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04 December 2012
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  • White House rejects GOP plan to avert "fiscal cliff"
    The White House turned down a proposal by House Republicans aimed at averting the "fiscal cliff" because it didn't include tax increases for the wealthiest Americans. "The Republican letter released today does not meet the test of balance," said White House Communications Director Dan Pfeiffer. "In fact, it actually promises to lower rates for the wealthy and sticks the middle class with the bill." Reuters (03 Dec.), The Washington Post (03 Dec.), Bloomberg (03 Dec.) LinkedInFacebookTwitterEmail this Story
  • EU concedes January is out of the question for Basel rules
    Although it is hoped the delay will be short, the EU says January is no longer a realistic deadline for implementing Capital Requirements Directive IV, put forward by the Basel Committee on Banking Supervision. Leverage limits, bankers' bonuses and liquidity rules are among sticking points. Bloomberg (03 Dec.) LinkedInFacebookTwitterEmail this Story
  • SEC: Big 4's Chinese affiliates withheld documents
    The Securities and Exchange Commission accused Chinese affiliates of the Big Four global accounting firms of withholding documents from U.S. investigators looking into possible fraud by companies based in China. The commission said in an administrative order that the accounting firms failed to cooperate with investigations relating to potential accounting fraud by nine Chinese companies with securities trading in U.S. public markets. Bloomberg (03 Dec.) LinkedInFacebookTwitterEmail this Story
  • Analysis: Troubled companies often pay big bonuses
    Companies in financial trouble often pay top executives big bonuses shortly before filing bankruptcy petitions. A review of more than 80 bankruptcy cases over the past five years by The Wall Street Journal found that more than 1,600 insiders received payments totaling more than $1.3 billion in the months before their firms filed for Chapter 11 bankruptcy protection. The Wall Street Journal (03 Dec.) LinkedInFacebookTwitterEmail this Story
Morningstar Direct – The New Efficient Frontier
Cutting-Edge Tools to Better Identify Downside Risk

Click here to read our article on how technology is changing Monte Carlo simulations.
  Market Activity 
 
  • Asian-Pacific markets mixed after Wall Street drops
    Asian-Pacific markets were mixed Tuesday, some following Wall Street's lead after data showed that U.S. manufacturing has shifted to contraction. Australia's S&P/ASX 200 dropped 0.6%. Japan's Nikkei 225 declined 0.3%. South Korea's Kospi slid 0.3%. Markets in China and India were somewhat stronger. Hong Kong's Hang Seng Index edged up 0.2%. China's Shanghai Composite rose 0.8%. India's Sensex was up 0.2% at mid-afternoon. The Economic Times (India) (10 Dec.), The Wall Street Journal (04 Dec.) LinkedInFacebookTwitterEmail this Story
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  Economics 
  • IMF conditionally allows capital controls
    The International Monetary Fund has withdrawn its objection, in certain situations, to nations' imposition of capital controls. "Capital flows can have important benefits for individual countries across the fund membership and the global economy. ... [They] also carry risks, however, as they can be volatile and large relative to the size of domestic markets," according to an IMF report. Bloomberg (03 Dec.) LinkedInFacebookTwitterEmail this Story
  • U.S. car sales jumped 15% in November
    Americans bought 1.1 million vehicles last month, 15% more than in November 2011. The surge marked the fastest sales growth since January 2008. Consumers replacing 250,000 vehicles destroyed by superstorm Sandy helped drive up the numbers. Los Angeles Times (tiered subscription model) (03 Dec.) LinkedInFacebookTwitterEmail this Story
  • "Fiscal cliff" fears blunt hiring, economists say
    Many employers who would ordinarily be hiring are refraining because of uncertainty over whether Congress will find a way to avert the U.S. "fiscal cliff," many economists say. Between July and September, worker productivity rose an annualized rate of 1.9%, indicating that employers are squeezing as much from workers as they can realistically expect to get, some experts say. But hiring hasn't picked up. NBC News/Economy Watch blog (03 Dec.) LinkedInFacebookTwitterEmail this Story
  • Corporations lack cash in U.S. but hold money offshore
    Major U.S. companies are holding a large amount of cash offshore to avoid taxes while letting cash at home dwindle to a point of borrowing for basic functions such as paying dividends, buying back shares and paying taxes. The emerging picture of corporate cash abroad is in response to pressure on companies from the Securities and Exchange Commission to give investors an accurate evaluation of liquidity. The Wall Street Journal (03 Dec.) LinkedInFacebookTwitterEmail this Story
Dark Trading: Is It Hurting Market Quality?
CFA Institute report examines impact of internalization and dark pool trading on market quality.
  Geopolitical/Regulatory 
  • Brazil adjusts trade policy as economy stalls
    As Brazil's economy slows, the government is implementing trade policy that the U.S. considers protectionist. Brazil has capped vehicles imported from Mexico, tightened limits on the import of car parts and increased tariffs on many industrial products. The Washington Post (03 Dec.) LinkedInFacebookTwitterEmail this Story
  • Experts criticize EU's proposed credit rating curbs
    An EU proposal to prevent credit rating agencies from reviewing sovereign debt more than three times a year sparked concerns from market participants. The proposal is intended to limit the frequency of downgrades or warnings so governments' ability to raise money wouldn't be hindered as much. However, one market participant says the outcome could be the opposite. "I'm disappointed that politicians show such little understanding about how markets work and what credit opinions are about," said Georg Grodzki, head of credit research at Legal & General Investment Management. Financial News Online (U.K.) (subscription required) (03 Dec.) LinkedInFacebookTwitterEmail this Story
  • SEC plans to move forward on fiduciary standard
    Creating a uniform fiduciary rule for financial advisers and brokers is a high priority next year for the Securities and Exchange Commission, the regulator says. The SEC's next chairman, Elisse Walter, is a longtime supporter of harmonizing rules that govern financial advisers and broker-dealers. AdvisorOne (03 Dec.) LinkedInFacebookTwitterEmail this Story
  • U.K. watchdog plans to ban products without inquiry results
    The U.K. Financial Conduct Authority, which will launch in April, will temporarily bar questionable financial products, instead of wait for results of an investigation. The regulator has opened public consultation on how such bans would work. Reuters (03 Dec.) LinkedInFacebookTwitterEmail this Story
  Financial Products 
  • PowerShares prepares S&P 500 ETF with hedging
    Trading is set to begin Thursday for an exchange-traded fund from PowerShares that provides hedged exposure to the Standard & Poor's 500 index. The PowerShares S&P 500 Downside Hedged Portfolio will use a rules-based strategy to shift fund allocation between the S&P 500, VIX futures and cash to hedge against downside risk. Benzinga.com (03 Dec.) LinkedInFacebookTwitterEmail this Story
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