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« Enero 2007 | Main | Marzo 2007 » Febrero 21, 2007 Despite a wide consensus of housing overpricing (real state in general) almost in any national market, prices seem resilient. Contrary to expectations we have hardly seen any significant price correction recently. In mid 2006 Nouriel Roubini from New York University declared:”This is the biggest housing slump in the last four or five decades: every housing indicator is in free fall, including now housing prices". This was not the only voice. The Economist started talking about a housing bubble already in 2002. And others have raised similar opinions. No matter how you look at housing prices, whether in terms of yields of home ownership or the ratio of house prices to income and rents, you get to the same conclusions, houses are overpriced. Continue reading 'Housing prices are falling is the US. Where else?' 
Febrero 20, 2007 Last week the IE hosted a Research Workshop on Corporate Governance attended by top scholars on the field of finance. Among the topics discussed, presentations dealt with the classical agency problems that exist in the boardrooms/shareholders relationship and the relationship between activism and performance. Continue reading 'Shareholders' Activism and Firm Performance'
Febrero 19, 2007 Os adjunto una noticia de Agencia, de la que he borrado los signos identificativos porque no se trata de señalar a nadie, que aglutina algunos de los factores que convierten a las finanzas en magia. Nada por aquí, nada por allá y ¡plop¡ se crea valor y la cotización sube. Continue reading 'La noticia de la semana'
Febrero 14, 2007 This is the main idea transmitted in the Fed Chairman Bernanke's Senate Banking Testimony. Ben Bernanke presented a rosy picture of the US economy. Growth slightly below trend, housing sector correction not to worry about and inflation in control though still needs some “vigilance”. Overall a more dovish statement than expected and no rate cuts/increases in the horizon. Continue reading 'Nothing to worry about'
Febrero 12, 2007 La pasada semana, el presidente de Siemens, Klaus Kleinfeld, ha hecho unas declaraciones al Financial Times sobre la miopía de los inversores que colocan su dinero en empresas individuales, en lugar de hacerlo en los conglomerados como el que él preside. “Los inversores viven en el mundo de “Alicia en el pais de las maravillas”, cuando desprecian los conglomerados en favor de las compañias individuales, incluso sabiendo que esta estrategia puede perjudicarles a largo plazo””Cita el periódico y el señor Kleinfeld,añade: Continue reading 'Sobre las grandes corporaciones'
Febrero 11, 2007 This seems odd but it is as it sounds. On Friday, we had the first hedge fund going public in the NYSE: Fortress. The main differences relative to others is how its assets under management are distributed. They have approximately 30 bn dollars distributed as: a) 60 % is in private equity; b) 30 % on hedge funds; c) 10 % is in real state. Continue reading 'Can Hedge Funds go public?'
Febrero 08, 2007 It seems that this is what we can interpret from the price of European Union Allowances for CO2 in Phase I (EUAs) within the European Trading Scheme (ETS). Yesterday, prices for EUAS prices were slightly above 1.5 euros per tonne. This means that any installation that emits above the allowances they were allocated, could comply just paying 1,5 euros per tonne of CO2 that they produce in excess. The ETS, considers two phases, Phase I going from 2005 to 2007 and Phase II going from 2008 to 2012. The amount of CO2 allocated to industrial installations in each phase is established in National Assignment Plans that have to be approved by the EU. Any amount of CO2 produced by installations in excess of their allocations has to be bought in the markets for EUAs. Continue reading 'You can emit for free:'
Febrero 05, 2007 At the end of 2006, Goldman Sachs announced that they will be offering an index able to clone hedge funds returns synthetically. The index responds to the appealing name of ART (Absolute Return Tracker) and would replicate hedge funds performance at a much lower cost, just a 1 per cent flat fee. Anyone that buys it can expect to get the returns of the universe of hedge funds that it clones. The flat fee would undoubtedly attract many investors if we consider fees charged in the hedge fund industry. Some fees in the US can go up to 2 % of annual management fees and the corresponding performance fees can reach 20 % of returns. Goldman’s step seems to be a very aggressive step running after the 1.3 billion dollars currently invested in this type of funds. Continue reading 'Alternatives to alternatives or cloning the hedge fund industry :'
Febrero 02, 2007 These are very common words in the financial press since Central Banks gained independence. But what do they mean? A "Hawk" is a central banker who is a little more concerned with implementing monetary policy to fight inflation rather than to stimulate the economy. A "Hawk" has a bias towards higher rates whenever there are signs of overheating in the economy. A "Dove" believes in the stimulating properties of monetary policy and thinks that it is a relevant tool in keeping the economy growing. A “Dove” is afraid that interest rates rises implemented to keep the inflation on hold might affect negatively growth. Both players (the “Hawks” and the “Doves”) believe on the importance of monetary policy to restrain an inflation process and they both believe that monetary policy can be used further in case growth needs to be stimulated. But how much each of these policy goals weight in central bankers’ utility is what distinguish one from the other. Sometimes when central banker do not express openly and undisputedly their preferences, one has to dive into a cryptic language in Central Banks statement and bulletins to understand the hawkinesh/dovinesh of the statement. This is the job of Central Bank watchers. They have to interpret the language of policy makers. For instance, in the US Greg IP is supposed to be a good Fed watcher. Continue reading 'Hawks and Doves'
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