News roundup – Between The Hedges
News
roundup – The Trader
The 6am Cut
London – alphaville
/ FT
Emerging
Markets Headlines – beyondbrics
/ FT
Debt
crisis: live – The
Telegraph
The Euro
Crisis Blog – WSJ
FX Options
Analytics – Saxo
Bank
European
10yr Yields and Spreads – MTS indices
Another quiet, tight-ranged Asian session as
the EU summit looms ever closer. Risk saw a mild uptick midaway the session as China unveiled new offshore
Yuan plans for Hong Kong.
Market Preview: Merkel resists idea of Euro
bonds – Saxo
Bank
European markets are likely to open firmer
Wednesday. Investors await the outcome of Angela Merkel's and Francois
Hollande’s meeting today. Yesterday, Egan-Jones downgraded its credit rating on
Germany to “A+” from “AA-”, with a negative outlook.
Danske
Daily – Danske
Bank (pdf)
Draft plan to be discussed at the EU summit
falls short of calming markets. Egan-Jones cuts Germany’s sovereign rating. US stocks increase despite weak consumer
confidence.
Morning
Briefing: An open mind – BNY
Mellon
The dimming prospects for a credible solution
to the Euro-area crisis is not the only issue that EUR bears must ponder
EURO CRISIS
Ray Dalio: Don't Assume That Germany Will
Bail Europe Out; Consider The "Fat Tail" A Significant Possibility – ZH
we think the popular assumption that the Germans and the ECB (which requires agreement of the key factions within it) will come through with the money to make all these debts good should not be taken for granted.
we think the popular assumption that the Germans and the ECB (which requires agreement of the key factions within it) will come through with the money to make all these debts good should not be taken for granted.
Since the last LTRO funding however, the MRO amount has risen significantly,
particularly in the past few weeks. It is now above the level it was prior to
the last LTRO, indicating a sharp increase in demand for liquidity. That may be
a signal for the ECB that it is time for a third round of LTRO in order to ease
the tight liquidity conditions.
Famous Last Words From Eurozone Founders – The
Daily Capitalist
Open Europe put together a collection of famous last words by the promoters and
founders of the Eurozone. It is a rather lengthy collection but here are a few
which reveal how clueless they were when they launched the euro. You might
enjoy going through the document.
Could Eurobonds be the answer to the Eurozone
crisis? – voxeu.org
Solutions
to the Eurozone crisis must balance the evils of austerity and moral hazard. This
column argues that the blue/red Eurobonds proposal might just get this balance
right.
OTHER
After the Sovereign Debt Crisis Comes the
Deleveraging – EconMatters
Using the previous deleveraging cycle of Sweden and Finland post financial crisis during the 1990s as a baseline, McKinsey compared
the current progress of US, UK and Spain. What KcKinsey found is that the United States may have been half way through that process, while households in Spain and the United Kingdom have only just begun to deleverage. (see chart below).