Posted by Neal Lipschutz
on March 15, 2010
, Wall Street
The political contributions of publicly traded companies seemed sure to become a governance issue for investors once the Supreme Court ruled in January to dismiss long-standing limits on corporate spending on political advertising.
Sure enough, movement. On Friday, New York City Comptroller John C. Liu trumpeted an agreement with Bank of America that has the bank agreeing to publish its political spending made with corporate funds and by bank-sponsored political action committees.
New York City Pension Funds hold about $600 million worth of common shares in Bank of America.
Posted by Rick Stine
on March 15, 2010
, Municipal Bonds
Here at Randomly Noted, this blogger has been banging the drum about troubles in commercial real estate and municipal finance. This week’s Barron’s has a great piece by Jonathan Laing that looks at the troubles in muni land by taking a deep look at the pension obligations many state and local governments have. It’s stunning how underfunded many of these plans are today and the prospect of making them fully funded isn’t in the cards anytime soon.
Again, one of the pet-peeves of this blogger is that state and local governments have been very late in dealing with their big deficits and haven’t done much to contain costs. One way would be to get out of the pension business and create something more like what companies have done – 401K plans, for example, where you aren’t on the hok to guarantee a certain amount of money for each employee upon retirement.
As she discussed Friday her concerns about the credit-default swaps market, especially when it involves sovereign debt, France’s finance minister, Christine Lagarde, turned a well-worn market notion on its head.
“Now it’s all OTC,” Lagarde said of CDS trading, “which I call ‘under’ rather than ‘over’ the counter.”
In a lunch interview with The Wall Street Journal and Dow Jones Newswires on Friday, Lagarde said she was particularly concerned with the lack of clarity around CDS trading, especially CDS on sovereign debt. The latter she described as a narrow and illiquid market.