News links for 25 Mar 2014
Plosser did say he wants rates at 3% by the end of 2016. He was the outlier dot on the Fed’s forecast summary.
“Those who expected Federal Reserve Chair Janet Yellen to push for a more dovish policy path continue to be dissapointed.”
“That is the real problem here – as a group, the Fed wants qualitative discretionary policy, and the dots provide quantifiable guidance. If they want qualitative discretionary policy, they need to pull all the numbers from their communications.”
“The money manager argues that the Fed’s interventions have ruined the very recovery it was supposed to stimulate and that the market is poised to disappoint investors.”
“James Montier, member of the asset allocation team at Boston-based GMO, has a hard time finding attractively valued assets these days. His advice to investors: Cash – and lots of patience. “
This shows us heading toward 1999: “Box Inc. on Monday revealed its plans for an initial public offering, and with that exposed financial numbers that show a fast-growing, but highly unprofitable startup. Box’s revenue last year more than doubled to $124.1 million for the year ended Jan. 31. But its losses also ballooned as the company tries to acquire new customers and build out its service. The loss for the year widened to $168.6 million in the fiscal year ended January, from $112.6 million the prior year. Its accumulated losses as of Jan. 31: $361 million. A big chunk of the costs are in sales and marketing — $171 million last year alone.”
“Documents found in Yanukovich’s ostentatious Mezhihirya palace, first-hand evidence from businessmen who had been corporate raided and interviews provided by business leaders all point to his long-established rule of a 50 per cent tribute in return for providing a krysha. After Yanukovich fled Ukraine, Dmytro Oliynyk , the deputy head of the executive council of the Federation of Employers of Ukraine spoke about the 50 per cent rule having become the norm ‘in recent years’.”
“Throwing a lot of external financial assistance at Ukraine’s government, for example with a very large loan from the International Monetary Fund, is unlikely to prove helpful. Based on recent prior experience, such lending may even prove counterproductive.”
“Many of the European Union’s eastern member states will resist moves to impose wide-ranging sanctions on Russia over its intervention in Crimea, mainly because their own economies could suffer. Below are details of how some of the ex-Communist EU states are economically exposed to Russia”
“A property boom across the biggest cities has been dubbed a betongold – literally concrete gold – rush. In Frankfurt’s well-heeled Westend, Michael Stegerwald has been selling kitchens for two decades. Last year was his most successful yet.”
“While the ECB will not oversee every bank in the eurozone, giving Frankfurt supervisory powers over the largest banks was a good-enough second best. Europe’s banking giants will no longer be under the friendly scrutiny of national watchdogs. The hope is that the ECB will be tougher, spotting potential problems before they become unmanageable. Yet the remaining segments of the deal are deeply unsatisfactory. ”
Producer prices in Spain fell 2.9% in the year to February, the worst fall since 2009.
“Islanders from Shetland, Orkney and the Western Isles have lodged a petition with the Scottish parliament asking for a vote on Sept. 25, a week after a referendum on whether Scotland should end its ties with the United Kingdom after 307 years.”
China also has too big to fail. The companies that will fail are the ones that are not systemically important
“Buyers of a 10-year bond to be issued on April 7 will get a coupon of 0.6 per cent a year, or 0.48 per cent after tax – about one-third the headline rate of inflation.”