With its record public equity offering in September out of the way, Alibaba Group Holding Ltd (BABA) has shifted its focus to the debt market. The Chinese e-commerce retailer company is preparing to notch up another milestone – Asia’s biggest bond sale – in the hope of raising as much as $8 billion.
It’s been a flurry of international financing activity for the Canadian banks since Ottawa changed the framework on what collateral could be included in covered bond issues two years back.
Those rules, when combined with the accompanying regulations that were brought into effect in late 2012, mean issuers aren’t allowed to include CMHC-insured residential mortgages as backing for a so-called Canadian legislative covered bond.
While Moody's slipped over 20% when the DoJ announced its cajillion dollar lawsuit against S&P for knowing the crisis was coming but not telling anyone, it later bounced back over 10% as investors believed the non-US-downgrading rating agency (that happened to be owned by Buffett) was too-big-to-jail.
Federal Reserve Chairman Ben Bernanke’s efforts to revive housing are making real estate bulls even more bullish.
JPMorgan Chase & Co. more than doubled its forecast for U.S. home price gains in 2013 to 7% this week, and predicts a more than 14% increase through 2015. Bank of America Corp. said last week property values will jump 8% this year, up from a prior estimate of 4.7% in a report titled “Someone say house party?”
Pretty much everyone agrees that we have a ratings agency problem. But I think the conventional way of describing it as a “conflict of interest” that’s created by the fact that “banks pay them to rate their securities” leaves some crucial steps out.