Whither Europe: The U.K. will inject $155 billion into the nation’s banking system in a move to head off ill effects of Greek elections on Sunday. That news comes after an unnamed G-20 official told Reuters yesterday that the world’s central bankers are ready to provide liquidity if the elections upset markets.
Niall Ferguson Read More
Whither Europe: “The Spanish government has very limited financial market access,” Moody’s said in a statement yesterday to announce the ratings company had cut Spain’s grade three levels to Baaa3, one level above junk. Spain’s borrowing cost on 10-year bonds hovered near 7 percent, up from 5.1 percent at the beginning of the year. Moody’s also cut Cyprus’s grade on fears of contagion following the results of the Greece’s June 17 elections.
The downgrade didn’t prevent Spain’s Amancio Ortega, founder of retail giant Inditex, from becoming Europe’s richest person, according to the Bloomberg Billionaire Index.
“We have no sense that European partners will follow this tactic of blackmail heard from some quarters and stop funding,” Alex Tsipras, leader of Greece’s anti-bailout Syriza party told Bloomberg Television. Rather, Mr. Tsipras thinks that Greece can break the terms of the European rescue agreement signed by a previous Greek government without being forced to exit the eurozone. Read More
Whither Europe: Greeks are withdrawing $1 billion daily and hording dry foods ahead of June 17 elections that may hasten the country’s exit from Europe’s monetary union.
An ill-timed acquisition has made Credit Agricole the foreign bank with the most to lose in the Greek crisis.
Despite Spanish Prime Minister Mariano Rajoy’s assertion Read More
Squeeze play: JPMorgan has been selling profitable securities to prop up second-quarter results after the bank’s chief investment office and the trader known as the London Whale incurred billions in losses. The asset sales may be tax inefficient, and will deprive the lender of future gains, which is just too bad for Jamie Dimon’s firm. With its share price down 18 percent from the day before the trading losses were first reported, JPMorgan is under pressure to generate earnings. Read More
JPMorgan fallout: Jamie Dimon couldn’t sleep after seeing the CIO positions! He had a hard time breathing! Mr. Dimon drank vodka, others drank wine and the JPMorgan chief executive officer struggled to fire “sister” Ina Drew. Ms. Drew told executives at an April 9 operating committee meeting that early press reports of the London Whale were Read More
Long-promised downgrades are set to kick in for Italian banks, Green Mountain’s chairman loses his post to margin call and, thankfully, new Charlotte ordinance barring crowbars at large events was passed in time for Bank of America’s annual meeting. All that and more, in today’s Wall Street roundup.
Scissor season: Moody’s is expected to begin cutting ratings on banks any day now, and Bloomberg notes the consequences: Higher funding costs, curbed lending and another thorn in the side of economic growth. According to a Moody’s note last month, Italian lenders are first on the chopping block, to be followed by banks in other European countries. U.S. banks will also come in for potential downgrades, but are unlikely to see ratings changes until June. Read More
Rock-star analyst and Paris Hilton impersonator Meredith Whitney is gearing up to launch a credit ratings service that will compete with Standard & Poor’s and Moody’s, the Financial Times reports. Apparently she’s found an opening in the market, after years of bad ink for the major ratings agencies over conflicts of interest and lazy, Read More
The Securities and Exchange Commission today announced that it has dropped a fraud case agenst ratings agency Moody’s “because of uncertainty regarding a jurisdictional nexus between the United States and the relevant ratings conduct” related to the recent passage of the Dodd-Frank financial reform bill.
Turns out Dodd-Frank limits the SEC’s ability to pursue Read More
