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Saturday, March 9

9th Mar - Weekender: Econ & Markets

Last week’s Econ & Markets here.

Previously on MoreLiver’s:

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Slow Money – Big Money – Fast Money?Bruce Krasting
With the DOW blowing by milestones I went looking for other things that were at record levels. The first one that I looked at was M2. No surprise at all, M2 is bigger than ever.

Where Austerity Really Rulesmainly macro
Many of us rightly complain about the damage austerity politics is doing in both the UK and the US. However, in terms of simple numbers, this is nothing compared to what is happening in the Eurozone. The table below, based on numbers from the latest OECD Economic Outlook, may look a little complicated, but it clearly establishes this point.

Quantitative easing does not address the fundamental problems underpinning struggling western economieseuropp / LSE
Quantitative easing has been adopted by a number of central banks in the wake of the global financial crisis. John Doukas takes an in-depth look at the effects of quantitative easing, arguing that it not only fails to increase real economic activity, it also increases unemployment and encourages outsourcing to developing countries that offer higher rates of return. He concludes that economic growth and job creation should be the priority of western governments and not of central banks.

Fancy stimulus tools: policy vs. politicsnoahpinion

Looking for a Robust Defence of AusterityMainly Macro

Resources & suggested reading for readers of The Little Book of EconomicsGreg Ip

Why fiscal problems don’t have fiscal solutionsFelix Salmon / Reuters

Why politicians ignore economists on austeritymainly macro

Blogs review: The Minimum Wage debatebruegel
In his State of the Union Address, US President Barack Obama resurrected a pledge to raise the minimum wage he had made during the 2008 campaign. In an effort to fight inequality, alleviate poverty and make work more attractive President Obama proposed proposed a $9 federal minimum wage, indexed to inflation. This has generated a lot of writings in the blogosphere, with the main issues revolving around the classic questions of the employment effect of the minimum wage as well as its efficacy as a means of redistribution.

How Many Billions Of Drug-Laundered Money Does It Take To Shut Down A Bank?ZH
 “If you're caught with an ounce of cocaine, the chances are good you're going to go to jail... for the rest of your life. But evidently, if you launder nearly a billion dollars for drug cartels and violate our international sanctions, your company pays a fine and you go home and sleep in your own bed at night - I think that's fundamentally wrong.”

HFT-Limiting Experiment Underway in GermanyAll About Alpha
The Germans seem prepared to experiment with limits on high-frequency trading, as we see in a recent Bundestag vote that leaves the particulars to BaFin. I spoke recently to David Weild, a former vice chairman of NASDAQ, about this experiment and about related issues.

Meet the Most Indebted Man in the WorldThe Atlantic
Former Société Générale rogue trader Jérôme Kerviel owes the bank $6.3 billion. Here's what his case tells us about financial reform.

30 years of financial inefficiencyTriple Crisis
The claim that the financial sector has been ‘functionally inefficient’ was made 30 years ago by James Tobin, and it’s great to have a quantitative basis to make this sort of judgment.

Abenomics or just your garden variety carry trade?TradingFloor
Abenomics is simply another excuse to dive into carry trades as the risk on/risk off market continues – this time with the JPY at the centre of things rather than the USD. Mind the gap in JPY crosses on the next equity sell-off.

Can Technical Analysis Boost Portfolio Returns?CFA Institute

P/E Ratios Creeping HigherBespoke

The Dow’s new high: Rally driversThe Economist

America’s stockmarket: Better than the alternativesThe Economist

Buttonwood: Desperately seeking yieldThe Economist

Barclays: "Equities Surge Masks Real Fragilities"ZH

What We're Reading ~ Hedge Fund Links 3/8/13Market Folly

Take The Zero-Hedge TestCassandra Does Tokyo

Who Moved Markets in 2012?Macro Advisers

Dow 36,000 Is Attainable AgainBB

Asset Location: The New Wealth Management Value-Add For Optimal Portfolio Design?Nerd’s Eye View

Electronic trading changed Wall Street foreverTradingFloor
In 1996, Island was launched as the first electronic matching engine. This triggered a battle between humans and computers from which the latter emerged victorious. The battlefield has now moved to other parts of the industry.

Factor Analysis: Part 6–Common ProblemsThe Analysis Factor

Bridgewater May Be the Hottest Hedge Fund for Harvard Grads, but It’s Also the WeirdestThe Daily Beast
Bridgewater Associates is the $145 billion hedge fund elite college grads are clamoring to work for. Daniel Gross on the oddball firm’s special sauce.