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Wednesday, March 21

21st Mar - Yields and Growth, We All Hope

"You are here"
Good morning America!  Evening post coming up later, for now enjoy these somewhat off-topic articles. Eurocrisis is on a short holiday but the sequels (Greece III, Portugal II) and whole new twists (Spain and Germany's reluctance) are coming soon to theaters near you. I’m on Twitter, Facebook, email, Ask me anything – I’m eager to please.

News And Market Re-Cap – RanSquawk / ZH
Frontrunning – ZH
The Lunch Wrap – alphaville / FT
Emerging: N.Y. headlines – beyondbrics / FT
Morning Take-Out – DealBook / NYT
EZ Crisis Daily Press Summary - Open Europe

Germany’s guarantees under the bailout funds could exceed size of the country’s 2012 budget; Germany’s far-left Die Linke challenges fiscal treaty in German Constitutional Court

Austrian banks exposed to Central and Eastern Europe - a risk?Saxo Bank
Does it make sense for the Austrian banks to trade to a premium to the Italian banks? Given both the relative and nominal amount of risk exposure to the CEE region, Austrian banks might soon trade at same P/B levels as the Italian banks.

Greece’s new bonds: Is another default coming?
Last week’s historical restructuring of Greek debt appears to have gone smoothly. This column argues that appearances may be deceptive.

Fed Is Ready to Act if Europe Falters Again: BernankeCNBC

Expecting Growth... And Inflation?The Capital Spectator

Don't Worry, Be Happy: Treasury Yield EditionMacro and other market musings
expected growth rate of nominal GDP or aggregate demand is strongly related to the 10-year treasury yield…(also high positive correlation between the stock market and the market's inflation forecast)

STOCKS: No Record Profits For Old Assets: Jim Montier On Unsustainable Parabolic Margin Expansion For DummiesZH
It is widely known that US corporate profits recently hit an all time high. What is less known is that in Q4, profit margins for the first time rolled over by 27 bps, and double that if one excludes Apple (GMO’s full pdf).

STOCKS: Where are the corporate profits headed?Pragmatic Capitalism
The key point here is that without a big debt boom and an enormous and probably historic investment boom the corporate profits picture is likely to come under more pressure as we head into 2013.  And if the budget cuts are sharper than expected we can expect a substantial hit to corporate profits.

China reform may require a deeper crisisBreakingviews / Reuters
The trouble is that China lacks external creditors or voters to hold leaders to account and make these reforms a reality.

Goldman Sachs history shows resignation naiveteBreakingviews / Reuters
By the numbers, Goldman has thrived. What the firm failed to calculate was the cost to its reputation of a success born less of helping customers than helping itself.

Craving a High: Trading on DopamineThe Psy-Fi Blog
Neuroeconomists, that breed of behavioral researchers seeking to link actual brain function to real human behavior, are fascinated by people who exhibit what they refer to as excessive risk taking and whom the rest of us refer to as “scary”.

Former Trading Floor Professional : 'People Yell. That's Rough, But Efficient'The Guardian
This monologue is part of a series in which people across the financial sector speak about their working lives

Babel, banks and broken business modelsalphaville / FT
his latest paper, which proposes a “common language” for all financial data, has the potential to go Biblical on many a bank’s business model. On financial intermediation itself, maybe.

Barclays Sheds ‘Capital’ From Its Investment Bank’s NameDealBook / NYT

Inside the Chinese Boom in Corporate EspionageBusinessweek
In terms of outright theft of intellectual property, there is growing evidence that China’s intelligence agencies are involved, as attacks spread from hits on large technology companies to the hacking of startups and even law firms.

Innovation History via 6,000 Pages of Annual ReportsFlowing Data
Fathom Information Design, in collaboration with GE, visualizes GE annual reports from 1892 to 2011. It doesn't sound so interesting at first, but browse the appearance of keywords, and you do get a sense of change.

Buffett Seizes Lead in Bet on Stocks Beating Hedge FundsBB
Warren Buffett made a friendly bet four years ago that funds that invest in hedge funds for their clients couldn’t beat the stock market over a decade. So far he’s winning.

ExtrasBPS Research
Brain and behavior: Eye-catching studies that didn't make the final cut

How One Response to a Reddit Query Became a Big Budget FlickWired
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Hedge Fund Market WizardsAmazon 
Jack D. Schwager, the author of the classic Market Wizards-books, is coming out with a new book, other books by Schwager here. The book is out in May, preorder now.