Izabella Kaminska joined FT Alphaville in October 2008. Before that she worked as a producer at CNBC, a natural gas reporter at Platts and an associate editor of BP's internal magazine.

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| Oct 11 14:24 | Comment |

According to strategists Bhanu Baweja, Manik Narain and Maximillian Lin the elasticity of trade to GDP — a measure of wealth creating globalisation — rose to as high as 2.2. in the so-called third wave of globalisation which began in the 1980s. This compared to an average of 1.5 since the 1950s. In the post-crisis era, however, the elasticity of trade has fallen to 1.1, not far from the weak average of the 1970s and early 1980s but well below the second and third waves of globalisation.  Read more

Markets Live: Tuesday, 11th October, 2016

Bryce is the FT's UK equities reporter.

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| Oct 11 11:00 | Comment |
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