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Monday, January 6

6th Jan - PMIs mixed, eventful week ahead

European Business & Consumer sentiment surveys

ECB meeting: the first after the new year, so will they or won't they - or can they

BoE meeting

FOMC minutes from the December meeting that decided to start tapering in January.

US employment report - are enough jobs created to stick with the tapering schedule?

All week: 
Watch emerging markets (FX, bonds, equity) for signs of sell-off. Could lead to slowed tapering by the Fed.

Previously on MoreLiver’s:
2014 previews (updated!)

Follow ‘MoreLiver’ on Twitter

Euro Supporter Credit Suisse Joins Bears: CurrenciesBB

Wanted: Crusaders for 'More Europe'WSJ
Political Leaders Facing Voters Who Are More Disillusioned With the European Project

Cutting public investment has consequences: house buildingMainly Macro
Almost everyone agrees that UK house prices are currently much too high, and (partly thanks to you know who) getting higher. It is also clear that if you cut back on supply, but pressures on demand remain, prices will rise.

Gambling for resurrection in
In 2008, Icelandic banks were too big to fail. The government’s rescue attempts had devastating systemic consequences in Iceland since – as it turned out – they were too big for the state to rescue. This column discusses research that shows how this was a classic case of banks gambling for resurrection.

ECB preview - no need for immediate actionNordea
The ECB meeting this week should be fairly calm. We expect no changes to the key monetary policy rates and no new unconventional measures to be in the pipeline. In a Spiegel interview on 30 December, Mr Draghi said: “we see no need for immediate action.

Markit December Services PMI
French service sector business activity falls at sharpest rate since June – Markit
Spain: Sharpest rise in services activity since July 2007 – Markit
Italy: Business activity falls again in December – Markit
German private sector expands at robust pace in December – Markit
Eurozone economic recovery accelerates at end of 2013 – Markit
UK: Strong growth of service sector sustained in December – Markit

Treasury Yields Climb to Highest Since 2011 as Tapering to BeginBB

Feldstein to Summers Forecast Quickening U.S. Growth This YearBB
U.S. economic growth will accelerate this year even as the pace of expansion remains sub-par almost five years after the end of the recession, according to academic economists and former policy makers.

*Strategies for sustainable growthLawrence Summers / WaPo
A growth strategy that relies on interest rates significantly below growth rates for long periods virtually ensures the emergence of substantial financial bubbles and dangerous buildups in leverage. The idea that regulation can allow the growth benefits of easy credit to come without cost is a chimera.

A Weekend of FedspeakTim Duy’s Fed Watch
Policymakers don't want to undershoot the recovery, but I don't sense they want to overshoot either.  That points toward cautious withdrawal of accommodation.  Pencil in somewhat stronger growth in 2014.  Pencil in a steady reduction in the pace of asset purchases until the program winds down at the end of the year.  Pencil in an extended period of low rates.  But also recognize that the tide of monetary policy is now receding

Where Ben Bernanke made a differenceGavyn Davies / FT
His personal impact can be mostly traced back to the fact that, unlike any of his predecessors, he was an accomplished academic macro-economist, who happened to have strong pre-dispositions about many of the challenges that confronted him at the Fed. This was extraordinarily relevant during his second term.

Central Banks Split on Stimulus in 2014 as Fed TapersBB
The erosion of the mostly synchronized stimulus that supported the world economy for the past six years has investors anticipating a stronger U.S. dollar and weaker Treasuries.

Plosser Warns Fed Shouldn’t Try to Offset Potential GDP LossBB
Efforts to use monetary policy to offset such permanent shocks and to close what appears to be a gap will likely be ineffective and perhaps even counterproductive

Rosengren Says Fed Needs to Be Patient in Removing StimulusBB
With the inflation rate below target and the unemployment rate significantly above target, we believe strongly that monetary policy makers have the opportunity to be patient in removing accommodation

  ISM Non-Manufacturing
Lowest Since June; New Orders Records First Contraction After 52 Months Of Growth – ZH
Second Month of Slower Growth Than Expected – dshort
53.0 indicates slower expansion in December – Calculated Risk
ISM Indexes and BLS Employment Report – Calculated Risk
Weaker Than Expected ISM Services – Bespoke
Stocks Slide To Worst Start To Year Since 2005ZH

Will the reforms speed growth in China?mpettis
I would argue that if China’s GDP continues to grow annually at above 7% in 2014 and 2015, this will be precisely because Beijing did not implement the reforms. Successful execution of the reforms, in other words, is exactly why growth rates will fall sharply.

Shadow Banking Risks Exposed by Local Debt Audit: China CreditBB
China’s audit of local governments exposed an increased reliance on shadow banking, swelling the risk of default on 17.9 trillion yuan ($3 trillion) of debt.

Japan’s Coming “Wage Surprise”Shinzo Abe / Project Syndicate
The year 2013 saw the Japanese economy turn the corner on two decades of stagnation. And the future will become even brighter, owing to an emerging consensus that long-term recovery cannot be achieved without a concerted effort to increase workers' wages and bonuses.

Stick With South Korea in 2014Gary Shilling / BB

HSBC China Services PMI
Composite data signals weaker rates of output and new order growth – Markit
China Services PMI Crumbles To 2nd Worst Level On Record – ZH
China services industry growth slows, confirms year-end cooldown – Reuters
Asian shares tumble to three-week low on China services PMI – Reuters

Four Drivers in the Week AheadMarc to Market
Significance of last week's price action * Interest rate differentials * Central banks * Economic data

The risk of catastrophic successHumble Student
If these charts of inflationary expectations all start to undergo an uptrend, then the risk of a dramatic rise in volatility in stock prices will rise as expectations transition from slow growth to overheating.

World's manufacturers drive global growthTradingFloor
A preliminary look at our global PMI tracker suggests that the world's manufacturers have ramped up activity. This is expected to translate into overall higher global growth in line with my 2014 forecast.

All The World's PMIs In One ChartZH

Business Cycle MonitorDanske Bank
Global leading indicators point to increasing activity. We expect the global recovery to stay close to trend growth in Q4 but move up a gear during 2014.

Global Services Sector Data Show Sluggish GrowthWSJ

Suomi joutunut outoon seuraan – rinnakkain Ranskan kanssaVerkkouutiset
Suomen taloustilannetta on verrattu Ranskaan, eikä se ole kohteliaisuus.

Kauko Juhantalon mukaan nykyhallitus ei tuntenut lainsäädäntöäVerkkouutiset
Juhantalon mukaan "vielä tänäänkin on syytä monen, monen johtavan poliitikon pitää suunsa kiinni ja suojella omaa etuaan. Jotain on Suomessa sellaista tapahtunut, että meillä on hyvin varakkaita johtavia poliitikkoja, johon (varakkuuteen) ei pelkästään palkkatuloilla voi päästä".