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Bloomberg Markets Magazine

Bloomberg Markets Magazine October 2015

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Bloomberg Finance LP
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in this issue

9 min
greetings from bitcoin island

The Isle of Man is a strange place. Home to four-horned sheep, cats without tails, and perfectly preserved Victorian-era steam locomotives, this rock in the middle of the Irish Sea is perhaps best known for hosting the world’s most dangerous motorcycle race, the Manx TT. It’s also a place where, after you take a 70-minute flight from London, a car service called The Lady Chauffeurs will meet you at the airport in a silver Mercedes-Benz S-Class. Imagine my surprise, then, when I’m greeted at arrivals by Keith, who, while courteous, impeccably dressed in a gray suit, and an able driver, is most decidedly not a lady. “All of our regular drivers are busy,” says an apologetic Nula Perren, who owns the company and has accompanied Keith to the airport. Not that…

3 min
why drugmakers are buying each other

WHEN TEVA PHARMACEUTICAL Industries agreed to buy Allergan’s generics business for $40.5 billion on July 27, the value of announced deals by drugmakers this year topped the tally for all of 2014, which was a record. And the view among bankers and analysts was that more were coming—perhaps, even, a $100 billion– plus transaction. Pfizer, the 166-year-old U.S. giant, might be tempted to bid for the rest of Allergan, which will still have best-selling branded treatments such as Botox and a pipeline of new products after the Teva transaction. “A 30 percent slimmer, all-brand, unlevered Allergan would be the perfect size for a Pfizer purchase,” Sanford C. Bernstein analyst Ronny Gal says. Allergan was valued at about $125 billion as of early August. Allergan, alternatively, might be the hunter rather than the…

11 min
building a bank for people who hate banks

ON A SWELTERING afternoon in July, Tom Blomfield emerges from the Bank of England offices in the heart of the City of London and promptly sheds his suit jacket. Blomfield, the 29-year-old, bearded CEO of Mondo, a startup smartphone bank that’s applying to operate in the U.K., isn’t the suit-wearing type. He’s eager to get back to his Clerkenwell workspace for a beer to celebrate Mondo’s surmounting a big hurdle in its quest for a banking license. Blomfield and his team have just spent two hours getting grilled by eight regulators from the central bank and the Financial Conduct Authority. The officials quizzed them on how Mondo will attract customers and remain financially viable. After poring over Mondo’s 250-page submission, which included details of its capital and liquidity plans, the group…

1 min
blue skies, cloudy outlook

ONE OF THESE IS WRONG ○ 500 MILLION TONS Economist Andy Xie’s forecast for China’s annual steel output a decade from now ○ 1.1 BILLION TONS Iron ore miner BHP Billiton’s prediction CHINA STEEL PRODUCTION WHEN CHINESE LEADERS welcome global visitors to Beijing, they don’t just roll out the red carpet; they sometimes order up blue skies. Cars are kept off the streets, and industrial plants in the region are temporarily shut. The 2008 Beijing Olympics is the bestknown example, but there have been other occasions since, including the Youth Olympics in August 2014 and the Asia-Pacific Economic Cooperation summit in November. The effect on the air is noticeable enough that some Beijing residents talk about the sky being “APEC blue.” The effect on the economy is enough that it shows up in government data. Gross domestic product…

1 min
yuan trap

Before China moved to devalue the yuan in August, it had become an outlier among troubled emergingmarkets economies. As other currencies plunged, the yuan gained half a percent versus the dollar over six months. The resulting disadvantage to the economy was probably a better argument than anything the International Monetary Fund might say in favor of allowing market forces a greater role in setting the yuan’s value. RETURN VERSUS U.S. DOLLAR*…

1 min
hedge funds

HFND is the Hedge Fund Home Page, which lets you download accredited-investor and qualified-purchaser questionnaires to request access to restricted funds. FSRC lets you search for funds that match criteria you specify. FREP lets you generate reports on the performance of a selected fund. HFA lets you analyze fund performance. NI HEDGE displays headlines of news stories related to hedge funds. BRIEF enables you to subscribe to the Hedge Funds and Hedge Funds Europe Bloomberg Brief newsletters. FLNG lets you analyze 13F filings for a selected hedge fund manager and aggregated filings. FMAP displays a pie chart that lets you analyze fund performance. BAIF lets you rank return and risk data for Bloomberg Active Indices for Funds. FSTA lets you analyze the style of a selected fund versus a benchmark. FSCO scores hedge funds by size or performance. HFNI lets you access hedge fund indexes. BEMS displays information about Bloomberg’s Execution Management System. XLTP XRSK lets you…