Rating Firms Inflated Credit Grades to Match Rivals, Report Says – Bloomberg 01-30-13

Salient to Investors: John Griffin, Jordan Nickerson and Dragon Tang at the University of Texas said Standard & Poor’s and Moody’s  inflated their grades on securitized debt prior to the financial crisis to match each other’s opinions to avoid losing business. CDOs rated AAA by both companies defaulted more often than securities with

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Megamerger Failures Cloud 2013 Deal Resurgence: Real M&A – Bloomberg 01-30-13

Salient to Investors: Bloomberg says two-thirds of company takeovers exceeding $20 billion since 1996 generated losses for the acquirer’s shareholders – the 78 buyers lagged behind the MSCI World Index by a median of 13 percent in the 3 years after completion, falling 21 percent. Warren Buffett says acquirers typically

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Chavez’s 681% Returns Mean Socialism Buoys Goldman: Andes Credit – Bloomberg 01-30-13

Salient to Investors: Venezuela bondholders have returned 14.7 percent annually, double the emerging-market average, enriching investors from OppenheimerFunds to Goldman Sachs. Sara Zervos at OppenheimerFunds said Chavez has done little good for Venezuela, but has serviced the bonds, and the Venezuelan securities are more attractive than Brazilian bonds, which offers little upside. Zervos said

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Gold Heads for Biggest Gain in 3 Weeks on U.S. GDP Data – Bloomberg 01-30-13

Salient to Investors: GDP growth for Q4 2012 was negative and weaker than any forecast in a Bloomberg survey. Tim Evans at Long Leaf Trading said more numbers like this and gold will rally. Sales of American Eagle silver coins rose to a record this month. Read the full article at http://www.bloomberg.com/news/2013-01-30/gold-little-changed-amid-fed-meeting-palladium-at-16-month-high.html Free email alerts

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Here We Go Again, Underpricing Europe Debt Risk – Bloomberg 01-29-13

Salient to Investors: Nicholas Spiro at Spiro Sovereign Strategy writes: Market sentiment toward the euro area has swung from panic to growing confidence in just six months. Spain and Italy, the twin bellwethers of sentiment on Europe, show how markets are again underpricing sovereign risk as even a cursory glance at

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