Global ETF News Older than One Year
The wasteful regime fund managers are loath to dump in the skip
June 28, 2015--Milton Friedman defined the most wasteful form of expenditure as one where an individual spends another person's money on some third party.
The economist wasn't thinking about asset management when he made the observation. But he might have been.
His bon mot pretty much sum up the way fund managers operate: charging clients to manage their money and then dipping into customers' funds freely to buy the services needed to do the job.P>view more
Source: FT.com
Morgan Stanley Weighs New Bond-Trading Push
Firm weighs new effort in fixed-income trading to help hit profit targets after postcrisis retreat
June 28, 2015--After years of ratcheting back trading operations in favor of more stable businesses, Morgan Stanley is quietly plotting a comeback.
The Wall Street firm is pushing for more fixed-income trading business, where it lost billions of dollars during the crisis and historically suffered from bad timing.
Source: Wall Street Journal
Don't let the unthinkable become the new normal, says BIS in 85th Annual Report
June 28, 2015--"There is something deeply troubling when the unthinkable threatens to become routine,"" writes the Bank for International Settlements (BIS) in its 85th Annual Report, released today.
In its main economic review of the year, the BIS calls for a shift to a longer-term focus in policymaking, with the aim of restoring sustainable and balanced growth.
The global economy has been growing not far away from historical average rates. Lower oil prices have provided a welcome boost, and dollar appreciation has shifted growth momentum from stronger to weaker economies. But the global expansion remains unbalanced, debt levels and financial risks are still too high, productivity growth is too low, and the room for manoeuvre in macroeconomic policy has continued to narrow.
view the BIS-85th Annual Report, 2014/15
Source: BIS
Legg Mason Is Poised to Run
June 27, 2015--After seven straight years of outflows, Legg Mason is bringing in money and its share are on the rise.
Legg Mason's share price has doubled in three years, to about $52. Past performance, as asset managers frequently remind, doesn’t guarantee future returns.
Source: Barrons's
That Russelling is the sound of indices being realigned
Annual recasting of listings has traders scrambling to keep up with-and game-the market
June 26, 2015--As I write this, in New York on the morning of Friday June 26, stock market traders are locked in to what they know will be the heaviest trading day of the year.
The headlines as US equity traders reached their desks-horrific terrorist attacks with high death tolls across the world, another cliffhanger in the Greek debt negotiations and a 7 per cent fall for Shanghai stocks bringing China into a bear market-might be enough to force a bad day on the stock market.
Source:FT.com
The BIS on ETFs and bond market liquidity
June 26, 2015--The latest BIS Annual Report,released on Sunday, cites numerous concerns about the unseen damage being caused to financial stability on account of ultra-low interest rates.
Key among those concerns: how liquidity-guaranteeing ETFs in the bond sector may be contributing to a global liquidity illusion, disguising the true state of the ability to trade positions on the bond market...
Source: FT.com
Renaissance Capital's 2Q 2015 Global IPO Quarterly Review
June 26, 2015--Analyst IPO Blog
Following a seasonally calm start to the year, global IPO issuance improved in the second quarter of 2015. Quarterly proceeds increased 29% from the first quarter to $46.6 billion, but still remained down 24% from last year's levels.
IPO proceeds in the 2Q15 were dominated by the Asia Pacific region, which accounted for 47% of quarterly proceeds. Asian proceeds were boosted by the listings of large, multi-billion-dollar Chinese brokerage firm IPOs. Europe and North America struggled to reach even half of the IPO proceeds raised last year as Greek debt-related market volatility in the Eurozone and an absence of large Technology and Energy IPOs in the United States weighed on the regions' totals.
Source: Renaissance Capital
DGCX-Middle-Earth: Greece Failed to Reach an Agreement, EU Leaders to Meet Again on Saturday
June 26, 2015--MARKET PULSE:
Asian equities plunged as Greece failed again to reach an agreement with its creditors.
EU Official : Eurogroup will reconvene on Greece on Saturday morning
IMF says Greece must implement reforms before talks on debt; On June 30 deadline, says IMF doesn't extend deadlines as a matter of policy
U.S. consumer spending recorded its largest increase in nearly six years in May, Purchases increased 0.9% vs 0.7% expected
Euro drifts in a thin range as markets await Greek outcome
The economic outlook depends to a great extent on global economic developments says Thomas Jordan, Chairman SNB: The Swiss franc is currently significantly overvalued
Source: DGCX
DECPG Global Weekly
June 26, 2015--Taking Stock
U.S. economy in Q1 contracted less than previously estimated, while consumer spending climbed the most in
six years in May. U.S. GDP contracted 0.2 percent (q/q saar) in Q1, less than the 0.7 percent decline previously
reported.
The upward revision was driven by stronger personal consumption, investment, and exports. Meanwhile, consumer spending jumped 0.9 percent in May, more than expected, following a revised 0.1 increase in April, reflecting in part the effects of lower gasoline prices and an improving labor market. Separately, the flash Markit manufacturing Purchasing Managers Index (PMI) for the U.S. fell to 53.4 in June, the lowest since October 2013, from 54 in May. A reading above 50 denotes expansion.
Eurozone PMI hit a four-year high in June. The flash estimate of the Markit Eurozone composite PMI reached 54.1 in June, a 49-month high, up from 53.6 in May. The latest reading was underpinned by improvements in both manufacturing and services sectors.
Source: World Bank
IMF Working paper-Does Easing Monetary Policy Increase Financial Instability?
June 26, 2015--Summary: This paper develops a model featuring both a macroeconomic and a financial friction that speaks to the interaction between monetary and macro-prudential policies. There are two main results. First, real interest rate rigidities in a monopolistic banking system have an asymmetric impact on financial stability: they increase the probability of a financial crisis (relative to the case of flexible interest rate) in response to contractionary shocks to the economy, while they act as automatic macro-prudential stabilizers in response to expansionary shocks.
Second, when the interest rate is the only available policy instrument, a monetary authority subject to the same constraints as private agents cannot always achieve a (constrained) efficient allocation and faces a trade-off between macroeconomic and financial stability in response to contractionary shocks. An implication of our analysis is that the weak link in the U.S. policy framework in the run up to the Global Recession was not excessively lax monetary policy after 2002, but rather the absence of an effective regulatory framework aimed at preserving financial stability.
view the IMF Working paper-Does Easing Monetary Policy Increase Financial Instability?
Source: IMF
