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HenryTo
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 Posted: Fri Aug 19, 2011 6:26 pm Post subject: France |
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Bridgewater on France's ability (or lack of) to bail out the Euro Zone's peripheral countries:
| Quote: | France is a Weak Backstop Even if They Are Willing
As you know, we believe that the amount of credit that the private sector will provide to peripheral Europe is significantly inadequate relative to the amount of credit that these countries will require. Furthermore, from both a political and financial perspective, we see it as increasingly unlikely that other EU countries will provide a sufficient backstop to fill the gap. In particular, as we dig into France, which represents 1/3 of non-peripheral Europe, we do not believe it will have the financial resources necessary to meaningfully contribute to a bailout (even if the political will exists). If this is the case, then Germany and a few other small countries will find themselves in the position of having to fund a bailout that will be greater than 50% of their domestic GDP, a proposition that is unlikely to be financially or politically feasible. This is likely to put the ECB in the difficult position of having to decide between stepping outside its normal role and bailing out insolvent sovereign debtors or accepting default and all that comes with it. |
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HenryTo
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| Posted: Mon May 07, 2012 10:22 am Post subject: |
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| In general, a giant wake-up call for those advocating further austerity measures. Germans now need to meet them halfway--likely first in the form of a financial/banking back-stop integration. Then ultimately a form of fiscal integration. French-German 10-year yield spread now down to 119 bps--its lowest level since early April. |
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rffrydr
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| Posted: Mon May 07, 2012 5:11 am Post subject: |
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But still got the big selldown. Now, had this been Brazil.....
Rare obvious buy.
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HenryTo
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| Posted: Mon May 07, 2012 1:37 am Post subject: |
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| Hollande victory widely expected. French-German 10-year yield spread initially spiked 8 bps to 132 bps, but has since eased back down to 130 bps. |
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rffrydr
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| Posted: Tue Apr 10, 2012 8:25 am Post subject: |
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| Quote: | | ....A recent European Commission survey found that 13 per cent of German industrial companies admitted doing nothing innovative between 2006 and 2008; for the French it was 47 per cent. Matthieu Pιlissiι du Rausas, a McKinsey management consultant, says: If you have one industrial company out of two not innovating for two years, that is incredible. That has to change. |
--FT
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rffrydr
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| Posted: Sun Apr 01, 2012 8:30 pm Post subject: |
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It'll be an event if re-elect Super-Sarko. It means they re-elect Merkel.
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HenryTo
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HenryTo
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HenryTo
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Location: Los Angeles, California
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HenryTo
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rffrydr
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| Posted: Thu Nov 03, 2011 8:43 am Post subject: |
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JPM on BNP earnings:
| Quote: | P Paribas posted a decent set of results, with good performance
in retail businesses, and positive asset quality trends. Key positive
messages include a) Funding well managed with liquidity reserves
increasing to 170bn and the group having completed 8bn of its 20bn
refinancing needs for 2012 already, and b) sovereign exposures down
QoQ, especially Italy (from 20.5bn to 12.2bn), although the group
realized losses on sale of 362m. However, the main focus will be the
impact of deleveraging 70bn RWAs, leading to 750m ongoing impact
or about 5% of pre-provision profits. The stock is trading at 4.9x PE,
0.6x 2012E tangible BV for RoNAV of 12.4%. Underlying results were
solid, however, estimates would have to be adjusted for the deleveraging
in our view. Given the sector headwinds, we would continue remain
cautious, although BNPP remains our pick within French banks.
NH
BNP Paribas reported stated pretax profits of 948m. Adjusting
mainly for i) 2.1bn of impairment on Greek government bonds, ii) own
debt gains of 786m, iii) impairment on AXA of 299m, iv) 163m
impact of Greece in the insurance business, we get to clean pretax of
2,645m, vs. our JPMCe 2,803m underlying. Note that we have not
adjusted for the 362m loss on the sale of sovereign bonds booked in
CIB revenues. After tax and minorities, we get to clean net income of
1,685m vs. JPMCe 1,691m. Clean EPS was 1.41 for Q3 11.
NH
Revenues were lower than expected at 9.41bn underlying vs. our
JPMCe 10.0bn, mainly driven by the Investment Bank (losses on
sale of the sovereign bonds). This was partly offset by lower provisions
800m clean excluding the 2.1bn for Greece and 0.1bn in the
insurance business, or 50bp on loans, up marginally from 48bp in Q2 11.
This compares to our provisions of JPMCe 968m and (company)
consensus of 946m. Costs were lower at 5.99bn vs. our JPMCe
6.33bn, with group cost/income ratio of 63.7% clean vs. 61.7% JPMCe.
By divisions, retail businesses performed well with French retail, BNL
bc, Belux retail and BancWest better than expected. Asset Gathering
results were a bit weaker, but the main disappointment came from the
Corporate & Investment Banking where capital markets revenues were
lower, partly as a result of the 362m loss on the sale of sovereign bonds,
however, equities revenues dropped -57% QoQ to 292m vs. JPMCe
550m, whilst Fixed Income performed better excluding the 362m loss
with revenues down -27% QoQ to 805m underlying vs. JPMCe 750m. |
Lookie thar, profits! That Bank West tells a nice story about our own small communities across the West.
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rffrydr
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| Posted: Mon Oct 24, 2011 9:04 am Post subject: |
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And this will be a good thing as it means Europe will improve its rating. Sarko don't want it into elections...but heads will have to roll if they want to pull this thing off.
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HenryTo
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