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Tuesday, December 13

13th Dec - Intermission

Quote of the day: Last week was the week we finally put Europe behind us, at least for the rest of the year — unless Europe turns out to be like the classic horror-movie monster that constantly rises from the dead to wreak havoc again just when the audience and/or  heroine thinks all is safe. It’s certainly had that sort of track record so far this year. – WSJ / MarketBeat

The electorate will accept austerity?

News (Tue morning) – BTH
News – The Trader
Market Preview – Saxo
Morning Briefing BNY Mellon
  With conventional macroeconomic policies at their limits, just what could be done is another matter, but undoubtedly investors will once again look to Berlin.

Especially with recession everywhere?
Zulauf: depression will lead to a collapse of the euroPragmatic Capitalism
Swiss macro money manager: Then I expect next year one country, probably three, will exit the euro.  That will make 2012 very interesting because there are no rules on how to exit the euro.  A country exiting the euro means the next day, when they exit, their banking system is bust.  That means the banking system has to be immediately nationalized in a new currency.

Europe Crisis TrackerWSJ
Interactive service, seems to have updated data. Good example by Big Picture.

The summit will prove a footnoteThe World / FT
As economies worsen, voters are likely to revolt. Even under current circumstances there are huge doubts about whether last week’s EU agreement will ever come into force.

Gillian Tett and Robert Rubin on European Debt CrisisCharlie Rose
22min video interview

EU crisis road map – key milestones aheadPragmatic Capitalism
Some dates by Dow Jones FX Trader service

IMF euro rescue starts to
Days after leaders pledged to channel €200 billion through the International Monetary Fund (IMF) to help rescue the eurozone, the Czech Republic, Estonia and the German central bank have come out against the idea. Japan, Canada and the US are also sending negative signals.

Cameron Attempts to Snatch Defeat from Jaws of Victory; Euro Project Intellectually, Morally, Democratically BankruptMish’s

Water, water everywhere…alphaville / FT
ECB open market operations, marginal lending facility and overnight deposits at peak crisis levels.

EU Summit Dec 8-9th: Kicking the Can Some
At the very best, the recent EU summit served to do what eurozone leaders do best: buy time. But as with the last summit, what was announced was as important in some ways as what wasn’t announced: a number of details were not agreed and the ECB did not respond with an announcement that it would step in to support peripheral countries in the markets as a lender of last resort (LOLR).

The ghost of the Bundesbank haunting the halls of BrusselsLighthouse IM
The Bundesbank and the Dutch Central Bank seem to be financing the entire Euro-zone central bank system. As the music stops, the Bundesbank is taking away all chairs at the same time. Merkozy are still trying to save the Euro by severe austerity at the last minute, but it is too late. Financial markets have already revolted and put countries in various buckets via yield curve “triage

The European Instability and Stagnation PactFatasmihov
But imposing coordination combined with a short-term focus on what should be a long-term goal will not deliver stability or growth. It will lead to stagnation in the region and instability in some countries as fiscal policy is not allowed to play a proper countercyclical role.

Eurozone Rescue Rests on Shaky
Is there a mechanism for countries to grow their way out of trouble — and prevent debt from rising inexorably — while remaining in the euro? I am not sure there is, or that it is in the gift of politicians to bring it about. The agenda in Brussels was about keeping the euro together, with or without Britain’s help. Call me Anglo-Saxon, but there will surely be future summits where talk turns to how to manage the exit of some eurozone members.
Chinese response to the crisis was credit expansion
Has Putin Come to the End of His Regime?PIIE

China’s Deserted “Fake Disneyland”; Shanghai Prices Down 40% from Peak, Inventory Clogs Market; Pollyannas Proven Wrong; Implications for US DollarMish’s

FiveBooks Interviews: Rana Mitter on 100 Years of Modern ChinaThe Browser
A century after the fall of China’s last imperial dynasty, the legacy of revolution remains deeply ambiguous in today’s People’s Republic. The China scholar tells us the story of the country’s tumultuous changes from 1911 to 2011.

“Financial repression” part I: a recapalphaville / FT
“Financial repression” was common in the four decades after the second world war and is essential to understanding policymakers’ responses to current credit problems in the US, Europe and China.

“Financial repression” part II: a critiquealphaville / FT
In the meantime, it’s worth applying some healthy scepticism to the useful concept of “financial repression”. Because it’s possible that we’re not repressed, we’re just scared.

Six Tail Scenarios That Deutsche Bank Are Watching For Next YearZH
1) China and geopolitics 2) Japan/US/UK sovereign risk 3) inflation 4) QE change 5) US housing 6) US election

New Report Features CDS And Shadow Banking, Is Not In The Sunday TimesDealbreaker
A look at the latest BIS quarterly report, the whole report is worth the time and I highlighted it earlier.

Sociology of ideas: Richard RortyUnderstanding Society
Where do new ideas and directions of thought come from?  Is it possible to set a context for important changes in intellectual culture, in the sciences or the humanities?  Can we give any explanation for the development of individual thinkers' thought?

10 Business Lessons from the BattlefieldThe Big Picture
66 slides or everything I needed to know in business I learned from a first-person shooting game.