Is Microsoft the quiet villain of global finance?
By Richard Beales
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
Microsoft may be the quiet villain of global finance. Excel errors overstated pre-crisis structured finance ratings, dented JPMorgan’s risk management just as banks were on the mend, and tripped up influential fiscal policy ideas. The rest of the Office suite of “productivity” applications – the bulk of a division responsible for $24 billion in revenue in the last fiscal year – seems equally apt to court trouble.
Review: The Robespierres of central banking
By Dominic Elliott
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
The most lasting inheritance of the 2008 financial crisis may be a change in the purpose of central banks. From the 1980s until 2007, most believed that monetary authorities should primarily use a policy interest rate to combat inflation. Interventions in the markets or in the financial system were outside the remit, or so the orthodox view went. Neil Irwin’s “The Alchemists” shows how that thinking has been turned on its head.
Latam can rely on masses for next phase of growth
By Raul Gallegos
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
Latin America can count on the masses for the next phase of growth. Though epitomized by a handful of people like the world’s richest man, Carlos Slim, and showy political leaders spearheading the region’s commodity-led export economies, a burgeoning middle class will make its mark in 2013 powering Latin America’s future.
US housing doesn’t need another government bailout
By Agnes T. Crane
The author is a Reuters Breakingviews columnist. The opinions expressed are her own.
America’s housing market doesn’t need another government bailout. But the White House is mulling plans to rescue homeowners trapped by underwater mortgages and above-market mortgage rates by allowing them to refinance into cheaper government-backed loans. Luckily, its latest musings look like a pipe dream.
The FED is currently giving banks 50 million per month, supposedly to help the banks buy back underwater or bad loans, and make it easier for working Americans to borrow. It is apparant this is not working, banks are refusing to lend to anyone without sterling credit. The FED should be buying back the bad and underwater loans directly from the homeowners, thereby repaying the banks and stimulating the economy simultaneously.
Washington may finally take up mortgage reform
By Daniel Indiviglio
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
America’s lawmakers may finally take reforming housing finance seriously in 2013. Assuming Congress settles the deficit debate, sorting out the government’s role in funding home loans should be its next stop. And a number of obstacles are dissolving.
? Besides the Consumer Financial Protection Bureau action hoped for in January ,the author has given no evidence that ‘things are changing’ and we will have this kind of mortgage reform.
How many congressman support this? There are no quotes of anyone with insight about who would sponsor or support this reform.
Fed’s foreign bank crackdown is price of stability
By Agnes T. Crane and Daniel Indiviglio
The authors are Reuters Breakingviews columnists. The opinions expressed are their own.
The Federal Reserve’s unilateral crackdown on foreign banks is necessary. The regulator’s requirement that overseas lenders properly capitalize their U.S. arms is a prudent way to protect the local and global financial system. The Fed’s approach could prompt other regulators to follow suit. But the fear that fragmentation could stifle global banking looks overblown.
Moody’s downgrade is good news for France
Pierre Briançon
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
François Hollande has received a little help from an unlikely friend. Moody’s, the ratings agency, has stripped France of its prized AAA status, following rival S&P’s similar move in January. Markets yawned at the long-expected news, with yields on French 10-year bonds up a meagre four basis points. The decision comes with threats of further downgrades, so it puts pressure on France to plough ahead with its reform plans. But the French president should welcome the announcement, which will help him convince his compatriots that more changes are needed, and that time is short.
SOEs could be China’s economic vampire squid
By John Foley
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
State-owned enterprises are China’s economic version of the giant vampire squid. The 20,253 industrial companies owned and controlled by the government soak up capital, and pay little out. Their costs are low and their bosses powerful. If China’s new leaders are serious about making households wealthy, they need to make these industrial giants behave more like normal companies.
Corporate China beating banks at their own game
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
By Wayne Arnold
Corporate China appears to be beating the country’s lenders at their own game. Even as banks heap credit into China’s economy to keep its credit-fuelled growth from crashing, companies are handing out credit to their own customers. That may help keep the economy revving, but the risk is that past-due bills make it harder for companies to service mounting debt.
UK banks’ euro zone firewall needs government help
By George Hay
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
UK banks’ euro zone firewall needs strengthening. Despite a range of support measures introduced after the 2008 financial crisis, the Bank of England’s arsenal for managing a pan-European liquidity freeze looks underpowered when compared with the European Central Bank’s three-year loans. But if the euro zone cracks, UK lenders would be better off turning to the government for support.
As an econmist I see real simple solutions to the liquidity issues facing the BoE, ECB and others. It is time to start thinking outside of the box and transfer the debt issues away from governments and expand the base and lesson the risk for all borrowers. Very simple. So all of you who are pointing fingures or have buried your collective heads in the sand, just stop!
Monroe, Maine USA has the solutions!
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Predictions 2013: Exploring the year ahead.
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