Good morning

The headlines:

  1. The MF Global story continues with breathless drama – as Edith O’Brian, the assistant treasurer who now lies at the centre of the $200 million transfer scandal – invokes her number-something amendment right to not testify in front of the House Financial Services Committee. On Monday, I wrote something about MF Global’s former CEO Jon Corzine, who was being accused of authorising a transfer of $200 million from a customer account to settle a brokerage account with JP Morgan Chase. Well – since then, he seems to have been vaguely exonerated by lacking explicit knowledge that the funds came from a customer account. Edith, however, organised the actual transfers. And she’s the hand behind the “Per JC’s direct instructions” line on the infamous memo. We’re all as disappointed as the House Committee. Link: MF Global Assistant Treasurer refuses to answer questions.
  2. Global investors are selling more Indian bonds than they’re buying. It’s the first time that the Indian government has faced a market net selling position since October 2010. And moreover – the Indian government is planning on raising 65% of its annual borrowings in the first half of the year, compared to 49% in the same time period last year. Presumably, the borrowing increase is a result of rising oil prices, which will push up the cost of subsidies incurred by the Indian government (according to Bloomberg, oil accounts for 23% of the total current subsidy cost). At the same time, I would think that the bearish attitude of investors may have something to do with those Iranian oil sanctions. Investors are skittish. Sanctions are bad publicity with a neat tag-line. Solutions to the sanctions? Long, complicated, misunderstood. Maybe we should all buy Indian bonds? Link: The Indian Debt Sell-Off.
  3. The Spanish Unions are preparing to strike over labour laws and austerity measures. Spanish PM Mariano Rajoy and his three-month old government are unlikely to be responsive. The issue is whether the current policies will fix the 23% unemployment rate, as well as the deficit in public finances. Question: are the unemployed part of unions? In which case, why are the Unions striking? The employed strike and the unemployed publicly protest. Confused. Link: The Spanish General Strike over Unemployment.
  4. And the Africa Business News in Brief. Link: ABN Briefs. The highlights:
    • The Comoros have awarded their first-ever oil exploration and production licence, to a private Kenyan company.
    • Uganda is also set to auction four more oil exploration blocks early next year.
    • Fuel Marketer Total Kenya reported a 96% drop in full year profit. This was apparently due to the interaction between rising input costs, and the inability to change pricing owing to price controls. Not ideal.
    • The World Bank has approved a $132 million zero-interest loan to Cameroon to help them build a new hydroelectric dam.
And that’s all for now.
Happy Thursday.