Every day ROB Insight delivers exclusive analysis on breaking business news and market-moving events. Streetwise offers news and analysis on Bay Street and the world of finance. Inside the Market delivers up-to-the-minute insights on market news as it develops.
Here are our editors’ picks of some of the best reads available to Globe Unlimited subscribers this week.
Nortel’s border-straddling legal show
The cast is assembled, the venues booked, and the performers are ready to take the stage for the much-anticipated bankruptcy trial of Nortel. In an unprecedented arrangement, U.S. and Canadian judges will oversee proceedings conducted simultaneously, courtesy of $1.3-million worth of video equipment. In Streetwise, Janet McFarland and Jeff Gray reveal the unusual protocols drafted up to deal with the multi-jurisdictional case that cover everything from rules surrounding witness testimony to the dress codes for lawyers, as scores of them push for their clients’ slice of $7.3-billion raised from the sales of patents and other assets.
Central Canadians to pay more, get less
Fewer services or higher taxes? Or both? These are the questions Ontario and Quebec have to wrestle with, as slower growth and aging demographics become the norm for years to come. Everything from health care to infrastructure investment is set to suffer, and the recent uptick in the two provinces’ short-term outlooks cannot be sustained. In ROB Insight, Glen Hodgson offers a prescription for a way out of the mess.
Top hedge fund manager bets against crude
Zach Schreiber must be a bit lonely, with his call for oil prices to head much lower. But the PointState Capital manager is no slouch when it comes to reading markets, boasting an impressive CV as a protégé of “market wizard” Stanley Druckenmiller, who, in turn, learned the hedge-fund ropes from George Soros. Mr. Schreiber was addressing the annual Sohn Investment Conference in New York, where a bevy of billionaires gather to swap investment ideas. In Inside the Market, Scott Barlow examines Mr. Schreiber’s relatively straightforward thesis on crude prices and the countervailing arguments.
U.S. oil’s saviour: Canada
The flood of new oil supply from shale plays is threatening to sideswipe crude prices in the U.S., and it may be Canada that saves the day for producers. The U.S. export ban on oil is constraining markets for all the new supply, but under an exception to the legislation, Canadian oil can be allowed to flow south to the U.S. to then be exported to other countries. In Streetwise, Jeffrey Jones explains how the mechanism would work to provide a floor for U.S. oil prices.
Pfizer puts cross-national buyouts in spotlight
U.S. pharma giant Pfizer’s bid for Britain’s AstraZeneca is ruffling more than a few feathers in the U.K. While the board of Astra is giving it the thumbs-up, and Prime Minister David Cameron appears to be giving his blessing, a much wider conversation is taking place. Much of Pfizer’s motivation is to relocate its head office in the U.K. so it can take advantage of a considerably lower corporate tax rate, and as a graduate of the school of slash-and-burn, Pfizer has raised fears about the gutting of the nation’s much-vaunted R&D leader in the sector. In ROB Insight, Carl Mortished examines the merits of the “public interest” argument, and weighs the pros and cons of allowing an industry darling to be acquired by a foreigner.
Doubts about Fed policy create buying opportunity
The U.S. Fed’s assurances that it isn’t going to raise its key interest rate any time soon have not been assuring enough for the bond market, which is currently signalling a worry about higher rates. In Inside the Market, David Berman outlines what’s behind the disconnect, and explains how investors may enjoy a buying opportunity if the Fed avoids a misstep by raising rates prematurely.