Weekend's market-related reads from the web.
Earlier on MoreLiver's:
Press Digest select articles from The Economist, The Telegraph, Der Spiegel
EURO CRISIS: GENERAL
A few thoughts about the Euro snafu… – Macro Rants
If Germany wants to remain an export powerhouse, it must find paying customers — which excludes much of the current EU membership. Germany would have to restructure its economy too (away from exports) to make the Euro work. Looking only at financial costs, it’s a no-brainer for Germany to shrink the Euro membership or to revert to a (new) D-mark.
The status quo, even with ESM and fiscal compact, is unstable and unsustainable. The market lull must be used by leaders to prepare the next steps.
Two EU bodies spending money like no tomorrow – euobserver.com
There are around 50 officials at each committee with a minimum salary of €123.890 and six officials at each committee earning over €180,000 - more than the Dutch or UK prime minister.
EU agrees new rules on 'shady' derivatives – euobserver.com
The parliament, member states and the commission agreed the final text of new rules meant to bring transparency to the over-the-counter (OTC) derivatives market. “The era of opacity and shady deals is over”, said EU internal markets commissioner Michel Barnier (the clown behind the credit rater criticism and multiple other idiocies)
EURO CRISIS: GREECE
Greek agreement with Troika – scribd
51-page document, dated 9-Feb from a deniable source
Greek Endgame in Sight – Credit Slips
1) seeming shift in the attitudes of European leaders, 2) dramatic, but unsurprising deterioration in economic and social conditions in Greece, 3) rich Greeks have already taken their wealth abroad
Let My People Go! – TF Market Advisors
Those betting on a “solution” are likely to be wrong. The focus now should be what happens with a Greek default.
Why the Greek Bailout Doesn’t Change Much of Anything – TIME
Thursday’s deal is supposed to allow Greece to avoid default and prevent the Eurozone from breaking up – but the deal isn’t final, it can’t work, and the real problems lie elsewhere.
As the crisis in Greece continues, the comparisons with Argentina’s chaotic bankruptcy a decade ago start to look more justified.
In Greece, it is time to tell the bitter truths but also time to attribute justice. Those who have benefited all these years should pay the high amount of the bill.
Violent Protests in Greece; 6 Cabinet Members Resign; LAOS leader "I Would Rather Starve Than be Under German Jackboot"; Controversy Over Missing Paragraphs – Mish’s
It should be perfectly clear Greece is already in a state of dysfunctional chaos. That said, things can always get worse, and they will.
Podcasts
ING’s Brzeski Says Greece Can Still Bring Down Euro – BB (mp3)
BGC’s Buik Says Chances Slim That Greece Succeeds – BB (mp3)
JPMorgan’s Frenkel Says Greece Needs Growth – BB (mp3)
Nordvig Says Best Choice for Greece Is Horrible – BB (mp3)
Nordvig Says Best Choice for Greece Is Horrible – BB (mp3)
The Long View: Sovereign Debt (Feb-7, 28 min) – BBC (mp3)
Jonathan Freedland examines the Greek sovereign debt crisis in the light of King Edward III's decision to default on his debts in the 1340s.
EURO CRISIS: BANKS
Overview of the capital plans – EBA (pdf)
The EBA bank recap, broken down – alphaville / FT
EBA may ease rules if bond yields stay low-Enria – Reuters
European banking regulators may ease demands on capital buffers for banks should a recent drop in sovereign debt yields prove lasting, Italian daily Corriere della Sera on Saturday quoted the chairman of the European Union's sector watchdog as saying.
Future of bank benchmark rate under review – Reuters
A global probe into whether banks colluded to set the interest rates at which they borrow money from each other has thrown into question the future of the benchmark they use to price financial products worth an estimated $360 trillion (228.62 trillion pounds).
EURO CRISIS: ECB
Those haircut-heavy credit claims – alphaville / FT
On the ECB’s new policy of easing national central bank’s collateral policy: the range of assets differs by country. Spanish banks can’t pledge mortgages to their central bank, but Irish banks can. Accepted currencies also vary. Austria only accepts euro-denominated claims while Spain allows those “denominated in euro or in major foreign currencies”
Preventing collapse isn't enough – Free exchange / The Economist
The ECB's willingness to allow the euro zone to fall into recession in order that inflation might fall has made it substantially more difficult for the single currency to resolve its serious structural issues.
COMMODITIES
Whither Crude – ZH
Morgan Stanley: geopolitics, supply concerns to keep crude slightly bullish despite bad fundamentals
Petroleum 3-Month Rolling Average Turns Sharply Lower; Negative Shipping Rates; Collapse in Global Trade – Mish’s
dropoff in gasoline and petroleum usage in the US, coupled with falling shipping rates, a drop in Japanese Exports Three Consecutive Months, and a European Recession poised to get much worse, makes a strong case that a collapse in global trade is underway.
Why Is Gasoline Consumption Tanking? – of two minds
Gasoline deliveries reflect recession and growth. The recent drop in retail gasoline deliveries is signalling a sharp contraction ahead.
Peak Everything - Oil, Food, Water: Is Everything Past its Peak? – BB
By 2030, the global middle class is expected to grow by two-thirds. That’s 3 billion more shoppers. They'll all want access to goods, including water, wheat, coffee and oil. Is there enough for everybody? Can business satisfy demand and avoid hitting "peak everything?"
OTHER
Bullish sentiment can be bullish, not bearish – Humble Student of The Markets
Positive sentiment together with low ownership is bullish.
Hating Bonds – The Source / WSJ
With very little upside left on bonds, investors are effectively betting that conditions won’t change for the next decade or two. Any improvement, any recovery, almost anything at all will ensure they take losses on their investments.
The Best of, Part 13: “Rules” – The Aleph Blog
Probably the biggest new thing I did at the blog was start “The Rules” series. Personally, I think all of them are best articles, because they proceed from deeply held beliefs of mine.
Alex – the cartoon banker with a remarkable feel for the markets – MoneyWeek
The Said Business School at Oxford University has analysed the text of the last 5,800 Alex cartoons to see how the wording and subjects correlate with financial, social and political trends. The results are fascinating.
World’s Dumbest Traders Were at Credit Suisse: Jonathan Weil – BB
The guilty pleas last week by two former Credit Suisse Group (CS) traders, on charges of falsifying their company’s asset values, revive an age-old question: How dumb do you have to be to get criminally convicted for a fraud you committed while working at a bank deemed too big to fail?
The guilty pleas last week by two former Credit Suisse Group (CS) traders, on charges of falsifying their company’s asset values, revive an age-old question: How dumb do you have to be to get criminally convicted for a fraud you committed while working at a bank deemed too big to fail?
Special report: The twilight of the Bond King – Reuters
(PIMCO’s Bill Gross) is the man who made bond investing sort of sexy - and now he may pay the price.
Stockbrokers: A Guide to Private Placement Due Diligence – The Reformed Broker
Brown's Law of Product Compensation states that the more a broker is paid to sell a particular product, the worse that product is for their clients.