My views
for the beginning week, together with select article links in Finnish, plus
entertaining off-topic articles. My last week’s views can be found here,
and a collection of view updates and commentaries
here.
Previously
on MoreLiver’s:
Weekender: World, Markets, Trading (updated seconds ago)
Weekender: Weekly Support weekly reviews and previews
Views for the week: EURUSD hit a low of 1.2162 before
reversing clearly higher on Friday. As
the attached charts show, we have approached the lower end of the multiyear chart,
driven by the bad macro and investment outflows. The consensus target for the
pair had been 1.20, and this is why I thought last week that we would not reach
that level – at least not yet. As we are at the lower end, it is important to
pay attention to currently unseen possibilities that could reverse the bear
trend. Previously the market has loved making marginally new lows, only to
reverse and go up, before resuming the downtrend.  |
S&P 500
(future): Rising range (bull trend channel, or a flag inside the bear market, I
don’t care) since the beginning of June. The market turned on Friday from the
range’s bottom and is on its way up. Usually such clearly defined patterns do
not last this long in the S&P. Therefore I am not really happy betting on marginal
new highs above the ones seen around US independence – even though technically
it would look probable. Most participants are now targeting those highs. My tactics
would be to keep long, lighten up around 1360-1370 for a possible correction
and eventually target 1395 for the short-term move.
So what is
driving the stock market higher? Fed’s “undecided” FOMC member came out on
Friday sounding much softer than previously. Bernanke has stated that further
economic weakness would be reason for action, and that extending Operation
Twist is not practical due to bond supply constraints. That means more QE3 is
now on its way. Previously the stock market has almost fully discounted QE
operations very quickly. It might well be that we are now in such a situation. Should
we really be in for the QE3, the market will break for a new high – 1500 sounds
reasonable. The QE expectations also explain euro’s strength on Friday.
PIIGS bond
yields are still range-trading around pre-summit levels, and clearly the crisis
is not over. No views and no interest at these levels. The range is just too
narrow to provide meaningful profit opportunities, as the event risks are too
high. Keep out, but pay attention.
OFF-TOPIC
Press Play? Hit Start – Hot Water Inc.
There’s been a lot of noise over the past few
weeks, from various people and places, about the quality of the current
electronic dance music experience.
Consciousness: How Do You Study What You Can't
Define? – big
think
FiveBooks Interviews: Bernard Bailyn on
Atlantic History – The
Browser
The Harvard professor and Pulitzer
prize-winning historian recommends reading on three centuries of empire,
conflict and slave trading between the Americas, Europe and Africa
The Library of Congress' list of 88 books that
shaped America, sorted by title
The Mysterious Evolution of Evolvability – technology
review
Computer scientists say they've discovered the
origin of one of nature's most important organising principles
The computer industry's future depends on a
behind-schedule technology that's proving tough to get working.
The Olympics and Economics 2012 – Goldman
Sachs (pdf)
(FT Long Room registration required)
Is the Web Driving Us Mad? – Newsweek
Tweets, texts, emails, posts. New research says
the Internet can make us lonely and depressed—and may even create more extreme
forms of mental illness
Silly space season – alphaville
/ FT
Ex-Goldman Trader to Attempt First Trade in
Space – Advanced Trading
Seeking a world record, Anton Kreil, a former
Goldman Sachs trader, plans to execute the first stock trade in space when he
blasts off aboard the shuttle in 2014.
Confessions of a Non–Serial Killer – Washington
Monthly
Conspiracy theories are all fun and games until
you become the subject of one.
Seinfeld on Why ‘Who’s on First?’ Worked – NYT
Think always of me – Letters of
Note
In the early hours of October 16th, 1793, nine months after the execution of her husband, Louis XVI, the
37-year-old former Queen of France, Marie Antoinette, wrote the following
tear-stained farewell letter to her sister-in-law, Madame Elisabeth, and her
children. Just eight hours later, Marie Antoinette was beheaded.
FiveBooks Interviews: On the History and
Diversity of Language – The
Browser
Nicholas Ostler, a scholar of language, tells
us about the progress of the spoken word from 3000 BC to today, how two
languages disappear every month, and the 50,000-word novel written without
using the letter “e”
This much I know: Daniel Kahneman – The
Guardian
The 78-year-old Nobel prize-winning psychologist
on his pessimistic mother, the delusion of investment bankers and the need for
irony
Things you didn't know about lies, liars and
detecting lies – Bakadesuyo
Round-up of psych and neuro links – The
British Psychological Society
IN FINNISH
Professori:
EU-päättäjiltä on taloustiede hukassa – Taloussanomat
Kansantaloustieteen
professori Vesa Kanniainen syyttää EU-komissiota taloustieteen unohtamisesta
eurokriisin hoidossa. Jos euro hajoaa, kriisistä ei hänen mielestään pidä
syyttää markkinoita vaan itse tehtyjä vääriä EU-päätöksiä.
Saksalainen ydineuro
korventaisi Suomea – Taloussanomat
Fixit, Grexit, Spexit.
Huhut ja spekulaatiot siitä, hajoaako euroalue ja kuka rahaliiton ensimmäisenä
jättää, ovat lisääntyneet. Huhupörssissä kärkisijaa pitää tällä hetkellä
Kreikan lisäksi Suomi. Miksi? Entä millainen euroalue olisi kaikkein raskain
Suomelle?
Saako
europolitiikasta keskustella? – Soininvaara
Espanjan vakuuksien
järkevyyteen on mahdoton ottaa kantaa ennen kuin näkee mitä ne ovat. Ne eivät
voi olla samanlaisia kuin Kreikka-vakuudet. Suomellahan ei ole mitään sopimusta
vakuuksista Kreikan kanssa, vaan saatavat on vakuutettu yksityisten pankkien kanssa
solmitulla hyvin monimutkaisella operaatiolla. Mitä tämä vakuuksien ostaminen
Suomelle maksoi, ei ole ainakaan minulle koskaan kerrottu.
Saksa pysyy Ranskan
rinnalla – Pääkirjoitus
/ HS
Jos pohjoinen lähtisi
etsimään omaa valuuttablokkiaan, Ranskaa siihen ei saataisi. Välimeren maat
ovat ja tulevat aina olemaan lähellä Ranskan sydäntä.
Olemme samassa
veneessä – Jyrki
Katainen / Savon Sanomat
Ei ole olemassa
helppoa ratkaisua, jolla Suomi irtautuisi kaikesta yhteisestä ja kukoistaisi
yksinään. On harhaluulo, että Suomen ero eurosta olisi vain ”hetken kirpaisu”
ilman merkittäviä vaikutuksia hyvinvointiyhteiskuntaamme. Itse uskon erittäin
vahvasti siihen, että euron säilyminen ja Suomen pysyminen mukana on
suomalaisten kannalta ylivertaisesti paras vaihtoehto.