{"id":31671,"date":"2015-12-18T03:10:45","date_gmt":"2015-12-18T08:10:45","guid":{"rendered":"http:\/\/prefblog.com\/?p=31671"},"modified":"2015-12-18T03:10:45","modified_gmt":"2015-12-18T08:10:45","slug":"december-17-2015","status":"publish","type":"post","link":"https:\/\/prefblog.com\/?p=31671","title":{"rendered":"December 17, 2015"},"content":{"rendered":"

The Fed’s implementation of new policy tools to raise the overnight rate went smoothly<\/a>:<\/p>\n

The Federal Reserve succeeded in nudging borrowing costs higher Thursday after its first interest-rate increase since 2006, and policy makers only needed to siphon $105 billion from money-market funds to achieve their goal.<\/p>\n

Led by Chair Janet Yellen, the Fed lifted the federal funds rate from near zero, where it had been since the financial crisis unfolded in 2008. Thursday, the quarter-point rate boost rippled through money markets that are awash in nearly $3 trillion in excess cash that the Fed injected through bond purchases.<\/p>\n

For all the talk of the challenge facing officials as they orchestrate higher rates with so much money sloshing around, Thursday\u2019s market operations weren\u2019t much different in scale than previous days. And the benchmark rate rose 0.2 percentage point, or 20 basis points — practically to the middle of the Fed\u2019s intended range.
…<\/b>
While the Fed is sticking to the funds rate as its main method of communicating its policy stance, the burden of lifting rates fell elsewhere. That\u2019s because with so much cash in the system, interbank lending has fallen almost 90 percent since 2008.<\/p><\/blockquote>\n

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Click for Big<\/i><\/div>\n

It looks as if somebody was either naughty or careless at Octagon<\/a>:<\/p>\n

Octagon Capital Corp. has been declared bankrupt, its chief financial officer has been fired and the brokerage is facing a shortfall of as much as $6.1-million.<\/p>\n

The Canadian Investor Protection Fund (CIPF) paid out millions of dollars to investors after the small Toronto-based investment firm was unable to meet obligations to clients when it entered bankruptcy proceedings earlier this month. The Investment Industry Regulatory Organization of Canada (IIROC) discovered the deficiency in late November after a routine audit, according to court documents filed by Octagon\u2019s bankruptcy trustee, Ernst and Young Inc. reason for the shortfall is unknown and an investigation continues.<\/p>\n

\u201cI am co-operating fully with the trustee,\u201d John Palumbo, Octagon Capital\u2019s chief executive officer, said in an e-mail. \u201cI can say that [the $6.1-million shortfall] represents an accounting amount which is in dispute, and I believe the total is much less.\u201d<\/p>\n

On the same day the shortfall was revealed, Octagon notified the IIROC that its chief financial officer, Christopher Everest, \u201cwas unable to return to work and was being removed from Octagon\u2019s accounts, e-mail and payroll systems,\u201d according to court documents.<\/p>\n

\u201cHe was terminated for cause,\u201d Mr. Palumbo said on Thursday.<\/p><\/blockquote>\n

The banks are claiming they are forced to publish shoddy analysis<\/a>:<\/p>\n

In a world where market news zips around at lightning speed with a click or a tweet, there is at least one anachronism: The delay in analyst research on companies that have just completed an IPO. Analysts who work for the investment firms that have taken the companies public have been blocked from issuing reports for 40 full days after the stock\u2019s debut.<\/p>\n

Regulators have now moved to shorten that period. FINRA, the U.S. body that governs its investment dealers, cut the IPO \u201cquiet period\u201d to 10 days this fall. And IIROC, the Investment Industry Regulatory Organization of Canada, followed quickly with a rule that harmonized the Canadian rules with the U.S. so as not to disadvantage this country\u2019s investment dealers.<\/p>\n

The biggest Canadian investment banks have now responded to this liberalization with a universal position: We want no part of this. Instead, they say, they want the quiet period extended to a full 25 days.
…<\/b>
With a new publication schedule of 10 days post-IPO, analysts won\u2019t have enough time to meet with management and produce a robust report, the firms argue.<\/p>\n

If firms compete to be first to market with their reports, just 10 days after the IPO, \u201ca likely outcome is a dilution in the quality of research being produced,\u201d Quentin Broad, the head of equity research at CIBC World Markets Inc., said in that firm\u2019s comment letter to IIROC. And the most likely investor to be harmed, Mr. Broad says, are retail investors who \u201cmay consume a single research product without conducting or having access to any additional research of their own.\u201d<\/p><\/blockquote>\n

Does it really make any difference? Sell-side analysis is excellent for data, pretty good for generating ideas regarding analytical techniques … but as far as actual actionable investment recommendations are concerned? Entertainment value only.<\/p>\n

As part of what appears to be a global redefinition of what the word “Conservative” means in politics, the UK wants all businesses and the self-employed to file four tax returns every year<\/a>:<\/p>\n

\nTax returns will have to be filed four times a year as part of a “digital revolution” at HMRC, George Osborne has indicated<\/p>\n

Business and self-employed workers will be expected to file their tax returns online from 2020 using free apps on their smartphones and HMRC’s website.<\/p>\n

The Government estimates that the move will raise an additional \u00a3600million a year by the end of this Parliament because it will help the taxman keep a better track of people’s income. It has insisted that the new digital service will make it easier to file tax returns.
…<\/b>
A spokeswoman for the ICAEW group of Chartered Accountants said: “This is an additional burden for small businesses especially at a time when they are already struggling with changes such as auto-enrollment. It is already a significant burden for people to file it once a year.”<\/p>\n

Earlier this year it MPs condemned the “abysmal” customer service at HMRC after it emerged that half of all calls to the taxman go unanswered. <\/p><\/blockquote>\n

This has provoked howls of anguish<\/a>:<\/p>\n

Self-employed workers, landlords and small business owners currently have to submit their figures just once every 12 months.<\/p>\n

Switching them to quarterly returns will bring them into line with big corporations. But financial experts say the move will simply add to the reams of red tape already strangling small firms.<\/p>\n

\u2018These changes are going to be very onerous,\u2019 said Chas Roy-Chowdhury, of the Association of Chartered Certified Accountants.<\/p>\n

\u2018It is not just about filling in a form, it is going to be a real burden.<\/p>\n

\u2018Workers will have to make sure their books and records are up to date at least four times a year in case the taxman decides something is amiss and investigates them.\u2019<\/p>\n

Initially workers will not have to pay tax four times a year. But accountants suspect quarterly returns are a step toward this.<\/p>\n

The plans were slipped out in the small print of George Osborne\u2019s autumn statement. Around four million people will be affected: the self employed, small business owners and landlords who make more than \u00a310,000 a year profit.<\/p><\/blockquote>\n

Industrial Alliance Insurance and Financial Services Inc., proud issuer of IAG.PR.A and IAG.PR.G, was confirmed at Pfd-2(high) by DBRS<\/a>:<\/p>\n

The Company has strong capitalization as illustrated by (1) its financial leverage ratio of 24.5% at Q3 2015, significantly reduced from a high of 35.2% at year-end 2012; (2) the improvement in the EBIT fixed-charge coverage ratio to 6.8x at Q3 2015, compared with 5.6x at Q3 2014; and (3) the minimum continuing capital and surplus requirement (MCCSR) of 225% at Q3 2015, an improvement of ten percentage points from Q3 2014.<\/p>\n

The Stable trends on IAG\u2019s credit ratings take into account the Company\u2019s conservative risk management, good financial metrics and capital levels coupled with low volatility. Negative ratings pressure could arise if IAG experiences a sustained erosion of market share in key segments, a negative impact on its earnings because of lower interest rates, equity market declines or adverse policyholder behaviour, or acquisitions of risky businesses. Positive pressure on IAG\u2019s ratings could emerge if underperforming businesses become profitable, if there is a reduction in exposure to interest rate and stock market value fluctuations, and if there is a significant increase in market share without cutting premium rates.<\/p><\/blockquote>\n

There has been a massive amount of issue news today, so for convenience I will list the posts here:<\/p>\n