Cartoon : shareholder value

http://www.ritholtz.com/blog/2012/11/shareholder-value/

Les français et le capitalisme : l'exception française

Le graphique ci dessus tiré de The Economist met en exergue une fois de plus l'exception française, en Europe et dans le Monde, avec le peu de sympathie que manifestent les français pour "le capitalisme".

Au sujet de la vision de la France par The Economist

La dernière livraison de The Economist présente dans un dossier spécial la France comme "une bombe à retardement" illustrée par l'image ci dessus qui figure en couverture.
On trouvera ci dessous une analyse très critique de cette analyse critique due à Erik Nielsen, le Chief Economist bien connu d'UniCredit:


France: Challenges ahead for sure, but no time-bomb!
Important UK publications, including the FT and The Economist, appear to have changed their outlook on the eurozone in recent months to now expect it to survive – which is welcome news. But after having noticed the clearer message out of Berlin with respect to the German commitment to Europe, and Greece in particular, some of them now seem to have found a new “Pruegelknabe”, namely France.

I don’t usually want to use this note to comment on other people's writing, but the latest issue of The Economist is just too much to take on a Saturday night with a wonderful glass of St Emilion by my side: The front page of this week's Economist announces “The time-bomb at the heart of Europe” above a baguette-wired bomb wrapped in the Tricolour, and inside you’ll find a borderline emotional 14-page special on France, suggesting that France will be the next "crisis country", possibly falling off the cliff next year. I’ll be the first to agree that France faces a number of important challenges, particularly when it comes to adjusting to the new globalised world. Its global competitiveness is not good enough. But that’s far from unique among OECD countries, and calling it a time-bomb is – frankly – silly. The desire among some here in London of aiming at anything slightly out of balance on the Continent, blow it out of proportion, while forgetting to look in the mirror never fails to surprise me.

We economists can always find issues to improve in any economy, so to me, comparisons are so much more interesting. Hence, this past week I updated a piece I did a year ago comparing Italy and the UK. A year ago I concluded that the two economies really are rather similar in terms of balance sheets etc, but I now found that the fundamental changes to adjust towards an economy that can compete in the new globalised world have progressed more in Italy than in the UK. Indeed, in some respect, the UK has moved backwards. (As you might guess, I received a good amount of responses to that note!)

I am not going to do a similar comparison between France and the UK this evening (the St Emilion next to me could make me biased!), but let me give you just two examples where The Economist's France bashing gets off trail: First, after (appropriately) worrying about the increasing public debt and high unemployment, The Economist leader concludes: “The external current account deficit (of France) has swung … into one of the eurozone’s biggest deficits. In short, too many of France’s firms are uncompetitive”. One would be forgiven for concluding that we have identified a major problem here - but if you bother to turn to page 96 of that same issue of The Economist, you’ll see that the latest 12-months French current account deficit was 2.1% of estimated 2012 GDP!

I'll make three quick comments: (1) yes, the French current account deficit is indeed “one of the eurozone’s biggest deficits”, but that primarily reflects the fact that the eurozone crisis countries have adjusted amazing well; (2) the authors fail to explain when a 2.1% of GDP deficit became a major issue; and (3) if they indeed feel that a 2.1% of GDP deficit is a major issue, what should the reader then think about the 3.2% of GDP deficit for the UK and the 3.1% deficits in the US and Canada? – all in the same table on page 96 of the Economist!

A second – and more emotional – example is the attack on Hollande: “Why should business believe (President Hollande) when he has already pushed through a string of leftist measures, including a 75% top income tax rate … No wonder so many would-be entrepreneurs are talking of leaving the country.” Believe me, I am no fan of a 75% marginal tax rate, and there are many other parts of French policymaking I disagree with, but maybe it would have been fair to mention that the 75% marginal rate is temporary and that it kicks in at one million euros. (I wonder how many "would-be entrepreneurs" anywhere outside Silicon Valley are planning on netting more than a million euros per year in personal income in the foreseeable future.) And maybe one could have reflected on the comparison with the temporary 50% extra bonus tax for one specific sector implemented by the UK conservative government when they came to power? Coming on top of the existing 50% marginal tax rate, that extra 50% bonus tax raised the marginal tax rate for UK taxpayers in the financial sector to … 75%, although in the UK the 75% margin did not kick in at one million euros, but in some circumstances at as low as at £150,000!

To be sure, I am not in the business of arguing that France does not have challenges – just that it is not more of a time-bomb than so many other countries. Indeed, for a balanced (if brief) discussion of Hollande, France and Europe, see the BBC's Stephanie Flanders' latest blog. And for a great discussion of the UK's challenges, see my former boss at Goldman, Gavyn Davies' piece in today's FT. Gavyn Davies argues that only about half of the UK underperformance relative to the US was due to the fiscal tightening – the rest “is down to the abject performance of UK exports, stemming mainly from the UK’s very low penetration of the rapidly expanding emerging markets." Incidentally, UK exports have underperformed that of Italy (and France) again this past year, as I discussed in my Italy vs the UK note earlier this past week.

Le dossier de The Economist:
http://www.economist.com/news/leaders/21566640-why-france-could-become-biggest-danger-europes-single-currency-time-bomb-heart

Un risque de bulle pour les obligations corporate?

Intéressant article dans The Economist qui s'interroge sur le risque de bulle sur le marché des obligations corporate devenu le placement favori des assets managers dans le monde entier et qui a conduit les taux d'intérêt qui lui sont attachés à un niveau bas historique que ce soit pour les obligations "investment grade" ou pour le "High Yied" (voir post plus bas). Il y'a là un effet d'aubaine pour les trésoriers d'entreprises.
Voir l'article de The Economist:
http://www.economist.com/news/finance-and-economics/21565974-investors-are-gorging-corporate-bonds-asset-bubble-being

Le Monde en 2050 selon Goldman Sachs

Goldman Sachs qui s'était déjà livré à cet exercice au début des années 2000 en forgeant le terme "BRICs" a récidivé en livrant de nouvelles projections des PNB (GDP) dans le Monde à horizon 2050. Ce type d'exercice repose sur des hypothèses que l'on peut évidemment toujours discuter. Il met en exergue justement la montée en puissance des BRICs qui occupent avec les États Unis les premières places du classement. La zône euro figure au 4ème rang et individuellement les grands pays européens sont relégués à la 9ème place (UK), 10 ème (France), 11 ème (Allemagne). La démographie est un élément explicatif important de ce classement y compris bien sûr pour justifier la position surprenante de l'Allemagne.

Bien sûr le classement du PNB par tête (ci-dessous) rétablit une hiérarchie plus traditionnelle avec une 4ème place attribuée à la France devant l'Allemagne.

C'est évidemment un exercice à consommer avec modération. Voir Sober Look:
http://soberlook.com/2012/11/goldmans-gdp-projection-for-2050.html

2012, année record pour les émissions High Yield

 

 

 

L'excellent blog Sober Look qui fait un point sur le sujet souligne que 2012 va battre les redords en matière d'émissions High Yield dans le Monde (voir ci-dessus). Le très grand appétit manifesté par les investisseurs par cette classe d'actif ont entraîné les taux - autre record - à un bas historique (voir ci-dessous).

 Ceci s'explique aussi par le bas niveau des taux en général car "le spread" des high yiels demeurent à un niveau plus élevé que dans les années 2005 -2006, ce qui est normal compte tenu d'un environnement plus risqué (attention de bien faire la distinction entre le niveau absolu de taux et le spread qui mesure le risque relatif).

 

 

 

 

On se rapportera au post de SOber Look:
http://soberlook.com/2012/11/2012-high-yield-debt-issuance-hits-all.html

La cartographie des grandes banques internationales

Le FSB, le Financial Stability Board, vient de publier une liste actualisée des 28 grandes banques internationales qui font courir un risque systémique. A ce titre ces banques, au delà du tier 1 minimum de 7%, sont soumis à un ratio majoré, la dite majoration allant de 1 à 2.5%. A vrai dire, ceci, qui doit s'appliquer en 2016, ne sera pas très contraignant. En effet l'Autorité Bancaire Européenne à imposé un ratio tier 1 minimum, non pas de 7% (le minimum Bâle 3), mais de 9%. Au Royaume Uni le minimum a été porté à 10 % et il est encore plus élevé en Suisse.
Le sélection ainsi opérée dresse la cartographie des grandes banques internationales aujourd'hui.La hiérarchie établie ne dépend pas de la taille mais de "la dangerosité" systématique, largement fonction de l'implication des différentes banques dans les activités de marchés.