Links: 2013-02-01
News links for 1 February 2013
“Financial data firm Markit said its U.S. Manufacturing Purchasing Managers Index rose to 55.8 last month, its best showing since April, from 54.0 in December.
A reading above 50 indicates expansion.
Firms tied the surge to a steady rise in domestic demand; the survey’s new orders component rose to 57.4, its highest since May, 2010. The output component rose to 56.8 from 54.5 in December. January’s reading was the highest in 10 months.”
El PMI manufacturero se reduce al menor ritmo desde junio de 2011 – CincoDías.com
The Spanish manufacturing PMI showed manufacturing in Spain declining at the slowest pace since June 2011 as the number rose to 46.1 in January from 44.6 in December. Across Europe, the numbers seem to be getting better with the big exception of France.
January payrolls: +157,000, unemployment rate 7.9 per cent | FT Alphaville
“Another month, another payrolls number in the 150k range — except this one comes with big positive revisions to the prior two months. The unemployment rate ticked up slightly, but careful with this report, as it includes an updated population estimate in the household survey, and also the annual benchmarking in the establishment survey to reflect a new count of total jobs. Read the explanations at the bottom of the release for detail.”
The perpetualisation of debt | FT Alphaville
“Bank resolution is fundamentally about transferring bank responsibility (and risk) away from the public sector and back to the private sector. It’s about making the banks responsible for themselves again by weaning them off state-aid.
Even though government loans have on the surface been repaid, the central bank put and the understanding that these institutions are now too big to fail, implicitly continues to provide an equity backstop. The equity risk has thus not yet really been transferred to the private sector at all.”
Santander: non-performing loans on the rise in LatAm, too | beyondbrics
“In Brazil, now Santander’s single biggest market, accounting for 26 per cent of group profits, there are signs that the country’s credit-driven consumer boom has hit a wall.
The ratio of non-performing loans to total loan book rose from 5.38 per cent to 6.86 per cent last year. The rise came even though the size of its loan book shrank 5 per cent to €74bn.
There was better news in Mexico – another of Santander’s key markets, accounting for 12 per cent of group profits. The number of delinquent loans there edged up slightly from 1.82 per cent to 1.94 of total loan book – which grew 12 per cent to €20.4bn.
In Chile, where the loan book grew 15.4 per cent to €29.7bn, the NPL ratio is up from 3.85 per cent to 5.17 per cent.”
Apple Absolutely Has To Make An iPhone With A Bigger Screen – Business Insider
“My point was that consumers really seemed to like the new, big screens on phones like Samsung’s Galaxy S3 and that screen size was going to be a major point of differentiation.
Well, when the iPhone 5 came out, it looked exactly like the one in the pictures–with a screen that was slightly taller than the old iPhone screen but no wider.”
Netherlands nationalises SNS Reaal – FT.com
“The Netherlands has nationalised SNS Reaal, the fourth-largest systemically important bank in the Netherlands, at a cost to Dutch taxpayers of €3.7bn.
The bank had spent the past several weeks in a desperate search for private capital to compensate for heavy losses in its real estate holdings, particularly in Spanish assets.”
Analysis: Investors cheer Portugal, on ground situation bleak | Reuters
“Portuguese consumer confidence is at record lows, unemployment at all-time highs and the country has launched the largest tax rises in living memory. Yet investors are snapping up its bonds and its international lenders are full of praise.”
Worst may be over for euro zone factories: PMI | Reuters
“Euro zone factories had their best month in nearly a year during January as burgeoning German output offered support amid signs the worst may be over for the troubled currency bloc, a survey showed on Friday.”
Dell nears buyout, deal could come as soon as Monday: sources | Reuters
“Dell Inc is nearing an agreement to sell itself to a buyout consortium led by its founder and Chief Executive Michael Dell and private equity firm Silver Lake Partners, possibly announcing a deal as soon as Monday, according to two people familiar with the matter.”
Croatia Cut to Junk by Moody’s on Fiscal, External Risks – Bloomberg
“Croatia’s credit rating was cut to junk by Moody’s Investors Service, which cited a stalled recovery, lack of budget discipline and vulnerability to external shocks by the European Union’s next member.
The Balkan country’s government bond rating was lowered to Ba1 from Baa3, the same level as Hungary and Ireland, Moody’s said in a statement released in London today. Standard & Poor’s cut Croatia to junk in December. Moody’s also changed Croatia’s outlook to stable from negative, saying the risk the government’s fiscal position and debt will “materially deteriorate any further” is limited.”
U.S. sues to stop beer deal to unite Bud and Corona | Reuters
“The U.S. government has filed a lawsuit seeking to stop Anheuser-Busch InBev SA (ABI.BR) from buying the half of Mexican brewer Grupo Modelo (GMODELOC.MX) that it does not already own, saying the $20.1 billion deal could mean higher U.S. beer prices.”
“Strategy Analytics said generous carrier subsidies and extensive marketing of the new iPhone 5 model helped Apple to claim the U.S. mobile crown in Q4 — taking the title from Samsung which had held it since 2008. Samsung still put in a good performance in the fourth quarter, according to the analyst — which noted that its market share rose five points from a year earlier. However this increase was “not enough to hold off a surging Apple”, it said.”
How can employment rise when growth falls? Because of zombie companies | Business | The Guardian
“Report says decline in UK productivity is in part due to banks propping up debtor firms while declining credit to start-ups”
Mexican governor sues Wal-Mart whistleblower over bribery claims | Reuters
“A Mexican state governor implicated in a bribery scandal involving Wal-Mart Stores Inc (WMT.N) sued a former lawyer-turned-whistleblower for the company and sought an apology for naming him in connection with the scandal.”
“Booking a loss to boost its capital ratio. Losing money, in the regular universe, should reduce your capital: capital is mostly retained earnings. Everything here is backwards.”
British monetary policy: Shake ’em up, Mr Carney | The Economist
I can’t get behind this. We continue to see monetary policy fetishism because people are loathe to use fiscal, especially when deficits are high. It won’t work except via asset prices. The asset-based economic model lives on.
“That is where the nominal GDP target comes in. By promising to keep monetary conditions loose until nominal GDP has risen by 10%, the Bank would provide certainty that interest rates will stay low even as the economy recovers. That will encourage investment and spending. At the same time an explicit target of 10% would set a limit to the looseness, preventing people’s expectations for inflation becoming permanently unhinged. It is an approach similar in spirit to the Federal Reserve’s recent commitment not to raise interest rates until America’s unemployment rate falls below 6.5%.”
Joining the Establishment, UK NGDP targeting edition | FT Alphaville
“We’re definitely not saying the case for NGDP targeting is done and dusted. But it’s become institutionally easier to imagine than many might think, surely.”
France could join list of eurozone casualties in a fresh crisis | Business | The Guardian
“Labour market data from Germany was again impressive. Unemployment has fallen to a 20-year low of 6.8%, not bad for a country that is heavily reliant on exports and thus exposed to the slowdown in the global economy in the second half of 2012. Meanwhile, France reported flat consumer spending in the final three months of 2012, with all the signs pointing to another weak performance in the first quarter of 2013. The jobless rate in France is at a 15-year high and on course to hit 11% later this year.
Make no mistake, neither country is going to have a 2013 to write home about. But should the eurozone crisis flare up again over the coming months, there is a real risk that its second biggest economy will be added to the list of countries where the public finances are deemed unsustainable.”
Norway: The rich cousin | The Economist
“The simple explanation for Norway’s penchant for state capitalism is oil. When it was discovered in the North Sea in late 1969 it transformed the country’s economy. Today Norway is the world’s eighth-largest oil exporter. Petroleum accounts for 30% of the government’s revenues as well as a quarter of the country’s value added.
There is also a more nuanced explanation. Norwegians have always looked to the state to help manage their abundant natural resources—minerals, fjords, forests, waterfalls—and to look after isolated and thinly spread communities.”
Apple iPad market share falls as tablet market booms – Technology, Business – Independent.ie
“Tablet shipments worldwide grew by more than expected in the final three months of last year, with more than 50 million units being shipped worldwide.
Apple still dominates the market with the iPad, which accounted for 43.6pc of tablet shipments, according to market analysts IDC.
Apple’s share fell from 46.4pc in the preceding quarter but it still had almost three times the share of Samsung, its nearest rival.”
“By the end of 2013, there will be 45 million Windows Phone devices, and 20 million BlackBerry 10 devices in use worldwide, ABI predicts. These respectively work out to 3.2 percent and 1.4 percent shares of the market. That may sound like peanuts compared with Android’s 798 million handsets (57 percent share) or iOS’s 294 million devices (21 percent share). But this will continue to remain just enough to keep a critical mass of developers interested in the platform — significant because apps will continue to be one of the main drivers for why consumers buy phones, says ABI.”
How Rising Taxes Drove Incomes Higher in December
“The biggest clue to how incomes rose while the economy stalled is contained in the Commerce Department’s data about the sources of rising income. Of the $353 billion income rise, $268 billion came from dividends. That is, dividends accounted for around 75 percent of the total increase.
That is a breath-taking rise. As Steve Liesman pointed out this morning, monthly dividends have only increased by more than that only once in the past 50 years — in 2004, thanks to a record-breaking dividend from Microsoft.”
Michael Rasmussen bekent twaalf jaar lang doping te hebben gebruikt :: nrc.nl
Silicon Valley’s most important document ever — Tech News and Analysis
“Netflix has long been famous for giving its employees unlimited vacation time. Netflix CEO Reed Hastings justified this move in a slide deck he first published online in 2009, which also outlines the company’s approach towards hiring (no “brilliant jerks,” please) as well as firing (only keep the people that you’d fight for if they wanted to leave).
Facebook COO Sheryl Sandberg praised the deck in a new GQ magazine story about Netflix, saying:
“It may well be the most important document ever to come out of the Valley.””
“Facebook’s No. 2 top dog, COO Sheryl Sandberg, recently said that Netflix’s company culture document “may well be the most important document ever to come out of the Valley.” The document, a bullet-point-happy PowerPoint, has become a cultural manifesto for the Internet’s economic epicenter, amassing over 3.2 million views on Slideshare.net.
More than simply a management guide, it’s a window into a philosophy that thrives on uncertainty, creativity, and trust — a blinding contrast to the hierarchical culture that dominated much of the 20th century workplace. To the extent that innovation and the Internet play a role in the modern workplace, it is a crystal ball into the future of daily life.”
News Release: Personal Income and Outlays
“Personal income increased $352.4 billion, or 2.6 percent, and disposable personal income (DPI) increased $331.3 billion, or 2.7 percent, in December, according to the Bureau of Economic Analysis.
Personal consumption expenditures (PCE) increased $22.6 billion, or 0.2 percent. In November, personal income increased $135.8 billion, or 1.0 percent, DPI increased $125.5 billion, or 1.0 percent, and PCE increased $41.6 billion, or 0.4 percent, based on revised estimates.
Real disposable income increased 2.8 percent in December, compared with an increase of 1.3 percent in November. Real PCE increased 0.2 percent, compared with an increase of 0.6 percent.”
Property loans hurt Santander earnings – FT.com
“Banco Santander returned €24bn of loans to the European Central Bank earlier this month as Spain’s largest lender by assets said it had set aside €18.8bn in provisions against soured property loans last year, sharply pushing down its earnings.
Santander, the largest bank in the eurozone by market value, said that net profits after provisions for last year tumbled by 59 per cent to €2.2bn following its hefty round of provisioning, with earnings in Latin America, the UK and US all slipping at a time when those markets have been hailed as crucial in protecting the bank from a sharp recession in Spain.”
Exclusive: Catalonia complains to Brussels about unfair treatment by Spain | Reuters
“Debt-laden Catalonia has complained to Brussels that it is being unfairly treated by Spain’s central government in the country’s drive to cut its public deficit and avoid fiscal meltdown.”
Spain’s Rajoy, ruling party deny secret payment scheme | Reuters
“Prime Minister Mariano Rajoy and Spain’s ruling People’s Party denied on Thursday that the party made unofficial payments from business donors to the premier and other party leaders after a newspaper published what it said were secret party accounts.”
Danish Housing Slump Is Over, Central Bank’s Callesen Says – Bloomberg
“Denmark’s housing market is past the deepest point in its slump and the key triggers for a recovery are now in place, central bank Deputy Governor Per Callesen said.
“Denmark is a healthy economy, a surplus economy” so “there are no rational economic reasons why it shouldn’t pick up,” Callesen said in an interview in Copenhagen yesterday. The housing market has now “bottomed out,” he said.
The comments follow a more-than 20 percent plunge in Denmark’s house prices since a 2007 peak. The nation’s gross domestic product probably contracted 0.4 percent last year, matching a decline in the 17-member euro area, as households stopped spending and businesses shelved investments, the government estimates. Denmark’s burst housing bubble also brought with it a regional banking crisis that has wiped out more than 20 lenders since 2008.”
España logra en noviembre su mayor superávit comercial mensual en décadas | Economía | EL PAÍS
Spain logged its highest monthly current account surplus in decades. It registered 1.777 billion euros of surplus in November 2012, the highest since records began in 1990. Net capital inflows were 13.178 billion euros, the third consecutive month of inflows.
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