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Sunday, September 23

23rd Sep - Weekender: Europe, US, Asia

If anyone is having a bad day, remember that in 1976 Ronald Wayne sold his 10% stake in Apple for $800.

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The one time I visited ECB's HQ in 2003 I remembered the Kaiserstrasse as the main street on the heroin- and red light-area, with the sidewalks filled with idle multikulti and Albanian three card monti stands.

A fitting location.

Previously on MoreLiver’s:
22.9. Disregard This Post (links to euro breakup analysis)
21.9. Weekender: Weekly Support (weekly reviews and previews)

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Euro zone to boost bailout fund firepower to 2 trillion euros Reuters
Euro zone states are preparing to allow the bloc's permanent bailout fund to leverage its capital in the same way as its predecessor so it can reach a capacity of more than 2 trillion euros and rescue big countries if necessary, Der Spiegel said on Sunday.

Completing Europe’s Economic and Monetary UnionECB
Speech by Benoît Cœuré, Member of the Executive Board of the ECB at the Palestinian Public Finance Institute Ramallah, 23 September 2012

Misdiagnosing the Eurozone crisis: Perspectives from
The Asian financial crisis of the late 1990s shows what can happen when economists misdiagnose a crisis. This column argues the Eurozone crisis may have been made worse by over-simplifying it as a debt crisis. The author suggests that the large institutional changes now afoot – the shift from Eurozone I to Eurozone II – are finally addressing the root causes, but they may be too little too late.

Remarks on banking union BIS (pdf)
Fernando Restoy, Deputy Governor of the Bank of Spain, at the round table "Systemic risk and securities markets", II International Conference on Securities Markets, held by the Comisión Nacional del Mercado de Valores (CNMV), Madrid, 14 September 2012.

Will Germans Pick Up the Tab for Deutsche Bank, Too?View / BB
Deutsche Bank is too big to fail both in terms of its direct involvement with the national economy and the potential knock-on effect on confidence in German industry. But the bank can fail in the sense that it could require future taxpayer assistance. To determine how likely this is -- and the scale of potential losses at any bank -- you need to answer three questions.

How to Lose Weight Fast the Deutsche Bank WayView / BB
Huge swaths of assets are allowed to vanish, making too-big-to-fail financial institutions seem leaner and safer than they are.

Is Mario Monti Going to be the ‘Next’ Italian Prime Minister?EconoMonitor
Investors and political leaders around the world are very worried that the new government that will emerge from the next Italian elections in April 2013 will not be headed by Mario Monti, nor pursue the “Monti Agenda” of structural reform and fiscal discipline. The worries are well founded, for several reasons.

Who’s investing in London propertyalphaville / FT

Intelligence chief: EU capital is 'spy capital'euobserver

Spanish rescue could cause collateral damage for ItalyMacroScope / Reuters

Spain eyes pension reform with aid package in sightReuters
Spain is considering freezing pensions and speeding up a planned rise in the retirement age as it races to cut spending and meet conditions of an expected international sovereign aid package, sources with knowledge of the matter said.

Spain's Fiscal Deficit 8.56% of GDP in First Half; Impossible Second Half TargetsMish’s
Spain's original deficit target for 2012 was 4.4%, then revised to 5% then 5.3%. The last revision brought the target all the way up to 6.3%. So how is Spain doing?

Spain risks break-up as Mariano Rajoy stirs Catalan furyThe Telegraph
The ruling parties of Catalonia have sought guidance from Brussels on the legality of secession from Spain, requesting a “route map” for membership of the European Union and the euro as an independent state.

Why a Spanish Approach to the ESM Will HelpPIIE

Troika report on Greece may come after U.S. voteReuters
An EU-IMF report into whether Greece's debt is manageable looks set to be delayed until after November 6 because policymakers want to avoid any shock to the global economy before the U.S. election, EU officials and diplomats said.

Europe Finally Comes Out: Obama's Reelection "Uber Alles" Determines Europe's FutureZH

Troika Calls Week’s Truce in Haggling Over Greek BudgetBB

What’s happening in Greece? News from the front lines of Europe!Fabius Maximus
The euro crisis began 30 months ago. The cheers for each new solution proved unwarranted. Likewise the fears of the skeptics, as the periphery nations have held together under horrific stress. So far. Here we look at public sentiment in Greece.

ECB in 'panic', say former chief economist Juergen StarkThe Telegraph
The European Central Bank is in "panic" over the eurozone crisis and acting outside its mandate with its new bond-buying plans, the bank's former chief economist said in comments published Saturday.

Paul Volcker on Greedy Bankers, the Ryan Plan, and the FedNewsweek
Legendary economist Paul Volcker speaks out on what’s wrong with Wall Street today, the Ryan plan, and the Fed’s bold moves.

QE3 will not fix America's problems, warns Paul VolckerThe Telegraph
Paul Volcker, the former Federal Reserve chairman credited with taming the inflationary threat of the 1970s, has warned that further quantitative easing will fail to repair economies in Europe and the US.

Rethinking Robert RubinBusinessweek

(audio) World Weekly with Gideon RachmanFT
Middle East turmoil and the US response: what recent events say about the internal stability of post-revolutionary Libya and Egypt and President Obama’s policy towards the Middle East. How will these and the other regional concerns in Syria, Iran, and the Palestinian territories affect the US election?

U.S. Banks Ignore Europe’s Lesson on GreedView / BB
The good news: Several big banks have finally started taking steps to reform Wall Street’s out-of-control compensation system, which rewards bankers and traders with big bonuses for taking insane risks with other people’s money. The bad news: These banks are in Europe, and most of their U.S. cousins still just don’t get it.

Pent up demand for new homes is bringing home-builders back to lifeSober Look

QE Infinity: Unintended ConsequencesJohn Mauldin / The Big Picture

Back Ben Bernanke's QE3 with a clothes peg on your noseThe Telegraph
Monetarists from across the world can mostly agree on one thing. The US Federal Reserve caused the Great Recession.

Q-Infinity and Beyond!Cognitive Concord

QEs comparedalphaville / FT
Deutsche Bank’s Alan Ruskin comparing the effects of QEs 1, 2 and 3.

Spread between US mortgage rates and agency MBS yields hits a record as "transmission" remains an issueSober Look

A dust up in Gotham reveals Fed’s frustrations with CongressMacroScope / Reuters
There was a tense and unscripted moment at the opulent Harvard Club of New York City this week when Richard Fisher, the otherwise elegantly spoken head of the Federal Reserve Bank of Dallas, seemed poised to insult one of the club’s good members.

The Next PanicThe Atlantic
Europe’s crisis will be followed by a more devastating one, likely beginning in Japan…For ordinary Japanese, public promises about retirement benefits and price stability will be broken just as their private savings collapse…Our financial systems appear to be returning to their inherently unstable nature, which plagued the 19th and early 20th centuries.

BOJ's money printing is offset by households' cash hoardingSober Look
This is exactly why deflation so dangerous. Cash becomes the best investment as deflation makes it "worth more" over time…For now however BOJ will need to continue its perpetual QE program just to keep up with all the cash hoarding by households.

No signs of rebound for the Chinese economy, says PBOC’s adviserASA

Is Japan Doomed?Economist’s View

Can China increase export competitiveness?mpettis

China: For Many Expats, It's Not Worth ItBusinessweek

Morgan Creek Capital Asks: Is China A Real Estate Bubble?market folly
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