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FT Alphaville

FT Alphaville is a free daily news and commentary service giving finance professionals the information they need, when they need it. In a world where market professionals are inundated with information there is a pressing need to edit and filter, and hopefully sow a few ideas along the way. That’s where the FT Alphaville team comes in.

Articles by FT Alphaville

Wanted: CEO to lead troubled startup

3 days ago

Uber Technologies Inc is an eight-year-old taxi company based in San Francisco. Its backers include some of the world’s smartest technology investors, like Saudi Arabia’s Public Investment Fund.The company is at a crossroads. We are looking for a chief executive to replace our famously aggressive founder, who remains on the board and retains a ton of voting rights. Candidates will need to demonstrate experience in putting lipstick on pigs, putting out dumpster fires and leading businesses as they pivot from ‘hot mess’ to ‘performatively woke’.A successful applicant will be able to avoid saying anything sexist during their interview. They will have interests that include sharing, subsidising and running rings around regulators. They must be a people person — regrettably the company is yet

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Thought for the weekend

8 days ago

But if we are going to work on Uber 2.0, I also need to work on Travis 2.0 to become the leader that this company needs and that you deserve.— Travis K

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Thought for the weekend

22 days ago

I like the challenge and tell the story of the coal miner’s son. The coal miner gets black-lung disease, his son gets it, then his son . If I had been the son of a coal miner, I would have left the damn mines. But most people don’t have the imagination–or whatever–to leave their mine. They don’t have “it.”– Donald J. Trump in a 1990 interview with Playboy Magazine, via Olivia Nuzzi.

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29 days ago

Cowboy Johnny Mantell, president of the Professional Wrestling Hall of Fame, says it was a choke slam, not bodyslam https://t.co/eRb1807G5K— Steven Perlberg (@perlberg) May 25, 2017

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Thought for the weekend

May 19, 2017

There’s an old adage that whomever enjoys either sausages or laws should never watch how they are made. Nowadays that runs increasingly true for the simple day-to-day politics of governance. I don’t think any of us are under the illusion that politics is a nice polite “After you, Sir.” “No, I insist, after you!” affair. Instead it’s almost always a sharp-elbowed, devil-take-the-hindmost process.However, what we are seeing at the moment in the US is showing a wild ‘sausage party’ being played out in the public eye – and it is hardly an edifying spectacle as far as markets are concerned. Indeed, amidst a surge in “Trump impeachment” (or “Trexit”) cries from the same sources who didn’t see him winning in November — and a spike in the odds of that happening — equity markets tumbled, the S&P

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Thought for the weekend

May 12, 2017

– Some new information from an old friend of Alphaville.

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Thought for the weekend

April 28, 2017

Home Capital Group’s financial problems clearly raise questions about the state of the Canadian property market and also in a broader sense about financial stability in Canada and it is hard not to see the similarities with the US subprime crisis.However, as with the subprime crisis – which turned into the Great Recession – we would argue that this is less about a property market bubble bursting than about monetary conditions becoming too tight…The most obvious thing to do would be to announce an open-ended quantitative easing program with the aim of keeping nominal demand on a stable path.—Lars Christensen, April 26 2017Related links:Home Capital’s Founder to Step Down After Securities Probe — Bloomberg

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Snap AV: Your Trump Trade reversals, charted

April 25, 2017

From Deutsche:Of course, that chart comes as part of a note entitled “don’t dismiss inflation” and as some Trump trades are reviving.More in the usual place.Related link:Wide-ranging Bernanke interview with Sorkin including the line that “as a practical matter it doesn’t look like major reform is very likely.” – NYT

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Thought for the weekend

April 21, 2017

Alex Jones of infowars tells court he smokes pot once a year, to test its strength. Says it’s too strong because of George Soros. pic.twitter.com/ohHX43cftD— Rhys Blakely (@rhysblakely) April 20, 2017

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Yes, Markets Live is back at 11am today

April 18, 2017

Easter is over. So join Bryce and Murphy at 11am.Click here.Maybe bring along a tin hat.

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Thought for the (long) weekend

April 13, 2017

“I think our dollar is getting too strong, and partially that’s my fault because people have confidence in me.”You know who.

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Snap AV: Have any post-Brexit bank relocation questions?

April 11, 2017

Mark your calendars for May 4.That’s the day of the European Central Bank’s workshop, which will address questions about supervisory procedures for banks relocating business to the EU after Brexit:

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Thought for the weekend

April 7, 2017

In Mosul, with artillery fire outside, Col Rayan of SWAT asks about London property prices. "How can people live under such circumstances?" pic.twitter.com/4C6eVsKZcC— Quentin Sommerville (@sommervillebbc) April 3, 2017

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Richmond Fed president Jeffrey Lacker resigns for role in leaking scandal

April 4, 2017

A stunning announcement (HT Josh Zumbrun):Do note that the text is vague. It isn’t clear whether the Medley analyst had previously received leaked information or if the analyst was floating the possibility of the “important non-public detail” when Lacker confirmed it in their phone call. If the analyst already had the information, then there is a leaker still to be found. (Disclosure: Medley is a part of the FT Group, though FT Alphaville has no working relationship with them.)Another important note: There’s no system of oversight to prevent or punish Treasury-market trading on confidential information, deemed “Class I FOMC – Restricted Controlled (FR).” (Ask your doctor about potential side effects.)In theory — though obviously not in practice — insider information shouldn’t really exist in global macro markets. And regulators aren’t collecting data on dealers’ Treasury-market trades just yet, since that initiative starts in July.There are staff guidelines for handling confidential information, but the consequences for leaking aren’t standardised. While the Fed is directed to notify authorities if laws are broken, the guidelines leave it up to the FOMC to “determine the consequences” for any breach of internal rules.

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Thought for the weekend

March 31, 2017

“We’re woke. Our community is woke, and the U.S. population is woke,” Lyft President John Zimmer tells TIME, sitting in his five-year-oldcompany’s San Francisco headquarters. “There’s an awakening … Our vote matters, our choice matters, the seat we take matters.” …“We’re not the nice guys,” Zimmer says. “We’re a better boyfriend.”– Time

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Caption competition, Article 50 edition

March 29, 2017

The Article 50 letter. #Brexit pic.twitter.com/SO5R5BTvhw— Donald Tusk (@eucopresident) March 29, 2017The winner gets £350 million a week.

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Podcast: Adaptive markets, and the lessons of an infamous call to sell

March 24, 2017

[embedded content]Alphachat is available on Acast, iTunes and Stitcher.

Introducing Alphachat, the FT Alphaville podcast
Podcast bleg: Alphachat returns
Sal Arnuk on high frequency trading
Alphachat returns
Snap Cyprus edition
The cunning plan edition
Dragons of Ljubljana edition
That dang negativity edition
Lee Buchheit edition, featuring Lee Buchheit
Abenomics gets the Alphachat podcast treatment
Alphachat Noah Smith on the Japanese economy
Alphachat Manmohan Singh on collateral chains
Michael Pettis edition (well, the second one)
Those fracking robots edition
MF Global nostalgia edition

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Thought for the weekend

March 24, 2017

Priceless from Juncker to the BBC pic.twitter.com/7gPVb7LaYw— Danny Kemp (@dannyctkemp) March 24, 2017

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Dear China, if you want some help sorting your markets out…

March 22, 2017

By Jennifer Hughes in Hong KongChina’s markets are among the biggest in the world – and also among the least-touched by foreign investors, not least because Beijing’s complex rules often make foreigners give up in sheer frustration.Helpfully Asifma, the Asian arm of the global markets lobbying group, has produced a 93-page guide to China’s bond, equity and currency markets, including its proposals for reform.If you want to know your CFETS from your Stock Connect programme, you’d best read the whole thing… but for those with less time we’ve highlighted some of the suggestions, as well as the idiosyncrasies, of China’s markets.So, in no particular order, here are some points that caught our eye:Stock trade settlementT+0, or on-the-day, settlement sounds remarkably efficient, until you factor in that it only works because all trades are pre-funded, creating a drag for investors who have to pay cash before they can instruct their broker to buy anything. Europe moved to T+2 in 2015 and the US is doing so this year. Also, try pre-funding from another timezone when you cannot know the exact price you’ll have to pay.IPO pricingThis has long been a source of bemusement for investors and traders in other markets. Each IPO candidate must be approved by Beijing, after which it joins a listing queue whose pace is also controlled by the state.

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Thought for the weekend

March 17, 2017

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Reminder: US Macro Live, Yellen presser edition at 2:20pm EST

March 15, 2017

Alex, Matt, and Cardiff are back to cover the Janet Yellen presser following the release of the FOMC statement for March.We’ll kick off the session at 2:20pm EST (6:20pm in London) to discuss the statement and look at the Fed’s new economic projections before the presser itself begins ten minutes later. You’ll find us at this link. See you then!And as always, we recommend the preview of the meeting from the Fed’s US economics editor Sam Fleming. An excerpt:The Federal Reserve’s ultra-cautious exit from super-easy monetary policy is likely to accelerate on Wednesday as the US central bank lifts short-term interest rates by another quarter point. What are the key signals to watch for as the Federal Open Market Committee meets?Policy change It would now be a significant shock if the US central bank did not lift the target range for the federal funds rate by another quarter point from the current 0.5 per cent to 0.75 per cent. …How does the Fed see the economy? The post-meeting statement seems likely to reaffirm the continued strengthening of the jobs market and moderate growth in the overall economy. It might acknowledge that the headline measure of inflation tracked by the Federal Open Market Committee is now at 1.9 per cent year on year, just a notch below the Fed’s target, although core inflation still remains a little further behind.

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Thought for the weekend

March 10, 2017

I would like to speak to the boss of @TeslaMotors but impossible to get them on the phone. I have a great idea for them .— Lord Sugar (@Lord_Sugar) March 9, 2017

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The HR start-up founded by Bridgewater alumni — based on Bridgewater principles

March 8, 2017

By Sujeet Indap and Mary Childs The group of college seniors had gathered for a relaxed, celebratory dinner. Each of the roughly dozen students had survived a rigorous interview process to earn a coveted job offer from Bridgewater Associates, the wildly successful and wildly iconoclastic hedge fund based in Westport, Connecticut. The dinner was a chance for the new recruits to meet Bridgwater professionals and each other, as they decided whether to accept entry-level positions.Yet despite the variety of schools represented, the Bridgewater team was startled to learn that most of the kids were already acquainted with each other, having already met during their high school days. Two students had competed on the Teen Jeopardy television quiz show. Several others had met during Model United Nations competitions.“There was this web of connectivity among this group of students who fit the culture at Bridgewater and we were able to fortuitously tap,” said Robin Levine, a veteran of various management and operational roles at Bridgewater.

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Thought for the weekend

March 3, 2017

Another tech worker feeling excluded from the real estate market was 41-year-old Michael, who works at a networking firm in Silicon Valley and last year earned $700,000.– Scraping by on six figures? Tech workers feel poor, 27 February 2017

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February 17, 2017

Market insiders say that, despite a general trend away from lunchtime drinking elsewhere in the City, it is still popular in the insurance world. “It still goes on more than you might expect. There is still a short hours and long lunch culture in some places and there are stories of brokers sitting in pubs handing out contracts like Jabba the Hutt,” said one person close to the insurance market.– Lloyd’s of London bans alcohol during work hours, FT

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President gives press conference

February 16, 2017

[embedded content]A couple of notable quotes:Related links:President Trump uses phrase “nuclear holocaust” in a press conference, stock market trades flat – video from White House websiteMy very good black history month tribute to some of the most tremendous black people – Donald J Trump, via McSweeney’s Internet Tendency

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Down on China? Not Morgan Stanley

February 14, 2017

By Jennifer Hughes in Hong KongIf you’re going to be contrarian, might as well go big. Morgan Stanley has done just that with a monster 118-page report explaining how the world’s second biggest economy will avoid the sort of financial shock feared by western investors, and make it to official “high income” status in the next 10 years.Positive views on parts of China get more rare the further you travel from Beijing. As the report notes, international investors hold their most extreme underweight position on Chinese equities of any point in the past decade.With that in mind, few if any big international banks we can think of have nailed their colours to the mast quite so comprehensively as MS has just done.Notwithstanding Morgan Stanley’s caveats – summarised at the bottom – here are three of MS’s big bull China arguments. They’ll be familiar to anyone following this stuff over the past while. Here they are in grid form first:1) China will avoid a financial shockHigh debt levels are the best-known fact about China, closely followed by estimates of when it will experience a crisis equivalent to the Asian one of 1997/8 and the GFC of 2007/8. By MS’s estimate, debt/GDP has indeed leapt from 147 per cent 10 years ago to 279 per cent last year.MS’s howevers are:The debt is funded by Chinese savings, not external finance.

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Thought for the weekend

February 3, 2017

President Donald Trump has begun killing off an Obama-era retirement-savings rule unpopular with Republicans and some financial-industry executives who say it would harm consumers more than help…“We think it is a bad rule. It is a bad rule for consumers,” said White House National Economic Council Director Gary Cohn in an interview with The Wall Street Journal on Thursday. “This is like putting only healthy food on the menu, because unhealthy food tastes good but you still shouldn’t eat it because you might die younger.”—Trump Moves to Kill Off Obama’s Landmark Retirement Rule, February 3 2017

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January 28, 2017

Lonmin reached a deal with workers last year for the basic monthly pay of 4,000 rock drill operators to rise by 2018 to nearly 12,500 South African rand (£744), the amount they were demanding in the days leading up to the 2012 massacre.But one shareholder said she believed miners’ wage demands were “unreasonable”, comparing the sum to her own pension and disability allowance.“The bulk of my pension goes on utilities,” she said. “They [mine workers] say they don’t have electricity, gas or running water so I don’t understand what they want to spend it on.”— The Guardian

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Snap AV: The Supreme Court ruled

January 24, 2017

And the government lost.Do click here for the full thing:But the main pars are… Par 121, with our emphasis:Where, as in this case, implementation of a referendum result requires a change in the law of the land, and statute has not provided for that change, the change in the law must be made in the only way in which the UK constitution permits, namely through Parliamentary legislation.Par 90The EU Treaties as implemented pursuant to the 1972 Act were and are unique in their legislative and constitutional implications. In 1972, for the first time in the history of the United Kingdom, a dynamic, international source of law was grafted onto, and above, the well-established existing sources of domestic law: Parliament and the courts. And, as explained in paras 13-15 above, before (i) signing and (ii) ratifying the 1972 Accession Treaty, ministers, acting internationally, waited for Parliament, acting domestically, (i) to give clear, if not legally binding, approval in the form of resolutions, and (ii) to enable the Treaty to be effective by passing the 1972 Act.

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