Wednesday, July 31
Saturday, July 27
Friday, July 26
This blog turned two years old last week.
Overall, a dull week. Europe showed terrible monetary data, while optimism is on the rise according to Markit PMI. The most important development has been the sudden uncertainty over who gets nominated as the next chairman of the Federal Reserve. Up next: the usual weekender-posts, plus link collections on Summers vs. Yellen-debate and the SAC.
Thursday, July 25
Wednesday, July 24
Tuesday, July 23
Monday, July 22
Quote of the Day: European banks need at least €350bn to €400bn of new capital. Our top-down and bottom-up work combined with OECD estimates point to a material deficit, two-thirds of which is in the Eurozone. The estimates ignore upside risk from adopting depositor preference. Options to plug the deficit include contingent capital – not CoCos (which do not work, in our view), but forms of standby capital. – Berenberg:
The richest 200 people have about $2.7 trillion, which is more than the poorest 3.5 billion people, who have only $2.2 trillion combined.
Saturday, July 20
Two years. 730 days. 1932 postings.
175,000 pageviews (robots, spammers removed)
This was my first post on 20 July 2011.
Most of you are regulars - thank you.
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1,800 alphaville / The Financial Times
Friday, July 19
The best articles from the ending week. Last week’s ‘best’ here.
This was supposed to be a relatively interesting week, but not much happened after all. China reported relatively low GDP numbers, US macro releases were also relatively weak, Federal Reserve's Bernanke gave a testimony but provided no new clues. Europe released montly current account balances, and it looks like that for a long, long time, countries excluding Germany are also making positive balances. To what extent this is just a reflection of the weak import demand, remains to be seen.
Wednesday, July 17
Funny – just as the IMF has stated that the Commission is not fact-based, highly political, cannot admit its policy errors and that the IMF will not participate in lousy, stupid, untenable bailouts in the future, the Commission is quick to state that the IMF should leave the Troika. The Commission sounds like the girls I used to go out with – quick to end a relationship when they sense that the other is about to leave.
Of course, the Reding’s argument of lack of democratic oversight is ridiculous – the Commission is not answerable to anyone in practice. Her suggestion would only lead to a further increase of Brussels’ powers, and more policy errors based on the narrow interest and political bickering.
Meanwhile, there have been comments that the Troika should really be abolished – and the IMF should take the whole Europe under its program.
Monday, July 15
Sunday, July 14
Saturday, July 13
Friday, July 12
The main event of the week was the release of the minutes from the previous Federal Reserve’s FOMC meeting, which showed that “tapering” – slowing down and eventually ending the asset purchases – is to remain conditional on the economy. Bernanke’s press Q&A confirmed the message. This led to huge moves in the US-dollar, a new high in stock markets and lower interest rates.
The second development is the muddle-through toward a banking union in Europe, but the obstacles seem surmountable.
The third development is signs of political discontent in many debtor (Spain, Greece, Portugal, Italy), and to a lesser extent in creditor countries as well, as they start to realize that there will be losses. This counters the attempts to federalization.
Everyone seems to be waiting for the German elections, and expects some sort of serious solution attempt, perhaps as early as December. If no serious attempts are made after the elections, the calm in Europe will be quickly over.
Thursday, July 11
Wednesday, July 10
Tuesday, July 9
Monday, July 8
Sunday, July 7
Saturday, July 6
In this week's edition the usual Europe with focus on the PIIGS, Vatican's latest scandal, Marc Rich is dead, some interesting off-topic articles and couple of Finnish-language links.
Friday, July 5
Last week’s ‘best’ here.
The main news of the week were the ECB’s and BoE’s move towards forward guidance – in case of the ECB, it is already done, and BoE is expected to introduce such policies in August. The EURUSD was hit hard, while asset markets loved it.
In Europe, Portugal is in a tight spot, but with the usual recipe of the Troika turning a blind eye and some political posturing, things will probably continue as they were, at least until the German elections are over.
Thursday, July 4
Heavy central bank day - both the Bank of England and the European Central Bank provided dovish surprises and introduced forward guidance-measures or promises. ECB promised to keep rates for "a long time" - hardly news, but still an improvement over the previous "we do not pre-commit". BoE indicated that it could introduce guidance perhaps as early as in August.
Anchor Grills Draghi on Forward Guidance – Youtube
Next update 5-July Friday European morning.