Here
are the ”best” from my posts of the ending week. Last week’s edition here.
Europe and Basel both announced they will go easy on the banks.
Previously on
MoreLiver’s:
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EUROPE
How
to translate “QE” into German – alphaville / FT
BANKING UNION
ECB
Sees Bad-Debt Rules as Threat to Credible Bank Review – BB
ECB is concerned that national differences in how bad debt is classified
could cripple its probe into the health of euro-area banks, according to an
internal ECB document.
A
little more detail on the ECB’s stress tests – Money Supply / FT
ECB
to simplify European bad loan definition in health check – Reuters
The ECB is set to allow the euro zone's top banks to meet less stringent definitions
for bad loans than previously planned when it makes an unprecedented review of
lenders' balance sheets this year.
ECB
Eases Stress Test: Capital Ratio Requirement From 8% to 6% - ZH
ECB
Said to Favor 6% Capital Requirement in Stress Test – BB
UNITED STATES
Larry Summers on why the economy is broken -- and how to fix it – WaPo
Larry Summers on why the economy is broken -- and how to fix it – WaPo
The economy, even in the seemingly good times, has been incapable of
creating enough demand absent bubbles or extraordinary stimulus. And that
problem is getting worse by the day. In this interview, Summers lays out his
concerns in more detail -- and suggests three paths we might take to restoring
economic balance.
FEDERAL
RESERVE
The updated FOMC
dove-hawk spectrum – alphaville / FT
The new spectrum applies after the January 28-29 meeting, Bernanke’s
last as chair.
The Fed preparing
markets for the reverse repo facility (FRFA) – Sober Look
Fed’s New Tools Also Work by
Adjusting Rates – WSJ
Rev-repo rising – alphaville / FT
Credit Suisse: In our
view, the Fed needed to get some larger-scale tests under its belt to develop
full confidence in the program’s capacity for both policy makers and the
market. The year-end results seem to have delivered such a result.
Lockhart Greenlights
Tapering – Tim Duy’s Fed Watch
But that's not really the big story at this point. The big story is the communications
strategy. The era of transparency has
arguably delivered only more complicated and confusing targets, thresholds, and
statements. With the Evans rule turning
into a pumpkin soon, they will need to decide if they want to double-down on
this strategy or move onto something else.
But what is that something else?
Whatever it is, it must be near the top of incoming Chair Janet Yellen's
to-do list.
MARKETS
The Shiller CAPE: Addressing
the Responses – Philosophical Economics
The Single Most Important
Chart For Markets Right Now – Asia Confidential
Rising inflation
expectations * Winners, if the trend holds * Why I’m not buying it yet
Goldman
Sachs: "The S&P500 Is Now Overvalued By Almost Any Measure" – ZH
OTHER
Basel Regulators Ease Leverage-Ratio Rule for Banks – BB
OTHER
Basel Regulators Ease Leverage-Ratio Rule for Banks – BB
Banks win Basel
concessions on debt rules – FT
Global regulators
diluted a planned debt limit for banks amid warnings that the measure would
penalize low-risk financial activities and curtail lending.
Research Review:
Asset Allocation Design & Management – The Capital Spectator
The Essence of Being A Quant – CSSA
In truth the quant is as much a threat to the classic portfolio manager
role as the machine is to human labor. A quant can manufacture investment
approaches that are far cheaper, more disciplined, have greater scale, and are
more reliable.
FINNISH
Hallintoalamaisen kirje
pääjohtaja Liikaselle
– Jan
Hurri / TalSa
Hyvä
pääjohtaja Liikanen. Lämmin kiitos kirjeestä, jolla vuoden alussa ensi kertaa
lähestyitte kansaa. Kiitos erityisesti siitä, että näin valotatte kantaanne
ajankohtaisiin talouskysymyksiin. Nyt tiedämme himpun enemmän, minkälaisin
miettein hallitsette yhteistä rahaamme ja ohjaatte talouttamme. Kiitos myös
siitä, että jätitte useita kysymyksiä avoimiksi. Se on toivon mukaan enne
uusista kirjeistä.
Selkäranka-seminaari – MoreLiver’s
EU-kriittiset yrittävät vallankahvaan
unionissa – YLE
Euroopan
parlamentin ryhmät suuntaavat jo katseensa EU-vaalien jälkeiseen aikaan.
Poliittisen kentän oikeanpuoliselta laidalta ponnistavat ryhmät tavoittelevat
lisää valtaa keskinäisen yhteistyön kautta. Yle Uutiset kävi läpi
EU-kriittisten edustajien vaikutusvallasta kertovia tilastoja.
Rehn varoittaa eurokriittisten puolueiden
noususta. Soini tyrmää arvostelun – YLE
Talouskomissaari
Olli Rehnin mukaan eurokriittisten puolueiden vaalivoitto vaikeuttaisi EU:n
päätöksentekoa. Perussuomalaisten Timo Soini pitää kritiikkiä
"EU-eliitin" puheena. Vaikeuttavatko eurokriittiset tahot EU:n
päätöksentekoa?
Onko eurosta hyötyä vai haittaa? – TalSa
”On harmillista, että maailmalla voimistuva ymmärrys oman valuutan
merkityksestä ei ole vieläkään juurtunut Suomen talouspäättäjien ja -viisaiden
ajatteluun.”