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Wednesday, November 30

30th Nov - Nothing to see, move along

Today's fourth fifth post - that's how it is nowadays. Time has compressed, more headlines and volatility in a week than in a normal year. It is the bipolar rapid cycling between inflationary and deflationary scenarios, appetite for risk switching on and off in a blink of an eye. Notice the RED link on quant factors towards the bottom of the post.

News (Wed evening) – BTH
Recap (30-Nov) Global Macro Trading
FX option vols – Saxo
Markets Live – alphaville FT
Debt crisis: live – The Telegraph
EZ crisis Live blog – The World / FT
  
EURO CRISIS
The next strategic target: De Gaulle’s EU legacyvoxeu.org
The ECB seems to be in the background during this crisis – almost helpless due to Treaty obligations and dogmatic adherence to old monetary theories. This column argues that quite the opposite is true. The ECB is a full-blooded political actor engaging in a strategy aimed at forcing EU political leaders to embrace fiscal rectitude and a quantum leap forward in European integration. (I've featured this earlier, but perhaps on the second try you will read it)

30th Nov - Euro Basis Swap Superpost

Nothing but swap rate cut stuff. A shorter evening post coming in a minute.

- MoreLiver

EURO SWAP RATE
Euro Basis SwapTF Market Advisors
Will any of this come at a cost? Will there be renewed pressure for banks to forgive sovereign debt? With public opinion so heavily against banks, does all of this help for banks really still come without a cost to them? Politically there is a lot of support to make banks take some pain.

The central bank deal: Five things to knowWonkblog / WP
1) swaps to increase liquidity 2) the big countries are coordinating 3) a more permanent swap set-up 4) the markets are excited; the analysts are skeptically supportive 5) all eyes on European Central Bank.

30th Nov - Supplies, Supplies!

Ok, risk-on as repo rates are cut. Some already speculate that this could be in preparation for further action from ECB, as it needs more swap lines. The number of central banks participating in this is meant to signal that they are serious, they are coordinating their actions and are prepared to surprise the markets. I think they managed to score on all three - this is not a solution but at least signal that they are targeting one.

Elsewhere, China has started easing its monetary policy, the summits in Europe are in full swing and the audience is digesting the latest rumors of a schedule for a plan to solve the "thing". And of course:
  • HAGUE SAYS U.K. DEMANDS CLOSURE OF IRANIAN EMBASSY IN LONDON
  • HAGUE SAYS ALL IRANIAN STAFF MUST LEAVE
  • UK FOREIGN SECRETARY HAGUE SAYS HAS ORDERED CLOSURE OF IRANIAN EMBASSY IN LONDON, EXPELS ALL STAFF

30th Nov - Stabilité


Shorter post for now: S&P downgrades 37 banks, EFSF admitted (sort of) as a failure. I  like the latest journalistic heroism from Bloomberg revealing how much support the Federal Reserve actually gave to the banks during the 2008 crisis - the unwillingness of the central bank to give out the details and the reasons they gave for their reluctance was ridiculous. 

If someone asks and needs a bailout, of course it should be an embarrassment to the deadbeat. Of course Fed should explain and tell what they are doing with the public money. The funny thing about democracy is that the more political something is (like who is going to be bailed out and who is not), the less democratic and transparent the process becomes.

For the past few weeks oil prices have been relatively strong, especially given the risk off-decline in other assets, and no wonder: Iran, Syria, Iraq, Afghanistan and Pakistan look really like Trichet had stabilized them. Add to the explosive (sorry about the pun) mix Israelian, Chinese, Russian and American ambitions and a soap opera second only to the EZ crisis is in the making. The crude oil correlation with the S&P is thus breaking down for now.


Guest Post: Credit - The Eye of the Storm

Guest post by Martin from Macronomics

Markets update - Credit - The Eye of the Storm.

"The fishermen know that the sea is dangerous and the storm terrible, but they have never found these dangers sufficient reason for remaining ashore."
Vincent Van Gogh

As we move towards the nth European summit of the last chance on the 9th of December and with liquidity becoming scarce by the day, in today's post we will review ongoing liquidity issues, as well as some recent market developments and some previous calls.

Tuesday, November 29

29th Nov - Plan Bee-line


A pretty good financial stress indicator: 
the spread between Libor and secured (repo) rate
Very quiet. Too quiet. The plans and the rumors are in place, but belief and conviction are in short supply. Did anyone notice the US-EU summit? Are we going to notice this week's summits, or are we still waiting for the 9-Dec for delivery of something a bit more, eh, real?

There are some minute signals that maybe they are getting it now: at first a  mini- or bilateral fiscal union and heavy support from ECB, and later a full fiscal union for the willing (and able), with euro bonds and full backstop by ECB. 

What happens if they agree on the first step, but the second step becomes another forever-fiasco that never gets done properly? Even worse, what happens if they cannot agree even on the first step?

29th Nov - "Dear Santa,..."

From the SocGen's report
Today two nice pieces of research papers via Zero Hedge. I'm now updating the Calendar page.

Joke of the day: Italy should not be considered a weak economy…A breakup of the euro zone is out of the question. There is no plan B… French banks do not face significant problems with funding, so there is no need for the government to re-enact emergency lending facilities used in 2008 – French central bank governor Mr. Noyer on Monday in Tokyo. He has a history for this:

Race to the bottom as everyone wants a haircut.
Joke of the Day from 4-Oct: Swiss National Bank’s peg to the euro reflects optimism in the common currency – Central Bank of France’s governor Noyer speaking in Tokyo The Source / WSJ

News (Tue morning) – BTH
Recap (28-Nov) – Global Macro Trading
Danske Daily (29-Nov) – Danske Bank (pdf)
Market Preview (29-Nov) – Saxo Bank
Morning Briefing (29-Nov)BNY Mellon
  (esp. comments on Japan)

FX option vols – Saxo
Markets Live – alphaville FT
Debt crisis: live – The Telegraph
EZ crisis Live blog – The World / FT

EURO CRISIS
Citi: "Forget Decoupling" - Here Is How To Trade During The Sovereign TraumaZH
Despite Strong Corporate Balance Sheets...Don't Expect Decoupling...Trade The Phases of The Crisis Again In 2012! – Full research note on scribd

SocGen Sees $600 Billion QE3 Starting In March 2012 Sending Gold Up Between $1900 And $8500/OzZH
The French bank makes the simple case that the worse things get, the stronger the response by global central banks will be. – Full “Patience: bad news will become good news”-research note on scribd

Monday, November 28

28th Nov - Check, please mate.

FT's death sentence - will the governor call print in time?

The posts are getting increasingly massive. I did not find a single optimistic view on the EZ crisis, anywhere. This is this.

– MoreLiver
 
News (Mon evening) – BTH
FX option vols – Saxo
Markets Live – alphaville FT
Debt crisis: live – The Telegraph
EZ crisis Live blog – The World / FT

EURO CRISIS
European rumourthon misses the markmacrobusiness.com
very nice roundup

The Euro Area Is Coming to an EndView / BB
Peter Boone and Simon Johnson: Tragedy awaits. European politicians are likely to stall until markets force a chaotic end upon them. Let’s hope they are planning quietly to keep disorder from turning into chaos.

28th Nov - No stone unturned




Good morning! Today the bond auctions and especially the EU-US summit are followed for possible headlines – I covered the summit in my usual review & what’s ahead- post Weekender. Expect more from the European rumor factory this week – it seems the IMF/Italy bailout package was “just a trial balloon”. The Calendar page has been updated.  My best links of the last week can be found here.  Friday evening’s post might have escaped the attention of my European readers. You can follow me on Twitter and Facebook and email me for suggestions and requests.  

– MoreLiver

News (Mon morning) – BTH
Danske Daily (28-Nov) – Danske Bank (pdf)
Market Preview (28-Nov) – Saxo Bank

Morning Briefing (28-Nov) – BNY Mellon
FX option vols – Saxo
Markets Live – alphaville FT
Debt crisis: live – The Telegraph
EZ crisis Live blog – The World / FT

Frustration on handling of eurozone crisis to mark EU-US summiteuobserver.com

EURO CRISIS
Goldman: "As The Endgame Approaches, The Rally In AAA-Euro Area Sovereign Bonds No Longer Seems Sustainable"ZH
In a ‘break-up’ scenario, the creditor ‘core’ countries will be confronted with a wave of insolvencies, which would also worsen their fiscal position. And in the middle ground between these two outcomes, where we currently stand, the ECB will be intermediating growing intra-Eurosystem imbalances. Through this monetary channel at the heart of EMU, the ‘shadow’ credit risk of the core countries is already rising, and at an increasingly rapid pace.

Europe Scrambles for SolutionsTim Duy’s Fed Watch
Very good roundup on Italy, IMF, bank recap etc. One way or another, Europe will experience a massive credit shock.  Presumably, the ECB could help offset this by allowing governments to loosen spending to support demand and fund bank recapitalization.  But the path we are on appears to provide ECB help only in return for more austerity.  And it is that never-ending pursuit of austerity that leaves me bearish on Europe, regardless of the political news of the day.

Sunday, November 27

Best of The Week

Here are the best links from this week’s earlier posts. Yesterday’s Weekender had a long editorial on what to expect next week. I collected some recent journal articles in Back to School and explained Why I blog. You can follow me on Twitter and Facebook and email me for suggestions and requests.  

EDIT: I updated the Calendar page.

- MoreLiver



EURO CRISIS
Why stricter rules threaten the eurozoneCenter for European Reform (pdf)
The introduction of the euro spurred the emergence of enormous macroeconomic imbalances that were unsustainable, and that the eurozone has proved institutionally ill-equipped to tackle. North European policy-makers have been reluctant to accept this interpretation. For them, the crisis is not one of the eurozone itself, but of individual behaviour within it. If the eurozone is in difficulty, it is because of a few ‘bad apples’ in its ranks. In this interpretation, neither the design of the eurozone nor the behaviour of the ‘virtuous’ in the core were at fault.

Saturday, November 26

Weekender - 300% given

Greece already gave 300%!

Weekend! I just laughed with a friend that I missed an obvious headline: after Greece can give 100% and Greece can give 200%, the 300% came and went last week. EDIT: I updated the Calendar page.

The situation in Middle East is escalating. There are no credible parties to mediate the mess, so I expect things to get worse. I wrote about this on 28th Sep Eurovision and War in Middle East and recently on 25th Nov Depressed?  


***

The latest episode in the "plan of the moment" after the eurobond debacle is the "no investor losses for sovereign bond holders, except Greece". I kind of understand the logic behind it - as investors are scared of possible haircuts, bonds have been sold and periphery yields have reached levels where a failure is guaranteed. 

Friday, November 25

25-Nov - Close Shave of a Dead End

End of the week. End of many things.
Massive linkfest to end the week. Sorry about that. 'Weekender' and 'Best of' coming tomorrow. 

Leave a comment, follow me on Twitter, Facebook or email me.

- MoreLiver


EURO CRISIS
Death of a currency as eurogeddon approachesThe Telegraph
This has made it impossible to hedge against eurozone sovereign debt purchases, and thereby destroyed the market. Worse, it's made investors believe that the euro cannot be trusted, that it'll repeatedly find ways of reneging on contract. That's the point of no return. This is no longer a serious currency.

Worry About Narrowing European SpreadsThe Source / WSJ
If, on the other hand, a euro bond is agreed, in effect it means Germany and the rest of the core have agreed to pick up the bill. Oh sure, countries at the periphery will agree to structural changes in their economy and to strict rules on debt and deficits. But those rules will be broken. Investors know that and German debt will consequently suffer. Already there are signs of this shift in sentiment.

25 Nov - Depressed?

Good morning, again a long post as I did not put out a regular evening post yesterday – instead, I had a research review Back to School and a credit guest post The song of Roland. I also put out a new page, About this blog and me. An evening post, a weekender and a best of-posts coming later.

With the US Thanksgiving, the approaching Christmas and general dark moods and lack of proprietary action markets are low in liquidity and interest - the only things of interest are the emergency exits. The risk-off is in full swing and the eurocrats seem and sound terribly tired. Latest attempt to stop the rot is the proposed EU treaty changes and eurobonds. Of course that cannot and will not happen in the time that is left before something too big to fail and too big to bail out fails.

* * *

The aftermath from this crisis will be huge - the ERM breakup from early nineties is peanuts and 2008 will pale in comparison. Even the 1930's will feel like a walk in the park, because as a society we are totally unprepared for the austerity and solidarity required. Nobody will take the responsibility and nobody will say: "this is something I can live without - please have this, because you need it more".

Thursday, November 24

Back to School for Thanksgiving

Photo source
Some of you do not like reading journal articles – but most do. Therefore from now on I will post academic stuff in separate posts, and those who just want to follow the market-moving news can keep up with my regular posts. So, here is my first “Back to School” link fest. 

Guest Post: Credit - The song of Roland


And again a guest post by Martin from Macronomics. I earlier posted a regular linkfest Thanks. Giving mostly on German bond auction, which was also covered extensively and commented by me on yesterday’s evening post. New page, About this blog is also online. And now over to Martin, the floor is yours!  

Markets update - Credit - The song of Roland

"In The Song of Roland, Roland carries his olifant (ivory hunting horns made from elephant tusks) while serving on the rearguard of Charlemagne's army. When they are attacked at the Battle of Roncevaux, Oliver tells Roland to use it to call for aid, but he refuses. Roland finally relents, but the battle is already lost. He tries to destroy the olifant along with his sword Durendal, lest they fall into enemy hands. In the end, Roland blows the horn, but the force required bursts his temple, resulting in death." - Source Wikipedia.

The recent developments in our ongoing European tragedy inspired me this time around to use this particular legendary reference namely "The song of Roland". It is an interesting analogy as Oliver (European leaders) are asking Roland (Germany) to use the Olifant (to unleash the unlimited resources of the ECB) to call for aid (ECB). In the end, Roland blows the horn...but is it already too late for Europe?

24th Nov - Thanks. Giving.

While news, given crisis not crazy
Today a lot more on the German bond auction, it was also covered extensively and commented by me on yesterday’s evening post. New page, About online. Happy Thanksgiving, I've included one upbeat and one downbeat video, so basically my position on TG is flat - I'm an European, after all!

Wednesday, November 23

23rd Nov - Why I blog and Germany

Summary & Views: Ok, the German bond auction is some sort of a game-changing event. Either the market is staying away from the low yields, or scared of Germany picking up the bill, or maybe even not picking up the bill. Perhaps alphaville got it right with their view of eurocrats keeping the repo rates artificially low (below in German bond auction links). 

Barroso’s eurobond proposal was immediately shot down by Merkel, and not much is heard from the extended IMF lines, probably built to handle the possible and very poorly hidden bailout by the ECB. 

Whatever the reason, the market is signaling there is enough debt out there already. A realistic bond yield level (without QE and given the growth- and debt prospects) for Germany would be somewhat higher. That would mean Germany would be unable to act as a credible backstop, even if it wanted to.

23rd Nov - On the road to French AA

China's PMI falling. Bad.
Middle of the week, slower on the material. Today the trouble with Dexia and China's PMI are the most important news - the imminent danger of France losing its AAA-rating and following that the death of any pretension that the EFSF would fly is the event everyone is expecting. This includes Germany and the ECB, as it will be the final turning point in the crisis - either Germany will pick up the work or allow the ECB to do it, or the only solution left will be a breakup.

Tuesday, November 22

22nd Nov - Stealth QE?

Spanish 2s10s inverted. B
No great news - except the Spanish have trouble even selling t-bills. Yield curves are inverted or about to invert, while CDS prices are exhibiting inversion across the markets. The link marked red is a must-read!

The links under IMF are probably the most relevant articles with any "new" information: as the ECB will not bend (yet), the IMF rumor had to be fired up again, and the fund announced technical changes allowing it to provide a lifeline to outcast countries. 

But the math is brutal - with the current war chest
Same spread as above, but longer time frame. Bad.
IMF could fund Italian and Spanish funding needs for couple of months at the current rate of ECB bond purchases - but as the plan of last week was that ECB would fund IMF, and IMF would bail out PIIGS, the IMF's announcement could and should be taken at least somewhat seriously. 
 
Should Germany cave in on the demands from everywhere else to allow ECB to do QE indirectly, the IMF's action at least makes it now technically possible. On the other hand, what is SMP but a mini-QE? 200 billion down the drain, if you ask me. Oh the joy when the ECB needs a recap in the endgame.

22nd Nov - Behave Yourself

Last night I posted La La Land and have little to comment on my editorial there. Commentary today is again giving very little hope for a happy ending and a great unraveling of the euro project is seen probable. The tone is also changing – what was once deemed impossible or unwanted (euro exits) is now seen as inevitable, something to hope for and ultimately beneficial. But try getting that message through to the eurocrats. Today's featured video is @Google Presents: Daniel Kahneman, uploaded on 10th November.

- MoreLiver


News (Tue morning) – BTH
Danske Daily (22-Nov) – Danske Bank (pdf)
Morning Briefing (22-Nov)BNY Mellon
Market Preview (22-Nov) – SaxoBank
Today in Euromess (21-Nov): Time for a eurobond? – Wonkblog / WP
Weekly Bull/Bear RecapRational Capitalist Speculator
  RCS's weekly came out late, but is still worth it.

Monday, November 21

21st Nov - La La Land

Just like in 1992, the CA balances kill the euro dream
A lot of writings coming out. The commentator's confidence in EFSF is completely gone. Comments are dominated by breakup scenarios, but some chance is seen for an eventual ECB backstop as long as some sort of fiscal union is in place first. 

The banks are holding the accumulated CA balance.
The talk is that the game is over before February, and there is no chance the eurocrats could agree on eurobond details in that time. So the only workable solution that would buy 6-18 months of time is the ECB and even then in that narrow window of opportunity they would have to agree on the details of the fiscal union and common bonds.

Guest Post: Credit - Goodwill Hunting Redux

Guest post by Macronomics, a standard evening post coming later. Have a good one!

- MoreLiver

Markets update - Credit - Goodwill Hunting Redux

"Errors of opinion may be tolerated where reason is left free to combat it."
Thomas Jefferson

21st Nov - D&D: Devaluations & Defaults?

D&D: Devaluations & Defaults? (source)
Today some research from Nomura, GS and MS plus lots of editorials and views. The discussion is definitely moving towards the “New Europe”, and consensus that the current system and its fixes are more or less finished. A lot of material and a long post, but so it is after the weekend’s publishing spree. 

Let's roll the d20 and see what comes up next: a wandering van Rompuy, a mystical Sovereign Wealth Fund from the far-away lands or perhaps a magical +1 EFSF? The excitement just never stops in the D&D universe!

Please notice Saturday’s particularly nice Weekender - When a massacre is a comic relief and ECB to QE or not to QE?, an euro crisis-special on the possibility of quantitative easing by the European Central Bank. Also, the standard Best of the week just got online. Leave a comment, follow me on Twitter, Facebook or email me.

Quote of the Day: And what is the new president of the ECB doing? Lecturing people on the need for discipline. – Paul Krugman / NYT

Quote of the Day 2: But no, the ECB will defend its credibility. And it will end up as the highly credible defender of the value of a currency that no longer exists. – Paul Krugman / NYT

Best of the Week

Here are last week's better links. On weekend I posted a particularly nice Weekender - When a massacre is a comic relief and ECB to QE or not to QE?, an euro crisis-special on the possibility of quantitative easing by the European Central Bank. Leave a comment, follow me on Twitter, Facebook or email me.

Reposting to other websites is authorized by prominently displaying the following sentence, including the hyperlink to this page, at the beginning or end of the post:
"”Best of The Week” is republished with permission of MoreLiver’s Daily."

EUROCRISIS
Decision Time For Europe: The Definitive Presentation On The Future (Or Lack Thereof) Of The EurozoneZH
Swiss private bank Pictet’s research paper: Current response to the crisis has created conditions leading the euro area towards depression…things are going to get worse before European authorities decide to wheel out their heavy artillery.

Saturday, November 19

Weekender - When a massacre is a comic relief

Euro Princess, source
Another massive Weekender linkfest with summaries, roundups and recipes for disaster, plus the usual lighter readings to alleviate the pain of the crisis-reality. Even reading about the Italian mafia, the Jonestown massacre, Terry Pratchett’s planned assisted suicide and a possible breakdown in physics (this week both standard model and special relativity are threatened) are a much-welcomed change.

I previously posted  ECB to QE or not to QE?, an euro crisis-special on the possibility of quantitative easing by the European Central Bank. Later I plan to post some pickings from the recent financial research and a Best of the week-list. Remember to follow MoreLiver's Daily on Twitter, Facebook or email me.

– MoreLiver

Quote of the Weekend: The pope can drink wine but not meet girls while the sultan has a harem but cannot touch booze. The Europe’s princess has the best wines and nothing to do, but she is constantly under the watchful eye and can only sniff the cork a bit. – Mr. Jiri Salin

ECB to QE or not to QE?

Should the ECB start massive QE, and will it do it? These have not been previously linked by me. If you like, I can edit and add stuff from previous posts and make this a "continually updated special".

Reposting on websites is authorized by prominently displaying the following sentence, including the hyperlink to this page, at the beginning or end of the post. "”ECB: To QE or Not to QE” is republished with permission of MoreLiver’s Daily."
 
Strategic Briefing: The ECB's Last Stand?The Capital Spectator
Several recent or classic summarized articles on ECB.

Friday, November 18

18th Nov - The last Summit?

Artist: Javier Peñalba Cerrill
Good day! Long postings coming later today and during the weekend. Prediction for the next three years: half of my audience will have to make a new choice of career. Don't let that thought ruin your weekend, though.  
– MoreLiver

News (Fri morning) – BTH
Today in Euromess (17-Nov) – Wonkblog / WP
Recap (17-Nov) – Global Macro Trading

Morning Briefing (18-Nov)BNY Mellon
With the end of the week approaching, it is worth pulling together a few key developments in the Eurozone crisis.

Danske Daily (18-Nov) – Danske Bank (pdf)
FX option vols – Saxo
Markets Live – alphaville FT
Debt crisis: live – The Telegraph
EZ crisis Live blog – The World / FT

Playing Chicken With The ECB: The Market Has Issued A Boycott On Draghi Until He PrintsZH
BoA: We are all waiting for the catalyst to a better or worse market - to us this means that the markets are now waiting for the ECB to step in… While the relevant time horizon is highly uncertain it feels more like a matter of two weeks than two months.

Thursday, November 17

17th Nov - The IMF Conspiracy

Where's the easing ECB?
Now this is getting interesting. If the ECB is not comfortable to bail out EZ countries and banks, but IMF, China and USA either cannot afford to or do not see the point in spending their funds, the job has to be done by ECB. The latest rumor is that the IMF would loan money from the ECB and do the bailouts, thus leaving ECB’s reputation impeccably clean. Is this related to today’s news that the head of IMF’s European department just resigned, after just one year in the role, due to “personal reasons”?

In the markets the usual bloodletting is going on. The Spanish bond auction went miserably and ECB was again very active in the secondary markets. Today’s link fest is huge. Expect more of the same, as this is how beautiful it can get. Soon we will see the eyes of a dead market. And this is this.
 
 – MoreLiver

17th Nov - Stuck in a VERY local optimum

Something must be happening behind the scenes, but clearly more pain is required before the political leaders will commit to a real solution (ECB printing, Eurobonds, Germany leaving or PIIGS leaving). Markets are slowly but surely adding pressure through bond yields and a negative feedback of margin calls, liquidation, bank balance sheet reduction and market’s lack of faith in increasingly meaningless statements is going on.

With some luck, they can muddle through the holiday period, perhaps by canceling bond auctions or using ECB support to give the illusion that the situation is not hopeless. I just do not understand what the hell they expect to change in the coming months. Is the idea that banks can offload their positions in the European sovereign junk bonds to the ECB, and then a real solution is made? Or am I too optimistic in my assessment of the euro leaders’ capabilities, and they are in fact just stunned? This is what I mean with today's headline: for policymakers, the VERY local optimum is not doing anything for now, and that is very, very far away from the global optimum of doing something.

Wednesday, November 16

17th Nov - Belgium and Finland getting contagion


Source: NYT
Now even Belgium has trouble selling treasury bills. The deeds of the elderly have followed us into the sanctity of our homes. It is already all over unless the ECB starts printing.

Quote of the day: I think we have maybe a few months — it could be weeks, it could be days — before there is a material risk of a fundamentally unnecessary default by a country like Spain or Italy which would be a financial catastrophe dragging the European banking system and North America with it. So they have to act now. – Willem Buiter, Economist at Citigroup

16th Nov - Who blinks first dies

Just posted a credit overview guest post by Macronomics, and for my European readers please note last night's linkfest Rain in Spain. Here are today’s links.

News (Wed morning) – BTH
Recap Nov-15 – Global Macro Trading

Danske Daily Nov-16 – Danske Bank (pdf)
FX option vols – Saxo
Markets Live – alphaville FT
Debt crisis: live – The Telegraph
EZ crisis Live blog – The World / FT

EURO CRISIS
Presenting Deutsche Bank's Pitchbook To The ECB To Go "All In"ZH
With full slides on DB’s report “The Tipping Point – Time to Call the ECB”. This week's must-read - and it's only Wednesday!


Presenting Europe's Remaining 2011 Bond And Bill Auctions... All 104 Of ThemZH
This is a good one from Barclays - has details too!

Guest Post: Credit - Mind the Gap...

Guest post by Martin from Macronomics.

Markets update - Credit - Mind the Gap...

"There is a time to take counsel of your fears, and there is a time to never listen to any fear."
George S. Patton

Tuesday, November 15

15th Nov - Rain in Spain


Italian spread to Germany - easy to see ECB's SMP-actions
Just after I said it that Spain is the new Italy…Terrible t-bill auction. France and Belgium are now part of the fun. It is easier to name the countries that are NOT in the circle of contagion: Germany, Netherlands and Finland.

News (Tue evening) – BTH
FX option vols – Saxo
Markets Live – alphaville FT
Debt crisis: live – The Telegraph
EZ crisis Live blog – The World / FT

Then the French spread to Germany
EURO CRISIS
Europe Gets It Peter Tchir / ZH
What has
Europe done, hasn't done (that they were supposed to), hasn't done (that wasn't in the plans)

French and German bond yields diverging
It’s a capital ratio of two halvesalphaville / FT
Markets are not currently playing nice about handing capital to the banks, making new funding rather expensive. Given this, banks are taking aim at the denominator of the capital ratio by deleveraging their balance sheets. Some are even getting all fancy about it by re-jigging their models to have lower risk weights than previously… It’s like a veritable garage sale out there… and it’s going on all in the same street.
Wonder what that will do for prices.

15th Nov - Damage reports


On the theme Spain is the next Italy, notice the uncertainty caused by the general elections next Sunday and the bond auction on Thursday. Good luck!  – Moreliver

News (Tue morning) – BTH
Danske Daily – Danske Bank (pdf)
Morning Briefing – BNY Mellon

FX option vols – Saxo
Markets Live – alphaville FT
Debt crisis: live – The Telegraph
EZ crisis Live blog – The World / FT

EUROCRISIS
European Portfolio Strategist 10th NovCiti (scribd)
40 pages: Euro to survive, To ECB or not ECB, Political risks, Market Risks, What to do.

The Future of the Eurozone and U.S. InterestsCongressional Research Service
32 pages prepared for members and committees of congress.

Monday, November 14

14th Nov - Bonds, jammed bonds.

From the Pictet's report featured here.
Monday was supposed to be a good day: Berlusconi had left and a technocrat government took over during the weekend, while Greece got a new government. ECB was supporting the Italian bond auction as an inauguration present. Meanwhile, Spanish bond yields were moving towards the 6% “level of death”. After the initial happy times, markets remembered that the problems have not changed even though the faces of some of the players changed. Spain is the next Italy, while Italy could become, well, more Italian. Iran is worth keeping an eye on, but I warned about that weeks ago. Follow MoreLiver's Daily on Twitter, Facebook or email me.

From of two minds.
Trade on!  – Moreliver
EFSF yield rising even faster than member yie


News (Mon evening) – BTH
Morning Take-Out – DealBook / NYT
Opening BellDealbreaker
This October everyone googles for "bond yields"
Morning Briefing – BNY Mellon
  (comments from Sarkozy and Merkel)
FX option vols – Saxo
Markets Live – alphaville FT
Debt crisis: live – The Telegraph
EZ crisis Live blog – The World / FT

EUROCRISIS
Perspectives Nov 2011Pictet & Cie (pdf)
Europe: some respite from the debt crisis, Safe havens – chasing rainbows? etc.

Special report: Europe and its currencyThe Economist
Notice that there eight parts to this report.