PrefBlog

I am pleased to announce that the regulatory response to the Credit Crunch has achieved its goal:

Job vacancies at London’s financial- services companies climbed 19 percent last month as tougher regulation of banks spurred hiring in compliance and anti-money laundering, recruitment firm Astbury Marsden said.
…
Firms in the City, the world’s number one financial center, according to consulting firm Z/Yen Group Ltd., have been hiring to improve compliance and reduce risk amid regulatory scrutiny following scandals including interest-rate rigging and money laundering. Banks, insurers and asset managers may add 4,000 jobs in the first half of the year, ending three consecutive quarters of cuts, the Confederation of British Industry said last month.

“Regulation is still driving recruitment in the City, as banks focus on trimming their businesses back to their most profitable areas in order to manage new capital requirements,” said Astbury Marsden in the statement.

European corporate and investment banks face a reduction in profitability from increased taxation, compensation restrictions and regulatory burdens, according to a report by Oliver Wyman and Morgan Stanley last month.

A rather audacious fraud has been uncovered:

The Securities and Exchange Commission today charged four individuals with ties to a New York City brokerage firm in a scheme involving millions of dollars in illicit bribes paid to a high-ranking Venezuelan finance official to secure the bond trading business of a state-owned Venezuelan bank.

According to the SEC’s complaint filed in federal court in Manhattan, the global markets group at broker-dealer Direct Access Partners (DAP) executed fixed income trades for customers in foreign sovereign debt. DAP Global generated more than $66 million in revenue for DAP from transaction fees – in the form of markups and markdowns – on riskless principal trade executions in Venezuelan sovereign or state-sponsored bonds for Banco de Desarrollo Económico y Social de Venezuela (BANDES). A portion of this revenue was illicitly paid to BANDES Vice President of Finance, María de los Ángeles González de Hernandez, who authorized the fraudulent trades.

There’s a few more words on Lapdog Carney’s legacy, this time from Philip Cross, Research Coordinator at the Macdonald-Laurier Institute and former Chief Economic Analyst at Statistics Canada:

The Bank of Canada proudly defends its independence. However, this independence places responsibilities on both the government and the Bank. The government is obliged to allow the Bank to set monetary policy, notably interest rates, without political interference. In return, the Bank is obliged to act in a non-partisan way. It is the latter that was tarnished during Carney’s tenure, not the former.

There are several examples of Carney over-stepping the constraints of non-partisanship. Most obvious was his dalliance with Liberal powerbrokers over their leadership.

I wasn’t really disturbed by the Grit thing. It was clear that that was all about Carney the man, not Carney the Bank Boss. My complaints about Carney relate to his eagerness to be a stalking horse for political pronouncements, e.g. “Ban the Bond” and the idiotic Central Clearing for Derivatives. But it worked! He got his reward! Firstly as boss of the Financial Stability Board and next as Monetary Puppet for another micromanaging western government.

It was a mixed day for the Canadian preferred share market, with PerpetualPremiums down 16bp, FixedResets gaining 4bp and DeemedRetractibles off 1bp. Volatility was low. Volume was ENORMOUS! Absolutely ENORMOUS! I don’t know what happened.

This entry was posted on Tuesday, May 7th, 2013 at 9:02 pm and is filed under Market Action. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.