Looks to me as if Obama’s preparing to reject Keystone XL:
U.S. President Barack Obama called into question the number of jobs that would be created from the controversial Keystone XL pipeline in an interview with the New York Times released on Saturday.
“Republicans have said that this would be a big jobs generator,” Obama said, according to the newspaper.
“There is no evidence that that’s true. The most realistic estimates are this might create maybe 2,000 jobs during the construction of the pipeline, which might take a year or two, and then after that we’re talking about somewhere between 50 and 100 jobs in an economy of 150 million working people.”
…
The Times said Obama disputed an argument that the pipeline would bring down gasoline prices. He said it might actually increase prices somewhat in the U.S. Midwest, which would be able to ship more of its oil elsewhere in the world, the paper reported.
TransCanada shot back:
In a statement issued late Saturday, TransCanada described the proposed 2,500-kilometre pipeline as the largest infrastructure project waiting to be built in the U.S., with 13,000 construction jobs alone.
Well, 13,000 construction jobs lasting how long each? And it is not clear how that reconciles with their other claim:
The $5.3-billion Keystone XL Pipeline Project is the largest infrastructure project currently proposed in the United States. Construction of the 1,179-mile pipeline will require 9,000 skilled American workers. The project will provide jobs for welders, mechanics, electricians, pipefitters, laborers, safety coordinators, heavy equipment operators and other workers who rely on large construction projects for their livelihoods.
In addition to construction jobs, an estimated 7,000 U.S. jobs are being supported in manufacturing the steel pipe and the thousands of fittings, valves, pumps and control devices required for a major oil pipeline.
There may be some legal tussling over the mosaic theory of investment analysis, given its likely prominence in the SAC trial:
In the 41-page indictment filed July 25, prosecutors alleged that Cohen and his top managers sought to hire traders and analysts who had the ability to deliver any kind of “edge” over the market.
Take Richard Lee, who joined the Stamford, Connecticut-based hedge fund from Citadel LLC in April 2009 even though prosecutors claim SAC had been warned by one of Lee’s former colleagues that he was suspected of insider trading at Citadel. Lee pleaded guilty on July 23 to two counts of insider trading, both of which occurred at SAC in 2009.
…
The SAC indictment also cites the examples of Jon Horvath, a former research analyst at SAC who pleaded guilty to insider trading last September, and Mathew Martoma, who has pleaded not guilty to charges that he engaged in insider trading.In an e-mail cited in the indictment, Horvath justified his recommendation that SAC invest in Sun Microsystems Inc. in October 2007 by saying, “My edge is contacts at the company and their distribution channel.”
As for Martoma, whose trial is scheduled to begin in November, SAC hired him, according to prosecutors, in part because of his “industry contacts beyond management” in the pharmaceutical field.
He’s accused of using tips from a doctor who had access to information on drug trials to recommend Cohen sell his stake in two drug companies, helping SAC make $276 million. It’s the biggest insider trading case in U.S. history, prosecutors said.
“The relentless pursuit of an information ‘edge’ fostered a business culture within SAC in which there was no meaningful commitment to ensure that such ‘edge’ came from legitimate research and not inside information,” the indictment says.
I’m not enough of a barrack-room lawyer to opine on how explicit the pursuit must be in order to be considered criminal; but one thing is clear: when you promise immense rewards if such-and-such is done and a pink slip if it isn’t, you have created a culture in which naughtiness is more likely than would otherwise be the case. But is that criminal? Cohen may well be citing Henry II in his defence: Will no one rid me of this turbulent priest? I mean, geez, that was rhetorical, right?
Politicians all over seem afraid of property bubbles:
Taiwan (TWGDCONY) is considering changes in luxury tax rules to narrow the gap between property prices and incomes amid slower pace of economic expansion.
“Current rules have flaws, for example, we are unable to tax those deep-pocket investors, who can wait for more than two years to sell properties,” Finance Minister Chang Sheng-ford said in a briefing on July 26. Changes may include a levy on buyers of properties, he said. Sellers are already taxed.
The move comes amid an increase in prices of properties in Taipei City, the country’s capital, and a widening in the gap between home prices and incomes. Taiwan, which imposed luxury tax from June 2011, may extend the current levy on investment properties sold within two years of purchase, Chang said.
A 15 percent tax applies to commercial and residential investment properties sold within a year of purchase and 10 percent to those sold within two years. A 10 percent tax applies on sales of luxury goods such as yachts and airplanes worth at least NT$3 million ($100,328), and furs and furniture valued at NT$500,000 or more.
All over? Well, maybe not in Rangoon, Burma (as us crypto-imperialists like to call it) – there it’s considered pretty good:
Sean Danley has spent the past six months scouting office space in Yangon after being sent to establish the Myanmar branch of his U.S.-based employer.
He looked in the city’s three sole 1990s-era towers, where annual rents have climbed to more than $100 a square foot, compared with less than $75 in downtown Manhattan, according to broker CBRE Group Inc. Too expensive, he said.
…
Developers are rushing to solve Danley’s problem, one faced by hundreds of multinational companies setting up operations in Myanmar following its political opening and easing of international sanctions. Yangon, the commercial capital, needs at least 8.7 million square feet (800,000 square meters) of office space to support the influx, according to Yoma Strategic Holdings Ltd. (YOMA) About 1.9 million square feet will be available by the end of 2015, compared with 600,000 now, the Myanmar office of broker Colliers International UK Plc estimated.
…
Rents have increased almost fivefold in Yangon’s three towers, none of which is higher than 27 stories, from $22 a square foot a year as of the end of 2011, before Myanmar President Thein Sein began allowing more political freedom and loosening economic controls, according to CBRE data. Tenants at the three — Sakura Tower, FMI Centre and Centrepoint Towers — include Standard Chartered Plc (STAN), PricewaterhouseCoopers LLP, Coca-Cola Co., Nestle SA, Sumitomo Corp., Bank of Tokyo-Mitsubishi UFJ Ltd. and Malayan Banking Bhd.
Some interesting testimony from Fabulous Fab:
Tourre testified he made $1.7 million in salary and bonus in 2007.
…
Tourre, a French citizen, said he voluntarily testified before a U.S. Senate subcommittee in 2010. After that he “had to take a step back and think about what to do,” as his career had been “effectively destroyed” by the allegations. Tourre was placed on paid leave by Goldman Sachs for one year, at his base salary of about $750,000. He said he hoped he’d be able to return to the firm.
The rewards for being a top-notch institutional salesman at a big-name dealer are pretty good! Of course, that leads to the whole corrosion of ethics problem that is currently at issue at SAC Capital; but the point is, the customers know this. A good institutional salesman will not waste your time; he’ll tell you about events, deals, market colour and trivia in which you might genuinely have an interest (lousy ones are just order takers), get you data, maybe even set up a meeting with somebody; but he will not give you decent investment advice, mainly because that’s not his job and that’s not the business of his firm. Only incompetent idiots, such as Laura Schwartz and Alan Roseman of ACA Management LLC would expect it.
Let’s all laugh at the Greens:
Germany’s air pollution is set to worsen for a second year, the first back-to-back increase since at least the 1980s, after Chancellor Angela Merkel’s decision to shut nuclear plants led utilities to burn more coal.
The nation, which is seeking to lead European climate-protection efforts, probably will produce higher greenhouse-gas emissions in 2013 on top of a 1.5 percent gain last year, according to the DIW economic institute, which acts as an adviser to the government.
Utilities led by RWE AG (RWE) and EON SE boosted hard coal imports 25 percent in the first quarter to 10 million metric tons, the nation’s Coal Importers Association said.
Dodd-Frank is having a visible effect:
American International Group Inc. (AIG) will return funds to customers of its banking unit and shut their accounts as the Dodd-Frank Act places limits on insurers with deposit-taking units.
AIG Federal Savings Bank “will no longer be servicing retail deposit accounts as of Sept. 30,” according to a letter to customers. “All accounts will be automatically closed as of that date and any funds, including all interest due on your accounts, will be returned.”
AIG is joining Principal Financial Group Inc. (PFG) in narrowing its focus ahead of rules that limit proprietary trading and investments in private-equity or hedge funds by insurers with bank units. MetLife Inc. (MET), Hartford Financial Services Group Inc. and Allstate Corp. have sold deposits or retreated from banking as regulators increase oversight.
“AIG Federal Savings Bank is currently undergoing an orderly transition from a traditional savings bank to a trust only thrift,” Jon Diat, a spokesman for the New York-based insurer, said in an e-mail yesterday.
A young man was shot by Toronto police on the weekend. According to a criminal lawyer of my acquaintance, Toronto cops have become increasingly arrogant over the past decade – he’s seeing lots of cases where all the escalation of an incident has come from the police side.
It was a mixed day for the Canadian preferred share market, with PerpetualDiscounts flat, FixedResets off 9bp and Deemed Retractibles gaining 1bp. Somewhat surprisingly, given the overall lack of movement, the Performance Highlights table is lengthy, with BAM issues notable amongst both winners and losers. Volume was below average.
| HIMIPref™ Preferred Indices These values reflect the December 2008 revision of the HIMIPref™ Indices Values are provisional and are finalized monthly |
|||||||
| Index | Mean Current Yield (at bid) |
Median YTW |
Median Average Trading Value |
Median Mod Dur (YTW) |
Issues | Day’s Perf. | Index Value |
| Ratchet | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.8112 % | 2,616.4 |
| FixedFloater | 4.10 % | 3.40 % | 34,744 | 18.58 | 1 | 0.1298 % | 4,046.5 |
| Floater | 2.68 % | 2.85 % | 85,283 | 20.10 | 4 | 0.8112 % | 2,825.0 |
| OpRet | 4.60 % | 3.33 % | 86,652 | 2.26 | 3 | -0.2547 % | 2,624.4 |
| SplitShare | 4.71 % | 4.62 % | 58,937 | 4.17 | 6 | -0.2397 % | 2,941.3 |
| Interest-Bearing | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.2547 % | 2,399.8 |
| Perpetual-Premium | 5.62 % | 5.14 % | 104,527 | 0.09 | 12 | 0.1127 % | 2,285.6 |
| Perpetual-Discount | 5.38 % | 5.46 % | 137,605 | 14.65 | 26 | 0.0016 % | 2,393.1 |
| FixedReset | 4.99 % | 3.73 % | 234,042 | 3.97 | 84 | -0.0878 % | 2,464.4 |
| Deemed-Retractible | 5.09 % | 4.72 % | 196,868 | 6.86 | 43 | 0.0104 % | 2,372.8 |
| Performance Highlights | |||
| Issue | Index | Change | Notes |
| BAM.PR.X | FixedReset | -3.75 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2043-07-29 Maturity Price : 22.41 Evaluated at bid price : 23.10 Bid-YTW : 4.05 % |
| BAM.PF.D | Perpetual-Discount | -2.47 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2043-07-29 Maturity Price : 22.18 Evaluated at bid price : 22.53 Bid-YTW : 5.50 % |
| POW.PR.D | Perpetual-Discount | -1.95 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2043-07-29 Maturity Price : 22.81 Evaluated at bid price : 23.19 Bid-YTW : 5.42 % |
| TRP.PR.B | FixedReset | -1.08 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2043-07-29 Maturity Price : 22.56 Evaluated at bid price : 22.90 Bid-YTW : 3.39 % |
| BNS.PR.K | Deemed-Retractible | -1.08 % | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 24.84 Bid-YTW : 4.92 % |
| GWO.PR.M | Deemed-Retractible | -1.00 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2019-03-31 Maturity Price : 25.00 Evaluated at bid price : 25.62 Bid-YTW : 5.42 % |
| GWO.PR.F | Deemed-Retractible | 1.07 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2013-08-28 Maturity Price : 25.00 Evaluated at bid price : 25.50 Bid-YTW : -12.18 % |
| GWO.PR.Q | Deemed-Retractible | 1.08 % | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 24.31 Bid-YTW : 5.56 % |
| BAM.PR.C | Floater | 1.21 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2043-07-29 Maturity Price : 18.38 Evaluated at bid price : 18.38 Bid-YTW : 2.87 % |
| BAM.PR.B | Floater | 1.26 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2043-07-29 Maturity Price : 18.53 Evaluated at bid price : 18.53 Bid-YTW : 2.85 % |
| BAM.PR.M | Perpetual-Discount | 1.77 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2043-07-29 Maturity Price : 21.83 Evaluated at bid price : 21.83 Bid-YTW : 5.51 % |
| FTS.PR.J | Perpetual-Discount | 3.79 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2043-07-29 Maturity Price : 22.63 Evaluated at bid price : 23.00 Bid-YTW : 5.23 % |
| Volume Highlights | |||
| Issue | Index | Shares Traded |
Notes |
| BMO.PR.L | Deemed-Retractible | 120,953 | TD crossed 48,100 at 26.45 and another 55,000 at 26.40. YTW SCENARIO Maturity Type : Call Maturity Date : 2013-08-28 Maturity Price : 26.00 Evaluated at bid price : 26.40 Bid-YTW : -1.18 % |
| BMO.PR.M | FixedReset | 60,842 | Will reset to 3.39% coupon. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 25.00 Bid-YTW : 3.52 % |
| TD.PR.R | Deemed-Retractible | 60,080 | TD crossed 49,500 at 26.15. YTW SCENARIO Maturity Type : Call Maturity Date : 2013-08-28 Maturity Price : 26.00 Evaluated at bid price : 26.13 Bid-YTW : -1.05 % |
| CM.PR.M | FixedReset | 53,740 | Scotia crossed 50,000 at 26.10. YTW SCENARIO Maturity Type : Call Maturity Date : 2014-07-31 Maturity Price : 25.00 Evaluated at bid price : 26.05 Bid-YTW : 2.25 % |
| BNS.PR.L | Deemed-Retractible | 53,723 | National crossed 24,500 at 25.10. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 24.94 Bid-YTW : 4.55 % |
| MFC.PR.K | FixedReset | 53,500 | Scotia crossed 40,000 at 24.76. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 24.76 Bid-YTW : 4.05 % |
| There were 25 other index-included issues trading in excess of 10,000 shares. | |||
| Wide Spread Highlights | ||
| Issue | Index | Quote Data and Yield Notes |
| TRI.PR.B | Floater | Quote: 23.10 – 24.50 Spot Rate : 1.4000 Average : 0.8754 YTW SCENARIO |
| POW.PR.D | Perpetual-Discount | Quote: 23.19 – 23.69 Spot Rate : 0.5000 Average : 0.3209 YTW SCENARIO |
| GWO.PR.M | Deemed-Retractible | Quote: 25.62 – 26.17 Spot Rate : 0.5500 Average : 0.3872 YTW SCENARIO |
| BNS.PR.Y | FixedReset | Quote: 23.59 – 24.09 Spot Rate : 0.5000 Average : 0.3403 YTW SCENARIO |
| BNA.PR.C | SplitShare | Quote: 24.10 – 24.65 Spot Rate : 0.5500 Average : 0.4176 YTW SCENARIO |
| TD.PR.S | FixedReset | Quote: 24.55 – 24.89 Spot Rate : 0.3400 Average : 0.2228 YTW SCENARIO |