Clik here to view.
Can Hedging Save Greece?
As a part of its restructuring of debt, the Greek government has decided to issue GDP-linked securities: Each participating holder will also receive detachable GDP-linked Securities of the Republic...
View ArticleClik here to view.
Sweeping for cash in the hedges
Natural gas producers in the US are faced with tough choices. Advances in drilling technology have made low cost production from shale resources viable on a large scale, and the industry has been in a...
View ArticleClik here to view.
Deleveraging and the creation of the Eurozone Keiretsu
Many Eurozone banks are going through huge deleveraging: they are selling their portfolios of loans to hedge funds, reducing and cutting revolvers to corporations, and shortening the overall maturity...
View ArticleClik here to view.
With a hedge, could Conoco have it all?
Liam Denning’s Heard on the Street column in this morning’s Wall Street Journal is reliably hard-nosed about budget trade-offs: Investors want it all—but they should be careful about companies that...
View ArticleClik here to view.
Is wholesale power trading as profitable a line of business as they say?
Gregory Meyer, in today’s Financial Times, reports that banks are scaling back their trading in U.S. wholesale electric power markets. In his companion article, he quotes me saying that The banks had...
View ArticleClik here to view.
Captives and Contagion
The French automaker Peugeot is in trouble. Automobile sales in Europe saw a dramatic 8.6% slump in 2012. For Peugeot it was even worse: a 15% drop. Since the company relies overwhelmingly on sales in...
View ArticleClik here to view.
Alternatives to Captives & Contagion
Last week we wrote about the financial contagion from Peugeot’s auto manufacturing business to its captive finance unit, Banque PSA Finance (PFA). The important question this raises for management is...
View ArticleClik here to view.
How large is the taxpayer subsidy to Too-Big-To-Fail banks?
The issue came up yesterday when Fed Chairman Ben Bernanke testified before the Senate Banking Committee. Senator Elizabeth Warren cited a Bloomberg report that put the number at $83 billion to the 10...
View ArticleClik here to view.
Two Tales of Debt Financing
Debt financing is always a gamble. And often a seductive bet. The Financial Times’ Andrew Jack reports on the pharmaceutical company Valeant which has been on a buying spree financed by debt. For an...
View ArticleClik here to view.
Can Hedging Save Cyprus?
Lenos Trigeorgis has a piece in the Financial Times’ Economists’ Forum advocating the use of GDP-linked bonds for Cyprus. Suppose that its steady-state GDP growth is 4 per cent and that fixed interest...
View Article