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There has been a rush of capital raising in debt markets as expectations grow that the Federal Reserve may start to slow its money printing, which has slashed borrowing costs, as early as next week. But year to date, debt financing activity is down one percent from 2012.
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Shell said it took a $700 million hit for a combination of Nigeria and for the tax impact of a weakening Australian dollar, and warned that Nigeria itself faces a $12 billion annual bill for the disruption. Shell recently put more of its Niger Delta activities up for sale.
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The taper, and it looks like we will get one either on Wednesday or later this year, is a risk management exercise in which the Fed, like a wise poker player, takes a bit off the table because it is a bit less confident in its hand and in its ability to read those of its opponents.
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Meanwhile, discreet preparations are being made for a UN Security Council resolution that, if passed, would transform the parameters of the conflict. I am told that the wording to be recommended by the UK is much tougher than any previous warning to Assad. If this muscular draft comes before the Security Council, it will face stern opposition and may be amended into vacuity. But there is a determination at the top of the Government to give it a try – to which end, there is a powerful diplomatic push this weekend to prepare the ground at the UN for the moment of decision.