Here are the regular links for the US open and a big article pile to chew
on. See previous two US Close: Beatings Will Continue
Until ... and EU Open: Spainout coming... for more and some thoughts of mine. I know I am not surrounded by intelligent, market-savvy professionals, and this might be obvious to my readers, but it is an interesting point that the German bonds include a currency option that pays out in case the eurozone breaks up. So it is not only the run to safety and deflation that is driving the bond yields ever lower.
Frontrunning
– ZH
The Lunch
Wrap – FT
EM New York
headlines – FT
Overnight
Summary – Bank
of America / ZH
Today’s
Front Pages – presseurop
Daily Press
Summary – Open
Europe
Spanish
government denies asking ECB to take part in Bankia recapitalisation plan; El
País: European Commission will demand relaxation of Spain’s deficit targets
Morning
MarketBeat: Stock Rally On Repeat – WSJ
Broker Note
Briefing – WSJ
Morning
Take-Out – NYT
AM Dear
Dairy: Back to Earth – Macro
and Cheese
US Open: One
Driver: European Crisis – Marc
to Market
Pre-market
Commentary – Marketwatch
Pre-Market
Trading – CNNMoney
Pre-Market
– NASDAQ
US Equity Preview – Bloomberg
Earnings
& Events – The
Street
MarketCurrents
– Seeking
Alpha
Debt
crisis: live – The
Telegraph
The Euro
Crisis Blog – WSJ
FX Options
Analytics – Saxo
Bank
European
10yr Yields and Spreads – MTS indices
EURO CRISIS: GENERAL
EC Says It Is Willing To Envisage Direct ESM
Bank Recapitalizations – ZH
Far less than meets the eye: as a reminder, this is the EU... not the ECB... and not Germany.
Far less than meets the eye: as a reminder, this is the EU... not the ECB... and not Germany.
EU calls for banking union, direct
recapitalization of banks – Reuters
The euro zone should move to a banking union
and consider directly recapitalizing banks from its permanent bailout fund, the
European Commission said on Wednesday in annual economic recommendations that
shone a critical light on Spain.
Forget full fiscal union. This crisis has
already stretched European solidarity, such as it was, to the breaking point… In
the medium term, Europe needs to drop its blithe commitment to “ever closer union” and adopt a
more discriminating approach. It needs as much union as required to make the
single currency viable, and no more.
It’s Groundhog Day for saving the euro zone – Opinion
/ Reuters
But remember: That movie ended. And every day
wasn't the same. Bill Murray made incremental changes – painful ones – until he
figured his way out. That’s what the euro zone is doing right now.
“Europeans” need enough solidarity to forgive
the mistake that was the careless creation of the euro, avert our minds from
the undemocratic capture of centralized power that a concerted response to the
crisis requires, and keep taking a medicine that politicians we hardly know
would administer. That is a very, very tall order, but it is the order of the
day.
The referendum is crucial, as it determines a
crossroads for Ireland. Securing a ‘Yes’ to the treaty is,
in our view, essential for
stability and further economic recovery. A ‘No’ would lead to a very uncertain
financial outlook with potentially significant economic ramifications.
The riddle of German self-interest By Martin
Wolf – Steve Collins / Twitlonger
How, I wonder, do Germany’s policy makers imagine they will halt the eurozone’s doom loop? I have
two hypotheses. The first is that they believe they will not. They expect that
life for some of the vulnerable economies will become so miserable that they will
leave voluntarily… second hypothesis is that the Germans really think these
policies could work.
Where the euro went wrong - a frank assessment
from one leading German policy adviser, Joachim Bitterlich, who was there at
the currency's birth. Plus we hear both sides of the debate about patents. We
speak to Paul Ryan, the boss of one of the companies blamed for fuelling the
patent wars, Acacia Research; and to David Martin of M-Cam, who says
"patent trolls" who buy up patents in order to launch legal actions
are holding back innovation.
The EU commission will on Wednesday (30 May)
publish reports and binding recommendations on each member state's economy, as
part of its increased budgetary surveillance powers.
Press release ECB Publishes its Convergence
Report 2012 – ECB
assesses
the progress made by eight EU members in fulfilling their obligations regarding
the achievement of EMU. (Full pdf)
EURO CRISIS: SPAIN
ECB's Refusal To Play Ball Means Spain Has To Foot A €350
Billion Bailout Bill Alone – ZH
J.P. Morgan: the sort of burden sharing that the Spanish government wants is not on offer. It could be argued that the government is delaying asking for EFSF/ESM help in the hope that the rest of the region will change its stance. Certainly a Greek exit would likely catalyse the kinds of changes that the Spanish government wants. But, it is not clear that Greece will exit anytime soon. Spain probably doesn’t have the luxury of waiting.
J.P. Morgan: the sort of burden sharing that the Spanish government wants is not on offer. It could be argued that the government is delaying asking for EFSF/ESM help in the hope that the rest of the region will change its stance. Certainly a Greek exit would likely catalyse the kinds of changes that the Spanish government wants. But, it is not clear that Greece will exit anytime soon. Spain probably doesn’t have the luxury of waiting.
Spain’s long climb to the
liquidity hospital [updated] – alphaville
/ FT
J.P. Morgan: bailout package (EFSF recaps banks) to be negotiated, possibly SMP used to suppress yields during that time.
J.P. Morgan: bailout package (EFSF recaps banks) to be negotiated, possibly SMP used to suppress yields during that time.
If the potential costs to Spain of a euro exit are
piling up, wouldn’t that make it less likely to exit — and therefore increase
its credibility in the eyes of investors? Not really, says Pettis.
Spanish regional profligacy sits as a worrying
lesson for the eurozone – Open
Europe
If Spain faces difficulties in achieving more
fiscal centralisation in its own country, due to political constraints, how
much more difficult will it be for the single currency to achieve similar
centralisation at the level of all 17 Eurozone members – considering its own
number of different parliamentary and economic models, government structures,
and cultural preferences? Just a thought.
Time to get real? – MacroScope
/ Reuters
For the next couple of month things aren't too
acute but the country faces hefty refunding humps in August and October which
could prove difficult. It will want borrowing costs to be significantly lower
by then which will require measures to foster investor confidence.
The problems of Spain’s economy all stem
from the fact that the government sector is attempting ( or being forced ) to
implement an austerity program at a time when the private sector is in deep
retrenchment. Given the economic and political circumstances the country finds
itself in it may have no choice, but that won’t change the outcome.
Spain is up next in As The Euro Crisis Turns after it admitted that it can't
afford to bail out its banks.
EURO CRISIS: GREECE
Greek exit from the Eurozone: Neither
inevitable nor desirable – voxeu.org
Avinash Persaud: Should Greece leave the Eurozone? This column argues that aggressive restructuring of
Greek debt within the Eurozone, rather than departure, is the best option.
Richard Koo’s prescription for Greece (and Germany) – alphaville
/ FT
But eurozone bonds (aka eurobonds) are not the solution, he says. Firstly, Greece needs to address its mutual distrust problem with Germany, and persuade the Germans that it will get serious about this tax collection thing.
But eurozone bonds (aka eurobonds) are not the solution, he says. Firstly, Greece needs to address its mutual distrust problem with Germany, and persuade the Germans that it will get serious about this tax collection thing.