Here's my summary of the key overnight news in 90 seconds at 9 am, including news the legal screws are turning on big banks and their past behaviour.
In the US on Saturday, following a late call between the US Attorney General and the boss of the bank, JPMorgan Chase has reached a tentative US$13 billion settlement over the bank’s questionable mortgage practices leading up to the financial crisis.
It will be a record penalty that would cap weeks of heated negotiating and underscore the extent of the bank’s legal woes, which Jamie Dimon says will 'unpredictable' in the coming months.
The settlement will cover outstanding investigations of the bank's residential mortgage-backed securities business, but won't cover continuing criminal probe of the bank's conduct. Formal announcements are yet to be made however, and it could yet fall apart on the detail of what the Government wants the bank to admit.
In China, the official media is making much of its strategy to reform its dairy industry, a signal to the rest of the world that it sees it a strategic component of its development. Foreign suppliers like Fonterra will be getting the full weight of the State lined up against them; and in other industries, that has not always worked out well for foreigners.
Markets start the week coming off the relief and release from the US debt-limit crisis. Equity markets are much higher and the US reporting season is now underway with a surprise from Google.
But the key is that markets expect more delays to tapering by the Fed. Gold is staying low, the US dollar is down as risk is back, and the US Treasury benchmark 10 bond is down to 2.58%. That has taken the top off recent NZ swap rate rises.
Today we get important migration signals for September
The NZ dollar starts the week at 85.0 USc, 87.8 AUc, and the TWI is at 78.2.
The easiest place to stay up with today's event risk is by following our Economic Calendar here »
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4 Comments
Is dairy in NZ important for our development, or other countries? http://www.stuff.co.nz/business/farming/dairy/9302171/Synlait-talks-up-Chinese-takeover-offer
Well its certainly important to the credit suppliers:
http://www.unlisted.co.nz/uPublic/unlisted.mt_announcement.showannounce…
Synlait Farms Limited reported a NPAT of $(0.6) million for the year
ended 31 May 2013.
Despite this, the leadership and expertise provided by Juliet and her team
delivered excellent results. Milk production averaged 410 kg MS/cow (403
kg MS/cow in the prior year) and 1,350 kg MS/ha (1,270 kg MS/ha in the
prior year) to produce an overall total of 5.31 million kg MS. Production
costs of $3.94/kg MS compared to $3.69/kg MS in 2011/12.
The new irrigation scheme promoters use 1500kg/ha as a base minimum production...
Several within site of the factory are doing p/ha figures that start with 2.
The very dry summer of 2012/13 highlighted the value of irrigated dairy
land in Canterbury. Access to water for irrigation has always been
important to Synlait Farms Limited and our assets include a range of
consents and infrastructure that enable us to apply water to a significant
proportion of the land we operate on.
Debt is show at $126,000,000, being approx. $23.73 p/kg MS. Interest (not derivatives) seems about $8m, say 6.47%
Working back, use your rule of thumb per kg value, remove fonterra share cost (supply is not shared up), add livestock and something for P&E.
Imagine the cost if you wanted to supply fonterra as a fully shared up supplier...
Remembering large increases in production would probably be subject to land use approval soon.
Maybe the property developers will sell the stock and let landcorp run the place, with the new chap running Landcorp you're have to say he's up for it.
http://www.stuff.co.nz/business/farming/agribusiness/9299295/NZs-bigges…
Remembering large increases in production would probably be subject to land use approval soon.
Intensive dairy farming in Canterbury is resulting in nitrate leaching into the region's drinking water.
It only takes a small amount of nitrate to put young babies and pregnant women at risk, by stopping oxygen getting to body tissue.
Canterbury Medical Officer of Health Dr Alistair Humphrey says Ashburton is a hot spot for high nitrate contamination.
He says it's disappointing that nitrate levels in twenty of their drinking wells are rising, despite the education around clean farming.
http://www.newstalkzb.co.nz/auckland/news/nbrur/1155670160-nitrate-leec…
http://www.stuff.co.nz/the-press/news/canterbury/9309568/Water-nitrate-…
http://ecan.govt.nz/advice/your-water/water-quality/pages/nitrates-wate…
http://www.ravensdown.co.nz/nz/Documents/newsletter/spring-newsletter-s…
http://www.ravensdown.co.nz/nz/Documents/newsletter/winter-newsletter-s…
http://www.sustainabletable.org/906/waste-management
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