Pink picks

Posted by Tracy Alloway on Jun 24 08:00.

Comment, analysis and other offerings from Friday’s FT,

News analysis: Greek crisis puts future of CDS in doubt
Earlier this year a eurozone finance minister telephoned a senior executive at one of the region’s biggest banks and told him that a credit event – or pay-out in credit derivatives in the event of a Greek default – must be avoided at all costs, writes the FT’s David Oakley.

Lex on Bernanke and the IEA
On Wednesday, an organisation with great influence said nothing, notes Lex. On Thursday, an organisation with supposedly no influence said something. Yet global markets gyrated to both announcements. During Ben Bernanke’s press conference, the Federal Reserve chairman repeated a well-read script. Investors, however, sensed a nervousness over core inflation, which has risen 2.5 per cent in the three months to May. Equities slipped and the dollar firmed. Then out of the blue the next morning the International Energy Agency announces the release of 60m barrels of oil reserves.

Philip Stephens: Europe’s return to Westphalia
Angela Merkel and Nicolas Sarkozy are forever protesting that the euro and the European Union are indivisible, writes the FT’s Stephens. They mean well. The purpose is to reassure: Germany and France will rescue the single currency because its failure would herald the collapse of the entire European enterprise. The two leaders may well be right in this analysis. But setting the bold rhetoric alongside the chronic hesitations and indecision of the past year invites another possibility: that cause and effect are running in the opposite direction.

Wen Jiabao: How China plans to reinforce the global recovery
About three years have passed since the eruption of the financial crisis, writes China’s premier. Thanks to the joint efforts of the international community, the global economy is recovering. Yet there remain many uncertainties, and the recovery is fragile. Global growth is uneven; unemployment in developed economies remains high; government debt risks in some countries have mounted; inflationary pressure is increasing. While the shock of the crisis has yet to end, new risks have emerged. The world must co-operate closely to meet the challenges.

Samuel Brittan: Greece’s euro exit can now only be a matter of time
A Greek debt default, however disguised, is a foregone conclusion, says the FT columnist. More interesting is the fate of the euro. On November 5 last year, I wrote that Greece should and would leave the euro, but most certainly could not give a date. Little has changed since then despite the increasing complexity of the financial packages being negotiated to save Greek membership.

Analysis: Corporate governance – the Eurasian equation
A boardroom bust-up at a Kazakh mining group lays bare how London listings have been granted to companies whose founders hold sway, write FT reporters William MacNamara and Alison Smith.

Material World: The truth about depressed consumers
The Boston Consulting Group has released an exciting report: “Navigating the New Consumer Realities,” which involves tracking spending movements and approaches across the globe over the past three to five years, writes the FT’s Vanessa Friedman. Guess what? Consumers are not so optimistic about their financial future and spending after all! In fact, in some countries (Italy, Greece, the US), they are downright depressed, and say they are going to spend less than they did last year.

Market insight: Credit rating review throws the spotlight on Italy
Greece may be dominating the headlines, but should investors also be watching Italy after last week’s decision by Moody’s to put the country’s credit rating on review for a possible downgrade? Antonio Garcia Pascual, chief southern European economist at Barclays Capital, argues that the threat of a ratings downgrade could bring Italy’s longstanding weaknesses into focus.

This entry was posted by Tracy Alloway on Friday, June 24th, 2011 at 8:00 and is filed under Uncategorised.

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