{"id":20616,"date":"2012-12-17T22:57:23","date_gmt":"2012-12-18T02:57:23","guid":{"rendered":"http:\/\/www.prefblog.com\/?p=20616"},"modified":"2012-12-17T22:57:23","modified_gmt":"2012-12-18T02:57:23","slug":"december-17-2012","status":"publish","type":"post","link":"https:\/\/prefblog.com\/?p=20616","title":{"rendered":"December 17, 2012"},"content":{"rendered":"

The patron saint of lapdogs is getting a little tarnish on his halo<\/a>:<\/p>\n

There has been quiet talk for some time that Bank of Canada Governor Mark Carney was seriously considering a run at the Liberal leadership but, until this weekend, it was only in the form of whispers.<\/p>\n

A Globe report, however, has revealed that Mr. Carney had serious discussions with Liberal party insiders on his ability to defeat Justin Trudeau in a leadership campaign and even stayed at Liberal MP Scott Brison\u2019s house for a period of time \u2013 a likely violation of the bank\u2019s conflict of interest guidelines. If true, the allegations reveal a serious lack of judgment and threatens to taint one of the country\u2019s most vital institutions.<\/p><\/blockquote>\n

I think Carney has done plenty to taint it already – in acting as a stalking horse for his political masters. But our hero can do no wrong<\/a>:<\/p>\n

The Bank of Canada says it\u2019s assessed Mark Carney\u2019s family stay over at the seaside home of the Liberal Party finance critic this past summer and decided he was not in a conflict of interest for accepting this hospitality.<\/p>\n

The Official Opposition NDP pointed out, however, that its finance critic could only get a phone call from the Bank of Canada governor when she asked for a meeting.<\/p><\/blockquote>\n

I mentioned the regulatory proposals on trailer fees on December 13<\/a> and will have more to say – in response to a query from an Assiduous Reader – shortly. In the mean-time, there’s a dogfight brewing in the UK<\/a>:<\/p>\n

Peter Hargreaves made himself a billionaire by selling mutual funds through his discount broker, Hargreaves Lansdown Plc. (HL\/) Now, as planned rules threaten his business model, he intends to raid fund managers\u2019 profits.<\/p>\n

Hargreaves built the firm into the U.K.\u2019s biggest retail broker, the country\u2019s equivalent of Charles Schwab Corp. (SCHW), by selling funds and charging money managers rather than clients. Starting in 2014, U.K. brokers will have to charge clients directly, a move analysts say jeopardizes the firm\u2019s 64 percent profit margin. Hargreaves says funds must eat the cost.<\/p>\n

\u201cAll the groups are sitting there, smug, thinking we\u2019re getting 0.75 percent and we\u2019re not going to give Hargreaves anything anymore,\u201d Hargreaves, 66, said in an interview at his office in Bristol, western England, where he started the firm in his spare bedroom 30 years ago. \u201cThat\u2019s not going to happen. They need to bear some of it.\u201d<\/p>\n

The Financial Services Authority, the U.K. regulator, plans to ban brokers from receiving cash from money managers and require investors to pay brokerage fees directly to bolster transparency in an industry where costs are more than double those in the U.S. Hargreaves Landsown has increased earnings sixfold since 2007, and the stock has climbed 65 percent this year in London trading, making it the second-best performer in the FTSE 100 Index. (UKX) Still, the shares have slipped 7 percent this month on concern the rule change will crimp earnings.
…<\/b>
Hargreaves plans to introduce charges to replace the payments, called trail commission in the U.K., which would either be an annual fee based on the value of clients\u2019 assets, a charge for each trade or a combination of the two. He declined to give more details on his pricing plans before the FSA approves the rules. The fees, which he called \u201ccompetitive,\u201d will probably apply to existing clients\u2019 funds, he said.<\/p><\/blockquote>\n

A custodial fee charged by discount brokerages will be interesting, to say the least, regardless of how much sense it makes. Geez, I can hear the howls from the DIY guys already … ‘you mean I have to pay as much to hold my ETF (and my common stocks? and my GICs?) as others do to hold their 2.5% MER mutual funds? What?’<\/p>\n

What else can we think of by way of unintended consequences? How about tied selling? “Sorry, buddy, but we will no longer allow you to buy ABC funds through your DEF account, because there’s nothing in it for us. We offer DEF funds only.” or how about “If you want to buy the ABC funds, you have to open a ‘Wonder-Gizmo ABC Account’. It’s quite expensive, I’m afraid, and charges have to be paid in person and in cash at our Tuktoyuktuq branch. Here, fill out these forms.”<\/p>\n

It was a mixed day for the Canadian preferred share market, with PerpetualPremiums gaining 5bp, FixedResets down 8bp and DeemedRetractibles up 13bp. Volatility was average, but entirely negative. Volume was high.<\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n
HIMIPref™ Preferred Indices
These values reflect the December 2008 revision of the HIMIPref™ Indices<\/strong>
Values are provisional and are finalized monthly<\/td>\n<\/tr>\n
Index<\/td>\nMean
Current
Yield
(at bid)<\/td>\n		Median
YTW<\/td>\n		Median
Average
Trading
Value<\/td>\n		Median
Mod Dur
(YTW)<\/td>\n		Issues<\/td>\nDay’s Perf.<\/td>\nIndex Value<\/td>\n<\/tr>\n
Ratchet<\/td>\n0.00 %<\/td>\n0.00 %<\/td>\n0<\/td>\n0.00<\/td>\n0<\/td>\n0.2408 %<\/td>\n2,481.8<\/td>\n<\/tr>\n
FixedFloater<\/td>\n4.18 %<\/td>\n3.53 %<\/td>\n30,288<\/td>\n18.21<\/td>\n1<\/td>\n-1.0870 %<\/td>\n3,853.3<\/td>\n<\/tr>\n
Floater<\/td>\n2.80 %<\/td>\n2.99 %<\/td>\n62,065<\/td>\n19.76<\/td>\n4<\/td>\n0.2408 %<\/td>\n2,679.7<\/td>\n<\/tr>\n
OpRet<\/td>\n4.64 %<\/td>\n2.44 %<\/td>\n51,760<\/td>\n0.50<\/td>\n4<\/td>\n0.0383 %<\/td>\n2,592.1<\/td>\n<\/tr>\n
SplitShare<\/td>\n4.64 %<\/td>\n4.69 %<\/td>\n59,438<\/td>\n4.40<\/td>\n2<\/td>\n0.5474 %<\/td>\n2,871.8<\/td>\n<\/tr>\n
Interest-Bearing<\/td>\n0.00 %<\/td>\n0.00 %<\/td>\n0<\/td>\n0.00<\/td>\n0<\/td>\n0.0383 %<\/td>\n2,370.2<\/td>\n<\/tr>\n
Perpetual-Premium<\/td>\n5.24 %<\/td>\n1.52 %<\/td>\n72,670<\/td>\n0.80<\/td>\n30<\/td>\n0.0503 %<\/td>\n2,323.9<\/td>\n<\/tr>\n
Perpetual-Discount<\/td>\n4.85 %<\/td>\n4.88 %<\/td>\n133,787<\/td>\n15.59<\/td>\n4<\/td>\n0.0305 %<\/td>\n2,636.7<\/td>\n<\/tr>\n
FixedReset<\/td>\n4.94 %<\/td>\n2.99 %<\/td>\n229,760<\/td>\n4.32<\/td>\n77<\/td>\n-0.0772 %<\/td>\n2,451.8<\/td>\n<\/tr>\n
Deemed-Retractible<\/td>\n4.90 %<\/td>\n1.70 %<\/td>\n117,749<\/td>\n0.40<\/td>\n46<\/td>\n0.1260 %<\/td>\n2,414.6<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n
Performance Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nChange<\/td>\nNotes<\/td>\n<\/tr>\n
FTS.PR.H<\/td>\nFixedReset<\/td>\n-1.67 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2042-12-17
\nMaturity Price : 23.57
\nEvaluated at bid price : 25.25
\nBid-YTW : 2.78 %<\/td>\n<\/tr>\n
BAM.PR.G<\/td>\nFixedFloater<\/td>\n-1.09 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2042-12-17
\nMaturity Price : 23.08
\nEvaluated at bid price : 22.75
\nBid-YTW : 3.53 %<\/td>\n<\/tr>\n
MFC.PR.D<\/td>\nFixedReset<\/td>\n-1.05 %<\/td>\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2014-06-19
\nMaturity Price : 25.00
\nEvaluated at bid price : 26.35
\nBid-YTW : 2.92 %<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n\n\n\n\n
Volume Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nShares
Traded<\/td>\n		Notes<\/td>\n<\/tr>\n
ENB.PR.T<\/td>\nFixedReset<\/td>\n80,245<\/td>\nRecent new issue<\/a>.
\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2042-12-17
\nMaturity Price : 23.11
\nEvaluated at bid price : 25.04
\nBid-YTW : 3.76 %<\/td>\n<\/tr>\n
BNS.PR.Y<\/td>\nFixedReset<\/td>\n54,798<\/td>\nNesbitt bought 10,000 from CIBC at 24.05.
\nYTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2022-01-31
\nMaturity Price : 25.00
\nEvaluated at bid price : 24.03
\nBid-YTW : 3.33 %<\/td>\n<\/tr>\n
CU.PR.C<\/td>\nFixedReset<\/td>\n53,512<\/td>\nRBC crossed 50,000 at 26.25.
\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2017-06-01
\nMaturity Price : 25.00
\nEvaluated at bid price : 26.24
\nBid-YTW : 2.87 %<\/td>\n<\/tr>\n
BAM.PR.B<\/td>\nFloater<\/td>\n52,612<\/td>\nNational bought 38,900 from Nesbitt at 38,900.
\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2042-12-17
\nMaturity Price : 17.52
\nEvaluated at bid price : 17.52
\nBid-YTW : 2.99 %<\/td>\n<\/tr>\n
NA.PR.K<\/td>\nDeemed-Retractible<\/td>\n50,113<\/td>\nCalled for redemption<\/a>.
\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2013-01-16
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.19
\nBid-YTW : 2.83 %<\/td>\n<\/tr>\n
BAM.PR.C<\/td>\nFloater<\/td>\n44,189<\/td>\nNesbitt bought 40,000 from National at 17.51<\/a>.
\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2042-12-17
\nMaturity Price : 17.50
\nEvaluated at bid price : 17.50
\nBid-YTW : 2.99 %<\/td>\n<\/tr>\n
There were 39 other index-included issues trading in excess of 10,000 shares.<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n\n\n\n
Wide Spread Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nQuote Data and Yield Notes<\/td>\n<\/tr>\n
MFC.PR.G<\/td>\nFixedReset<\/td>\nQuote: 25.90 – 26.90
\nSpot Rate : 1.0000
\nAverage : 0.5382<\/p>\n

YTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2016-12-19
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.90
\nBid-YTW : 3.44 %<\/td>\n<\/tr>\n

FTS.PR.H<\/td>\nFixedReset<\/td>\nQuote: 25.25 – 25.72
\nSpot Rate : 0.4700
\nAverage : 0.2656<\/p>\n

YTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2042-12-17
\nMaturity Price : 23.57
\nEvaluated at bid price : 25.25
\nBid-YTW : 2.78 %<\/td>\n<\/tr>\n

IAG.PR.G<\/td>\nFixedReset<\/td>\nQuote: 25.67 – 26.00
\nSpot Rate : 0.3300
\nAverage : 0.2053<\/p>\n

YTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2017-06-30
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.67
\nBid-YTW : 3.63 %<\/td>\n<\/tr>\n

ELF.PR.H<\/td>\nPerpetual-Premium<\/td>\nQuote: 26.00 – 26.28
\nSpot Rate : 0.2800
\nAverage : 0.1723<\/p>\n

YTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2021-04-17
\nMaturity Price : 25.00
\nEvaluated at bid price : 26.00
\nBid-YTW : 5.07 %<\/td>\n<\/tr>\n

W.PR.J<\/td>\nPerpetual-Premium<\/td>\nQuote: 25.50 – 25.70
\nSpot Rate : 0.2000
\nAverage : 0.1240<\/p>\n

YTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2013-01-16
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.50
\nBid-YTW : -6.88 %<\/td>\n<\/tr>\n

BNS.PR.Z<\/td>\nFixedReset<\/td>\nQuote: 24.48 – 24.67
\nSpot Rate : 0.1900
\nAverage : 0.1199<\/p>\n

YTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2022-01-31
\nMaturity Price : 25.00
\nEvaluated at bid price : 24.48
\nBid-YTW : 3.39 %<\/td>\n<\/tr>\n<\/table>\n","protected":false},"excerpt":{"rendered":"

The patron saint of lapdogs is getting a little tarnish on his halo: There has been quiet talk for some time that Bank of Canada Governor Mark Carney was seriously considering a run at the …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[],"class_list":["post-20616","post","type-post","status-publish","format-standard","hentry","category-market-action"],"_links":{"self":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/20616","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=20616"}],"version-history":[{"count":0,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/20616\/revisions"}],"wp:attachment":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=20616"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=20616"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=20616"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}