AI News, Morgan Stanley Dep Shs repstg 1 (MS artificial intelligence
Morgan Stanley PFD A 1/1000 (MS-PA)
(Bloomberg) -- Some foreign holders of Lebanon’s Eurobonds are expressing support for a government debt restructuring as the clamor grows among local politicians to skip a payment due in weeks.At a private meeting days ago with government representatives, a number of foreign funds that own Lebanese sovereign bonds, including a $1.2 billion note due March 9, argued that the crisis-ridden country would be better off restructuring rather than paying its debt, said a person familiar with the matter, declining to identify the investors.In a suggestion that the fallout can be contained, they said Lebanon’s bonds were already discounted on their balance sheets, according to the person, who asked not to be named because the information isn’t public.Most of Lebanon’s bonds maturing beyond this year trade at between 35 and 40 cents on the dollar.
They’re trying to convince the premier and others that Lebanon risks a crisis and violence similar to Venezuela, which defaulted on its debts in 2017.Legislators present at a committee meeting last week almost unanimously agreed -- albeit in private conversation -- that the government shouldn’t pay, a lawmaker said.The debate is playing out against a dire backdrop, with Lebanon’s reserves stretched thin and the economy succumbing to a recession as currency shortages worsen.An ex-economy minister, Nasser Saidi, has called for a restructuring of public debt, while also saying Lebanon would need a bailout of as much as $25 billion that could require support of the International Monetary Fund.
“We need to look at all the options and study their impact and there should be a conclusive plan that doesn’t only focus on paying or not paying but also a larger plan.”The central bank’s net foreign-currency holdings are sufficient to pay for the near-term import bill and debt redemptions, while local lenders have enough in reserve to cover deposit outflows, according to Morgan Stanley.“What is more important to watch is the political sentiment on the trade-off of using reserves to cover debt servicing versus imports,” Jaiparan Khurana, a London-based strategist at Morgan Stanley, said in a report.
The Goldman Sachs Group, Inc. (GS-PD)
(Bloomberg) -- It’s a mad scramble for the best data: Economists are grappling with ways to gauge the real-time impact of the coronavirus on the world economy, even as the outbreak continues to confound forecasters.Store closures, flight-tracking websites, factory shutdowns and the latest numbers on infections and fatalities are just some of the high-frequency data points economists are scouring for clues on the hit to growth.“To track the impact of the virus on the global economy, we have had to look at indicators I have never looked at before in my 25 years of doing macroeconomic forecasting,” said Torsten Slok, chief economist for Deutsche Bank AG.We asked a group of economists how they’re tracking the fallout.
Here’s a snapshot of their responses:Torsten Slok, chief economist for Deutsche BankUnderstanding the impact of the virus is all about identifying the transmission channels through which it will impact the global economy, and those include: global tourism, supply chain disruptions, Chinese consumer spending, lower commodity prices, and wealth effects from global lower stock prices, with the last effect probably being more important than the others combined.
Put differently, the level of global anxiety and the impact of the “fear factor” in markets is probably what we should worry most about.Rob Carnell, chief economist for Asia Pacific at ING Groep NVMy daily routine has changed: I now check the latest World Health Organization situation report and supplement that with Worldometer’s coronavirus count.Most important for me now are the new cases of non-China infection, as these are now either from encounters with Wuhan/China tourists, evacuated residents from Wuhan or community transmission.
It is really the first and third of these that may shed light on whether this virus is going to go global and, therefore, if we have to take a much dimmer view on what impact this will have on the global economy than just factoring how many fewer tourists will arrive in Thailand.Ben Emons, managing director of macro strategy at Medley Global AdvisorsI expect the first signs of the virus impact on local economies to show up between February 20 and February 25, when Taiwan export orders, Australia PMI, Thailand and Hong Kong import data are released.
Also, any large manufacturers’ announcements regarding production shutdowns (such as in South Korea) give valuable early insights about the disruptions to supply chains.Tourism, transportation, automotive industry, petrochemicals (Hubei is a hub for autos and petrochemicals, for instance), and basically any sector that relies on consumer spending.Richard Moody, chief economist, Regions Financial Corp.We’re monitoring guidance from corporations concerning supply chains, production schedules, service cancellations and the like.
Before you continue...
To give you a better overall experience, we want to provide relevant ads that are more useful to you.
For example, when you search for a film, we use your search information and location to show the most relevant cinemas near you.