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Sunday, July 15

15th Jul - Weekender: Views & Off-Topics

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.

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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

88 Books That Shaped America Roger Ebert’s Journal
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 Moore's Law Moon Shot technology review
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 KahnemanThe Guardian
The 78-year-old Nobel prize-winning psychologist on his pessimistic mother, the delusion of investment bankers and the need for irony

Secrets of the CIAYoutube
92 min documentary. Nice interviews

Things you didn't know about lies, liars and detecting liesBakadesuyo

Round-up of psych and neuro links – The British Psychological Society

Professori: EU-päättäjiltä on taloustiede hukassaTaloussanomat
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 SuomeaTaloussanomat
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 rinnallaPääkirjoitus / HS
Jos pohjoinen lähtisi etsimään omaa valuuttablokkiaan, Ranskaa siihen ei saataisi. Välimeren maat ovat ja tulevat aina olemaan lähellä Ranskan sydäntä.

Olemme samassa veneessäJyrki 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.

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