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Wednesday, May 16

16th May - US Open: Eurocrisis Holiday

The slide of Spanish bond markets was halted – either because of Hollande’s and Merkel’s statement that they will go easier on Greece, if it just sticks to the basic austerity program, or because ECB was supporting the markets. It could be both – we’ll see about this later. See last night’s US Close: GRRR!! for plenty of articles and remember to follow ‘MoreLiver’ on Twitter and Facebook.  

Greek bank deposits
Daily US Opening News And Market Re-Cap – RanSquawk / ZH
Frontrunning – ZH
The Lunch Wrap – FT
EM New York headlines – FT
Daily Press Summary – Open Europe
  Financial markets rattled as Greece set for new elections in June; Withdrawal of deposits from Greek banks accelerated following Greek elections

Overnight Summary – Bank of America / ZH
Spanish bond yields surging...
Morning MarketBeat: ‘Sell in May’ Working, So Far – WSJ
Broker Note Briefing: Wednesday – WSJ
Morning Take-Out – NYT
AM Dear Dairy: Calm – Macro and Cheese
US Open: Fear Overwhelms Everything – Marc to Market
The T Report – TF Market Advisors

Pre-market Commentary – Marketwatch
Pre-Market Trading – CNNMoney          
Pre-Market – NASDAQ
...but today pulling back
US Equity Preview – Bloomberg
Earnings & Events – The Street
MarketCurrents – Seeking Alpha

Debt crisis: live – The Telegraph
The Euro Crisis Blog – WSJ
Tracking Europe’s Debt Crisis – NYT
FX Options Analytics – Saxo Bank
European 10yr Yields and Spreads – MTS indices

Follow ‘MoreLiver’ on Twitter or Facebook.  

Note to Ambrose Evans-Pritchard at The Telegraph: You Have Excellent Insight as to What is Happening and Why, But Please Get a Grip on Reality as to SolutionsMish’s
As Pritchard suggests, Germany will indeed pay. Mathematically Germany must pay. It's something I have pointed out numerous times over the years. The problem as Pritchard notes is the flaw in the Eurozone in the first place.

Can Greek public opinion be turned?MacroScope / Reuters
European roundup

Hollande or Insurrection?Project Syndicate
For better or worse, Europe is now engaged in an revolt against the fiscal pact condemning EU member countries to austerity without growth. Will the election of François Hollande as French President shift Germany’s uncompromising stance?

The Eurozone crisis: Fiscal fragility, external imbalances, or both?
Unsustainable debt along Europe’s periphery is bringing the euro to breaking point. But this column argues that this is not simply the result of fiscal ill-discipline. After 2010, the Eurozone crisis went from a fiscal crisis to a balance-of-payments crisis – with different prescriptions for policy.

James Galbraith on the Euro CrisisEconomist’s View
Third part of the discussion

I know, I know, M2 isn’t exactly the right indicator Marginal Revolution
M2 money supply growth rates are plunging in Greece (down -16.8% y/y through February), Spain (down -4.7%), and Portugal (-3.8% through January). It is up only 1.3% through February in Italy.

Italian 10-year yield back at 6% as euro crisis continuesASA

BizDaily: Greek exit?BBC (mp3)
How much money is flowing out of southern Europe because of a possible Greek exit from the eurozone? Lesley Curwen talks to economist Gabriel Stein from Lombard Street Research. Plus Carl Elsener, CEO of Victorinox, talks about the Swiss Army knife without a blade. And technology commentator Jeremy Wagstaff argues that new technologies don't always mean the death of the old ones.
Greece on brink of collapse The Telegraph
Europe’s financial crisis lurched into a perilous new phase as dire predictions emerged of a collapse in Greece’s economy, with a run on its banks bringing an inevitable end to its membership of the euro.

Greeks apologise with huge horsethe daily mash
LOL: The nation of Greece said sorry to the European Union with a present of an enormous wooden horse.

Minister blames spike in Spain’s risk premium on Greece’s political problemsEl Pais
“Not our fault”

Spain Potpourri: Official Denials From Finance Minister; More Nationalizations Coming Up; Banks Use ECB Money to Refinance Large Enterprises in Dire Shape, New Credit To Households Down 80% - Mish’s
Those charts show the Spain is banking system is in deep, deep trouble in spite of official denials from the finance minister. Ponzi financing of the largest enterprises is the name of the game and the bond market has zeroed in on it. Yield on the 10-year bond has soared to 6.35%. I expect back above 7% soon.

Spain: A Lack Of AccountabilityThe Daily Capitalist
Like failure, accountability is an essential principle for the survival of a free-market capitalist system. It is quite dangerous for the political class to continue to hide its mistakes at the public’s expense. If markets are not forgiving when trust is gone, the people, as Greece reminds us, are even less so.

Tis an ugly morning in eurolandalphaville / FT
The Greek fall-out continues with Spanish 10-year yields hitting 6.5 per cent, their highest level in almost six months

Merkel and Hollande want Greece to stay in euroeuobserver
France's newly elected president and the German Chancellor on Tuesday said they want Greece to remain in the eurozone. The IMF, however, said an "orderly exit" must be considered if Greece does not stick to its reform commitments.

Greece’s predicament: Lessons from
Greece’s economic and financial crisis is quickly deteriorating and there is no strategy – or even a coalition government – to figure out what to do next. This column looks at the lessons from Argentina’s default in 2001 and argues that Greece’s road to necessary economic reforms, fiscal sustainability and recovery may be even more daunting.

Merkel-Hollande Meeting Yields Greece Growth SignalBB
And this is why the markets turned.

Plug-pulling in Athensalphaville / FT
Several Athens bankers voiced concern on Tuesday over a sustained outflow of deposits of more than €5bn since May 6, reflecting increased political uncertainty. That works out at an average of €700m per business day, up to May 15.

Emerging Markets Briefer - May 2012 Danske Bank (pdf)