EasyJet Chased by Network Carriers Squeezed by Budget Travel; The massive difference in the last 10 years is that people can go on a family holiday for a week for less than the price of a coffee a day.”

EasyJet Chased by Network Carriers Squeezed by Budget Travel

EasyJet Plc (EZJ) said it’s ready to take on a low-cost challenge from Europe’s former flag carriers, predicting they’ll struggle to embrace the no-frills approach that’s lured travelers to discount operators. A potential 86 million short-haul passengers flying from Europe’s top 20 airports each year could be surrendered to EasyJet by network carriers because they don’t feed lucrative long-haul services, Chief Executive Officer Carolyn McCall said in an interview, predicting that airlines including Air France (AF) may be left with as few as 21 million transfer customers. Read more of this post

Brazil may be spending its way towards a downgrade

Brazil may be spending its way towards a downgrade

Filed 11 hours ago

By Silvio Cascione and Asher Levine

SAO PAULO – Brazil’s finances are set to deteriorate substantially next year, leaving the government with few options to revive a sputtering economy and raising the threat of a credit downgrade. The government is likely to miss its key 2014 budget target, the primary surplus, by as much as 50 billion reais ($22 billion), delivering only about half its goal, estimates by Reuters and private economists show. Read more of this post

Inside the End of the U.S. Bid to Punish Lehman Executives; “Why is there no case? The world won’t understand.”

SEPTEMBER 8, 2013, 8:57 PM

Inside the End of the U.S. Bid to Punish Lehman Executives

By BEN PROTESS and SUSANNE CRAIG

At a closed-door meeting in early 2011, Wall Street regulators were close to throwing in the towel on their biggest case. The Securities and Exchange Commission’s eight-member Lehman Brothers team, having hit one dead end after another over the previous two years, concluded that suing the bank’s executives would be legally unjustified. The group, noting that prosecutors and F.B.I. agents had already walked away from a parallel criminal case, reached unanimous agreement to close its most prominent investigation stemming from the financial crisis, according to officials who attended the meeting, which has not been reported previously. Read more of this post

Banks Seen at Risk Five Years After Lehman Collapse

Banks Seen at Risk Five Years After Lehman Collapse

Ruth Porat didn’t see it coming.

The Morgan Stanley (MS) banker who thought she understood the risks to the financial system in September 2008 was advising the U.S. Treasury Department on its rescue of Fannie Mae and Freddie Mac when she got a message: Would she come back to Washington to deal with the collapse of American International Group Inc. (AIG)? Read more of this post

Banks Face Physical Commodity Curbs

September 10, 2013, 8:01 p.m. ET

Banks Face Physical Commodity Curbs

Fed Is Expected to Issue Rules Soon

MICHAEL R. CRITTENDEN And CHRISTIAN BERTHELSEN

Wall Street is bracing for a ruling that may hasten the exit of J.P. Morgan ChaseJPM +1.53% & Co., Goldman Sachs Group Inc. GS +3.54% and Morgan StanleyMS +2.19% from businesses such as metals warehousing, oil shipping and power generation. Financial-industry executives expect the Federal Reserve to issue guidelines as soon as this month limiting bank participation in so-called physical-commodities businesses. The decision would mark a significant step in the government’s effort to curtail risky activities on Wall Street, forcing large financial companies to dismantle franchises a decade or more in the making. The rules would apply to all U.S. banking companies. Read more of this post

Alan Blinder: Five Years Later, Financial Lessons Not Learned as the law sinks under the weight of special-interest lobbies

September 10, 2013, 6:53 p.m. ET

Alan Blinder: Five Years Later, Financial Lessons Not Learned

A good-though-weak law sinks under the weight of special-interest lobbies.

ALAN S. BLINDER

Next Sunday marks the fifth anniversary of the fateful day that investment bank Lehman Brothers filed for bankruptcy, signaling the start of a frightening financial meltdown. It’s a good time to ponder how the U.S. economy was nearly brought to ruin. But will we? Or are we already forgetting? Consider the stark historical contrast between the 1930s and this decade: Read more of this post

A 500-year-old bank in Italy is teetering, and threatens to take the rest of the country’s financial system with it

A 500-year-old bank in Italy is teetering, and threatens to take the rest of the country’s financial system with it

By Jason Karaian @jkaraian September 10, 2013

Uniquely among the euro zone’s beleaguered “periphery”, Italy’s response to the financial crisis has not included nationalizing large parts of its banking system. Compared with the wreckage in Cyprus, Ireland, Portugal and Spain, Italian lenders have gotten off relatively lightly. Until now. The finance ministry has announced a revised rescue plan (link in Italian) for the country’s third-largest bank, Monte dei Paschi di Siena. The bank, which traces its roots back to 1472, was propped up with €4.1 billion ($5.4 billion) in government loans earlier this year. The blessing of the European Commission is necessary for it to keep this aid, and Brussels wants tougher conditions attached. If the bank cannot meet these conditions, the loan will convert into shares and the fragile, debt-ridden Italian government will become the proud owner of a bank that has reported more than €8 billion in losses since 2011. At that point, the state of the Italian banking industry as a whole might turn from chronic to acute. Read more of this post

China banks seen issuing hybrid debt to cope with bad loans, boost capital; Mainland lenders seen issuing more debt that can convert to equity, force losses onto investors

China banks seen issuing hybrid debt to cope with bad loans, boost capital

Monday, 09 September, 2013, 12:00am

Jasper Moiseiwitsch jasper.moiseiwitsch@scmp.com

Mainland lenders seen issuing more debt that can convert to equity, force losses onto investors

In the dark days of July, as investors digested news of China’s growth slowdown and grappled with an interbank market liquidity squeeze, Tianjin Binhai Rural Commercial Bank quietly raised 1.5 billion yuan (HK$1.9 billion) in new capital. It was seemingly no big deal. But given increasingly alarming talk about mainland banks’ non-performing loans in the context of slowing growth and an imploding shadow banking sector, Tianjin Binhai’s transaction may prove transformational. Read more of this post

Li Ka-shing withdrawing from mainland property market

Li Ka-shing withdrawing from mainland property market

Staff Reporter

2013-09-10

Hong Kong property tycoon Li Ka-shing has been selling his assets in mainland China, with Hutchison Whampoa and Cheung Kong Holdings recently announcing plans to sell off a large shopping mall in Guangzhou, the Shanghai-based National Business Daily reports. The two companies, both owned by Li, announced that they will sell their respective 50% stake in Metropolitan Plaza in Guangzhou’s Liwan district to an offshore company called GCREF Acquisitions 22, for HK$3 billion (US$390.7 million). The deal is scheduled to be finalized on Nov. 29. Read more of this post

Day-Trippers Underpin Hong Kong Mall Rents

Day-Trippers Underpin Hong Kong Mall Rents: Real Estate

Jane Hu, a financial adviser from the Southern Chinese city of Huizhou, travels to the outskirts of Hong Kong to shop with her friends at least once a month. They rarely venture into the city center or stay overnight. “It’s only a two-hour bus ride so we’re not wasting our money on hotels,” said Hu, 30, hauling around a suitcase stuffed with pharmaceutical drugs and snacks she bought in the New Town Plaza shopping mall in the Sha Tin district, about 16 miles (26 kilometers) from Hong Kong’s border with mainland China. “These are like grocery-shopping trips.” Read more of this post

Regulator Mulls Paving the Way for Private Banks

09.09.2013 18:12

Regulator Mulls Paving the Way for Private Banks

CBRC plans to unveil a model by end of year, a development private companies and cities around the country are eagerly anticipating

By staff reporter Wu Hongyuran

(Beijing) – It has been two months since the State Council said the government will explore the establishment of private banks invested by private capital and bearing risks themselves. The move is widely viewed as real progress toward opening the financial industry to private investors because though non-state companies have been allowed to be the controlling shareholder of a bank, they do not manage the bank’s operations independently enough to be considered running a business at their own risk. Read more of this post

As Chinese Farmers Fight for Homes, Suicide Is Ultimate Protest

September 8, 2013

Picking Death Over Eviction

By IAN JOHNSON

As she drove down a busy four-lane road near her old home, Tang Huiqing pointed to the property where her dead sister’s workshop once stood. The lot was desolate, but for Ms. Tang it lives. Four years ago, government officials told her sister that Chengdu was expanding into the countryside and that her village had to make way. A farmer who had made the transition to manufacturer, she had built the small workspace with her husband. Now, officials said, it would be torn down. Read more of this post

China SOEs — How They Think and Why

China SOEs — How They Think and Why

2013-09-09 18:26:15

Peter Fuhrman, Chairman and CEO China First Capital

There are many flavors of State-Owned Enterprise (“SOE”) in China, from polluting monster chemical factories to quaint dumpling houses that date from before the revolution. Since coming to China, I’ve seen up-close quite a number SOEs, probably more than most other non-Chinese. No two are quite alike. But, equally, SOEs in China, from the largest centrally-administered “national champions” (known as 央企, or “yangqi”, in Chinese and include such familiar names like Sinopec,China Mobile, ICBC) that earn billions in profits every year to smaller local loss-making industrial companies with a few hundred employees, share a similar genetic code. Or more precisely, provide the same iron rice bowl. Read more of this post

China Needs Beijing to Be Even Bigger; China accounts for 30 of the 50 largest cities in east Asia with half a dozen megacities with populations of more than 10 million and 25 “large” cities exceeding 4 million

China Needs Beijing to Be Even Bigger

One of the most critical and controversial economic debates in China today revolves around how the country should urbanize. Already, more Chinese live in cities than on the land, a proportion that is expected to rise to 70 percent by 2030. Proponents of further urbanization are hoping that Premier Li Keqiang will announce reforms this fall that will make it easier for migrants to move to cities and receive the same rights as locals. This, they believe, will unlock the productivity gains needed to sustain growth over the coming decades. They’re right about the need for more city dwellers — but not about the need for more cities. Read more of this post

Youngest Japanese Boards Beating Oldest With Stocks Rising 139%

Youngest Japanese Boards Beating Oldest With Stocks Rising 139%

Youth is beating experience in Japan’s stock market, where only 4 percent of companies have boards where the average age is less than 50, generating returns twice those of corporations with older directors. Of the companies listed in Japan where Bloomberg compiles data on the board ages, 68 have an average age of below 50. Their shares surged 139 percent in the three years through Sept. 6, a period spanning the plunge following Japan’s biggest earthquake, and the steepest rally in a quarter century after the election of Prime Minister Shinzo Abe. Among the 80 firms with boards aged 65 or older, returns were 52 percent. Read more of this post

Tokyo Bay’s Properties Are Biggest Olympic Victory Beneficiaries; About 90 percent of the competition venues will be located within 8 kilometers (5 miles) of the Olympic Village in Harumi, an area of reclaimed land about 2 miles southeast of downtown Tokyo

Tokyo Bay’s Properties Are Biggest Olympic Victory Beneficiaries

Tokyo Bay area property prices stand to benefit the most in the lead up to the 2020 Olympic Games, adding to the recovery in the city’s real estate values after 20 years of declines.

About 90 percent of the competition venues will be located within 8 kilometers (5 miles) of the Olympic Village in Harumi, an area of reclaimed land about 2 miles southeast of downtown Tokyo, according to the Tokyo 2020 Bid Committee. Apartment prices in the area may increase as much as 20 percent, said Sanyu Appraisal Corp., a property appraisal company. Read more of this post

Short-selling interest on the rise for Tokyo Olympic-related stocks

Short-selling interest on the rise for Tokyo Olympic-related stocks

10:41pm EDT

TOKYO (Reuters) – Hedge funds have begun shorting some Japan stocks that have had huge gains in the lead up to and aftermath of Tokyo’s winning bid for the 2020 Olympic Games, with mid-sized building contractor Tekken Corp (1815.T: Quote, Profile, Research, Stock Buzz) a case in point. Tekken on Tuesday jumped by its daily limit of 50 yen, up 26.3 percent, to 240 yen, and has doubled in value over the past month. Read more of this post

Price Cartels Exploiting Poor Governance in Indonesia

Price Cartels Exploiting Poor Governance

By SP/Novianti Setuningsih & Dyah Ayu Pitaloka on 8:50 am September 10, 2013.
Production of soybean products were on hold at this home in Tangerang on Monday as workers took part in a strike protesting consistently rising prices. (JG Photo/Fajrin Raharjo)

The government’s poor management of commodities has caused loopholes that have resulted in the creation of cartels among several groups looking to control the market, an official from the national anti corruption agency said. Read more of this post

Indonesian president Celebrates Birthday as Makers of His Favorite Food Strike

President Celebrates Birthday as Makers of His Favorite Food Strike

By Ezra Sihite on 7:45 am September 10, 2013.
President Susilo Bambang Yudhoyono turned 64 on Monday and probably celebrated his birthday with a plateful of tempeh, one of his favorite dishes. However, unlike the president, many Indonesians will have difficulties finding tempeh in markets over the next couple of days because hundreds of tempeh and tofu producers have decided to go on strike in protest against the soaring prices of soybeans. Read more of this post

Cows on Runways Show Indonesia Growth Challenge: Southeast Asia

Cows on Runways Show Indonesia Growth Challenge: Southeast Asia

Jakarta’s Soekarno-Hatta airport, Southeast Asia’s busiest, couldn’t offer Lion Group the space it needed to build a new airplane maintenance facility. Instead, the company ended up picking a site near Singapore. With its Lion Air unit poised to overtake Singapore Airlines Ltd. (SIA) as the region’s largest carrier by fleet size, the Jakarta-based company’s maintenance arm is spending $250 million to build the facility on Batam, an Indonesian island a short ferry ride from Singapore. When finished, it will have four hangars that can handle a total of four Boeing Co. (BA) 747 aircraft or 12 single-aisle planes. Read more of this post

Why Indian exports need more than a cheap rupee

Why Indian exports need more than a cheap rupee

5:33pm EDT

By Manoj Kumar and Frank Jack Daniel

NEW DELHI (Reuters) – The upside of the Indian rupee’s slump is an export boom that sets the economy straight, right? Wrong. Prime Minister Manmohan Singh echoed classical economic theory when he told parliament last month that the plunging rupee, which has lost 18 percent against the dollar since selling pressure picked up in May, would spur exports and discourage imports. Read more of this post

McDonald’s Selling Steak for Breakfast in Menu Overhaul

McDonald’s Selling Steak for Breakfast in Menu Overhaul

Breakfast just got meatier at the Golden Arches. McDonald’s Corp. (MCD) is introducing a new “thick, juicy steak” for the morning crowd, Lisa McComb, a spokeswoman for the Oak Brook, Illinois-based company, said in an e-mail. Customers can get steak on any breakfast sandwich and the new morning fare will be featured in advertisements, she said. The fast-food chain began introducing the steak across the U.S. last month and is continuing to roll it out now, she said. It will be sold in about 9,600 of the chain’s more than 14,100 domestic locations, she said. A steak, egg and cheese biscuit with grilled onions has 540 calories — 10 less than a Big Mac – – while a steak patty on an English muffin packs 430 calories. Read more of this post

Jeweler Pandora Charms Investors With 76% Stock Revival; Danish jeweler is taking a page from Zara, which introduces designs as often as twice a week., in adding collections seven times annually, up from twice last year

Jeweler Pandora Charms Investors With 76% Stock Revival

Diamonds, it’s been said, are forever. That’s far too long for Pandora A/S, (PNDORA) which is counting on women to update their jewelry boxes several times a year with charms crafted from silver, gold, and gemstones. The Danish jeweler, which has gone from stock market darling to disaster to darling again since its 2010 initial public offering, is taking a page from fast-fashion retailers like Zara, which introduces designs as often as twice a week. Read more of this post

US Equity Trading Volume Hits Fresh 15-Year Low

US Equity Trading Volume Hits Fresh 15-Year Low

Tyler Durden on 09/09/2013 20:50 -0400