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Wednesday, July 11

11th Jul - US Open: Fed wait

US Open regulars, sry about the late post (another medical emergency here...)

News & Recap – RanSquawk / ZH
Frontrunning – ZH
Overnight Summary – BofA / ZH
The Lunch Wrap – FT
EM New York headlines – FT
Today’s front pages – presseurop
Daily press summary – Open Europe

Morning MarketBeat: Earnings Off to Rocky Start – WSJ
Broker Note Briefing – WSJ
Morning Take-Out – NYT
Spain and the New ModelMarc to Market
Lying LIBOR Banks, Spanish MOU, & EarningsTF Market Advisors
AM Dear Dairy: Driftup – Macro and Cheese

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
Tracking Europe’s Debt Crisis – NYT
FX Options Analytics – Saxo Bank
European 10yr Yields and Spreads – MTS indices

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Structural reforms and regional
A major cause of the Eurozone crisis is the difference in income and productivity between the core and the periphery. This column presents evidence suggesting that structural reforms can be instrumental in fostering the development of lagging regions within a country. It argues that this in turn can accelerate the rate of convergence across countries within a currency union.

Are all euro summits the same? Market perceptions before and after bruegel
First, it is true that government bond yields mostly revert to their level five days before the summit after 5 days. In particular in Italy and Spain, no systematic improvement is visible in any of the five summits…We also observe that the pattern of yield developments is rather heterogeneous on the five summits.

Why Finland Is Not Likely to Be the NextDan Steinbock / EconoMonitor
After the recent Eurozone summit, Finnish politics led some observers to think that Finland might be the next to exit the Eurozone. In reality, most Finns would prefer full EZ integration. Small countries like big muscle.

Europe has a political crisis. The economics are just symptoms.Fabius Maximus
The Euro-crisis is at root a political one. Like all such, there are several levels to it.  All different.  Mostly invisible in the analysis featured by the general media, which instead prefer to describe this in bogus fashion as a morality play. The economics are exhaustively covered; here we glance at the politics of the crisis.

The pain in Spainalphaville / FT
draft memorandum of understanding for the bail-out includes provision to force any bank seeking aid to compulsorily write-off their preferred shares and subordinated bonds.

The international role of the euroECB (pdf)
Press release here

Get me to the court on timeMacroScope / Reuters
The head of the court raised the possibility of a review taking take two to three months. That could create a dangerous vacuum though he stressed that was just one option. Schaeuble is just out again saying he hopes for a verdict before the autumn.

The German Constitutional Court Rules Against Euro HysteriaTestosterone Pit
After eight hours of discussions, it was clear: the court wasn’t eager to decide. The decision might be condemned by politicians and entail crashes cascading around the world. Even a mere injunction could be interpreted as a decision to scuttle the European bailout policies.

German court set to delay bailout fund decisioneuobserver
Germany's top court might delay its decision on the EU's permanent bailout fund, despite a warning of "massive uncertainty" on the markets.

Bigger Delay to ESM: Court May Take Longer to Rule on Euro Measures Spiegel
The German Constitutional Court may take several months, rather than the expected three weeks, to decide on a request that it issue a temporary injunction blocking measures to rescue the euro. Finance Minister Wolfgang Schäuble urged the court to hurry up Tuesday, warning that a delay could lead to a further market turbulence.

More cracks appear in the Chinese banking systemASA
Chinese banks shares have been hit today on the stock market…This is another case that the risks in the shadow banking system of China is feeding into the formal banking system.

China, beyond the hard/soft landing debateHumble Student
…while the world focuses on the China hard vs. soft landing debate, I am thinking about the longer path for Chinese growth. They will slow down. When the next downturn hits, we could see a classic negative GDP growth recession.

Spooks on the payrollsalphaville / FT
 ‘CleanSweep Red Team Report’ on America’s most hyped-up economic release, sent to the DOL last year by cybersecurity analysts at Sandia National Labratories (spooks) – and for a weird tale of official paranoia and the workings of the financial media

Citi Says: Second Big Wave of Allocations on the WayAll About Alpha
the hedge fund industry experienced what was but a first wave of new institutional allocation in the period 2003 to 2007, when institutions redirected their capital out of actively managed long-only funds and into hedge funds with a variety of strategies. Citi expects the second wave shortly.

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