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Wednesday, October 23

23rd Oct - European Banks Stressed

Previously on MoreLiver’s:

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Germany: Coalition talks commencedDB Research
Coalition talks to form a new government for Germany started yesterday. Policy agreements are to be found in twelve working groups. A total of 75 politicians from both camps will participate.

Banking Union: ‘Merkel is planning a reform campaign in EuropePresseurop
According to the daily, the German Chancellor hopes to use the October 24-25 EU Council meeting to convince the other leaders to rally around a new strategy for joint liquidations, a key component of the banking union

Stress, Stress, StressMacroScope / Reuters
ECB is caught between the devil and the deep blue sea. Come up with a clean bill of health as previous discredited stress tests did and they will have no credibility. So it is likely to come down on the side of rigour but if in so doing it unearths serious financial gaps, fears about the euro zone would be rekindled and there is as yet no agreement on providing a common backstop for the financial sector.

ECB starts comprehensive assessment in advance of supervisory roleECB
Comprehensive assessment noteECB
Single supervision mechanismECB

ECB, on new mission, sets out tougher bank health testsReuters
The ECB promised on Wednesday to put top euro zone banks through rigorous tests next year, staking its credibility on a review that aims to build confidence in the sector.

Highlights: ECB's financial stability chief on bank health testsReuters
Factbox: Details of health check of euro zone banksReuters
Eurozone bank shares fall after ECB outlines health check planFT
ECB Says Bank Review to Be More Credible Than BeforeBB
The ECB’s probe into the health of Europe’s banks will be more credible than previous exercises because the institution itself will have to deal with the outcome, the official overseeing the test said.

Verdict looms on legality of  ECB bond purchase programmeTradingFloor
Juhani Huopainen: Remember last June's hearings at the German Constitutional Court on the legality of Mario Draghi's bond-buying programme? The ruling should be out any day now. The tail risk scenario is that OMT is killed off.

Q&As on next episodes of the US fiscal soap operaNordea
Once again Congress has merely kicked the can down the road for a few months. However, despite the recent reckless behaviour in Congress we believe that the next episodes of the US fiscal saga will prove much less disruptive than the drama that just ended (summary).

Economic activity during the shutdown and brinkmanshipCEA
…consistent with a 0.25 percentage point reduction in the annualized GDP growth rate in the fourth quarter and a reduction of about 120,000 private-sector jobs in the first two weeks of October…could understate the full economic effects of the episode to the degree it continues to have an effect past October 12th.

A Wish List for China’s Third PlenumiMFdirect

Introducing: China Econtracker 2.0WSJ
The Wall Street Journal’s China Econtracker – now enhanced so that you can plot two economic indicators simultaneously – lets you follow the ups and downs of the world’s second-largest economy in real time.

China property: hot, hiss or pop?FT
Of 70 cities measured, prices in 69 were on the up, some by 16-plus per cent year on year. That’s bubble territory, surely? But take a look at wages, inventories and developers’ sales and you might think the bubble is deflating or has even popped already.

IMF Warns Japan About Using Monetary Policy as CrutchWSJ
Economists at the IMF warn that Japan's plans to revive the economy through monetary policy could hit a wall unless more fundamental reform measures take their place.

Five Points for Hump DayMarc to Market

Saksalaisten makromiesten laskelmaJuhani Huopainen

HS:n gallup: Perussuomalaisten kannatus ohitti kokoomuksenMTV3
Perussuomalaiset nousi kakkoseksi ohi kokoomuksenHS
Epävarmojen osuus on noussut, puoluekannastaan täysin varmoja on enää 36 prosenttia

Korkman: Toiveajattelulle rakennettu euro oli rohkea hyppy tuntemattomaanVerkkouutiset
Aalto-yliopiston professorin Sixten Korkmanin mukaan rakenteilla oleva Euroopan pankkiunioni ei saa johtaa moraalikatoa aiheuttavaan yhteisvastuuseen, vaan sijoittajavastuun tiukkaan toteuttamiseen.

Tämän takia myös EKP:n stressitestit lässähtävätTalSa
Jan Hurri: Eurovaltiot eivät hevin pääse sopuun, kuka vastaa suurpankkien tappioista ja kenen on pantava uutta pääomaa pankkien taseiden tilkkeeksi. Niin kauan kuin maksajasta ei ole tietoa, tuskin edes EKP uskaltaa toteuttaa pankeille niin tiukkaa kuntotestiä kuin näiden todellisen tilan selvittämiseksi olisi tarvis. Niinpä seuraavakin pankkitesti lässähtää.

Urpilainen: Suomelta ei saa viedä budjettivaltaaTalSa
Valtiovarainministeri Jutta Urpilaisen mielestä jokaisen maan on vastattava omista veloistaan ja taloudestaan. Hän pelkää, että Euroopasta on tulossa maailman sairas maanosa.

Brysselin kone: Vaihtoehtoja EU:lleYLE
Ohjelmassa keskustellaan siitä, mitä vaihtoehtoja Suomella voisi olla politiikassaan, jos se ei kuuluisi EU:hun. Haastateltavana on Itsenäisyyspuolueen varapuheenjohtaja Jarmo Nevalainen ja toimittaja on Maija Elonheimo