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The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.
Jerome Powell

World economy 13th May 2020

The Fed would prefer not to discuss going negative

David Lafferty (Natixis) | Central banks have pinned the front end to zero – or lower – but real rates and inflation premiums have some room to rise into the recovery phase – as slow as it may be. Yields will also see some upward pressure when the Fed and other central banks eventually begin to slow QE purchases. At this point, the Fed would prefer not to discuss going negative as the overnight market recently priced. Another sell-off or prolonged shutdown might put negative rates on the table, but we’re not there yet.

 

JPMORGAN 682 967596a

World economy 13th May 2020

Crypto Corner: JPMorgan Chase providing banking services to crypto exchanges

Adam Vettese (eToro) | Investment banking giant JPMorgan Chase has begun to provide banking services to cryptoasset exchanges, according to reports. The Wall Street Journal first reported overnight that both Coinbase, the largest US-based bitcoin exchange with more than 30 million accounts, and Gemini, which was started by Tyler and Cameron Winklevoss, have agreed a deal to use JPMorgan’s banking services.

Caixabank, Telefónica, El Corte Inglés or Iberdrola, the Spanish firms best prepared to confront 2019

Spanish economy 13th May 2020

Over 40% of Spanish Firms Plan To Cut Their Workforce Due To Covid-19

More than 40% of Spanish companies are planning or considering cutting their workforce due to the impact of Covid-19. At the same time, 25% of firms have frozen salaries and 16% are reducing them, according to a survey of nearly 1,000 European organisations, carried out by consultancy group Willis Towers Watson. More than one hundred Spanish companies are included in the survey.

norweigen sovereign wealth

World economy 13th May 2020

Norwegian Sovereign Wealth Fund Makes A Shift In Management Strategy And Will Carry Out Historic Asset Sale

The Norwegian Global Pension Fund, the world’s largest sovereign wealth fund with assets of around $1 trillion, will be subject to a withdrawal of funds by the Norwegian government which could amount to $41 billion, which amount 4,2% of legally established limit on the fund’s reimbursements. Just two months ago, at the height of the market crisis, the big message for the sovereign wealth funds was that they would not resort to redemptions involving asset disposals.

euro digital currency

European economy 13th May 2020

The ECB Warns That A Digital Currency Would Have Serious Effects For The Financial System

If the European Central Bank (ECB) were to introduce a digital currency for citizens, with the possibility of them being able to open deposit accounts directly with the institution, it would undermine the role of the banking sector as an intermediary. This disintermediation would lead to legal problems and economic inefficiencies, stated Yves Mersch, Luxembourg’s representative on the ECB’s board.

corporative deb fed

World economy 12th May 2020

US High-Yield Bonds: No Room For Complacency

Markus Allenspach (Head Fixed Income Research, Julius Baer) | Investors will recall that the Fed is refinancing existing loans to companies only with a debt-to-EBITDA ratio below 6x and new loans with a ratio below 4x. In other words, the Fed is not lending to companies that were over-indebted prior to the Covid-19 crisis.

This is how ancient Rome’s republic died – a classicist sees troubling parallels at Trump’s impeachment trial

In the World, World economy, World politics 12th May 2020

“Donald Trump would like to be a Dictator,” says George Soros

Soros was speaking in an interview entitled The Crisis of a Lifetime with the journalist and author Gregor Peter Schmidtz, published by Project Syndicate. He argues that “Donald Trump would like to be a dictator” but cannot because there is a constitution in the United states that people still respect though “that doesn’t mean he will not try”. “I put my faith in Trump to destroy himself, and he has exceeded my wildest expectations”.

Arcelor Mittal

Ibex, Markets 12th May 2020

ArcelorMittal Will Hike Capital To Recover “Investment Grade” Status

After Moody’s downgraded ArcelorMittal’s debt rating by one notch yesterday, causing it to lose its “investment grade” status, the company has proposed a $2 billion capital increase via shares and mandatory convertible bonds. It will decide what proportion is covered by each of the two offers. Furthermore, it reserves the right, depending on demand, to increase the amount of $2 billion.

ECB at dusk

European economy 12th May 2020

The ECB Increases Its Emergency Purchases By 54% In The Week Of Germany’s Constitutional Court Ruling

Just a few weeks before the ECB’s key meeting (4th June), Lagarde has responded to Germany with the biggest weekly purchase since the start of the pandemic: 44 billion euros, 54% higher than the weekly average since April. Furthermore, Olli Rehn affirmed that the German Constitutional Court’s ruling could have an impact on the central banks’s ability to exercise its price stability mandate.

china tourism

World economy 12th May 2020

China’s Tourism Sector Faces its first test as population start to travel again

Fidelity | Over 100 million travellers hit the Chinese roads during the five-day May Day holiday, the first major test for domestic tourism demand since the Covid-19 containment measures began to be lifted. International travel remains out of the question, but clear signs of a gradual recovery in Chinese domestic tourism could give other countries a boost in confidence as they look to the future.