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Tuesday, June 18

18th Jun - US Close: Fed, plenty of Finnish, bad Europe

G-8 went, no-one noticed, but perhaps tax evasion will become even harder in the future. Kind of fits with the possible bail-ins coming to Europe - and probably elsewhere as well. US FOMC seems to be on the top of everybody's list. European news getting again nasty - I have a hard time with the view that it would be Europe's turn to surprise positively over the U.S. - perhaps at some point, but not yet, and not in the current state?

Previously on MoreLiver’s:

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Roundups & Commentary
Markets – Between The Hedges
The Closer – alphaville / FT
US: Market Echoes June 2012 FOMC As Dow Swings Most Since Oct 2011 – ZH

Europe's most important political party hits the campaign trail: a sneak peak at the EU section of CDU/CSU's election manifestoOpen Europe

The EU summit on 27/28 June and what it means for the banking unionNordea
Three issues will dominate the agenda: 1) How to support lending to small and medium enterprises, 2) What to do against youth unemployment, 3) Progress on banking union. In this note, we focus on the banking union because whether it succeeds or fails will make a difference for financial markets over time.

The question before the courtFree exchange / The Economist
Helmut Siekmann, professor at the Institute for Monetary and Financial Stability (IMFS) at Goethe University of Frankfurt, and Volker Wieland, professor at the IMFS and a Member of the German Council of Economic Experts discuss the German court case on the OMT.

Finland has a collateral credibility issuealphaville / FT
The voters don’t trust the Greek collateral deal.

No Break for Periphery BanksEconoMonitor
EU ministers apparently made little progress last week on terms under which the ESM would recapitalize weak banks, though they still hope for an agreement by end month.

Bad Loans Continue to Rise in Spain and ItalyMarc to Market

When Correlation Is CausationZH
Relationship between the surging unemployment rate of the OMT-bound nation and its delinquent loan growth is hard to argue with.

Berlusconi: Let's breach EU deficit rules, no-one would throw us outOpen Europe

IMF points to major risks in Portugal's path to recoverySober Look
The fund said it can't say with high probability that Portugal's debt is sustainable over the long term, and noted the country's finances are vulnerable to potential distress such as a deteriorating growth outlook and higher borrowing rates.

The Rally in Three Charts (Hint: It’s Not All About the Fed)WSJ
Fed, earnings, jobs.

Bernanke's done, Obama kinda sorta saysWonkblog / WP
The countdown may have officially begun for Federal Reserve Chairman Ben S. Bernanke.

The Tapering Talk and Rising Yields Are a Sign of RecoveryEconoMonitor
For (Bernanke) to even consider tapering implies he believes a solid recovery may be finally taking hold. But, by his own admission, a solid recovery means higher interest rates.

Bernanke: mission accomplishedFree exchange / The Economist
When Mr Bernanke speaks to the press tomorrow after the release of the Fed's latest policy statement and economic projections, his task will be to explain why those other factors justify the probable reduction in asset-purchases by late this year, despite the fact that the Fed remains well short of the programme's stated goals.

The chairman’s challenge MacroScope / Reuters
Bernanke says ‘taper,’ markets hear ‘tighten’

FOMC preview: QE tapering? Not yetTradingFloor
Mads Koefoed: We expect the FOMC to recognise some improvement in the data, but clarify that it is not enough to begin tapering QE just yet.

FOMC Decision - "Real Fundamentals" Or "Reaction Function"ZH
As asset-gatherers bluster about the fact that the Fed can't leave now because things are not that great (correctly) they are perhaps missing the key point that the Fed has changed its reaction function from fundamentals to technicals - and is worried...

Inflation Continues to Undershoot Fed Target – WSJ
Housing Starts increase in May to 914,000 SAARCalculated Risk
Housing Starts: A few comments – Calculated Risk
Fed: Household Debt Service Ratio near lowest level in 30+ years – Calculated Risk
Housing Starts, Permits, CPI All Miss – ZH
Housing Starts In May Rebound After April's Sharp Correction – The Capital Spectator

When liquidity meets control in China, with credit crunch probabilityalphaville / FT

The end of the end of the end of the commodities supercycle is nigh, in Asiaalphaville / FT

The central bank (communications) bubblealphaville / FT

Global FX Strategy – A new paradigm?Nordea (pdf)
EURUSD has of late also been supported by higher peripheral bond yields, which attracts investors to EUR assets, hence supporting long EURUSD, – but is this correlation sustainable? History strongly suggests NO. This begs the question what will drive a change and how big will the impact be… The new paradigm could well be relative growth.

Inflated expectations deflatingNordea
Inflation is quickly becoming a topic again – not because of concerns the huge stimulus measures pursued by central banks would be creating inflation, but because the falling inflation rates are raising questions of whether central banks are doing enough. Bonds should thrive in an environment of falling inflation.

2103 World Wealth ReportCFA Institute
From Capgemini and RBC Wealth Management

Emerging Markets Briefer - June 2013Danske Bank (pdf)

Statement by Lagarde on the G-8 Leaders SummitIMF
G8 Economic Scorecard: No Runs, No Errors – CFR
G-8 Signs Information Sharing Agreement To "Fight The Scourge Of Tax Evasion" – ZH

Raportti: Maahanmuutto hyödyttää julkista talouttaHS
Tuoreen OECD:n raportin mukaan julkinen sektori jäi maahanmuutosta plussan puolelle

Immigration and the public finances: Boon or burden?The Economist
A new study shows that the fiscal impact of migration is broadly neutral: the impact of migration becomes slightly negative (minus 0.1% of GDP on average).

Migration picking up but rising unemployment hurting immigrantsOECD

International Migration Outlook 2013OECD

OECD: Suomi ei ole hyötynyt maahanmuutostaJuhani Huopainen / US Puheenvuoro

Liberalistinen vapauden kaipuu voimistuuHS
Matti Apunen on Elinkeinoelämän valtuuskunnan johtaja.

Liberaalien vapausihanteiden väärinkäyttöTeivo Teivainen
On aika haastaa vapautta julistavien käskytysjärjestelmien puolustajien taipumus omia liberaalit vapausihanteet. Omistamiseen perustuvien etuoikeuksien pönkittämistä ei ole järkevää kuvata liber-alkuisilla termeillä.

Heikki Koskenkylän analyysi EU:n ja IMF:n väittelystä - kumpi on oikeassa?PS
Onko Kreikalla velkasaneeraus edessä? Suomen Pankin osastopäällikkönä toiminut valtiotieteiden tohtori Heikki Koskenkylä arvioi EU:n ja IMF:n kriisinhoitomenetelmiä ja kertoo kantansa Suomen asemasta mahdollisessa velkasaneeraustilanteessa.

HS-gallup: Kriisimaiden tukeminen ei miellytä suomalaisiaHS
Suomalaiset vaativat euroalueelle samaan aikaan elvytystä ja säästökuuria. Kreikka-vakuuksiin luottaa vain neljännes suomalaisista.

Kansa ei usko Kreikan vakuuksiinHS

Jos talouskasvu loppuu kun keskuspankit lopettavat elvytyksen niin jatkakoot elvytystä – presidentti Niinistö toisella linjallatyhmyri

Euron tuho, euroero ja Saksan perustuslakituomioistuinRaha ja talous