Stock exchange rival, anyone? So will the Australian stockmarket and competition regulators delay the attempted move into Australia by Chi-X Europe, the region’s third-largest trading platform, after it replaced its global chairman Tony Mackay, an Australian, overnight? Federal parliament has passed legislation allowing for new exchanges to establish themselves here in competition with the ASX. The issue was to go to federal cabinet next month for a final decision. Mackay is being replaced by John Woodman, described as a former UBS banker and currently a consultant to the company. Reports in European business media suggest Mackay was replaced to “distance itself from its former owner Instinet”. Mackay continues as chairman of Instinet Europe, which owns around 34% of Chi-X Europe. Big banks like Credit Suisse, Goldman Sachs (AKA the Vampire Squid), UBS and Morgan Stanley now own a combined majority in the exchange. Instinet is a US-based financial trading network. The problem for its Australia ambitions is that Mackay was well known here in Labor circles. His brother Chris is a former head of UBS, now a well-known Sydney fund manager. The question now is whether Chi-X has the local connections to get a licence to start operating here.

An iPad-led recovery? It’s out on Easter Saturday in the US, but those eager bunnies who ordered early won’t get their new devices until April 12 at the earliest, instead of this weekend as Apple originally suggested. Apple started taking orders for the iPad on March 12, promising to ship the touchscreen device to buyers on the official US sales launch date of April 3. They cut orders to two machines each. Apple is now promising a shipping date of April 12. (‘The iPad is in the mail, promise’). US media reports reckon Apple could sell one million of the thingies by the end of June: prices range from $US499 for the basic to more than $US800 for the juiciest of devices. Some US shops will  receive just 15 iPads each (five of the three main models) That’s a guarantee for bedlam and frustration.

US economy saved (again?): Savings in February fell, consumption rose, but personal income was flat, meaning Americans dipped into their savings to keep their heads above water last month. Some economists said it means consumption would be a solid boost to growth this quarter, others said it would surge in coming months because (yes, you guessed it), the snowstorms of last month had caused incomes to stagnate because of short working time and factory closures. Hmmmm. Personal income was flat in February after a rise of 0.3% in January, real disposable income was flat after falling 0.4% the month before, the savings rate fell to 3.1%, the lowest since late 2008, from 3.4% in January. Spending rose 0.3%, after a rise of 0.4% in January. But what Americans spent their savings on gives us a clue as to what’s going on. Spending on big ticket items such as cars, furniture, appliances and other durable’ or long-lasting goods fell 0.2%. But spending on non-durables, such as groceries and clothing rose 0.9%. Spending on services also rose 0.3%. Most American consumers are battling to stay afloat.

Deal of the day: 7.7 billion Citibank shares anyone, a bargain, one owner, apply in Washington at the US Treasury. That’s a 27% stake in what was America’s wobbliest bank to survive the crunch. Now the Government’s stake is available for a price. The US Treasury paid $US3.25, so there could be a small earn for US taxpayers. Citi shares fell 3.3% to $US4.18 overnight. It’s a Tarp reducer for the Feds, who will be able to recycle the money into a $US50 billion home loan modification plan revealed last Friday. The Citi stake will be sold into the market so as not to cause the share price to tank. Citi has so far repaid the Treasury $US20 billion of Tarp money, around $US3 billion in dividends and $5.3 billion in premiums on asset insurance. It means the Government has pulled back from much of its support for Citi (the asset insurance program remains in place). Can Citi make it on its own after being bailed out and saved from collapse? Would you bank with them? Big questions.

No relief for Greece: Any thoughts the country’s government may have had of last week’s EU deal producing an immediate easing in the punitive interest costs associated with its international borrowings, were swept aside yesterday. Greece came to the market with a €5 billion loan, (with demand for €6 billion) and the borrowing rate was 5.9%. That meant the effective rate was 3.25% over the rate for the bellwether European bond, the German Bund. Market reports suggested Greece had been looking for a margin of 3.10%. So while the yield is great for hungry investors it is is unsustainable in the medium term.

Keep pedalling Greece: The issue meant the Greece won’t have to approach the markets until next month when it needs to raise another €10 billion to roll over existing debt, pay interest and cover the country’s budget deficit for that month. It’s a treadmill that won’t stop.  That means the Greek debt burden will worsen significantly before it shows any signs of getting better. Other economies such as Italy, Spain, Portugal and possibly Ireland, also face a no-growth/shrinking growth outlook this year and in 2011. The UK budget last week said it would borrow £167 billion this year (That’s $US250 billion, gulp!) and growth would be minimal, and there’s also an election. German and French government borrowing will also rise as budget deficits rise this year.

Is Britain the new Greece? Just when everyone though the Olive economies of Europe, Greece, Italy, Spain and Portugal, were the ones on the edge, along comes Standard & Poor’s (That’s one of the credit rating groups that helped cause the subprime mess and credit crisis, by the way) to remind us of a heavily indebted sluggish economy off the European coast called Britain. The ratings group said overnight that it could cut the UK’s rating from its current AAA if the a new government fails to cut massive public debt. The election is expected in early May, and ahead of the announcement, S&P said it was reaffirming Britain’s AAA rating, but with a negative outlook. “The outlook on the United Kingdom remains negative based on our view that … the UK’s net general government debt burden may approach a level incompatible with a AAA rating,” S&P warned. It said “the rating could be lowered if we conclude that the incoming government’s fiscal strategy is unlikely to put the UK debt burden on a secure downward trajectory over the medium term.” That’s a bit rich from S&P, which, with Moody’s and Fitch ratings, gave out cushy AAA ratings on dodgy subprime loans and other related securities and got away with it and escaped any real punishment for their roles in the whole credit mess. They abrogated their responsibilities for the sake of more income because they were paid by the issuing banks such as the Squid, UBS, Morgan Stanley, Citi and Merrill Lynch. Read Michael Lewis’ new book The Big Short for more juicy details.

Oh what feeling? Toyota had a small boost yesterday with the news it lifted its February car sales worldwide by 13%, despite the 8 million vehicle recall scandal, which has impacted sales in the US and damaged the company’s global image.  The company, which includes brands Daihatsu and Hino trucks, sold 613,845 vehicles worldwide last month, up from 543,435 last year. The 2009 figure was a huge fall on the same month in 2008 as the global recession hit home. The group’s global production in the same period jumped 69.2% to 734,631 units, of which 655,180 were for the Toyota brand. That tells you how bad it was a year ago. The rebound was natural given the depths of the economic pressures a year ago, but the company is not off the hook by a long way.

Shell leaves NZ, Aussie next? Shell has left the New Zealand downstream (retailing, refining, etc) sector officially, next Australia? A couple of weeks ago I pointed out that Shell Australia has a structure different to the rest of the empire, except New Zealand. Shell was in the processing of selling its NZ downstream interests, and the feeling was that if this happened successfully, then Australia might be next. Well Shell  yesterday finalised the sale of its Kiwi downstream assets to Infratil Ltd and the Guardians of New Zealand Superannuation for $NZ696.5 million. That was after the agreement last November to negotiate exclusively with the Infratil-led group. Involved in the sales are 229 service stations, port terminals and a 17% stake in New Zealand Refining Co. Shell has been in NZ  for 97% years and keeps its producing oil and gas assets. Australia is divided into downstream stations, terminals and two refineries (there’s also the JV with Coles Group on Coles Express) and two refineries in Geelong and Sydney. The LNG , natural gas and coal seam gas interests in WA and Queensland are separate.

When Irish banks are ailing: Ireland now knows the size of its so-called bad bank that will be home to 81 billion euros of bad property loans left over from the financial crisis. That’s about 20% of total loans made by the country’s banks and roughly one third of 2009 GDP. Most are expected to continue to go bad. Ireland’s National Asset Management Agency, (the actual “bad bank”) will now reveal what are expected to be larger than expected discounts or “haircuts” on €17 billion of non-performing loans extended to the country’s top 10 property developers by the banks. Some have already started transferring loans to the agency. More announcements are due later tonight and during the run up to Easter. Bank shares fall sharply overnight as investors realised up to €16 billion  of new capital might be needed, on top of the €11 billion already injected into the big five banks by the national government.

Irish banks’ government future: These will be the first lot of loans in the 81 billion total to be taken off the hands of the struggling banks. The announcement will have direct implications for the level of capital the banks will need in the future — and will in turn determine the extent of any increased government shareholding the banks may need to maintain  acceptable capital levels. The government has 25% indirect stake in Allied Irish Bank, a 15.7% direct stake in Bank of Ireland and full ownership of Anglo Irish Bank. With the expected new capital needs, the government could end up with 70% of Allied Irish and 40% of the Bank of Ireland, if the banks can’t raise new capital from the market.