Government & Agencies

Windfall taxes get a breezy airing Down Under

14 Jun 2023

New levies on high coal prices accounted for a third of the $10 bln in resources royalties Queensland raked in over the past year. It helps the state invest in renewables, hospitals and childcare without trashing fossil-fuel firms’ margins. It’s how such tariffs should work.

Fed’s rate hike habit will be hard to kick

13 Jun 2023

The US central bank is mulling a pause after raising interest rates at its last 10 meetings. In this Exchange podcast, Morgan Stanley chief economist Seth Carpenter lays out the calculus behind the Federal Reserve’s next move, and why it’s so hard for policymakers to pivot.

Dutch chip export saga exposes EU shortcomings

13 Jun 2023

The Netherlands is limiting exports of high-end semiconductor gear to China, after a US push to curb Beijing’s AI and military prowess. While the EU will soon unveil a plan, it looks hard to strike the right power balance in the defense arena. Brussels needs a clearer role.

Berlusconi invented the entrepreneur as politician

12 Jun 2023

The tycoon-turned-Italian premier has died aged 86. He pioneered the use of wealth and media to achieve political power. Though his party is unlikely to survive his departure and his business empire is much weakened, his unorthodox methods spawned imitators across the West.

Capital Calls: UBS, Brookfield

9 Jun 2023

Concise views on global finance: The Swiss bank’s state loss guarantee is structured like an insurance policy against an unlikely event; the Canadian investment group teams up with UAE and Saudi investors to beat CVC’s consortium and win payments provider Network International.

Coinbase investors are still aiming for the moon

9 Jun 2023

A lawsuit from the US Securities and Exchange Commission poses an existential risk for the crypto exchange. Yet it’s still valued at more than $11 bln, excluding spare cash. Loyal shareholders are betting CEO Brian Armstrong can avoid the crackdown – and find new ways to grow.

Wildfires send American voters a smoke signal

8 Jun 2023

Haze from smoldering Canadian forests has blanketed U.S. cities, a reminder that air has no borders. Politicians struggle to be joined up on atmospheric issues. Companies have little incentive to. But toxic fog might spur a shift – albeit small – among the real decision-makers.

‘Reverse CFIUS’ threat will be deterrent enough

8 Jun 2023

Team Biden is nearly ready to unveil a plan to restrict some $15 bln of US investment in Chinese tech. The process probably will be even messier than one used to review inbound capital aimed at sensitive domestic sectors. Extra red tape alone, however, should serve its purpose.

Pirelli CEO pivots from globalisation to trade war

5 Jun 2023

Marco Tronchetti Provera teamed up with a Chinese buyer to take the tyremaker private in 2015. Now Sinochem’s 37% stake poses business and governance risks for the $5 bln company. An appeal to Italy’s nationalist government may help the veteran industrialist maintain control.

President Dimon would be square peg in Oval hole

2 Jun 2023

JPMorgan’s longtime boss could get a head start on a 2024 White House run by capturing the powerful capitalist constituency. Beyond that, there are too many pitfalls. For one thing, he is an avowed free-enterpriser, a quality ill-suited for this particular executive office.

Biden’s America goes from oil guzzler to gusher

1 Jun 2023

The commodity’s main benchmark is including prices of oil from Texas, a reflection of a shift. Even as American demand stagnates, U.S.-based producers pump and export more. The president wants the country to be green. He can’t control the private industry that supports the world.

Treasury buyers live for the moment, unfortunately

1 Jun 2023

Markets tend to brush off near-disasters when it comes to pricing U.S. debt. Yields fell as Congress struck a deal to avoid default, even though the Treasury is prepping a borrowing spree and rates are staying stubbornly high. Investors’ fingers remain firmly stuck in their ears.

Global tax would spoil investors’ plastic party

1 Jun 2023

The world is drowning in waste, but demand for durable polymers is soaring. This may change if UN talks to end plastic pollution by 2040 succeed in introducing a levy. That will shrink a bonus market for Big Oil and cut packaging firms’ margins.

Overhauling US debt limit is an easy no-brainer

31 May 2023

Congress is again set to raise the cap on the country’s borrowing mere days before a default. President Joe Biden isn’t willing to abolish the ceiling, but every creditor has limits. A soft limit on the deficit, which balances the budget when crossed, would be a better safeguard.

Summer vote can dissipate Spain’s economic clouds

31 May 2023

Prime Minister Pedro Sánchez is gambling on a snap general election after a rout in local polls. Frictions within his ruling coalition irked voters. Strong popular backing would give him the mandate to tackle the country’s fiscal woes, pension costs and high unemployment.

Capital Calls: US debt deal

30 May 2023

Concise views on global finance: The pending deal for raising the debt ceiling would shift $20 billion out of the government’s tax collector. The move eases some short-term budget pressures, but could surrender a seven-fold payoff down the road.

Erdogan win sends stark note on economy and votes

29 May 2023

People in Turkey effectively opted to prolong the president’s wild policies that have led to 44% inflation. The extension of his 20-year rule tees up the country to inch further away from the West. For global leaders, it’s a warning that success in money matters only goes so far.

Biden gives little, gets less in debt ceiling deal

28 May 2023

The White House reached an agreement with Republicans to raise the debt limit for two years. The deal will avoid a big knock on Biden’s reelection plans, but the victories end there. Spending caps and social-aid restrictions give Democrats little else to cheer.

Economic stability hangs on US love of BBQ

26 May 2023

The US government is racing to ink a deal to avoid default ahead of the long weekend that marks the start of summer. Agreeing on how to handle the debt ceiling would relieve US creditors and calm markets. The rush will almost certainly leave big problems unfixed.

How risky bank debt makes customers safer

25 May 2023

Protecting depositors is at the top of regulators’ list of priorities after recent bank failures. Big banks already derive extra protection by issuing loss-absorbing bonds. Getting mid-sized US players to do so too could be the key to promising clients their cash is risk-free.