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Saturday, November 16

16th Nov - Weekender: Best of the Week

Here are the ”best” from my posts of the ending week.

The view from Germanymainly macro
The problem arises because the ECB is unwilling or unable to target 2% inflation. That in theory allows Germany to attempt to force the EZ as a whole to make the required internal adjustment without inflation in Germany exceeding 2%. It can do this by a restrictive fiscal policy. This is exactly what it has done.

Eurozone Morality Playsmainly macro
Evidence does suggest that seeing the competitiveness imbalances in the Eurozone as simply the result of excess outside Germany is at best only half the story, and at worst not a very realistic story at all.

Skeptics See Euro Eroding European UnityNYT
“This is what I was afraid of, that the euro would be preserved and it would pervert the venture and destroy the European Union,” he said. “Instead of the solidarity that was supposed to be embodied, it became every country by itself.”

Banking union: A good idea, going nowhereFT
 “Private” banking union in Europe is a good idea that is going nowhere. Since the euro’s creation, peripheral banks have never been so crammed with their own sovereigns’ debt – 19 per cent of assets, JPMorgan reckons – and have never held fewer non-domestic government bonds.

European Council: The EU’s secret summitryPresseurop
A lack of openness in Brussels negotiations is often cited as a cause of the EU’s democratic deficit. But for the “Brussels' ultimate insider”, historian Peter Ludlow, behind-closed-doors meetings are a cornerstone of EU leaders’ decision-making.

Euro area heading back to recession?Nordea
I cannot help but feeling that the Euro area is just one recession away from a serious deflation problem.

Next From The ECB: Here Comes QE, According To BNPZH

Three Things the ECB Should Do Beyond Cutting Rates WSJ

Should we be worried about deflation if the ECB is?TradingFloor

Analysis: Deflation threat in Europe may prompt investment rethinkReuters
The threat of deflation in the euro zone could reverse a major investment trend of 2013, drawing funds out of stocks and into government bonds and cash.

Four Takeaways From Interview With ECB’s PraetWSJ

Monthly Bulletin, November 2013ECB

RBS: Fed Monetizes A Record 70% Of All Net Bond Supply"ZH

Missing Piece in the Communication StrategyTim Duy’s Fed Watch
The Fed is clearly signalling they want to change the policy mix.  They are not clearly signalling why.  Kocherlakota effectively makes clear that the "why" has to do with the cost/benefit calculus surrounding asset purchases.  I would very much like Yellen to explain that calculus in her Senate hearing, and wish someone would ask the question directly.  Probably not gonna happen.

Yellen's likely poker face at nomination hearing may offer cluesTradingFloor
Four Key Points From Yellen on TaperingWSJ
Yellen faced the Senate today. Here’s everything you need to knowWaPo

Financial Innovation Is DepressingBB
Because it seems to be mostly finding legal ways to deceive people into paying too much for stuff they don’t need, or failing that finding illegal ways to do that, or failing that just firing everyone and giving up.

Assets of the AyatollahReuters Investigates
Reuters investigates Setad, the $95 billion economic empire behind Iran’s Supreme Leader. Khamenei controls massive financial empire built on property seizures

Sisäisen devalvaation tilannekuvaa EspanjastaTyhmyri
Tiedot tilanteen kohentumisesta liioiteltuja

Sekä oikeisto- että vasemmistopuolueet Suomessa käyvät sotaa pienituloisia vastaanTyhmyri

Rahan kiertonopeuden muutos EuroalueellaTyhmyri
Kiertonopeus on pienenevä ja pienenemistrendi on noin -2,5%

Jan Hurri: Arvostelu kiihtyy: Saksa painaa heikkoja kyykkyynTalSa
Saksa ei ole talousveturi vaan kasvurohmu, jonka kauppaylijäämä on muilta pois ja keskeinen syy talousanemiaan muualla. Tämä euron valuvikoja korostava tasapainohäiriö on ollut eurokriitikoiden tiedossa euron perustamisesta lähtien. Nyt Saksan arvosteluun yhtyvät yllättäen Yhdysvallat ja IMF.

Jan Hurri: Kumpaa nyt pelkäisi, inflaatiota vai deflaatiota?TalSa
Keskuspankit ovat vuosien ajan pelotelleet kansaa inflaatiopeikon ilkeyksillä. Nyt inflaatio on miltei kadonnut eikä se ole enää paha peikko vaan turva uutta vitsausta vastaan. Nyt peikon avulla pitäisi torjua "inflaatiotakin vaarallisempi" deflaatiomörkö. Tällainen pelottelu perustuu osin harhaanjohtaviin ja jopa vääriin väitteisiin rahan ja hintojen luonteesta.

Jan Hurri: Tässä kisassa euro jää helposti jumboksiJan Hurri / TalSa
Keskuspankit käyvät kisaa siitä, kenen valuutta heikkenee eniten. Kaikki haluavat heikon valuutan, jotta talous lähtisi kasvuun muita nopeampi. Kaikki eivät voi tätä kisaa voittaa eikä yksi voi kuin hävitä. Euron rakenne ja säännöt tarkoittavat, että se ei voi olla valuuttojen suurin pudottaja.

KEVA / Merja Ailus / Keskusta spesiaaliMoreLiver’s

Saksan toimet syyniinHenri Myllyniemi / US Puheenvuoro

Mikään ei koskaan muutuJuhani Huopainen / US Puheenvuoro