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Monday, March 25

25th Mar - US Open

This is going to be a dull week - especially with the holidays approaching... Next week we have the ECB meeting and US payrolls. I "sense a disturbance in the force": market wisdom says buy the rumor, sell the fact. Not just because markets discount the news before the event, but also because the "news" tends to disappoint. The Cyprus has not been solved, and new trouble is coming toward us already.

This week (Cyprus in the background all the time, obviously):

US: Fed Dudley, Bernanke speak

US: Durable Goods, House prices, New Home Sales

UK: 4Q Current account & GDP, US:Two Fed speakers

Ger:  Unemployment, EZ M3 Feb Money Supply, ECB LTRO repayment

Japan data, US personal income & spending

The Cyprus-related articles are collected in the Special.

Previously on MoreLiver’s:

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Roundups & Commentary
Frontrunning – ZH
*Overnight: The Morning After – ZH
The Lunch Wrap – alphaville / FT
Emerging N.Y. headlines – beyondbrics / FT
Daily press summary – Open Europe
Morning MarketBeat: Investors Worry Less, Rejoice More – WSJ
The Week Ahead – Marc to Market

Cyprus crisis shows Europe cannot perpetually move in one direction onlyOpen Europe
This episode signals that Germany and the other northern European countries are no longer willing indefinitely to foot the bill alone. At the same time the eurozone continues to lack the tools to deal with an acute crisis. This makes change almost inevitable for the way the eurozone is governed. Some governments have already called for a formal mechanism to allow a country to exit the euro.

The Ten Commandments of Eurozone Membership (for small states)Brian M. Lucey

Italy: Will Bersani have any luck in forming the new government? Open Europe

Where has all the (base) money gone?Bruegel
Unlike in the case of Germany before monetary union, in the euro area, the money multiplier only had some kind of stability for a short period between the Autumn of 2005 and the Autumn of 2008. Before that it was affected by the currency change-over, after that by the crisis.

BizDaily: Italy: Europe's next big hurdle?BBC (mp3)
Could the Cypriot bailout and political gridlock in Italy throw Europe into turmoil once again? Simon Jacks speaks to Emma Bonino, former vice-president of the Italian Senate, and Enrico Cucchiani, chief executive of Intesa Sanpaolo, Italy's biggest bank, about the prospect of Europe-wide bank runs. One of the problems facing Italy is labour market stagnation.

Emerging Markets Briefer - March 2013Danske Bank (pdf)

Hot Money BluesKrugman / NYT
I don’t expect to see a wholesale, sudden rejection of the idea that money should be free to go wherever it wants, whenever it wants. There may well, however, be a process of erosion, as governments intervene to limit both the pace at which money comes in and the rate at which it goes out.