Bernanke
will soon start his babbling, and S&P has edged slightly up ahead of the
event. No reason now to be in the markets – short-term target around 1360 is
already too close. Reports that Finland and Spain have agreed on the bailout
collaterals, but details are scarce – they have to be, because the collaterals
have negative net present value and politically it is important for the Finnish government to
pretend the collateral agreement is worth something. In today's links some Fed watch-articles, couple of really good ones on Europe, and a collection of interesting articles in Finnish for my native audience.
Previously
on MoreLiver’s:
News &
Recap – RanSquawk / ZH
Frontrunning
– ZH
Overnight
Summary – BofA / ZH
The Lunch
Wrap – FT
Emerging N.Y.
headlines – FT
Today’s
front pages – presseurop
Daily press
summary – Open
Europe
Broker Note
Briefing – WSJ
Morning
Take-Out – NYT
On hold for Mr Benanke – Kiron Sarkar
/ The Big Picture
AM Dear
Dairy: Steady – 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
FX Options
Analytics – Saxo
Bank
European
10yr Yields and Spreads – MTS indices
EURO CRISIS
The ECB’s Swedish plan – MacroBusiness
I’m not completely sure why, after years of
demanding the opposite, the ECB has suddenly changed its mind. Perhaps this is
more screw turning by the central bank or perhaps recognition that the
emergency mechanisms simply aren’t going to be large enough to do the job…Is
the Eurozone, and more explicitly the ECB, suddenly running the Swedish
playbook ?
The unacceptable behavior of the market – mpettis
(Heavy on Spain and also China)
Unfortunately there isn't much that can be done in a big enough or credible
enough way to reverse the downward spiral, and this is why I don't pay too much
attention any more to the proposals and counterproposals that are on offer in Europe.
I think it is probably too late for that…
The IMF is now predicting that Spain will face a further
five years of an increasing debt burden
In the early 2000s, Germany was struggling to adhere to euro-zone criteria aimed at ensuring common
currency stability. Instead of introducing austerity, however, Chancellor
Gerhard Schröder simply launched an effort to change the rules. New documents
show just how key his role was in weakening the Stability Pact.
FED
Bernanke Could Signal Fed’s Next Step in
Testimony – TIME
QE wink today or next time? – The Big
Picture
If Bernanke doesn’t give the market what it
wants today, the ensuing market selloff in the context of a fragile economy
will just clinch an eventual QE program. So we’ll get the wink today or next
time.
Previewing Bernanke's 10 AM Congressional
Testimony – ZH
Goldman Sachs: FOMC will extend the forward rate guidance further at the July 31-August 1 meeting, and to return to asset purchases in late 2012/early 2013. An earlier return to asset purchases is possible if the data continue to disappoint, but we do not think that the hurdle has yet been met. We do not expect a cut in the interest rate on excess reserves (IOER) or a credit easing program along the lines of the Bank of England's "funding for lending" scheme, although both may well come up in Tuesday's testimony.
Goldman Sachs: FOMC will extend the forward rate guidance further at the July 31-August 1 meeting, and to return to asset purchases in late 2012/early 2013. An earlier return to asset purchases is possible if the data continue to disappoint, but we do not think that the hurdle has yet been met. We do not expect a cut in the interest rate on excess reserves (IOER) or a credit easing program along the lines of the Bank of England's "funding for lending" scheme, although both may well come up in Tuesday's testimony.
Fed Shifts Focus to Jobs as Unemployment Stalls
Above 8% – BB
ASIA
Charts: HK/China mega-bear market and others – ASA
HK/China market seem to top slightly ahead of
US.
Not only are there two diverging measures of
electricity – output and consumption – but there are credible motives for local
authorities to massage the figures both upwards and downwards, making it near
impossible to hazard an educated guess at what the underlying picture might be.
OTHER
The Globalized Economic Cycle – The
Source / WSJ
The current weakness can be seen as an echo of
that 2008 crisis. Rescue attempts ignited an extensive rebound but didn’t fully
resolve the underlying problems of excess private-sector debt in some countries
like the U.S., the U.K., Ireland and Spain, or wider regional strains, like the current-account imbalances between
core and periphery euro-zone countries or between the U.S. and China.
Goldman's Earnings Fall 12% in Second Quarter – DealBook
/ NYT
Goldman Beats Modest Estimates As Prop Trading
Revenue Plunges; Employee Comp Slides 16% From Year Ago – ZH
IN FINNISH
Eurooppa pankkiensa
vankina – Henri
Myllyniemi / Puheenvuoro / US
Jäljellä on kuulemma
ainoana keinona enää setelirahoitus. Olen siitä samaa mieltä mikäli EMU:a
yritetään pitää hengissä. Toinen vaihtoehto, eli esimerkiksi euroalueen
sisäiset protektionistiset toimet pääoman, ihmisten ja työn liikkuvuuden
estämiseksi maasta toiseen tuskin saa kattavaa kannatusta. Siihenkin voidaan
kuitenkin ajautua. Eritoten, jos setelirahoituskeskustelu saa tyrmäävän
vastaanoton.
Suomen eurotiestä on
päätettävä vaaleilla – Thomas
Wallgren / Vieraskynä / HS
Eurooppalainen
solidaarisuus olisi helpompi hyväksyä, jos sille olisi alun perin haettu ja
saatu lupa kansalta. Nyt kansalaisilta pitäisi kysyä Suomen tulevaisuudesta.
Taloustieteilijät
arvioivat, mitä tapahtuisi, jos Suomi eroaisi eurosta – HS
Neuvottelusuosituksia
ERVV:n ja EVM:n suhteen – Sami
Miettinen / Puheenvuoro / US
Vakuusperiaate on myös
arvokas suoja Euroryhmän haastavissa yhteisvelkaneuvotteluissa. Sitä tarvitaan
holtittomasti rakennetun ERVV:n yhteydessä. Paremmin toimivan EVM:n kanssa
joudumme hyvin todennäköisesti pärjäämään ilman.