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Thursday, January 5

5th Jan - Hungary in Eurovision

Click for a larger one. You know the drill.
I posted earlier today an editorial in "Addicts in Recovery" and a quick European Meltdown Roundup

- MoreLiver 

News 5-Jan evening – BTH
Recap 5-Jan – GMT
FX option vols – Saxo
Debt crisis: live – The Telegraph
Europe Crisis Tracker – WSJ

Goldman Remains Cautious On Europe As Negative Feedback AcceleratesZH
GS: Even the best case for early 2012 is likely to involve volatility around key events – programme reviews, auctions, IMF disbursements and periodic summit meetings – as in 2011. And we remain skeptical that upcoming events (the Merkel/Sarkozy meeting on January 9th or the EU leaders’ summit on January 30th) will give discrete breakthroughs.

The Italian bidalphaville / FT
The bid/offer spreads of the Italian bonds started to move in July and have continued higher all the time, even though the yield stabilized somewhat in December.

Europe's 2012 Monthly Bond Redemption ScheduleZH

A central bank is only as good as its targetalphaville / FT
Unsecured short-term money market rates are no longer a representation of real financing costs. So why not target the repo rates?

Central banks: Distortions aheadButtonwood’s / The Economist
QE’s trouble: what will the CB’s do with all their holdings – and what happens when they sell them?

Unconventional monetary policy in theory and in practiceBank of Italy (pdf)
Compares effectiveness of unconventional monetary policies adopted by the FED and ECB in response to crisis.

(more on Hungary in my earlier post)
Hungary — the good, the bad, and the conditionalityalphaville / FT
It’s not very often the EU would ask for media legislation to be changed before it sent money, for example, or that the IMF board would possibly have to consider US objections to a country’s new constitution.

Hungary: bad policies gone awrySober Look
Default is now becoming increasingly more likely.  One might of course ask the question: who cares about Hungary in the overall scheme of the eurozone crisis, given that the nation is not even a part of the euro?  The answer of course is Austria, whose banks are highly exposed to Hungary.

[Credit event auctions] Why do they exist?alphaville / FT
Why the (credit event) auction process was put in place, how it works, and why it may be biased — while discussing some rather curious cases along the way.

The 2-product, 2-customer wonder called AustraliaLighthouse
Half of Australia’s exports go to China and Japan, and 70% of growth in past ten years is because of them. Iron ore and coal are half of the exports. If either China or Japan has a problem, so does Australia.

The Decline of the Public GoodRobert Reich / EconoMonitor
We’re losing public goods available to all, supported by the tax payments of all and especially the better off. In its place we have private goods available to the very rich, supported by the rest of us.

Reading onlineBabbage / The Economist
Helps you make static, thematic maps from geographic data by bringing the best of traditional cartographic design to internet map-making.