Brian Bollen's Blog

Sub-editing God

I'd like to suggest an amendment to one of the 10 Commandments. Immediately after 'Honour thy father and thy mother', we should insert 'Honour thy daughters and thy sons'.

Just a thought.

If we kept putting great products in front of customers

Mint – Blain’s Morning Porridge  - September 27 2013

Our belief was that if we kept putting great products in front of customers, they would continue to open their wallets…

The phoney war continues as markets remain in the grip of post taper-caper cross-currents. Still think long-term bull, but short-term caution. Up a bit today and down a bit tomorrow. Consensus is taper will start in December once new Fed is in place – but some of the recent US inflation data suggests a still very weak economy. Does that mean further bond gains? Doubt it.. but…

The America's Cup is a race of management

Mint – Blain’s Morning Porridge  - September 26 2013

The America's Cup is a race of management, money, technology, teamwork and, last and incidentally, sailing

I would love to talk about markets this morning, but please forgive me as I wax lyrical about last night’s America's Cup. (Drop down for thoughts on trading France and all the other stuff that might or might not matter in markets.) I feel sorry for New Zealand. The prime minister summed it up when he simply tweeted “Bugger” this morning.

Well done Team Oracle – it’s an awesome thing to come back from 8-1 down. The team of Englishmen, Italian, Dutchmen, Aussies, Kiwis (yes!) and a token Yank (whose name we can’t recall, but I think was born in Ireland) pulled back the most spectacular recovery in history. Imagine a football team trailing 8-1 at half time and winning on the final kick of the game. As my colleague Andy said this morning:  “they aren’t boats, they’re aeroplanes!”

PIMCO Launches GIS CSF across Europe

News just arrived from PIMCO, reporting the launch of the PIMCO GIS Capital Securities Fund, which it says utilises a global approach to subordinated debt instruments issued by banks, insurance companies and other speciality finance companies. The fund is managed by Philippe Bodereau, managing director and head of global financials research based in PIMCO’s London office. Bodereau, it adds, has been successfully managing assets under this strategy since July 2011, returning 12.29% annualised since inception, outperforming the benchmark by 11.92%.

In yacht racing there is no second

Mint – Blain’s Morning Porridge  - September 25 2013

Going to be really short this morning as too much business going on! The no-taper rally didn’t last very long and steady declines confirm markets are still confused and frankly unconvinced. Common sense and the long term say be bullish (see yesterday’s porridge for reasons as to why), but short term nothing gives a particular sense of solidity. Correction feels in the air.

Whoa lady, I only speak two languagues

Mint – Blain’s Morning Porridge  - September 24 2013

Whoa lady, I only speak two languagues, English and Bad English

As we approach the end of Q3 we’re at a very peculiar point in markets. Participants scratching their heads to understand what happened and what’s going to happen next. Is it going to be bullish or bearish?

Well, I reckon we should be putting our bull hats on. Get over the confusion and put your buying boots on. Even though the Fed tripped over its own “forward guidance” nonsense and utterly confused us all (momentarily), and the taper remains an imagined future threat, let’s think through the global reality and the US within that.

First up – Stock Positive.

What's Eating Emerging Markets?

Schroders’ Allan Conway, Head of Emerging Market Equities, takes a look at why emerging markets (GEMs) have underperformed developed markets over the last three years, whether the trend will change and what has been discounted in equity markets

Why have emerging markets underperformed?

Why have GEMs underperformed? It is probably fair to say that many investors accept that the long-term structural case for emerging markets remains intact. Superior economic growth driven by favourable demographic trends and strong balance sheets means the centre of gravity of the global economy will continue to move towards the emerging world. 

Lloyds Branding Bollocks

The following (unedited) breathless press release just landed in my in-tray. I'll leave you to make your own mind up whether you agree with me that it is absolute bollocks. Then again, maybe you agree that the agency charged with the transformation has delivered “a revitalised brand that connects with customers in a contemporary, engaging and distinctive way”. Do let me know...but I've been a Lloyds customer for nearly 30 years so am speaking from a position of first-hand knowledge; I've half a mind to jog up to my branch and gawp at the transformation for an hour or two...

THE BRAND TRANSFORMATION STORY OF THE YEAR

LLOYDS BANK LAUNCHES REVITALISED BRAND AND REDEFINES ITS CUSTOMER EXPERIENCE WITH RUFUS LEONARD, RKCR/Y&R, PROXIMITY LONDON and MEC.

The agency group worked with the British banking icon to deliver a brand that serves customers in a contemporary and distinctive way

Evolution of the Lloyds Bank Brand

Everyone is equal, but...

Mint – Blain’s Morning Porridge  - September 23 2013

Everyone is equal, but some are more equal than others...

Lots going on this week as markets weigh the implications of last week's unexpected Fed do-nothing, and the German elections. Taper is not stopped, just delayed. The sword of Damocles still hangs over us. It will be a wild ride into year end, but lots of funds long treasuries will be thanking Bernanke for their Get-out-of-Jail cards.

But bond markets are tired, and stock markets look fully priced. Time for flatners? Perhaps. We’re likely to see more schizophrenic trading behaviours after markets rallied on the perverse news the US is weaker than we thought it was.

Sell into any strength and wait I suppose.

What To Watch In German Election: PIMCO

Attached is a new European Market Update by Myles Bradshaw, executive vice president and portfolio manager at PIMCO.

What to Watch in Germany’s Election

This summer the eurozone bond market’s focus has been on interest rate risk and the impact Fed tapering would have on the global economy. The Fed’s decision this week not to taper has clearly repriced interest rates across the world. But it has had little impact on eurozone sovereign spreads to Bunds. These have had a relatively quiet summer, with Italy and Spain the main oupperformers.

In terms of news, Germany’s desire to avoid any significant political arguments ahead of this Sunday’s general election has more than compensated for ongoing political uncertainty in Rome. But the relative calm also points to stable market technicals: the absence of levered buyers and the strong demand from deleveraging domestic banks.

Download PIMCO | European Market Update - What to Watch in Germany’s Election- 19 September 2013

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Time To Buy European Equities: Schroders

Martin Skanberg, fund manager on the European Equities team at Schroders, looks at the case for European equities

European equities have been supported by European Central Bank president Mario Draghi’s pledge in summer 2012 that he would do ‘whatever it takes’ to preserve the euro. That remark, and the accompanying ECB policy action, have helped to restore confidence in the Eurozone, and driven share price gains. Nonetheless, we believe that there remains scope for European equities to build on this upward momentum. The recent upturn in economic activity in the Eurozone should see domestic earnings play a greater role in propelling equities higher.

When Is A Bubble Not A Bubble?

Consider This…
A view from the UK Jupiter Team

Steve Davies, co-manager of the Jupiter UK Growth Fund, believes the Bank of England’s Financial Policy Committee should hold off from intervening in the UK property market as talk of a housing bubble is largely overdone

When is a bubble not a bubble? This is the tricky question the Bank of England’s Financial Policy Committee (FPC) is hoping to answer this Wednesday when it meets to consider whether government initiatives to stimulate the UK property market are fuelling another debt-financed housing boom. Our view is that it is quite far-fetched to call a rise of just over 3% in house prices a boom 1.

Mend your speech a little

Mint – Blain’s Morning Porridge  - September 17 2013

Mend your speech a little, lest it may mar your fortunes…

Are we poised on the edge of another disorderly bond rout - a reversal of the recent rally back up to 2.75%? Is 3.25% is the next stop?

Well, that grabbed your attention - but it feels a very real threat as things start to unwind politically in the US. One trader told me each day is a coin-flip, no one is certain what happens next – and I’ve never seen such poor liquidity in the treasury market. Any threat of a renewed bout of rising US rates would be a most significant challenge for the global market consensus. Bonds are testing the bottom of the 2.75-3% 10-year range, but how much potential pain might result from the failures to manage the Fed appointment, a botched taper start, and the increasingly distracted US leadership?

First Names Names New Ireland MD

Fiduciary, funds and corporate services provider First Names Group has appointed Andrew Ryan as managing director of its Irish operation.  He will take over from Oonagh Hayes, who will move to the group role of director of corporate development.

BNP Paribas Launches Local Custody in Colombia

From Bogota comes the news that BNP Paribas Securities Services has become a local custodian in Colombia. The bank says it has also secured an operating licence from the Superintendencia Financiera de Colombia (SFC), the country's financial supervisor.

No-one has ever washed a rented car

Mint – Blain’s Morning Porridge  - September 16 2013

In the history of the world, no-one has ever washed a rented car…

I’ve lost a number of bets on Larry Summers to be the next Fed chairperson – sell dollars, buy bonds! Halfway through September, and all sorts of stuff is falling into place in terms of global growth, focus on stocks, fewer China and Japan concerns, and the switch in focus from EM back to developed world. But this morning the whole market is focused on personalities – trying to guess who will do/say what - which is frankly daft.

Africa Dominates Jungfrau Marathon

Ignore all my previous attempts to report correctly the results of the Jungfrau Marathon (held on September 14). Contrary to earlier reports, it was Kenyan runner Geoffrey Ndungu (pictured below) who finished first in the men's race in what, if my limited German serves me well, is a new record time of two hours and 50 minutes.

Petro Mamo from Eritrea was second. Switzerland's European marathon champion Viktor Roethlin came a creditable third in what was his first attempt at the race.

Another debutante, Andrea Mayr, took the women's title in three hours 20 minutes, another new course record. In second place was France's Aline Camboulives, who won the race in 2011.

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Gonna be so neat, Yeah….

Mint – Blain’s Morning Porridge  - September 12 2013

Gonna be so neat, Yeah…. dancing to the euro-beat

Did anything except Verizon happen yesterday? Of course – more below. But Verizon was a cheap deal priced to sell in quazillions. 5/6%+ coupons proved irresistible. The market was all over the deal like the proverbial cheap suit. $100bn+ book – a single ticket of $7bn from the Californians for the 30-year apparently.. and a $15bn 30-year tranche. Bonds ratchet 40-60 beeps tighter on the break.

The deals success tells us lots of things about the confidence of market to buy long dated telecoms specifically, but more generally the lack of alternative things to do in secondary markets because of chronic illiquidity! Other big attractive deal yesterday was the Telefonica nc5 and nc8 hybrids – both priced attractively to sell.

Call To Hedge Fund Summit Action

This missive just arrived from Mitch Ackles, president of the Hedge Fund Association and CEO of Hedge Fund PR.

Dear Friends,

We are counting down the days to the FINforums Annual Hedge Fund Summit, which takes place next Thursday, Sept. 19, in New York City. There are still a few seats left, and we invite you to join us.

A seated lunch will be followed by an afternoon full of fantastic speakers, including a keynote address from BlackRock Vice Chairman Barbara Novick titled “Managing Hedge Funds in the Evolving Regulatory Environment.”

There will be plenty of time to network with fund managers and investors, including a two hour cocktail reception. Please click here for more information and to register. Friends of Hedge Fund PR receive a 15% discount – use the code HFPR2013.

I hope to see you there!

Best regards,

Mitch Ackles

Partner, FINforums

CEO, Hedge Fund PR

President, Hedge Fund Association

 

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Man Versus Machine: Standard Life

In the latest edition of Global Horizons Standard Life Investments, the global investment manager, examines how investors can use behavioural finance to improve their understanding of markets and enhance decision making.

Standard Life Investments’ report focuses on the insights provided by behavioural finance into collective decisions in the context of financial markets, describing how investors interact with machines, using them to improve the quality of trading decisions in applications of artificial intelligence or to speed up the execution of trades in algorithmic trading.