9 dicembre forconi: corporate
Visualizzazione post con etichetta corporate. Mostra tutti i post
Visualizzazione post con etichetta corporate. Mostra tutti i post

sabato 6 ottobre 2018

How The Corporate Debt Bubble Will Destroy The Economy

The stock market is soaring and the economy, even though we are in the midst of one of the longest expansions on record, continues to chug along. This might lead you to think that all is fine with the world and the growth will continue for years to come.
Steve Mnuchin debt
Scratch below the surface and there are several reasons to be worried. These include threats of a global trade war, rising energy prices and interest rates, and debt – a whole mountain of debt which thanks to the free money have gotten significantly larger since the financial crisis 10 years ago.
To put it in perspective, the U.S. stock market is currently valued at $30 trillion dollars, while the bond market alone was priced at more than $40 trillion. Now, if this was the balance sheet of your business and you went to the bank for a loan, you probably would not get approved.
[REITs]
However, money keeps flowing into high-yield bonds including the corporate debt markets.This means that investors (i.e. pension funds, universities, and even retirees) are taking on riskier investments in the search for returns. If this doesn’t scare you, then read on as we explore how the corporate debt bubble could destroy the economy.
As you probably know a stock is a bet on a company, while a bond is an obligation to repay debt. As such the bondissuer is expected to repay the bondholder the principal as well as making regular interest payments. In addition, bondholders are usually the first to get paid when, or if, a company files for bankruptcy.
But, some observers have noted that over the last decade bonds have become mispriced. This means that investors are underestimating the risk they are taking on when purchasing these instruments. In many ways, this is just as bad as what happened during the financial crisis as investors bought into mortgage-backed securities which they mistakenly thought were backed by high-quality loans instead of riskier subprime loans.
While the impact isn’t really felt when times are good, mispricing bonds can have catastrophic consequences when the defaults start to pile up. If you are a small business owner, then think of it this way; you are in the market for bookkeeping services for small businesses but instead, you end up engaging a Big Four auditor to look at your books.
Not only will they not understand the nature and scale of your business, but you will end up being out a lot of money. Now, let’s look at what this means for the broader economy.
According to a recent report from the International Monetary Fund, the current run-up in corporate debt is “fueled by excessive optimism among investors”. Sound familiar? This is a classic sign of a bubble and it is a reason why many are beginning to sound alarm bells.This includes William D. Cohan, a former investment who was recently interviewed by Knowledge@Wharton and Warren Buffett.
If they are correct, then investors large and small could be big losers as much of what they have invested could evaporate. While you might be thinking that this won’t impact you because you are not investing in corporate bonds you could be wrong.
Here’s why. First, the companies under the most risk could be your employer or a key customer. In this case, you could lose your job and that would have a direct impact on both you and your family.
Second, pension funds are big investors in corporate bonds and this could be putting how you plan to pay for your retirement at risk without even knowing it. The reason why these funds invest in corporate debt is simple – the returns compared to the “risks”.
When priced correctly bonds are a low-risk investment, even corporate bonds. Add to this the higher interest rates they pay to attract investors and one cansee why they would choose to make these investments.
Third, the mutual fund you have invested in as part of your 401(k) could be investing in corporate bonds. This is especially true if it is a bond fund and as such, you might want to check the investment documents of your mutual fund to see where your money is going.
What does this mean for the broader economy? As mentioned, the bond market (i.e. debt) is larger than the stock market, which by the way is larger than the economy. If the bond market were to drop by ½ percent, then would be equal to a roughly 1 percent drop in the economy.
While this is small compared to how much GDP declined in the fourth quarter of 2008, it would be enough to trigger a recession and possible broader losses in the bond market. As such, the corporate bond market bubble could destroy the economy and bring an end to 10 years of growth.

giovedì 5 luglio 2018

Chris Hedges: The Coming Collapse

The Trump administration did not rise, prima facie, like Venus on a half shell from the sea. Donald Trump is the result of a long process of political, cultural and social decay. He is a product of our failed democracy. The longer we perpetuate the fiction that we live in a functioning democracy, that Trump and the political mutations around him are somehow an aberrant deviation that can be vanquished in the next election, the more we will hurtle toward tyranny. The problem is not Trump. It is a political system, dominated by corporate power and the mandarins of the two major political parties, in which we don’t count. We will wrest back political control by dismantling the corporate state, and this means massive and sustained civil disobedience, like that demonstrated by teachers around the country this year. If we do not stand up we will enter a new dark age.
The Democratic Party, which helped build our system of inverted totalitarianism, is once again held up by many on the left as the savior. Yet the party steadfastly refuses to address the social inequality that led to the election of Trump and the insurgency by Bernie Sanders. It is deaf, dumb and blind to the very real economic suffering that plagues over half the country. It will not fight to pay workers a living wage. It will not defy the pharmaceutical and insurance industries to provide Medicare for all. It will not curb the voracious appetite of the military that is disemboweling the country and promoting the prosecution of futile and costly foreign wars. It will not restore our lost civil liberties, including the right to privacy, freedom from government surveillance, and due process. It will not get corporate and dark money out of politics. It will not demilitarize our police and reform a prison system that has 25 percent of the world’s prisoners although the United States has only 5 percent of the world’s population. It plays to the margins, especially in election seasons, refusing to address substantive political and social problems and instead focusing on narrow cultural issues like gay rights, abortion and gun control in our peculiar species of anti-politics.
This is a doomed tactic, but one that is understandable. The leadership of the party, the Clintons, Nancy Pelosi, Chuck Schumer, Tom Perez, are creations of corporate America. In an open and democratic political process, one not dominated by party elites and corporate money, these people would not hold political power. They know this. They would rather implode the entire system than give up their positions of privilege. And that, I fear, is what will happen. The idea that the Democratic Party is in any way a bulwark against despotism defies the last three decades of its political activity. It is the guarantor of despotism.
Trump has tapped into the hatred that huge segments of the American public have for a political and economic system that has betrayed them. He may be inept, degenerate, dishonest and a narcissist, but he adeptly ridicules the system they despise. His cruel and demeaning taunts directed at government agencies, laws and the established elites resonate with people for whom these agencies, laws and elites have become hostile forces. And for many who see no shift in the political landscape to alleviate their suffering, Trump’s cruelty and invective are at least cathartic.
Trump, like all despots, has no ethical core. He chooses his allies and appointees based on their personal loyalty and fawning obsequiousness to him. He will sell anyone out. He is corrupt, amassing money for himself—he made $40 million from his Washington, D.C., hotel alone last year—and his corporate allies. He is dismantling government institutions that once provided some regulation and oversight. He is an enemy of the open society. This makes him dangerous. His turbocharged assault on the last vestiges of democratic institutions and norms means there will soon be nothing, even in name, to protect us from corporate totalitarianism.
But the warnings from the architects of our failed democracy against creeping fascism, Madeleine Albright among them, are risible. They show how disconnected the elites have become from the zeitgeist. None of these elites have credibility. They built the edifice of lies, deceit and corporate pillage that made Trump possible. And the more Trump demeans these elites, and the more they cry out like Cassandras, the more he salvages his disastrous presidency and enables the kleptocrats pillaging the country as it swiftly disintegrates.
The press is one of the principal pillars of Trump’s despotism. It chatters endlessly like 18th-century courtiers at the court of Versailles about the foibles of the monarch while the peasants lack bread. It drones on and on and on about empty topics such as Russian meddling and a payoff to a porn actress that have nothing to do with the daily hell that, for many, defines life in America. It refuses to critique or investigate the abuses by corporate power, which has destroyed our democracy and economy and orchestrated the largest transfer of wealth upward in American history. The corporate press is a decayed relic that, in exchange for money and access, committed cultural suicide. And when Trump attacks it over “fake news,” he expresses, once again, the deep hatred of all those the press ignores. The press worships the idol of Mammon as slavishly as Trump does. It loves the reality-show presidency. The press, especially the cable news shows, keeps the lights on and the cameras rolling so viewers will be glued to a 21st-century version of “The Cabinet of Dr. Caligari.” It is good for ratings. It is good for profits. But it accelerates the decline.
All this will soon be compounded by financial collapse. Wall Street banks have been handed $16 trillion in bailouts and other subsidies by the Federal Reserve and Congress at nearly zero percent interest since the 2008 financial collapse. They have used this money, as well as the money saved through the huge tax cuts imposed last year, to buy back their own stock, raising the compensation and bonuses of their managers and thrusting the society deeper into untenable debt peonage. Sheldon Adelson’s casino operations alone got a $670 million tax break under the 2017 legislation. The ratio of CEO to worker pay now averages 339 to 1, with the highest gap approaching 5,000 to 1. This circular use of money to make and hoard money is what Karl Marx called “fictitious capital.” The steady increase in public debt, corporate debt, credit card debt and student loan debt will ultimately lead, as Nomi Prins writes, to “a tipping point—when money coming in to furnish that debt, or available to borrow, simply won’t cover the interest payments. Then debt bubbles will pop, beginning with higher yielding bonds.”
An economy reliant on debt for its growth causes our interest rate to jump to 28 percent when we are late on a credit card payment. It is why our wages are stagnant or have declined in real terms—if we earned a sustainable income we would not have to borrow money to survive. It is why a university education, houses, medical bills and utilities cost so much. The system is designed so we can never free ourselves from debt.
However, the next financial crash, as Prins points out in her book “Collusion: How Central Bankers Rigged the World,” won’t be like the last one. This is because, as she says, “there is no Plan B.” Interest rates can’t go any lower. There has been no growth in the real economy. The next time, there will be no way out. Once the economy crashes and the rage across the country explodes into a firestorm, the political freaks will appear, ones that will make Trump look sagacious and benign.
And so, to quote Vladimir Lenin, what must be done?
We must invest our energy in building parallel, popular institutions to protect ourselves and to pit power against power. These parallel institutions, including unions, community development organizations, local currencies, alternative political parties and food cooperatives, will have to be constructed town by town. The elites in a time of distress will retreat to their gated compounds and leave us to fend for ourselves. Basic services, from garbage collection to public transportation, food distribution and health care, will collapse. Massive unemployment and underemployment, triggering social unrest, will be dealt with not through government job creation but the brutality of militarized police and a complete suspension of civil liberties. Critics of the system, already pushed to the margins, will be silenced and attacked as enemies of the state. The last vestiges of labor unions will be targeted for abolition, a process that will soon be accelerated given the expected ruling in a case before the Supreme Court that will cripple the ability of public-sector unions to represent workers. The dollar will stop being the world’s reserve currency, causing a steep devaluation. Banks will close. Global warming will extract heavier and heavier costs, especially on the coastal populations, farming and the infrastructure, costs that the depleted state will be unable to address. The corporate press, like the ruling elites, will go from burlesque to absurdism, its rhetoric so patently fictitious it will, as in all totalitarian states, be unmoored from reality. The media outlets will all sound as fatuous as Trump. And, to quote W.H. Auden, “the little children will die in the streets.”
As a foreign correspondent I covered collapsed societies, including the former Yugoslavia. It is impossible for any doomed population to grasp how fragile the decayed financial, social and political system is on the eve of implosion.
All the harbingers of collapse are visiblecrumbling infrastructure; chronic underemployment and unemployment; the indiscriminate use of lethal force by police; political paralysis and stagnation; an economy built on the scaffolding of debt; nihilistic mass shootings in schools, universities, workplaces, malls, concert venues and movie theaters; opioid overdoses that kill some 64,000 people a year; an epidemic of suicides; unsustainable military expansion; gambling as a desperate tool of economic development and government revenue; the capture of power by a tiny, corrupt clique; censorship; the physical diminishing of public institutions ranging from schools and libraries to courts and medical facilities; the incessant bombardment by electronic hallucinations to divert us from the depressing sight that has become America and keep us trapped in illusions.
We suffer the usual pathologies of impending death. I would be happy to be wrong. But I have seen this before. I know the warning signs. All I can say is get ready.
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domenica 29 aprile 2018

Deutsche Bank: è crollato l’utile netto. Tonfo del titolo

La prima trimestrale di Deutsche Bank ha rivelato un forte crollo dell’utile netto. Cosa ha influito sui conti del colosso tedesco e, di conseguenza, sull’andamento delle azioni societarie?

L’utile netto trimestrale di Deutsche Bank è crollato e ha trascinato nel baratro le azioni societarie in avvio di sessione.
Nei primi tre mesi dell’anno la flessione dell’utile è risultata del 79% e ha visto scendere il dato dai 575 milioni di euro del pari periodo 2017 a quota 120 milioni di euro. L’utile ante imposte del colosso tedesco è risultato di 432 milioni di euro (contro gli 878 milioni della prima trimestrale 2017).
A scendere, comunque, non sono stati soltanto gli utili ma anche i ricavi. Nel periodo di riferimento il dato è scivolato del 5% su quota 7 miliardi di euro. L’apprezzamento dell’euro rispetto al dollaro USA e i minori ricavi nel Corporate & Investment Bank hanno determinato in misura maggiore l’andamento dei conti trimestrali di Deutsche.
Anche il Common Equity Tier 1 ratio al 13,4% si è discostato dal 14,0% rilevato alla fine del 2017.

Il 2018 sarà l’anno dei tagli per Deutsche Bank

Di fronte ad una trimestrale non propriamente brillante, Deutsche Bank ha comunicato la sua intenzione di procedere ad una riduzione significativa della forza lavoro. Le suddette operazioni prenderanno il via già nel corso dell’anno corrente e si concentreranno sui settori meno redditizi per l’istituto tedesco, con particolare riferimento alle attività in Asia e negli Stati Uniti.
“Nel riallocare le risorse e migliorare l’efficienza del capitale e del bilancio, la banca ridimensionerà altre aree in cui il board ritiene che Deutsche Bank non abbia più un vantaggio competitivo e sostenibile nel mutato contesto di mercato”,
hanno fatto sapere dall’istituto.
I tagli riguarderanno soprattutto l’investment banking e avranno l’obiettivo di ridurre i costi adjusted sotto la soglia dei 23 miliardi di euro.
Come molti avevano previsto, a risentire in misura maggiore della prima trimestrale 2018 sono state le azioni Deutsche Bank, che hanno inaugurato l’odierna sessione di Borsa con una decisa flessione di quasi 4 punti percentuali. Gli ultimi mesi non sono stati certamente facili per il colosso tedesco, che dopo una chiusura di 2017 non particolarmente brillante ha dovuto anche dire addio al CEO John Cryan.
Al momento della scrittura le azioni Deutsche stanno scambiando con un ribasso del 3,68% su quota 11,56 euro.
Fonte: qui

Deutsche Bank annuncia riassetto e tagli al personale

Revisione attività, ridimensiona business tassi Usa e azionario
Deutsche Bank annuncia riassetto e tagli al personale
Deutsche Bank, la sede a Francoforte
Ansa- Deutsche Bank annuncia una revisione delle sue attività di corporate e investment banking (Cib) e "una significativa riduzione della forza lavoro nel 2018" allo scopo di rispettare l'obiettivo di mantenere la base di costi sotto i 23 miliardi di euro nel 2018. La banca ridimensionerà le attività Usa sui tassi (Us rates) e riesaminerà le attività sul mercato azionario (Global Equities) "con l'aspettativa di ridurre la sua piattaforma".
Il riassetto prevede un focus maggiore sulle attività di banca commerciale e private, oltre che nell'asset management, così da stabilizzare la base di ricavi, e un ridimensionamento delle attività internazionali, in particolare negli Usa, con l'obiettivo di dedicarsi maggiormente alla clientela europea e a quelle aree di attività in cui l'istituto tedesco vanta una leadership. Salva l'Italia, indicata da Deutsche Bank come uno dei "mercati in crescita" nel campo della banca commerciale e private su cui focalizzarsi.
"Deutsche Bank è profondamente radicata in Europa, dove vogliamo fornire ai nostri clienti accesso al soluzioni globali di finanziamento e di tesoreria. Questo è quello su cui ci focalizzeremo in modo più deciso andando avanti", ha commentato il ceo Christian Sewing. "Ridisegnare la Corporate & Investment Bank" causerà "riduzioni del personale nelle regioni e nelle aree di attività coinvolte" "dolorose" ma "inevitabili per assicurare alla nostra banca competitività nel lungo periodo".
Deutsche Bank parla di "aggiustamenti strategici per traghettare la banca verso fonti di ricavo più stabili e rafforzare le linee di business core. Entro il 2021 - si legge - la banca prevede una sostenibile quota di ricavi di almeno il 50% dalla banca commerciale e private e dall'attività di asset management di Dws. Considerando anche i ricavi del Global Transaction Banking la quota di ricavi stabili dovrebbe attestarsi al 65%".
Nel trimestre i ricavi sono scesi a 7 miliardi (-5% sul 2017) e un utile di 120 milioni (-79%). "Dobbiamo agire in modo deciso e rivedere la nostra strategia. Non c'è tempo da perdere in quanto gli attuali ritorni non sono accettabili", ha detto Sewing.