Currently no one is really satisfied on the way the great recession of 2008 has been solved. As Philippe Waechter, chief economist at Ostrum AM, points, “banks profitability is back to a higher level but, even with a stronger regulation, no one is totally convinced that it would resist to a new major crisis.”
Investors and the authorities have learnt the lessons from the collapse of the investment bank, but we could be looking in the wrong direction when looking for the next turbulence, according to Paras Anand, Director General of Asset Management for the Asia Pacific in Fidelity.
Fernando Rodríguez | Analysts who study banking stocks every day do not seem to pay much attention to the factors which condition the systemic banks. In general, they feel that whether a bank is systemic or not should not influence its stock market performance or its dividend policy. It should not be the only criteria for investing in a bank.
AXA IM | Companies have re-leveraged their balance sheets since the global financial crisis (GFC), driven by low borrowing costs. Although heightened, corporate leverage is not currently excessive in developed markets, although we see signs of concern in emerging markets. In this note we assess whether we should be concerned about corporate leverage at current levels.
HAMBURG | By Dr. Beate Reszat| Shortly after the US default had been averted on October 16, the S&P 500 closed at an all-time peak of 1,744.50. Alan Wheatley (Reuters) commented enthusiastically: “If Wall Street’s record high is a signpost, the U.S. economy has every chance of pulling further ahead of a stuttering Europe despite new battles to come in Washington over the government’s budget and debt ceiling.” Does this mean that all the worries of the past weeks about a “Lehman moment” were nothing but hot air? Is the debacle that we observed nothing more than an episode in an endless soap opera that long ceased to impress markets?
MADRID | By JP Marin Arrese | In the aftermath of the world financial crisis, the G 20 solemnly committed itself to undertake a major overhaul to avoid such a disaster from happening again. The diagnosis rapidly identified a disproportionate risk appetite, coupled with lenders’ reckless confidence, as the main culprit. Deregulation and the benign neglect hailed by supervisory authorities as a hallmark for best practices also stood in the pillory. Yet, five years later, no major breakthrough in dealing with the core problems has been performed.
NEW YORK | A double reminder of the American financial system burst was news today. On one hand, Warren Buffett earned a few hundred million dollars swapping his Goldman Sachs warrants for stocks of the company, maybe the single most lucrative bailout for a single investor. In a separate move, Lehman announced it is paying back more than $14 billion to its creditors
New York | Although Lehman Brothers collapsed more than three years ago, its full dissolution depended on settling creditors’ claims worth around $450 billion. On Tuesday, a federal judge paved the way for the now infamous firm to exit Chapter 11 protection. The final phase of the largest and most complex biggest bankruptcy in US history –as the firm defined it– that tipped world economies into chaos, involving 7,000 legal…