Tag: reading

Sunder’s List: Taper? Fuggedaboutit‎

Roundup: Dow -0.15%, S&P -0.13%, Nasdaq +0.02%, Gold $1242.70, London -0.34%, Germany -0.90%, France -0.57%. At pixel: Nikkei -0.20%, Hang Seng -0.45%

SEBI wants you to sign more forms so that it will be easier for you to sign forms… Feels like living through 1984 (ET)

Iran is threatening to trigger an oil price war, warning Opec members that it would increase output even if crude prices tumbled. “Under any circumstances we will reach 4m b/d even if the price of oil falls to $20 per barrel.” (FT)

For 2014: The bottom line is that those EMs that have nurtured domestic growth drivers and pushed needed reforms will outperform those that have relied excessively on external and domestic credit as well as fiscal stimulus. In such a scenario, Brazil is the most vulnerable among the BRICs and China the least; Russia and India fall somewhere in between. Among non-BRIC EMs Turkey and South Africa are in the most vulnerable camp, and Mexico and Korea in the least vulnerable; Indonesia and Thailand occupy the middle ground. The key takeaway for EM investors is that sustained growth is the variable that matters most, not when Fed tapering begins. (ET)

India has not turned itself into a serious manufacturing centre. Investment has stalled. Several would-be foreign projects, including a $12bn steel plant that was to have been built by South Korea’s Posco, have rumbled on fruitlessly for years. The state has no legitimacy, neither to convince affected communities that such developments are in their interest nor even to bulldoze them through over their objections. That leaves everything in limbo. The biggest beneficiaries of the status quo are the crony capitalists who have been permitted to extract rent to no one’s obvious interest but their own. (FT)

Taper ain’t gonna happen anytime soon: Bernanke has made it clear that there will be no taper until he sees certain economic conditions, specifically the unemployment rate at 6.5%. Recent unemployment data has been between 7.3% and 7.9%. In other words, the Fed won’t do anything until the data improves. Also, incoming Fed President Janet Yellen has recently expressed her desire for a 6% rate. (joefahmy)

From Black Friday to Bleak Friday: How US retails shot themselves. (HBR, WSJ)

Good luck!

 

Sunder’s List: (B)RIC

Roundup: Dow -0.59%, S&P -0.32%, Nasdaq -0.20%, Gold $1222.1, London -0.95%, Germany -1.90%, France -2.65%. At pixel: Nikkei -2.05%, Hang Seng -0.38%

Jaguar Land Rover US unit sales +37% to 6,047. Land Rover brand sales +25% Y/Y to 4,601 while Jaguar more than doubled to 1,446. (JLR) [stockquote]TATAMOTORS[/stockquote]

UP sugar industry fears that cane arrears would mount up to “unimaginable levels” by next year. “Adding to the carry forward of the last season, cane arrears would escalate to Rs 10,000 crore by next year.” (ET)

You could build a robot that replicates Warren Buffett’s stock-picking performance (Bloomberg):

  1. 1.6x leverage, plus
  2. a statistical factor-weighting investment approach that overweights growing, high-payout, profitable companies with low betas

Citi’s Hans Lorenzen is inciting a rebellion against the US central bank. Credit quality is deteriorating while yields can’t go much lower. “Uncertainty is underpriced.” (FT)

What is BRIC without Brazil? RIP? Brazi’s capital markets appear to be suffering from a sudden flight of capital, the country’s 10-year yield spread (vs. the U.S.) shot to its highest level since the summer of 2009. And Q3 GDP was reported to have contracted by 0.5%, worse than expectations. (SA)

Good luck!

 

Sunder’s List: The CIA Has Your Fingerprints

Roundup: S&P -0.27%, Dow -0.48%, Nasdaq -0.36%, Gold $1220.60, London -0.83%, Germany -0.04%, France -0.22%. At pixel: Nikkei +0.34%, Hang Seng -0.81%

Disturbing: MongoDB is part-funded by the US Central Intelligence Agency.
Even more disturbing: They got contracts from Aadhaar!

When the whole world is worried about NSA spying, we just handed over information of every single Indian citizen to the CIA! (ET)

India’s current account deficit shrunk to 1.2% of GDP. It was 4.9% in the fiscal first quarter ended June and 5% a year ago for the quarter ended September. (LiveMint)

Don’t worry, Sonia Gandhi can probably wipe out our CAD a few times over. She is #4 on the list of the world’s richest politicians. Net Worth: $2-19 billion. (BI)

Maruti (-6%), Tata Motors (-42%), Hyundai (-3.6%), Mahindra (-32%) see sales declines from a year-ago period. (LiveMint) [stockquote]MARUTI[/stockquote] [stockquote]TATAMOTORS[/stockquote] [stockquote]M&M[/stockquote]

RBI’s CPI index bonds: not so hot. One glaring drawback of the inflation-indexed bonds in the current form is the lack of any tax incentive for interest earned, which makes the nominal return less attractive. (LiveMint)

US November’s PMI read of 57.3 is up from 56.4 last month, and the highest print this year. Leading is a 3 point gain in New Orders to 63.6 and a 2 point gain in Production to 62.8. Gold crashed further. (SA)

Good luck!

Sunder’s List: WWJD?

Roundup: S&P -0.08%, Dow -0.07%, Nasdaq +0.37%, London -0.06%, Germany +0.19%, France -0.17%. At pixel: Nikkei -0.12%, Hang Seng +0.66%

This could be huge: RBI is looking to offer CPI linked bonds. Inflation-linked bonds currently available are linked to wholesale price indices and they have not taken off in a big way. (ET)

Trading volumes on MCX, the country’s largest commodity exchange, has fallen by a whopping 70% over the past five months. Overall, total futures turnover of six commodity exchanges, including MCX, has fallen by 54% over the same period. (ET) [stockquote]MCX[/stockquote][stockquote]FINANTECH[/stockquote]

Why is sugar such a boondoggle?

Bad economics: In the past three years, sugar prices have fallen about 10% but cane prices, fixed by politicians, rose 37% in two years.

Millers in Utter Pradesh: “This could evolve into a transformational period where we either make the policy of fixing cane price rational, or sound the death knell for the sugar industry.”

Farmer in Karnataka: “Depressed for failing to repay the debt, Arabhavi went behind the stage where farmers were demonstrating since Monday for arrear payment and higher support price from the state government, and consumed a pesticide.”

Meanwhile, in the US: The U.S. government is being forced to support sugar companies even though taxpayers are already footing a $280 million bill stemming from loans the companies can’t repay. A glut of sugar over the past year sent prices plummeting, sparking the biggest wave of loan defaults among sugar processors since 2000. In total, processors defaulted on $171.5 million in 2013, even after the USDA spent $106.7 million buying sugar to boost prices.

(ET, NDTV, ET, WSJ)

WWJD: What Will Janet Do?

For more than four years, the stock market’s main fuel has been the Federal Reserve’s willingness to provide various forms of financial stimulus, which currently consists of $85 billion in monthly bond-buying. The Fed is expected to begin trimming that stimulus at some point. But based on incoming Chairwoman Janet Yellen’s soothing comments at her confirmation hearings, many investors think she will wait longer to make cuts, and go slower, than current Chairman Ben Bernanke would. Ms. Yellen takes office Feb. 1 (WSJ)

Drones

Amazon is experimenting with fulfilling small orders (5 pounds or less) using autonomous drone aircraft. The drone service, called Prime Air, is expected to go live in 4-5 years.

(SA, TechCrunch, TechCrunch)

Good luck!

Sunder’s List: Bailout

Roundup: US markets closed. London +0.08%, Germany +0.39%, France +0.22%. At pixel: Nikkei -0.13%, Hang Seng +0.13%

More and more experts are now not ruling out the rupee going back to 55 levels against the US dollar. (ET)

Bailout nation: Jharkhand, Andhra Pradesh and Bihar power distribution companies are getting a “special package”. And the government is close to finalizing a bailout package for road developers. (LiveMint, LiveMint)

SEBI wants you to trade bonds and thinks setting up a unified bond trading platform is the key. (ET, #SEBI)

Morgan Stanley survey: Most of the 105 pension funds, central banks, endowments, insurers and asset managers – with total assets under management of more than $1.6tn – intend to increase their exposure to emerging markets. (FT)

But the money may not flow into the “old” BRICs… they may be chasing MINTs (Mexico, Indonesia, Nigeria and Turkey) (HBR, BI)

I thought rote-learning was an Indian thing. But it turns out its a world-wide epidemic. Schools in many of the Old World countries, and certainly in the European South, still prioritize memorizing over critical thought. These school systems were built at a time when information was scarce and valuable, and obtaining vast amounts of it through memorization, was a useful skill. And Universities had evolved to serve the needs of a different polity and economy: skilled professionals destined to work in highly structured societies. (HBR)

Good luck and have a nice weekend!