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from Breakingviews:

Review: A pained call for radical financial reform

By Edward Hadas

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

Martin Wolf is still recovering from the financial crisis. In his new book, the Financial Times economics commentator admits to being surprised at the depth, breadth and length of the economic malaise which followed the near collapse of the global financial system in 2008.

“The Shifts and the Shocks: What We’ve Learned – and Have Still to Learn – from the Financial Crisis” is partly a cogent review of what went wrong before, during and after the crunch six years ago. But the part economists and policymakers could usefully focus on is the writer’s conclusion that the best ideas for the future are far from the mainstream.

Wolf digs far deeper than the obvious bad behaviour of banks and their employees. His main insight is broad and depressing. Finance has become fragile: “Over the last four decades, the world economy does not seem to have functioned without huge financial excesses somewhere.” Those excesses often end in a sharp reversal.

from Breakingviews:

S&P 500 at 2,000 invites “new normal” thinking

By Martin Hutchinson

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

Beware new paradigms. The S&P 500 Index’s first trades above 2,000 on Monday invite the idea of a new normal in markets. The price-to-earnings ratio is under 20, only moderately above average, and interest rates remain low. But U.S. earnings are at a peak relative to GDP. Assume they adjust back to the long-term norm, and the stock benchmark would be a third lower.

from Breakingviews:

Ushering Eric Cantor to revolving door

By Rob Cox

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

The following is a fictional letter that could be circulated in the corridors of K Street, the canyons of Wall Street and the hedgerows of the Hamptons this summer:

from The Great Debate UK:

Financing must improve if UK auto sector is to thrive

--Guy Walsh is Regional Director at ABN AMRO Commercial Finance PLC. The opinion expressed are his own.--

The automotive industry is the UK’s largest sector in terms of exports, generating around £30 billion of annual revenue, but many smaller players in the sector languish due to a lack of funding.

from Edward Hadas:

Market failure can be sign of fatigue

By Edward Hadas

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

Modern economies work to meet consumers’ needs. So if needs are not met, that must be an economic failure, right? Healthcare suggests otherwise. Sometimes, unhelpful ideologies get in the way of economics delivering the goods.

from Breakingviews:

Future financiers condemned to repeat sins of past

By Jeffrey Goldfarb

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

Future financiers are condemned to repeat the mistakes of the past. Nearly 150,000 wannabe investment advisers, bankers, risk managers and analysts around the world will sit for the CFA exam this weekend. Success hinges on their understanding of the capital asset pricing model and return on equity. Knowledge of disasters like the South Sea Bubble and the Great Crash, though, are not required. Widespread ignorance of financial history is an overlooked systemic risk.

from Breakingviews:

Alibaba finance arm better out than in for IPO

By John Foley

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

Alibaba’s secret weapon is its payment division. Yet Alipay isn’t part of the Chinese e-commerce company’s upcoming initial public offering. The company is “conceptually” thinking about reuniting them, according to people familiar with the situation. But the status quo, however strange, looks better.

from Edward Hadas:

In defence of financial coercion

Last week the British government gave a new freedom to its citizens, or at least to a relatively privileged group of them. No longer will pensioners with defined contribution retirement plans be forced to invest their accumulated funds in an annuity. The old requirement was a form of financial coercion: government rules which influence behaviour.

For the pensioners in question, the new arrangement may feel like liberation. They will no longer be enslaved to a product which offers meagre yields. For the rest of Britain, though, financial freedom has probably been reduced. All taxpayers will end up paying more for the medical bills of some pensioners, those who would have had an annuity income but who might now be forced to turn to the state if they run out of money when they need expensive care.

from Photographers' Blog:

City Slickers

London, Britain

By Eddie Keogh

The beast that is Canary Wharf underground station spits out its batch of workers every morning and swallows them up again every evening, Monday to Friday.

The relentless cycle never seems to change for the financial markets’ suited workers, who return every day, smartphone in hand. They are concentrating on their emails – the oxygen of business.

from Breakingviews:

Wealth Addicts Anonymous? It misses the point

By Edward Hadas

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

Sam Polk has seen the light. Once a derivatives trader who measured his income in millions of dollars, he quit for a new life. Now he reckons his extravagantly rewarded former colleagues should realise that they have a problem - an addiction to wealth. Writing in the New York Times, he suggests others join him to “form a group and confront our addiction together.”

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