Top 10 links: Moody's review of Australian banks; Swiss banking woes;
20th Feb 09, 12:19pm
Here are my top 10 links from the last 24 hours or so. I welcome your favourites in the comments below. Perhaps we actually need to have coin operated machines to help restrict our savings. This from the often brilliant Rod Emmerson. Just a friendly chat... Moody's has said it will review the ratings of the big four Australian banks (Westpac, ANZ, CBA and NAB) because of the recent deterioration in the Australian economic outlook. But it pointed out the Australian banks (who also own Westpac, ANZ-National, ASB and BNZ here respectively) are among the strongest in the world and have actually gotten stronger in the last year because of extra Australian government support, successful capital raisings and the demise of rivals. Here's more details on businessspectator.com. The review's findings are due by early March. The more I see of the banking system in Britain, Europe, the United States and the Caribbean (!) the more we should thank our lucky stars that our banks were too boring, too slow, too unsophisticated and too well regulated to have gone after the easy, stupid and dangerous money flying around in London and New York in the last decade or so. Our banks have borrowed from New York and London, but they didn't get too deeply involved in the sub-prime debacle or into investment banking. Lucky stars needed thanking. You don't want to piss off these guys... US and other authorities have been investigating Texan billionaire and cricket enthusiast 'Sir' Allen Stanford for 15 years, the TimesOnline reports. But the most interesting development is ABCNews' reports that the FBI have been investigating Stanford over connections to the notorious Mexican drug runners known as the Gulf Cartel.
Federal authorities tell ABC News that the FBI and others have been investigating whether Stanford was involved in laundering drug money for Mexico's notorious Gulf Cartel. Authorities tell ABC News that as part of the investigation, which has been ongoing since last year, Mexican authorities detained one of Stanford's private planes. According to officials, checks found inside the plane were believed to be connected to the Gulf cartel, reputed to be Mexico's most violent gang. Authorities say Stanford could potentially face criminal charges of money laundering and bribery of foreign officials.No wonder Stanford is on the run and cannot be found. Update. CNBC say the FBI have found him. We'll have to keep a watch out for him down here. It would be hard to find anywhere further away from the drug cartels than New Zealand. I suspect he will have shaved off that silly moustache and be wearing a baseball hat. If you see him, don't make any sudden movements with anything that looks like a gun. He might get too much of a fright... The Poor Swiss Swiss banking as we know it may be about to come to an end. The agreement by UBS this week that it will hand over the names of potential tax dodgers to US authorities and pay a US$780 million fine has shaken the Swiss. This from Business Week.
UBS and other Swiss banks are more and more going to be forced to earn their living from providing superior wealth management and other services and not just rely on the attractions of secrecy.A trillion pounds of fresh public debt anyone? A fascinating not-so-little story here from Britain about the Office of National Statistics deciding that partly nationalised banks Lloyds Banking Group and Royal Bank of Scotland should be counted as state-owned entitites and therefore their one trillion pounds of debt is counted as public debt. This adds about 70% to 100% of GDP to Britain's debt. Previously the public sector debt was 40.4% of GDP. This is in the Wall St Journal. Dow at record lows as banks hammered The WSJ's excellent marketbeat blog tells the story of the Dow's fall back into record low territory overnight, including the bath taken by banks on fears of nationalisations. Get it over with already. Kill the zombies. A long recession. US Finance company executives has said in a survey reported in WSJ.com that they don't see an economic turnaround until 2010. If the US is still in recession in 2010 then the rest of the world will probably still be recession. My pick is we are in for another full year of recession in New Zealand and may not see much growth in 2010. This will be a long hard grind characterised by increased savings, debt reduction, less consumer spending, higher unemployment, less investment in the short term and lower standards of living. My gut feel, given the scale of the deleveraging that needs to take place globally, is we are in for a decade of restricted growth and hopefully no worse than that. It's all a communist (or capitalist) plot... Poland's currency and economy is being slaughtered. Now there's a few people in Poland saying its a Russian or American conspiracy. This in FT's Alphaville. Here's Krzysztof Liedl, the head of Terroism consultancy firm Centrum BadaÅ„ nad Terroryzmem.
This is a massive undertaking, and cannot be planned and in-acted without the help and cooperation of some sort of secret services. In cold war times both US and Russian agencies undertook this exact strategy against eachother: attacks on exchanges and financial markets.Oh dear. Maybe the problem is 60% of Polish mortgages are denominated in Swiss francs.... Let us keep the money Another sign of the times for old American newspapers. The New York Times has suspended its dividend to save US$34.5 million. Methinks the future of news is online, but I would say that wouldn't I... This in the WSJ.com Yet Nestle is thriving... We talk a lot about Fonterra's problems. But one global food company that competes with Fonterra is doing very well despite the global economic grief. It sees organic (without acquisition rather than without chemicals) sales growth this year of 5%, the FT reports.