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from The Great Debate:

No drama in Obama’s Ukraine policy

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Many are asking: How can we stop Russian President Vladimir Putin from moving into Ukraine and seizing a large chunk of its territory in the east? The actions of forces that resemble the Russian special operations troops who created the conditions for annexation of Crimea suggest that other parts of Ukraine may also be in the Russian strongman's sights.

The fact is, however, we cannot stop Putin. Or, to be more precise, we should not try to stop him physically. Doing so would require military threats or troop deployments to Ukraine. The stakes do not warrant such a step. It is not worth risking World War Three over this.

Ukraine is not a member of the North Atlantic Treaty Organization. It does not have a formal security treaty with the United States, and its strategic importance is not great enough to warrant such escalation. Though we can feel for Ukrainians -- and reject what Putin is doing -- this is a classic case of where the old axiom "We can't be the world's policeman" does apply.

Yet we cannot be indifferent to what happens in Ukraine. The stability of the international order has been compromised by Russia’s blatant aggression. The norm against interstate violence and forceful changing of borders has been violated.

from Breakingviews:

Sanctions on Russia will cost less than inaction

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By Pierre Briançon

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Vladimir Putin has set the stage well for the first international talks on Ukraine. Armed pro-Russian separatists have seized buildings in several eastern Ukrainian cities. Their uniforms and weapons suggest they are equipped by the Russian army, if not part of it. The rebels’ success has shown that the government in Kiev is not in control of the country – not even of its own security forces.

from Breakingviews:

Diageo throws money at Indian empire-building

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By Robert Cole and Una Galani

The authors are Reuters Breakingviews columnists. The opinions expressed are their own.

Diageo is engaging in some expensive empire-building in India. An under-powered tender offer meant an earlier attempt to take control of Vijay Mallya’s United Spirits was only partially successful. Now the world’s biggest spirits maker has more than doubled the price it is willing to pay, offering $1.9 billion to raise its stake to 54.8 percent from 28.8 percent.

from Breakingviews:

Europe’s banks lose their cover on leverage ratio

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By Dominic Elliott

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Europe’s banks have lost their cover on the leverage ratio. European lenders used to contend that American rivals had an easier ride on newly vogue-ish equity-to-asset yardsticks. New rules published on April 8 mean they can carp no longer.

from Global Investing:

Buying back into emerging markets

After almost a year of selling emerging markets, investors seem to be returning in force. The latest to turn positive on the asset class is asset and wealth manager Pictet Group (AUM: 265 billion pounds) which said on Tuesday its asset management division (clarifies division of Pictet) was starting to build positions on emerging equities and local currency debt. It has an overweight position on the latter for the first time since it went underweight last July.

Local emerging debt has been out of favour with investors because of how volatile currencies have been since last May, For an investor who is funding an emerging market investments from dollars or euros, a fast-falling rand can wipe out any gains he makes on a South African bond. But the rand and its peers such as the Turkish lira, Indian rupee, Indonesian rupiah and Brazilan real -- at the forefront of last year's selloff --  have stabilised from the lows hit in recent months.  According to Pictet Asset Management:

from Global Investing:

Ukraine and the IMF: a sense of deja vu

The West has just agreed to stump up a load of cash for Ukraine but there is a distinct sense of deja vu around it all.

Let's face it - Ukraine's track record on how it manages ts economy and foreign affairs isn't great. This is the third aid programme Kiev has signed with the International Monetary Fund in a decade and two of them have failed. The IMF has its fingers crossed that this one will not go the way of the past two. Reza Moghadam, the IMF's top European official, tells Reuters in an interview:

from Hugo Dixon:

Don’t bet on EU treaty change

Both continental European euro-enthusiasts and British Conservatives received a boost last week when the German and UK finance ministers called for a rewrite of the European Union’s treaties. The goal, outlined by Wolfgang Schaeuble and George Osborne, is to kill two birds with one stone: shore up the euro zone and keep Britain in the EU.

The entente is significant. German-UK relations have certainly warmed since December 2011, when London tried to block one of Berlin’s pet projects – a treaty that restricted borrowing by euro zone countries – unless it was given guarantees to protect the City of London.

from Ian Bremmer:

The G7 and the limits of Russia’s ‘political isolation’

 

On Wednesday, President Barack Obama delivered the major address of his weeklong trip to Europe, focusing on the Russian incursions into Ukraine and the coordinated Western retaliation. “Together, we have isolated Russia politically, suspending it from the G8 nations,” Obama said. For annexing Crimea, Russia was punished with temporary exile from this coalition of advanced industrial democracies, a group of Western countries that collectively act on their shared values.

There is just one problem: Russia never shared these values, and the G7 has neither represented global interests nor driven the international agenda for quite some time.

from Hugo Dixon:

How EU can wean itself off Russian gas

European Union leaders at the summit last week made a commitment to cut their dependency on Russian gas. The Ukraine crisis has highlighted the issue: about 30 percent of the gas the EU consumes comes from Russia.

Not that there is any immediate risk of the Kremlin turning off the taps. After all, Russia gets around 14 percent of its entire export earnings from gas it sells to other European countries.

from MacroScope:

The much-anticipated “capex” boom? It’s already happening, and stocks don’t care

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It's a familiar narrative: companies will finally start investing the trillions of dollars of cash they're sitting on, unleashing a capital expenditure boom that will drive the global economy and lift stock markets this year.

The problem is, it looks like an increasingly flawed narrative.

For a start, capital expenditure, or "capex", has already been rising for years. True, the Great Recession ensured it took three years to regain its 2007 peak. But the notion companies are just sitting idly on their mounting cash piles is misplaced. As Citi's equity strategists point out:.

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