<![CDATA[Hedgehogs.net: Ken Yeadon's connections' blogs]]> http://www.hedgehogs.net/pg/blog/keny/friends/?view=rss http://www.hedgehogs.net/pg/blog/CentralBankNews/read/11628348/this-week-in-monetary-policy-israel-kyrgyzstan-rwanda-taiwan-fiji-romania-moldova-bulgaria-czech-republic-and-mexico Mon, 27 Jun 2016 02:07:24 +0100 http://www.hedgehogs.net/pg/blog/CentralBankNews/read/11628348/this-week-in-monetary-policy-israel-kyrgyzstan-rwanda-taiwan-fiji-romania-moldova-bulgaria-czech-republic-and-mexico <![CDATA[This week in monetary policy: Israel, Kyrgyzstan, Rwanda, Taiwan, Fiji, Romania, Moldova, Bulgaria, Czech Republic and Mexico]]>
    This week (June 27 through July 2) central banks from 10 countries or jurisdictions are scheduled to decide on monetary policy: Israel, Kyrgyz Republic, Rwanda, Taiwan, Fiji, Romania, Moldova, Bulgaria, Czech Republic and Mexico.
    Following table includes the name of the country, the date of the next policy decision, the current policy rate, the result of the last policy decision, the change in the policy rate year to date, the rate one year ago, and the country’s MSCI classification.
    The table is updated when the latest decisions are announced and can always accessed by clicking on This Week.

JUN 27 - JUL 2, 2016:
COUNTRY       DATE           RATE      LATEST        YTD     1 YR AGO    MSCI
ISRAEL 27-Jun 0.10% 0 0 0.10%       DM
KYRGYZ REPUBLIC 27-Jun 6.00% -200 -400 9.50%
RWANDA 27-Jun 6.50% 0 0 6.50%
TAIWAN 30-Jun 1.50% -12.5 -12.5 1.88%       EM
FIJI 30-Jun 0.50% 0 0 0.50%
ROMANIA 30-Jun 1.75% -25 0 1.75%       FM
MOLDOVA 30-Jun 13.00% -200 -650 15.50%
BULGARIA 30-Jun 0.00% 0 -1 0.02%       FM
CZECH REPUBLIC 30-Jun 0.05% 0 0 0.05%       EM
MEXICO 30-Jun 3.75% 0 50 3.00%       EM

http://www.hedgehogs.net/pg/blog/asiablues/read/11628342/gold-market-analysis-video Sun, 26 Jun 2016 19:03:46 +0100 http://www.hedgehogs.net/pg/blog/asiablues/read/11628342/gold-market-analysis-video <![CDATA[Gold Market Analysis (Video)]]> By EconMatters

We look at the key technical levels in the Gold Market in this video, as an indication of where the Gold Market is likely headed.

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http://www.hedgehogs.net/pg/blog/CentralBankNews/read/11628337/policy-remix-needed-to-tackle-pentup-risks-bis-says Sun, 26 Jun 2016 11:37:22 +0100 http://www.hedgehogs.net/pg/blog/CentralBankNews/read/11628337/policy-remix-needed-to-tackle-pentup-risks-bis-says <![CDATA[Policy remix needed to tackle pent-up risks, BIS says]]>
    (Following press release was provided by the Bank for International Settlements. Click to read the 86th Annual Report of the BIS.)

    There is an urgent need to rebalance policy in order to shift to a more robust and sustainable global expansion and address accumulated vulnerabilities, the Bank for International Settlements (BIS) writes in its 86th Annual Report, calling for prudential, fiscal and structural policies to play a greater role.
    “We need policies that we will not once again regret when the future becomes today,” the BIS says in the report, released today, which describes a broad-based economic realignment as financial cycles mature, commodity prices fall, the dollar strengthens and global liquidity starts to tighten.
    In its flagship economic report, the BIS argues that growth rates are not far from historical averages. Still, it identifies a risky combination of unusually low productivity growth, historically high global debt and shrinking room for policy manoeuvre, which leaves the global economy highly exposed, not least to shocks and political risks.
    The recommended policy rebalancing should be incorporated into a long-term framework with a stronger focus on preventing costly financial boom-bust cycles, the BIS says. Prudential, fiscal and structural policies need to work alongside monetary policy, with a clear delineation of responsibilities.
    The structure of taxes and subsidies could be adjusted to remove the bias towards debt accumulation, for example by eliminating the tax advantage of debt over equity, and the quality of public spending could be improved by focusing more on investment. Throughout this process, prudently assessing fiscal space and maintaining sound public finances are key.
    Safer and stronger banks will also contribute to a more resilient economy since better capitalised banks lend more and stronger market-makers mean more robust market liquidity.
   Over the last year, major economies’ interest rates – adjusted for inflation – have edged further into negative territory and the stock of sovereign bonds trading at negative yields has hit record highs. The persistence of such exceptionally low rates has raised questions about their impact on the profitability and resilience of financial institutions, the sustainability of asset prices and the broader economy.
   The BIS authors look at concerns about the declining impact of monetary policy on the domestic economy and the increasing prominence of external channels of transmission, such as exchange rates.    
   They examine the merits of a financial stability-oriented monetary policy and conclude that leaning against the wind brings the greatest benefits when monetary policymakers take financial stability into account all the time, during both booms and busts.
    Other new research in the Annual Report discusses anomalies in financial markets; how financial risk-taking can undermine the traditional impact of currency moves on an economy; the role of global value chains in the globalisation of inflation dynamics and the treatment of sovereign debt on banks’ balance sheets.
    The BIS’s financial results, which were also published in the Annual Report, included a balance sheet total of SDR 231.4 billion (USD 326.1 billion) at end- March 2016 and a net profit of SDR 412.9 million (USD 581.9 million).


http://www.hedgehogs.net/pg/blog/asiablues/read/11627710/hedge-funds-which-are-really-money-managers-have-become-dumb-money-video Sat, 25 Jun 2016 16:03:46 +0100 http://www.hedgehogs.net/pg/blog/asiablues/read/11627710/hedge-funds-which-are-really-money-managers-have-become-dumb-money-video <![CDATA[Hedge Funds which are really Money Managers have become Dumb Money (Video)]]> By EconMatters

So called "Hedge Funds" who employ no real hedge fund strategies for the majority of their allotted fund capital are really just marketing themselves as Alpha Players to charge the 2 and 20, when based upon performance and trading strategies deserve just the 1.5 to 2% money managing fee of standard money managers.

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http://www.hedgehogs.net/pg/blog/asiablues/read/11627699/we-like-valeant-pharmaceuticals-for-a-trade-video Fri, 24 Jun 2016 22:53:56 +0100 http://www.hedgehogs.net/pg/blog/asiablues/read/11627699/we-like-valeant-pharmaceuticals-for-a-trade-video <![CDATA[We Like Valeant Pharmaceuticals for a Trade (Video)]]> By EconMatters

Considering it costs $2.5 to $5 Billion from the initial Research phase to bringing a new drug to market, the $32 Billion in VRX Debt given their other assets, and proven drug portfolio makes this stock look cheap here on a valuation basis.

I bet I could find a buyer willing to pay $50 a share for Valeant Pharmaceuticals over the weekend if Bill Ackman wasn`t in such a hole on this stock, and needs a much higher price given the average stock price on his accumulated share stake.

Given that there is going to be further consolidation in this space, and the high costs associated with organically generating new drugs for the marketplace with no guarantees of success - VRX looks like an attractive take-out candidate to me. Their debt is actually in line with many utilities trading at much higher valuations with much lower revenue generation capabilities from both an overall  margins and gross profit standpoint.

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http://www.hedgehogs.net/pg/blog/CentralBankNews/read/11627553/central-bank-news-link-list-jun-24-brexit-vote-triggers-shock-silence-but-market-chaos-averted Fri, 24 Jun 2016 16:49:39 +0100 http://www.hedgehogs.net/pg/blog/CentralBankNews/read/11627553/central-bank-news-link-list-jun-24-brexit-vote-triggers-shock-silence-but-market-chaos-averted <![CDATA[Central Bank News Link List - Jun 24: Brexit vote triggers shock, silence but market chaos averted]]>
Here's today's Central Bank News' link list, click through if you missed the previous link list. The list comprises news about central banks that is not covered by Central Bank News. The list is updated during the day with the latest developments so readers don't miss any important news.

http://www.hedgehogs.net/pg/blog/asiablues/read/11627547/the-brexit-carnage-from-a-traders-perspective-video Fri, 24 Jun 2016 14:43:46 +0100 http://www.hedgehogs.net/pg/blog/asiablues/read/11627547/the-brexit-carnage-from-a-traders-perspective-video <![CDATA[The Brexit Carnage from a Trader`s Perspective (Video)]]> By EconMatters

The surprise Brexit event made for some fun trading with great price action opportunities last night - sort of like being in a hurricane without getting your house destroyed - there is something "energy" in the air.

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http://www.hedgehogs.net/pg/blog/CentralBankNews/read/11627542/sri-lanka-maintains-rate-growth-in-line-with-expectation Fri, 24 Jun 2016 14:30:31 +0100 http://www.hedgehogs.net/pg/blog/CentralBankNews/read/11627542/sri-lanka-maintains-rate-growth-in-line-with-expectation <![CDATA[Sri Lanka maintains rate, growth in line with expectation]]>     Sri Lanka's central bank left its key policy rates steady, as expected, saying growth in the first quarter was broadly in line with expectations while inflation is expected to ease and remain in mid-single digits in the medium term.
     The Central Bank of Sri Lanka last raised its key rates, the Standing Deposit Facility Rate (SDRF) and the Standing Lending Facility Rate (SLFR), by 50 basis points in February to 6.50 percent and 8.0 percent, respectively.
     Sri Lanka's inflation rate picked up speed in May to 4.8 percent from 3.1 percent in April, an acceleration that was expected due to May's increase in Value Added Tax (VAT) to 15 percent from 11 percent and the removal of certain exemptions to raise government revenue.
    The International Monetary Fund (IMF) - which earlier this month approved aid of US$1.5 billion, with immediate payment of $168.1 million, to help Sri Lanka meet balance of payment needs until it can adjust its macroeconomic policies - forecasts average inflation this year of 4.1 percent, up from 0.9 percent in 2015.
    For 2017 the IMF sees inflation rising to 5.3 percent before easing to 5.1 percent in 2018, 5 percent in 2019 and the same in 2020.
    Although Sri Lanka's economy expanded by an annual rate of 5.5 percent in the first quarter of the year, up from 2.5 percent in the previous quarter, the IMF said the economy was beginning to show signs of strain from the weak external environment and the challenges of policy adjustment.
    The IMF forecasts annual growth of 5.0 percent this year and the following two years compared with 4.8 percent last year.
    The linchpin of the IMF-led reform program is a reduction in Sri Lanka's fiscal deficit to 3.5 percent of Gross Domestic Product by 2020 from 6.9 percent in 2015 by rebuilding tax revenues, controlling expenditures and putting state enterprises on a more commercial footing.
    Revenue last year rose 1.5 percentage points to 13.1 percent of GDP, but this was mainly due to one-off measures and taxes from a temporary surge in vehicle imports. Meanwhile, expenditures rose by 2.1 points to 19.9 percent of GDP.
    The IMF also wants Sri Lanka to commit itself to a flexible exchange rate that will enable it to adjust to external forces and allow the central bank to rebuild foreign exchange reserves and focus more closely on price stability.
    Sri Lanka's rupee has been facing downward pressure for months due to capital outflows and has been depreciating steadily since late August until early this month when market sentiment improved following the IMF's approval of the Extended Fund Facility (EFF), which the central bank expects should help strengthen the country's external position.
    The rupee was trading at 146.6 to the U.S. dollar today, down 1.7 percent this year.
    Sri Lankan shares have been also been under pressure recently, with the benchmark Colombo index hitting its lowest close in two months on Thursday in response to a downwards revision of Sri Lanka's outlook to negative from stable by Moody's and a government proposal from June 15 to reintroduce capital gains, especially on land sales.

   The Central Bank of Sri Lanka issued the following statement:

"According to provisional estimates of the Department of Census and Statistics (DCS), the Sri Lankan economy grew by 5.5 per cent, in real terms, in the first quarter of 2016 compared to the growth of 2.5 per cent recorded in the last quarter of 2015. Economic growth was mainly supported by the expansion of Industry and Services related activities, which grew by 8.3 per cent and 4.9 per cent, respectively, during the first quarter of 2016 in value added terms. Meanwhile, Agriculture related activities recorded a moderate growth of 1.9 per cent during this period. The growth rate recorded in the first quarter was broadly in line with expectations for the year.

As anticipated, inflation increased in the month of May reflecting the impact of the increase in Value Added Tax (VAT) and the removal of certain exemptions applicable on VAT and Nation Building Tax (NBT), as well as the supply side disruptions due to adverse weather conditions. Accordingly, the Colombo Consumers’ Price Index (CCPI, 2006/2007=100) based headline inflation increased to 4.8 per cent, year-on-year, in May 2016 from 3.1 per cent in the previous month, while the National Consumer Price Index (NCPI, 2013=100) based headline inflation also increased to 5.3 per cent, year-on-year, in May 2016 from 4.3 per cent in the previous month. Core inflation as measured by both CCPI and NCPI also increased in May 2016 mainly reflecting the impact of revisions made to the tax structure by the government. In spite of these transitory price movements, inflation is expected to moderate in the period ahead and remain in mid-single digits in the medium term supported by appropriate demand management policies.

In the monetary sector, the year-on-year growth of broad money (M2b) decelerated to 18.2 per cent in April 2016 compared to 18.9 per cent recorded in March 2016. The expansion in credit to the private sector and the government remained key drivers of broad money growth, while credit to public corporations recorded a repayment during the first four months of the year. Credit extended to the private sector by commercial banks grew by 28.1 per cent in April 2016 on a year- on-year basis, although in absolute terms, disbursements in April 2016 were limited to Rs. 27.4 billion compared to Rs. 87.7 billion in the previous month. Short term money market rates displayed some stabilisation, while the upward trend observed in other retail market interest rates continued reflecting the gradual transmission of the monetary policy measures that were taken previously, amidst low levels of rupee liquidity in the domestic money market.

On the external front of the economy, the deficit in the trade account contracted by 2.4 per cent during the first four months of 2016, on a year-on-year basis, as the decline in imports was greater than the contraction in exports. Earnings from tourism were estimated to have increased by around 18.4 per cent during the period from January to May 2016, while workers’ remittances increased by 4.7 per cent during the period from January to April 2016. Gross official reserves were estimated at US dollars 5.6 billion by end May 2016.

Meanwhile, the Executive Board of the International Monetary Fund (IMF) approved a three year Extended Fund Facility (EFF) of SDR 1.1 billion (approximately US dollars 1.5 billion) for Sri Lanka on 03 June 2016 to support the balance of payments (BOP) position and the broad economic reform agenda of the government. Following the approval of the IMF-EFF and the resultant improvement in market sentiments, the Sri Lankan rupee appreciated against the US dollar so far during the month of June 2016. Going forward, the EFF and other multilateral and bilateral credit facilities, along with the planned structural reforms and the realisation of the envisaged non- debt-creating capital inflows, are expected to strengthen the country’s external position. The expected improvements in the fiscal sector will also assist the Central Bank policies in maintaining macroeconomic stability on a sustainable basis.

Taking into consideration the developments discussed above, the Monetary Board, at its meeting held on 24 June 2016, was of the view that the current monetary policy stance of the Central Bank is appropriate, and accordingly, decided to maintain the Standing Deposit Facility Rate (SDFR) and the Standing Lending Facility Rate (SLFR) of the Central Bank unchanged at 6.50 per cent and 8.00 per cent, respectively. The Monetary Board will continue to closely monitor developments in the domestic as well as global markets and make appropriate adjustments to the monetary policy stance, as necessary."


http://www.hedgehogs.net/pg/blog/asiablues/read/11627457/an-85-percent-probability-of-black-swan-event-in-bond-markets-video Thu, 23 Jun 2016 23:23:46 +0100 http://www.hedgehogs.net/pg/blog/asiablues/read/11627457/an-85-percent-probability-of-black-swan-event-in-bond-markets-video <![CDATA[An 85 Percent Probability of Black Swan Event in Bond Markets (Video)]]> By EconMatters

This is one of the Few times in financial market history that analysts could with high probability predict a black swan market event. The Federal Reserve is going to lose a lot of money on their Bond Portfolio Holdings over the next 10 years.

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http://www.hedgehogs.net/pg/blog/asiablues/read/11627450/female-business-leaders-need-to-bring-more-to-the-table-than-just-diversity-video Thu, 23 Jun 2016 17:23:52 +0100 http://www.hedgehogs.net/pg/blog/asiablues/read/11627450/female-business-leaders-need-to-bring-more-to-the-table-than-just-diversity-video <![CDATA[Female Business Leaders Need to Bring More to the Table than Just Diversity (Video)]]> By EconMatters

We discuss the topic of the Diversity Discussions that have been so prominent in the media lately from a meta analysis perspective.

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