While You Were Sleeping: Will Q4 Be the Breakout? Grumbling About Bank Bonuses

The Wall Street Journal’s Tom Lauricella gives a preview of the Q4 earnings season, beginning this week, when many firms should show the first year-over-year gains since the recession began.

Dutch brewer Heineken NV (HEIA) this morning said it would purchase Mexican suds maker Femsa for $7.6 billion, including assumed debt, in an all-stock transaction, confirming a story by
WSJ’s Dana Cimilucca, Jeffrey McCracken, and David Kesmodel report last night.

Foreclosures are happening in Dubai, finally. After real estate fell 52% last year, reports Bloomberg’s Zainab Fattah;, Barclays PLC won the first residential foreclosure in the emirate in a Dubai court over the weekend. The victory paves the way for banks to foreclose on perhaps 12% of the 27,000 residential mortgages in Dubai over the next 12 to 18 months.

Two days before chief executives of Goldman Sachs (GS), Bank of America (BAC) and other banks testify in congress, public outrage is mounting over hefty bonuses on Wall Street, the Financial Times’s Justin Baer, Francesco Guerrera, and Daniel Dombey report. The “comp ratio” will actually hit a record low at Citigroup (C) and J.P. Morgan-Chase (JPM), they write. Nevertheless, according to an anonymous source, “The industry will pay out the lowest ratios ever, yet still deliver bonuses that most people consider mind-numbingly large.” the question left lingering is whether President Obama and congress will follow the U.K. with some kind of bank bonus tax.

But even in England, things are not so simple: the FT’s Patrick Jenkins and Megan Murphy report most banks are planning to absorb the cost of the tax to sheild bonuses.

Meantime, Chinese banks have taken four of the top five slots in a global survey ranking bank stock valuations, FT’s Patrick Jenkins reports. China Merchants Bank and peers have pushed Bank of New York-Mellon, Citi, Wells Fargo, Llyods of London, and Morgan Stanley out of the top spots for most valuable banks, with China’s financials trading above three times book value and most U.S. banks fetching less than one.

The U.S. Government is set to accelerate its issuance of Treasury Inflation-Protected Securities (TIPS), writes WSJ’s Min Zeng, in response to demands by China and other governments that their investment be protected from the U.S.’s massive stimulus effects.