Monday, May 28, 2012 11:58 AM EDT
U.S. defence spending: What’s the real figure?
From the FT's Lex blog
The day after Memorial Day in the US is not a bad one to ask how much money the country spends on national defence. It is a simple enough question and, given the state of public finances, certainly an important one. But bureaucratic obfuscation, impenetrable accounting and a dose of serial denial make getting an answer difficult.
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Monday, May 28, 2012 7:37 AM EDT
Chinese coal, iron ore defaults prompt mystery
Javier Blas is the FT's commodities editor
Over the last two weeks, Chinese consumers of thermal coal and iron ore have been defaulting on their contracts, sending prices sharply down.
The reason behind the cancellations is a hotly debated topic in the physical commodities market.
Monday, May 28, 2012 6:48 AM EDT
Bankia: No time to wait
From the FT's Lex blog
Bankia has the ring of a computer-generated name that was supposed to give clients and investors a warm feeling. The seven Spanish cajas that merged under its banner and listed last July needed a seductive image: they were riddled with toxic property exposure. Yet, less than a year later, Bankia’s name - and its Pisa-esque leaning office tower on Madrid’s main thoroughfare - symbolize all that is wrong with Spain’s gradualist approach to fixing its banks. The government says it will inject a further €19-billion into Bankia, making a total outlay of €23.5-billion, and taking a 90 per cent stake. The injection should enable the bank to meet new Madrid rules on bad loan provisions.
Friday, May 25, 2012 7:07 AM EDT
HP/Autonomy: a necessary gamble
That gleeful background noise, as Hewlett-Packard presented its quarterly results on Wednesday, was Larry Ellison giggling. Last autumn, the Oracle boss got into a nasty public back-and-forth with Mike Lynch, then head of Autonomy, about whether or not Lynch had shopped his company to Oracle, only to be told the price was too rich.
Hewlett-Packard ended up paying $10.3-billion for the company. This week, HP said that Autonomy stumbled badly last quarter, and that Lynch was being replaced as its leader.
Thursday, May 24, 2012 12:32 PM EDT
SABMiller: two big challenges
SABMiller is like someone who spends a year travelling around the world and is met by friends at the airport to a chorus of “I almost didn’t recognize you!” After a hyperactive year - buying Foster’s, taking a 24 per cent stake in Turkey’s Anadolu Efes, naming a new chief executive-designate - the global brewing company has at least returned with a laden suitcase.
Thursday, May 24, 2012 7:02 AM EDT
Dell: Investors hit control alt delete
Dell is not as much a computer maker as an odd sort of venture capital fund. The PC business is not a long-term winner. It is big, though, and the hope is that Dell DELL-Q can, over time, use profits, distribution and wherewithal from the PC franchise to cultivate related businesses with better growth and more defensible margins (data centre hardware, software and services).
Wednesday, May 23, 2012 7:14 AM EDT
Commodities: running of the tigers
From the FT's Lex blog
Commodities gave global equities a run for their money in the first quarter of the year - but have flagged since. Standard & Poor’s GSCI Spot Index of raw materials is down 12 per cent from its February peak. Rightly or wrongly, investors treat commodities as a homogeneous group - hence the broad sell-off in resources stocks. But the demand dynamics vary.
Wednesday, May 23, 2012 6:44 AM EDT
A fragile Europe must change fast
I sympathize with the Germans. This is not because I agree with their prevailing view of how the crisis occurred or what to do about it. I sympathize because the German elite were the ones who understood what creating the euro implied. They realized that a currency union could not work without a political union. But the French elite wanted, instead, to end their humiliating dependence on the monetary policy set by Germany’s Bundesbank. Now, two decades later, Germany’s partners, including France, have learnt a painful lesson. Far from being liberated from German control, they are now far more firmly under it. In a big crisis, creditors rule.
Tuesday, May 22, 2012 8:18 AM EDT
Wanda buys AMC: China goes to Hollywood
When the 3D film Avatar hit China, 2,000 people braved temperatures of -10C to queue for tickets. The Chinese like movies. And if you are a local cinema owner in search of a little glitter, where else are you going to look for it except in the homeland of Hollywood? Especially if you are planning an initial public offering.
That is the logic behind Monday’s announcement that Dalian Wanda, the largest owner of cinemas in China, is buying AMC Entertainment, the U.S. cinema operator, for $2.6-billion, including debt.
Thursday, May 17, 2012 7:05 AM EDT
Container shipping: boxed in
When Frank Loesser penned Slow Boat to China he was actually romanticising a common poker player’s wish to be trapped with a cash-rich good loser for a long time. Container shipping lines are currently slowing their vessels to and from China. Their shareholders have already been big losers yet the end of the voyage is not in sight.
