Money Matters: Firstline Securities Blog
The Weekly Report: A Groundhog Summer?
16 May 2012
Is this summer going to be a repeat of 2011’s choppy waters?
‘Groundhog Day’ was a brilliant movie from the early 1990s starring Bill Murray as a sardonic, jaded and self-loathing journalist who goes to a town in the Midwestern United States for what is supposed to be a short trip. The protagonist ends up in a bizarre time-space warp where the same day happens over and over again, and in Hollywood tradition, hilarity and self-discovery ensues.
Investors and traders are going through their own sort of Groundhog Day, except unlike Bill Murray’s character, their jaded resignation is punctuated by panicked episodes of frantic activity. The same problems have been persisting for three years now and specifically, this summer looks like it may be a repeat of events from Summer 2011. Read more…
The Weekly Report: Spotlight on NGCTT – Familiar Name, Undervalued Bond
1 May 2012
Rated one rung higher on the bond totem pole than the Kingdom of Spain by Standard & Poors, the bond for the National Gas Company of Trinidad & Tobago (NGCTT) is priced below par and is comparatively liquid when compared to other Caribbean corporates.
NGCTT enjoys being one of the few efficiently run and profitable state enterprises in T&T and I dare say throughout the Caribbean. If you haven’t yet thought of it as a likely candidate for your portfolio, here are a few reasons to give it a first (or second) look. Read more…
Country In Focus: PANAMA
23 April 2012
Panama has a problem that many other countries would envy: economic growth is so high, and competition for workers so intense, that firms are stealing workers from each other.
Panama’s unemployment is currently 4.4%, and may go down even further as the economy grows 10% in 2012, repeating 2011’s performance as the fastest growing economy in Latin America. The country currently has BBB- / Baa3 ratings from S&P and Moody’s respectively, with a stable outlook from S&P and a positive outlook from Moody’s on general future creditworthiness. Read more…
Country in Focus: Colombia
31 March 2012
Colombia has gone from being an economic and security basket case to a leading investment destination in Latin America. In this second Country in Focus report, Firstline explores Colombia’s outlook and risks, which have not completely disappeared, and also looks at candidates for bond investments.
The Weekly Report: About the Heritage & Stabilisation Fund
28 March 2012
Finance Minister Winston Dookeran has said that the Heritage and Stabilisation Fund (the “HSF”) now stands at US$4 billion and that the returns on the Fund have been modest but still positive given what is happening in the international environment in which the Fund invests.
In addition, he has said that the legislation establishing the Fund is currently the subject of public consultation and one of the issues being considered is whether there should be a separation of the Fund and the creation of a Heritage Fund and a Stabilisation Fund.
How much do you know about your HSF?
Country In Focus: PERU
19 March 2012
Firstline is launching a new series today: Countries in Focus which looks at the economy of a country and investments in its sovereign and corporate bonds available through Firstline Securities. In this first instalment, we focus on PERU which has grown tremendously in the last ten years due to increased political and economic stability, high commodity prices (Peru is the world’s third largest copper producer and second largest zinc producer), and increased domestic consumption and international investment.
The Weekly Report: Wage Rage
6 March 2012
The following excerpts represent a brief timeline of recent wage negotiations involving well-known local companies.
T&T Guardian – February 26th, 2012
“In the impasse at TCL, a company financially troubled since the passing of the energy-boom busy construction period, the company has offered seven per cent in the face of a union demand for a 16 per cent wage increase. Regardless of the condition of TCL, the union is moved to secure an increase no less attractive than that which it had won at Petrotrin. Predictably, nine per cent will be viewed as the new base for wage demands. Despite differences in circumstances, this is likely to apply both inside and outside of the energy sector and the public sector.”
T&T Express – March 1st, 2012
“Employees of both the National Insurance Board (NIB) and insurance firm Algico yesterday held unrelated protests outside their offices in Port of Spain to highlight wage negotiations.”
Are wages about to go through the roof? Read more…
The Weekly Report: On The Rally
27 February 2012
After the meltdown in 2008, subsequent crash in 2009 and the extreme volatility of 2011, many investors are extremely wary of investing in U.S. equities.
However, the S&P 500 is up 6% since January and seems poised to continue upward in 2012 – but as usual, probably not in a straight line.
What’s behind this bull-run? And does the bull have legs? Read more…
The Weekly Report: Return of King Sugar?
16 February 2012
“The European Union (EU) handed over a cheque for 16.585 million euros (TT$134.2 million) to the Government yesterday to aid in restructuring the country’s sugar industry.
The State-controlled sugar industry was disbanded in 2007 with the closure of Caroni (1975) Ltd and the then PNM administration approached the EU to help facilitate a National Adaptation Strategy for former sugar workers to promote life after sugar.”
T&T Express (February 9th, 2012) Read more…
The Weekly Report: Energy in 2012 | Beware the Ides of March
6 February 2012
In this, our last instalment on Energy in 2012, we will examine the risks that Europe’s sovereign debt crisis pose to global energy markets, using a little imagery from the movie “300” and other Greek history or mythology. Europe’s situation is more likely to impact on global energy prices than Iran: the sovereign debt crisis there is a fact, while military conflict with Iran is still quite removed from inevitability.
While the news of the European fiscal compact is certainly encouraging (ignoring the fact it only took them 16 meetings in 2 years), there are still a number of scenarios that could rattle energy markets in the short term, including further sovereign downgrades as well as defaults. The markets are focusing on the fiscal compact, but eventually will have to refocus its attention on the Greek debt negotiations, which aren’t going so well.
Greece is the country most likely to default—in fact, it is almost a certainty. It isn’t a question of if, but when, and how. Greece has proven to be a veritable Trojan Horse for the European Union, and particularly its currency and collective creditworthiness. Read more…
