Kathleen's Feed
Oct 18, 2011
via The Great Debate UK

The corporate hijacking of Occupy Wall Street campaign

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By Kathleen Brooks. The opinions expressed are her own.

As New Yorkers hurried to work on Wall Street on Friday morning they were greeted by police bracing themselves to cope with a wave of protestors apparently threatening to storm the New York Stock Exchange. By lunchtime the storming had failed to occur, 14 protestors had been arrested and hungry workers were free to go out and get a sandwich.

In recent days the Occupy Wall Street campaign is looking more like a damp squib than a counter-capitalism movement. The protests may be born out of a genuine frustration with bank bailouts funded by the tax payer, but no sooner had the first placard been written then corporate big-wigs sensed the opportunity it presented and rushed in to join the fray.

Oct 4, 2011
via The Great Debate UK

Osborne’s “difficult” Conference Speech

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By Kathleen Brooks. The opinions expressed are her own.

Chancellor George Osborne has weathered criticism of his economic policies from both sides of the political isle in recent months, so it was no surprise that the buzz word from his Conservative Party Conference speech was “difficult”. Life at Westminster is difficult for Osborne at the moment and it’s unlikely to get any easier.

The problem for the Chancellor is that he has staked his credibility on bringing down the UK’s deficit, yet he is also trying to be a pioneer of growth and jobs. In the current environment neither goal looks achievable.

Sep 26, 2011
via The Great Debate UK

Has Ireland de-coupled from the periphery?

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By Kathleen Brooks. The opinions expressed are her own.

Ireland is on a wave. After a bad patch and a massive loss of confidence eventually it looks like it has turned a corner and we can start to believe that there may be brighter times ahead. Of course, I could be talking about the Irish rugby team who had a stunning win over Australia at the rugby World Cup in New Zealand. But the economy isn’t doing too badly either.

Data last week showed that the economy grew by a respectable 1.6 percent in the second quarter, after expanding by an even better 1.9 percent in the first three months of this year. This beats the dismal growth rates in the UK and the euro zone, which both came in at 0.2 percent in the three months to June.

Sep 2, 2011
via The Great Debate UK

A make-or-break month for the euro zone

By Kathleen Brooks. The opinions expressed are her own.

For over a year now people have been calling for the collapse of the euro zone. Either one of the bailed out nations would leave, or the more fiscally sound northern European states would form their own version of a union. Regardless of what the outcome would be, the harsh reality was that the Eurozone’s massive floor -  allowing countries like Greece to borrow for nearly a decade at German-style interest rates without some limit on spending or enforcement of fiscal rules – meant that it could not survive.

But after 18 months of stop gap solutions, emergency weekend summits and hastily constructed bailout plans it feels more and more like September may be the swan song for the currency bloc.

Aug 23, 2011
via The Great Debate UK

Could Europe be on the cusp of a Lehman moment?

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By Kathleen Brooks. The opinions expressed are her own.

The euro zone debt crisis has now spread from the sovereigns – after the ECB came in and purchased Italian and Spanish debt – to the banking sector. Although the EU authorities put in place a short-selling ban, which has another week to run, the banking sector is back at the pre-ban levels or in some cases even lower.

Europe’s banks are by and large less capitalised than their U.S. peers. They are also exposed to Europe’s sovereign debt and European loan books. Even if a member state manages to avoid a default, growth is now slowing and we could be in line for another recession that would most likely increase bad debts and further erode banks’ profits.

Aug 5, 2011
via The Great Debate UK

Is there such a thing as a real safe haven?

By Kathleen Brooks. The opinions expressed are her own.

There are traditional relationships that the financial markets respect. For example, when the markets are tanking the world wants to own safe havens like the yen, the Swiss franc, U.S. debt and gold. If volatility spikes investors go into auto-mode and are almost pre-programmed to purchase these asset classes.

But just how safe are the safe havens? Both the Japanese and Swiss authorities intervened to limit the appreciation of their currencies in recent days. The Swiss National Bank (SNB) did so first by slashing interest rates and announcing a new QE program to flood the economy with money to try and put downward pressure on the franc. The Bank of Japan (BOJ) embarked on something similar, but they directly intervened and sold yen in the markets.

Jul 22, 2011
via The Great Debate UK

Could the Murdochs be the saviours of journalism?

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By Kathleen Brooks. The opinions expressed are her own.

When newspaper moguls are grabbing the headlines something has gone spectacularly wrong, but are we forgetting what the Murdochs have done to preserve print journalism?

Anyone who has followed the unfolding story over the News of the World phone hacking saga will be rightly outraged that a newspaper – a journalist – could think it was perfectly acceptable to get a story from hacking into someone’s voice mail.

Jul 18, 2011
via The Great Debate UK

Ben Bernanke could teach the EU a thing or two

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By Kathleen Brooks. The opinions expressed are her own.

Markets thrive on certainty. Anything that smacks of uncertainty, fence-sitting or indecision will lead to market turbulence, as investors punish those who don’t tell them how it is.

This is exactly what we are seeing in Europe right now. The markets are losing patience with the EU’s inability to come up with a credible plan to fight the sovereign debt crisis and that is why it is escalating at an alarming rate.

Jul 11, 2011
via The Great Debate UK

Women’s fortunes in the job market take a turn for the worse

By Kathleen Brooks. The opinions expressed are her own.

Back in early 2009 I was sitting in the library trying to find a new spin on the U.S. financial crisis for a college paper. I trawled through book after book and they all said the same thing. But finally, late into the night, I stumbled upon something fresh in the latest unemployment report.

Jobs had been slashed in the U.S. and unemployment was rising, but interestingly, women were faring better than men. So there was my story. After June’s jobs report I decided to review this phenomenon and find out whether this was really just a male crisis.

Jul 4, 2011
via The Great Debate UK

Europe’s bigger crisis waiting to happen

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By Kathleen Brooks. The opinions expressed are her own.

So it looks like Greece has staved off default for another few months at least. Investors are breathing a sigh of relief and buying up risky assets like the world is a rosy place again.

The markets always suffer from a chronic case of short-termism, but once a sovereign debt crisis takes hold it is very difficult to reverse. Investors may be concentrating on Greek, Irish and Portuguese funding needs for the next 24- 36 months now, but it won’t be long before investors start to scrutinise longer-term liabilities that are currently being clocked up for the next 10,20 even 30 years.