The German bank is quitting energy and base metals trading. That should free up capital without hurting results. It’s a helpful step that others like Barclays and BNP Paribas may follow. It won’t, however, fully solve the bigger problem of a swoon making profits elusive for all.
Larry Summers seems to think years of negative real interest rates can end “secular stagnation”. That’s too optimistic. If the torpor is demographic and technological, it’s probably incurable. In that case, more money-printing will only bring new financial messes.
Since regulators published a list of systemic institutions in 2011, the banks concerned have boosted capital and tamped down their balance sheets. But smaller lenders, particularly in Europe, have done the same. The “too big to fail” club turns out not to be too harsh after all.
Nelson Mandela, dead at 95, was a brave leader who was too timid economically. Avoiding the errors of others, he set post-apartheid South Africa on course toward being a mostly free market with stable finances. Unfortunately, he also left the country slow-growing and unequal.
Christie’s says artworks owned by the bankrupt Motor City could fetch up to $866 mln. That’s nearly 10 pct of unsecured creditors’ claims. But there’s no need to stop there. With 78,000 abandoned buildings and a Banksy tag worth $1 mln or more, graffiti could save the day.
The buyout firm’s traded units are at last nearing their $31 debut price of 2007. The recovery coincides with a profitable float of the hotelier, a $27 bln deal Blackstone struck the same year. While the results diverge for investors, both speak to private equity’s timing nous.
Beijing won’t allow currency competition. The central bank has barred financial institutions from trading the pseudo-money, while reining in anonymous users. Bitcoin can still be traded, but the authorities are wary. The virtual asset has just lost of lot of its speculative appeal.